Automation isn’t automatic. Five essential factors for success

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June 11, 2018

Andy Ruggles, PwC Tax Reporting and Strategy Leader, PwC US  |  Justin Femmer, PwC Tax partner, PwC US

Small automation is transforming the tax function through fast implementation of flexible and adaptable technologies that offer solutions not easily accomplished by enterprise systems. New small automation toolsets are enabling tax functions to rapidly deploy technology to automate processes, driven by end users.

Small automation isn't replacing the traditional big automation technology investments or platforms. Instead, it builds upon the foundation of traditional automation solutions while minimizing the lead times for deployment, dependency on heavy IT support, and the rigidity of more traditional enterprise automation solutions. We have seen tax functions methodically deploy these new tools to automate processes end-to-end in a matter of weeks with a quick return on investment (ROI) — often achieved in the first year.

Successful deployment of small automation can support a more flexible and directional technology roadmap to move towards a strategic, long term vision for the tax function. Tax functions making the most progress in this space start by efficiently and effectively implementing new selfservice tools, and generating momentum early with quick automation wins. A governance model is established to manage the automation program from implementation, scale-out, and adoption then continues to manage maintenance.

While other emerging technologies, such as advanced machine learning and natural language processing are being applied to tax functions in expanded use cases, there are three types of self service automation solutions driving small automation in tax today.

The three types of self-service solutions used for small automation are

Extract, transform, and load (ETL) — used to integrate, manipulate and perform simple to very complex transformation of data from disparate sources;

Robotics — coded software to perform rule-based processes which mimics the interactions of users;

Analytics and data visualization

Analytics and data visualization (e.g., dynamic/interactive dashboard displays).

These self-service tools require minimal IT to develop code (i.e., low or no code) and allow for flexibility and autonomy for the end tax users to maintain. The functionality provided by these tools in combination allows for end-to-end automation of many disparate tax processes. Understanding the integration of these tools and how they connect various tax processes is key for success.

PwC has identified five key automation success factors to consider during your automation journey:

  • Do we understand our business processes and pain points?
  • Are people and culture at the heart of our strategy?
  • Will our efforts be sustainable through robust governance?
  • How is our technology ecosystem evolving to meet our goals?
  • Are we measuring business returns beyond financial ROI


Let’s talk about these five key automation success factors.

Business Processes: Reimagining your work

The first step in implementing automation technology (i.e., big or small) should be assessing your current processes. Solicit input from key stakeholders within and outside of the tax function to identify pain points and inefficiencies. Assess subprocesses for automation suitability and to determine the best tools (or combination of tools) for long-term solutions. These assessments can be performed relatively quickly once sub-processes and key stakeholders are identified. Automation doesn’t have to be end to end — it may be practical to automate only certain sub-processes  or tasks initially — others can be automated later.

Collaboration with other functions, such as accounting, finance, IT, and other stakeholders, within the organization is key — evaluate what they are doing upstream and downstream that may already address tax’s pain points or may unexpectedly make things worse. Looking at the tax function’s processes without considering other stakeholder inputs or perspectives may leave on the table opportunities for more impactful solution for all involved.

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People: The secret to automation success

Reimagining the tax function and related processes is important, but don’t forget about the owners of the existing processes. Change can be discouraging to these process owners and ultimately impact the function’s culture. Empower your people to embrace automation. Encourage them to be a part of the change and experience the benefits of automation. Communicate and be transparent about your vision for the department. Talk about the overall benefits to the team and potential opportunities for personal career growth. Focus on getting your people involved and excited.

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Governance: Automation can’t be left on auto pilot

It is critical to identify key stakeholders within and outside the tax function, and then work together to develop a governance model. Governance includes established best practices in automation design that are consistent with the organization’s regulatory requirements. Develop a governance framework and internal controls by identifying areas of risk that must be managed. Consider IT security, access rights, technology standards, data sources, and system maintenance, among other things.  

There are various types of governance models to consider, such as IT led governance, business led governance, and cross-functional steering committee governance. Assess which type of governance model is best for you.

It’s important to find a balance between allowing end users to experiment or innovate and deploying consistent standards across functions. Too much experimentation or innovation can result in redundancy or inconsistent quality and lack of transferability of automated solutions. On the other hand, too much consistency can stifle innovation and prevent the automation program from spreading within and across different user groups. Successful tax functions have found the right balance.

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Technology: Evolve your ecosystem with your goals

Automation via technology does not save money or improve process without adequate process and role changes. Evaluate your tax function’s existing enterprise investments, technologies, and processes. Involve your people in determining how the rollout of self service automation tools can bridge the gap between various sub-processes or via integration between new and existing tools. These technologies don’t have to be complex solutions — combine simple and more complex technology solutions to achieve a bigger impact.

Consider opportunities for enhancements to existing systems. For example, how can you increase automation within existing tools? Are there ways to integrate existing tax technology with new automation technology? Evaluate relative effort to fix less flexible enterprise tools versus addressing the problem with a self service tool.

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ROI: Value proposition extending beyond financial ROI

Automation drives benefits that extend beyond financial ROI when you reimagine your process end-to-end. The value proposition expands to improved quality, better managed risk and a higher level of employee engagement and retention. Tax functions become more agile as employees are empowered to automate manual tasks and focus on (1) tax planning and forecasting, (2) deeper analytics of tax calculations, and (3) enhanced support for the business.

Benefits include higher quality work product, less rework, and reduced tax costs upon audit (e.g., interest, penalties). Talent retention may increase due to a more technology-enabled environment, improved staff engagement, better work-life balance, and greater job satisfaction. 

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Contact us

Andy Ruggles

US Data Automation and Global Alteryx Alliance Leader, PwC US

Justin Femmer

Data Automation Partner, PwC US

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