Michael Cox on navigating the digital landscape

Greenwoods & Herbert Smith Freehills' Chief Operating Officer, Michael Cox, presented at The Tax Institute’s 2017 SME Symposium on ‘Navigating the digital landscape – a plan for today’s tax professional'.

Here he speaks about the steps tax practitioners can take to address digital disruption in their profession, the technologies needed to operate an evolving tax practice, and why technology is so important in today’s business world.

What steps can tax professionals take to navigate the new landscape?

“Undoubtedly, there's lots of technology out there. There are three steps that I'd call out in the tax space and number one is the Australian Tax Office. They're going through huge transformation. In the next 12, 18 months, I think we'll see every form of communication and interaction through a digital means. The second one is automation. I can see us starting to replace some of those activities that we've offshored, some of those low value-adding activities, and replacing them with automation technology. When we do that, we'll see the time that we spend on those things significantly reduced.”

“The third that I see happening is we'll start to see the vendors incorporate machine learning into their tax platforms because at the end of the day, machine learning is about categorizing transactions, which is what tax people do. When those three pieces of technologies start to come together, then I think we start to see a real end-to-end disruption of the tax world.”

What technologies will be needed to operate the evolving tax practice and grow client bases?

“I think it's safe to say that most tax professionals feel comfortable about tax topics, but don't about technology, so increasing their knowledge is probably the first step”.

“The second one is they need to change their mindset from being binary to being open to options. I hear very often tax professionals saying, “Because we don't have the full end-to-end perfect machine, we're really not interested,” when in fact, there's lots of really good technology that people can be looking at to pick up in a tax process. The third thing is you need to know where to spend your money. The best way to do this, is to have some form of framework to help you divide how you'll spend your money and make your investments. When you do those three things together and have a go, that's how you start to navigate the future.”

Why is technology so important in today’s business world?

“As shown in a recent study, digitally enabled businesses, particularly in the small and medium sized space, are likely to have at least 50% more revenue per employee than those that are not, so it's something worth tackling. If I were to pick one single piece of technology to start with, that would be technology in the area of collaboration and communication. Today, all of us feel very at home and familiar with using Facebook Messenger, WhatsApp, etc., but when it comes to talking to our clients, we are in black and white letters, so I think any piece of technology that can change the way that we interact with our client can only be for the positive.”

With the tax landscape continually changing, professionals need to evolve to stay relevant. That’s why The Tax Institute has evolved its membership, education and information programs to meet practitioners’ needs both now and into the future. Click here for more information on what education you’ll need to up-skill in today’s fast-changing tax environment.


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