In the article “Transformation at the IRS”, authors Amy Edmondson and Frances Frei provide an in-depth analysis of the recent transformation that has taken place within the Internal Revenue Service.

Their report consisted of a brief synopsis of the problems that the IRS was facing in the late 1980s and 1990s and the solutions that were adopted during the Clinton administration to solve them. By global comparison, the IRS has been extremely effective at the business of collecting taxes. As reported by our authors, the collection of taxes by means of voluntary compliers was at 85% as compared to a single digit success rates in other countries.Despite this success, the American taxpayer feared the employees of the IRS and often believed that their rights were violated or ignored.

In addition, the voluntary compliance was not improving and in many cases getting worse. This coupled with a complicated tax code which was not getting any simpler it was determined that changes needed to be made. In 1997, President Clinton appointed Charles Rossotti as commissioner of the IRS. Rossotti was a successful private sector manager with extensive experience in information technologies.

Rossotti wanted to prove that the IRS could function as a well-managed private-sector service organization. I believe that Rossotti could be classified as a transformation leader given that he set forth with a vision statement and always attempted to move the IRS in the direction of fulfilling that mission. The vision created by Rossotti was to “Provide America’s taxpayer’s top-quality service by helping them understand and meet their tax responsibilities and by applying the tax law with integrity and fairness to all. ” While Rossotti was working towards changing the IRS, President Bill Clinton was also exploring new options for reform.

Clinton formed a bi-partisan presidential commission, a task force and eventually Senate congressional hearings. The recommendations discovered helped formulate a new law called the Restructuring and Reform Act (RRA98) in which President Bill Clinton signed in 1998. This new law mandated the IRS to focus on serving its customers as opposed to merely collecting taxes. One of the first challenges under the new law was the restructuring of the numerous call centers that were performing poorly causing inadequate access, incorrect information, and inconsistent service to the American taxpayer.The current system was flawed given that the call operators needed to be educated on all aspects of the complex tax code.

The changes, which were made possible due to innovations in technology, included rerouting callers to specific operators based on the tax question or form that they were using. This allowed for the improvement of information given to the tax payer and therefore alleviated many of their frustrations. Additionally, changes included a detailed internal communication plan to ensure that IRS employees were aware and involved in the changes that were occurring.The structure of the IRS was simplified and broken down into four divisions; wage and investment, small business & self-employed, large & mid-sized businesses, and tax exempt & government entities. Other changes included linking compensation to performance rather than seniority, improved communication of performance expectations, and evaluations for all employees. In 2001, which was towards the end of Rossotti’s tenure as commissioner of the IRS, John Reece was appointed as the new Chief Information Officer (CIO) and Deputy Commissioner.

Reece developed a 10-year; 10-billion plan to modernize internal and external systems. He accomplished this by consolidated the computer mainframes and improving upon the electronic filing experience for the taxpayers. In conclusion, the task of reforming and changing such a large organization such as the Internal Revenue Service could never have been completed without someone first having a clear vision, core values, and goals with measurable standards. Rossotti demonstrated all three!