Case Study

Empowering Growth Through Tax Process Improvement: How Automation Reduced Labor and Increased Efficiency

SUMMARY/OVERVIEW

Organizing a Sea of Data

Imagine manually processing tax data from more than 50 source files that contain information from 86 operating locations across 72 U.S. cities. One mechanical systems services provider didn’t need to imagine that overwhelming scenario — they were experiencing it. After aggregating the vast amount of data and performing analytics and reconciliations, internal teams still needed to move every datapoint into their tax software for provision and return preparation. The onerous, time-consuming process placed a burden on client resources while diverting attention away from higher-value tasks that required the team’s attention.

Our team of experienced tax technology professionals presented the client with a series of steps and tools that would both help address their immediate needs and provide scalability to grow with their business.

Key Takeaways

32% reduction in overtime hours for state apportionment calculation

Improved time to generate apportionment results from more than a week to mere hours

Improved consolidation of fixed asset data time from over one month for multiple resources to 1.5 weeks for a single resource, a reduction in time of 87%

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The Challenge

Contending With Manual and Inefficient Tax Processes

The client was processing data from more than 50 templates across multiple workstreams, amounting to more than 200 templates in total. Manually aggregating, analyzing, and reconciling the datapoints in each of those templates required extensive time for a non-value task — all of which occurred before teams could conduct any knowledge-based work. Further, without automation, the process was subject to errors that stem from manual entry.

We also needed to consider company growth. As operations scaled, the amount of data would continue to increase, potentially reaching a point at which existing processes went from burdensome to outright unviable.

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The Approach

Leveraging Collaborative Effort To Create a Comprehensive Solution

We met with the client to listen to their challenges and present options that could make the process more efficient. One of our primary suggestions was adopting the Alteryx platform, a tool the client had previously explored but wasn’t entirely familiar with. In a live demonstration using the client’s own data, we showed the client some of Alteryx’s powerful capabilities and how it could automate extensive manual processing to alleviate burdens on internal teams.

  1. To make the disparate data more usable, our experienced advisors created a master data file that incorporated customizable rules to address the client’s state apportionment factor calculation. During regular meetings with the client, we also developed an understanding of the project’s scope and began to triage different workstreams to create an immediate impact for the business. As an added benefit, as we walked the client through the automation setup during design sessions, the client learned how to use their new tools, reducing the risk that they would become overwhelmed by a sudden deluge of information.

  2. As part of our enhancements, we also addressed the client’s accrued liability process and fixed assets consolidation. The automated steps we built combine more than 50 templates for each workstream provided by company controllers, compare the information to the prior year’s data, and map that data into predefined categories leveraging Alteryx. By landing the transformed data into Microsoft Excel, then layering on Microsoft Power Query, our team further enabled the client to perform category manual inputs and include topside adjustments as necessary.

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The Results

Significant Time Saving With Future Scalability

  • Time Savings

    Our work with the client yielded a dramatic reduction in the time and manual effort they spent working through the year-end provision period. That resulted in the client saving hundreds of hours in manual labor and decreasing their processing time from almost two weeks to a matter of a few hours. It also reduced the client’s overtime labor by 32%, freeing their professionals to focus on more complex, knowledge-based work. 

  • Greater Efficiency

    We reduced a downstream process that took three or four team members nearly a month to complete to 1.5 weeks for a single team member. That resulted in an approximately 87% reduction in the time it took to finish the task, which was more focused in data management rather than value-added work.

  • A Scalable Solution

    As the business grows and the volume of data increases over time, the new tools and processes we’ve helped the client establish can scale with them. While the internal team has been trained to create new automation and apply what they’ve learned throughout the project, our experienced professionals continue to assist with larger tasks and guide the client through additional phases to deliver additional automation efficiencies.

Our team of experienced tax professionals helped the client identify ways to reduce burdensome manual processes, freeing them to focus on higher-value, knowledge-based tasks.

Diana Konopka
Managing Director, Tax Automation & Innovation

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