Should We Outsource the Tax Department?
The group conflict situation inherent in a controversy over whether to outsource a companyÆs tax department involves several parties(the companyÆs tax department director, financial director, the audit department supervisor, and the human resources director. The tax department director and human resources director favor keeping the tax function in house, while the financial director and the audit department supervisor favor outsourcing it. Although all four individuals are seeking to achieve the most accurate tax handling with the best impact on the companyÆs bottom line, they disagree on the best way to achieve that goal.
There are a number of factors contributing to the conflict. One is a directive from the companyÆs CEO stating that tax compliance errors will no longer be tolerated because they are costing the company too much money. Another is the concern by the tax department and human resources directors over the likelihood of employee layoffs if the function is outsourced. The tax department director has the perception that the suggestion to outsource the tax function means that the work of his department is regarded as substandard and inadequate, a view he vehemently disagrees with. The human resources director is concerned that outsourcing the tax department may initiate a series of outsourcings within the company that will make her job difficult, and may possibly eventually eliminate it.
In the attempt to reach a consensus on the subject, the four department heads have had several meetings, but these have not been productive since the same arguments continue to be raised without consensus being achieved. Statements they have made have not been confirmed by supportable data but have been primarily based on opinion and feeling.
There are a couple of ways that this conflict might be resolved su
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