Group Report ATO
- The Australian Tax Office (ATO) initiated a 10-year transformation program that was aimed at overhauling its IT platform to enhance its ability to serve its clientele in the year 2000 (CPT Global 2012). The change process at the ATO like in other organizations was subject to challenges, which are inevitable for any organization that chooses to implement a change program. In Kotter’s Strategic Eight-Step Model, it is noted that change is associated with uncertainty and is loathed by many (Pryor et al. 2008). This negative attitude stems from the fact that change threatens the status-quo which many find solace in. Kotter adds that to handle resistance, which often arises in the face of organizational change, the leadership needs to create a sense of urgency around the change program. The ATO leadership effectively created a sense of urgency before the change program by pointing out the shortcomings of the old ATO system and the need to depart from it. By doing this they were able to circumvent this key challenge. Other challenges entailed failure to keep the program within the estimated time frame and budget hence eliciting sharp criticism (Australian National Audit Office 2010). The delay and soaring costs resulted from trying different frameworks in a real-life situation to find out what was viable. This part fits in with the second step of the Action Research Model, which calls for several trials before settling for the best option (Pryor et al. 2008). A further challenge involved serious delays in tax processing in late 2009 and early 2010 which caused disgruntled tax accounts to issue threats of sue the ATO; the ATO was compelled to hire about 800 additional staff to help with manual processing (LeMay 2012).
- The change process that was undertaken by the ATO was transformational (Australian National Audit Office 2010). It sought to completely overhaul the ATO’s IT system to enhance its efficiency and effectiveness (Australian National Audit Office 2010). Other underlying objectives such as increasing public confidence in the ATO system, reduction of revenue risk, and integrating the entire system into a single holistic entity were also factored into the program before its actual takeoff (Australian National Audit Office 2010). By doing this, the ATO leadership was carrying out a planned change program aimed at transforming the ATO’s IT platform and how it (ATO) handles its business (Australian National Audit Office 2010). The nature of the change process, planned change, makes it fit in with Lewin’s Model. This model postulates that to achieve permanent change, the existing systems must be completely dismantled to provide room for new systems and prevent the possibility of reverting to previous ways. This was the case at the ATO when after dismantling the previous system; additional 800 staff members were hired to assist with manual processing of tax returns before the new system took effect rather than reverting to the old system (LeMay 2012). The change was planned such that it was gradual but permanent at every stage.
- After conducting a comprehensive survey of the community, ATO identified the general population required a more interactive and personalized system to increase taxpayer compliance (Australian National Audit Office 2010). Utilizing the rational perspective approach, there was a need for alignment between the organization (ATO) and its environment (Cameron 2010).
- The realization of the need for an overhaul of the system was in line with Lippitt’s Phases of Change Theory. The problem was diagnosed, an assessment of the capacity and motivation to carry out the change was made then the objectives or expected outcomes were also set before the change was initiated (Kritsonis 2005).
- The prime objective behind the program was to deliver an efficient and effective IT platform for the ATO to enhance its interaction with its clientele (Australian National Audit Office 2010). Other objectives such as building community confidence in the system and reduction of revenue risk would only be achieved in the presence of efficiency and effectiveness. By achieving these objectives, the change process was expected to provide a standard operating environment in which a centralized reporting portal for enterprises would be availed to ease the hustle that enterprises had to undergo filing their tax returns. The change program implemented by the ATO was by all indications, well-timed, and necessary. According to CPT Global (2012), the ATO’s new system has been impressive since the conclusion of the process in 2010. Its rate of return on investment within the first 18 months of the conclusion indicated that it could recover the invested money in only four years.
References
Australian National Audit Office 2010, The Australian taxation office’s implementation of the change program: a strategic overview, Audit Report No. 08 2009-10, pp. 13-26.
CPT Global 2012, ATO Change Program Benefits Realisation Assessment, CPT Global, Australia.
Kritsonis, A 2005, ‘Comparison of change theories’, International Journal of Management, Business, and Administration, vol. 8, no. 1, pp. 1-6.
Pryor, M. G., Taneja, S., Humphreys, J., Anderson, D. & Singleton, L 2008, ‘Challenges facing change management theories and research’, Delhi Business Review, vol. 9, no. 1, pp. 1-20.
Cameron, K. S 2010, Organizational effectiveness, Edward Elgar, Cheltenham.