The Future of the Tax Profession: Transcript

0:00:10.3 Cara Griffith: Welcome everyone. I'm Cara Griffith, the president and CEO of Tax Analysts. Thank you for joining us today to explore a question that we are all asking these days. What is the future of the tax profession? How are we going to educate and train the next generation of tax professionals in light of fast changing technology that is transforming how we all do business? And how quickly can we do so? Well, today's event is another in Tax Analysts' series of public discussions that we call Taxing Issues. We launched this series as another way for Tax Analysts to encourage debate on tax issues. We have been bringing together the tax community, leading policymakers, and experts for bipartisan discussions on the future of tax policy and administration. As always, we welcome your feedback on how we can make our webinars more useful, as well as your suggestions on future webinar topics.

0:01:00.7 Cara Griffith: You can send your feedback and suggestions to events@taxanalysts.org. For those of you who would like CPE credit today, please be sure to participate in the program for at least 50 minutes and answer at least three of the poll questions that will appear throughout the webinar. They will appear on the right side of the viewing window above the comment section. To receive credit for your answers, you need to register with Pigeonhole, our interactive Q&A system, by providing your name and email. Also, please remain in the default viewing window because you won't be able to see the questions if you expand to full screen. The course materials, which were sent out in advance, are also available for download under the viewing window. One last housekeeping item. We welcome your feedback, oh I'm sorry. We welcome your questions for today's event. Please use the chat feature to submit questions during the webinar.

0:01:49.9 Cara Griffith: For our panel discussion, I will begin by asking a few questions and then I will turn to questions from you, our audience, and I promise to get to as many of them as time permits. Now let's turn to today's topic. Needless to say, the tax profession that we know and love is undergoing a profound transformation. In the past few years, we have seen the impact of new regulations, new service models and new disruptive technologies. The tax profession of old is disappearing and a new one is emerging. Some of the changes are coming from the outside, like new regulations, and some are coming from the inside as tax practitioners work to become more efficient and provide more value. COVID-19 certainly accelerated this need for efficiency. With the switch to remote and hybrid working models, tax professionals needed to store data in the cloud, needed to hold virtual meetings, and even perform virtual audits.

0:02:46.6 Cara Griffith: Today, many tax professionals are using skills and tools that years ago they never expected to have. Many tax leaders have made automation a top priority, while at first automation was mostly for compliance work. The tax profession has learned that its application is much broader. Tax professionals are having to embrace the idea that a machine can perform routine tasks, particularly those that are heavily manual and ripe for human error. That has changed the daily roles of many tax professionals, and it could change how many tax and compliance processes are managed. Along with using automation, a new tax professional must fully understand data, data analytics, and visualizations. Tax data touches a broad range of areas within an organization. A tax professional who really understands data can be extremely valuable to any business and have more influence on business decisions than ever before. And then, of course, there's artificial intelligence, AI, which holds the great potential to disrupt the tax profession in even more profound ways.

0:03:52.9 Cara Griffith: AI, which we're all still trying to understand, is just in its early stages, its infancy, and we don't yet know the level of impact that it will have on the tax industry. Now to be clear, I am not suggesting the tax technical skills are obsolete. Those skills will remain critical, but future tax professionals won't be able to rely on those skills alone. Professionals will have to be able to leverage technology and data analytics, anticipate regulatory changes, and reimagine consulting services, and they're going to need to be able to sell their services in a dynamic and evolving environment. Tax professionals won't just be using new tools. More and more organizations are asking tax professionals to play a more strategic advisory role. Corporate tax departments, law firms, accounting firms, and other professional service firms must start sooner than later to define what all of this means. And they must figure out how to hire, find, and develop the right people for a new workforce.

0:04:53.4 Cara Griffith: At the moment, there are more of these needed skills than there are people who can provide them, which raises the question of what the academic community must do to increase the number of students who graduate with the right skills. We've arrived at a moment that will define the future for tax professionals. It's scary, but it's exciting. The tax professional who enters the field today can be more influential than ever before. With change comes opportunity. So there are a lot of questions, and we have an outstanding panel to tackle them, to provide their thoughts and to discuss many of the current challenges that the tax professional faces. First, we have Gina Salama. She's a senior director with Deloitte. Gina is part of the global employer services team within Deloitte Tax. She's an experienced tax leader who specializes in global workforce consulting and mobility. Next, we have Omri Marian, a professor at the University of California, Irvine School of Law. Omri is the founding academic director of UCI Law's graduate tax program, and he served in that role until 2022.

0:06:00.7 Cara Griffith: And last, but certainly not least, we have Tony Santiago, the founder and president of TaxSearch Inc. Tony is a recognized global leader in executive search retention and talent development for major corporate tax departments. Welcome to you all, and thank you so much for joining us today. I think this is going to be a very fun conversation and will provide a lot of insights. So, Gina, let me turn to you first, spring boarding off of what I was just saying in my opening. From your seat, what do you see as the biggest tax challenges that are – the biggest talent challenges that tax is facing today?

0:06:33.2 Gina Salama: Thanks, Cara. Yeah, and thanks again for inviting me here today. Like you said in the intro, there is such a transformation right now happening within tax and it has many implications when it comes to talent. I'll focus on three of them. The first one is the need, the skills gap, right? The need to upskill, re-skill or hire in certain skills that we just don't see in many tax teams today. And this is not unique to tax at all. If you... If we look at the macro trend of the Great Resignation that started a few years ago, to what we at Deloitte started to call the Great Reset, it's really left a skills gap in terms of the technology skills, the automation, and some of the consultative skills, particularly in the tax department.

0:07:41.6 Gina Salama: So many are struggling with how to fill this gap. I know we're going to get more into that, but right now tax departments feel very overburdened a lot of time with just the day-to-day work that needs to happen, and figuring out the best way to fill this gap is a big struggle today. The next one is succession planning. There's definitely an aging workforce, especially with the leaders, many of whom are planning retirement in the next five years or so. And a lot of the tax professionals aren't getting the opportunities that, to lead, the leadership opportunities to really gain those skills and sharpen those skills so that they can be positioned for that succession. And then there's the question, of course, of do we hire that externally? And that has a lot of its own implications in terms of cultural fit.

0:08:42.8 Gina Salama: Do they actually have the right skills to lead the team, the trust that needs to be built when you bring someone in externally. So that's another big challenge that we hear from a lot of tax leaders. That's a concern. And then in the last bucket I would put candidate attraction. So we know that there's a really big war for the right tax talent today, and that doesn't necessarily look the same as it did maybe two years ago, five years ago, because of the tech skills, the consulting skills that are needed, but also just a declining number of professionals, depending on the skill, the source. I've seen anywhere from nine to somewhere in the tens in terms of the decline, percentage-wise, of accounting – people majoring and graduating with accounting degrees, and then as high as a 17 percent decrease in overall amount of accounting professionals just in the job market today. So we're already operating with less individuals to start with. And you put the skills gap on top of that and it's definitely a big challenge. So organizations are figuring out, tax departments are trying to figure out, you know, this conundrum of, do we buy the talent? Do we build the talent internally? Do we borrow the talent? Or now there's this new category of do we automate the talent through a bot? So those are definitely the three main challenges that I see.

0:10:17.0 Cara Griffith: That's really – the automation starts to get a little worrying, like it's going to replace a whole class of workers. It's interesting. Omri, let me turn to you, because one of the big questions that I think a lot of people have had is what can the academic community do to educate tax professionals of the future? If we're looking and saying that some of these jobs are going to be automated and maybe we need a more advanced tax professional that is coming out of a tax program, what can the universities do to enable students to learn more, learn differently in order to prepare them for the career that they might ultimately have?

0:10:57.5 Omri Marian: Well, first of all, thank you. I'm really glad to be here and discuss this important topic, and let me take this question by offering my, I think, rather unique and lucky maybe unlucky perspective, coming from starting a new tax program at the time where three major challenges presented themselves all at once for tax teachers. First is the Tax Cuts and Jobs Act which offered significant – prescribed significant changes to the tax code. Second is the COVID pandemic which forced the entire profession to work remotely. And not only to work remotely, but also to teach remotely, which definitely is, this is definitely going to have long-term effect, I think, on the way we teach and work. And finally, the rise of AI is an umbrella term, I think, but I will say that it's very clear that various technologies are changing the way lawyers are expected to... Tax professional generally.

0:12:12.2 Omri Marian: Not only tax lawyers, I mean, I teach tax lawyers, this is my point of view, but it's clear that the changes, it offers opportunities, but also creates expectations that I think not all candidates are aware of, expectations to possess certain skills. The problem with academia, of course, is that almost all academic institutions or all of them are very slow-turning ships. It's difficult to change traditions of tax teachings that have been in place since the founding of the, for example, the New York NYU tax LLM program many decades ago. And I think the one, the main thing we can try to do as academics is try to engage seriously with the attempt to turn this ship rather than keep teaching what we know and feel comfortable teaching. So I was lucky to start from scratch.

0:13:20.3 Omri Marian: So I basically, well, built the ship, I can say maybe. Or gave it its preliminary course. And what I think academics can do specifically is three things. First, I don't think that doctrine, technical knowledge, is ever going to be, per se. . .. We always need that. So we need to keep doing that. We need to make sure that our students do know doctrine. But the second thing is that doctrine alone, and this is based on input I'm getting from tax professionals, from institutions that change their behavior, especially Big Four, I should say the way they recruit is that they need to match this doctrine, the doctrinal knowledge, with skills that past professionals didn't have to. When we speak, for example, of data, learning how to work with data, no one expects, or I don't expect and I also don't think that most hiring partners expect, the future of tax professionals candidates to be data analysts.

0:14:45.9 Omri Marian: No one... They went to law school. They didn't go to become data scientists, but they need to be subject matter experts that are able to work with data, for example. So I think that the one of the challenges of the advent of new technology is the ability to take the technological person [and] the subject matter person and match them together and make them able to work with each other. And, you know, it's, if you are a fantastic tax doctrinal expert, but cannot work with data or you're a data scientist, but you don't know anything about tax, it's going to be very difficult for you to generate any insightful advice out of data. But I think what we're seeing today in the industry, the data industry, you know, the tax industry, is what I like to refer to as the democratization of data.

0:15:39.4 Omri Marian: You don't... You no longer need to be a programmer. You don't need to be a statistician. You don't need to be a data scientist to be able to work with data because we have so many platforms that enable you to actually apply your subject matter knowledge to datasets and be able to work with them. But what I see, at least, from students or candidates is that many are still afraid because working with data or technologies is still not, I mean, there needs to be some switch somewhere. It's still not viewed as part of the skillset that a tax professional, especially lawyers, need and it is, I think, if we're looking at where the profession is going, I personally don't think that AI is going to replace lawyers. It's just going to change the way lawyers work.

0:16:34.7 Omri Marian: And finally, the third thing, so we have doctrine, we have learning to deal with technologies, and I think the last thing that I see – it has always been relevant, but I think this became even more relevant since the financial crisis of 2008 – is that the standard way the tax professionals land jobs, especially entry-level jobs, is, which most people that I expect in the audience know based on their own experience of doing the academic degree, going on some job interview through some campus initiative on campus interview, and then get the offer, this... It doesn't work like that anymore for most entry-level candidates. What I am saying is that there is much more demand on, and importance for, soft skills that are usually not what lawyers think about when they go into law school.

0:17:36.7 Omri Marian: So in the past, I think MBA programs were good at creating the soft skills for their candidates. I think now we're starting to see LLM programs starting to do the same, by applying such workshops into the curriculum that teach you how to look for a job, how to behave as a candidate, how to sell your skills. How to not only acquire these important new skills of working with data or AI platforms, but how to sell the fact that you have these skills. So doctrine, learning to work with new technologies, and soft skills.

0:18:19.4 Cara Griffith: So there's a lot to unpack there. And I look forward to asking each of you some questions based on what you just said. But before we do that, Tony, I wanted to turn to you. You've written before about the potential generational impact on training and talent development. Given that there is a likelihood that we're going to have a large number of people retiring in the near future, I think we've actually seen a large number of people that chose early retirement as we went through the great resignation. Can you talk about that a bit and sort of set the stage for what do you think we need to be prepared for in the coming years?

0:18:52.5 Tony Santiago: Sure. Again, I appreciate the opportunity to speak to the members here. Basically, let's take it generationally. Let's start with the baby boomers. So, we've talked about this many, many times in papers and such, but we are losing a very large percentage of our leadership as well as mid-management and staff people to the baby boomer generation. Most people assume it's only going to be at the leadership level. That is not correct. There's a lot of, it's about 20 percent still baby boomers at the senior staff level in corporate, in-house, not public accounting, but corporate in-house. That is actually going to flip here pretty quick as well. They might drag on a little longer, they might not. But you're going from 40 percent down to 20 percent from the heads of tax down. They're still going to all, for the most part retire in the next five years. And we have a pretty good pulse of what the younger baby boomers are thinking.

0:19:54.2 Tony Santiago: And they're not thinking 65, they're thinking pre-60. So it's going to surprise some people in the acceleration. We are doing tremendous amount of retirement refills externally because we just don't have the talent internally ready yet. They've gotten shocked by that. When they get them ready, somebody steals them to another company. So this is a constant problem we're running into. The baby boomers have a good news situation. Some of them do want to continue to work, not on a full-time basis, some do, but I think we will get some relief from the baby boomers on fractional, agile-type staffing platforms which will bring them back to help ease the pain of the shortage we have in all the areas. So where the professional services can't, in their standard traditional form, fill in, I do think there'll be some agility opportunities for baby boomers to come back and add value, groom and train the next generation. That knowledge is unbelievable though.

0:20:51.6 Tony Santiago: The percentage of years of experience, the last time we did the data points, it is a very large percentage. Still right now about 44 percent of all the years of experience is held in the baby boomers that are leaving. So it's eye-opening when you look at it that way. The Gen Xers, however, are more like the narrow neck of a bell curve. They're a much smaller population behind the baby boomers and they've been held back for years. So they are accelerating up quickly, unfortunately because they were held back. Some of them are too narrowly scoped. They got stuck in roles on the operations side or the planning side or the controversy side. And they don't have the breadth of skills that some of the CFOs are looking for when they get these chief tax officer roles. But the ones that do are in high, high demand and going rather quickly. Their challenge for them is they have to manage people that are a little bit different than they were or the baby boomers had to manage. So they're managing the millennials and Gen Z, and they're doing it at a time that might be clearly the most difficult time in our history for tax leadership to be managing, for all the reasons we all know. The good news for them is they have tremendous opportunities. So whether they were held back before, now the doors open up wide. So there's always a pro and a con to this in each generation.

0:22:16.2 Tony Santiago: The millennials are being pulled up because that hourglass is going to move up and that neck becomes a smaller top, which means we have to pull up the millennials at a faster rate, especially the older ones. So they need to get accelerated. It did not help for us to have COVID hit when it hit, with our demographic time bomb going on. The amount of time lost in the mentoring, time that could have been done in face-to-face environments, that I think is essential, especially at that level when they're moving from mid-management to upper management. That is a tension point. And we're going to see some people be promoted probably sooner than they should and some issues where they're going to have to go and rebuild that situation over time. The positive for them is obviously tons of opportunities. Their challenge will be to stay focused, not to move too many times too quickly, not to think the grass is greener. The baby boomers didn't have that option and certainly the Gen Xers didn't, but they will now. The Gen Xers will have the same temptation because of the supply and demand issue. The millennials will have to be accelerated on their EQ skills to be successful. And that's a problem. As Omri pointed out, I did have an opportunity to speak early on when he was putting together his programs about the softer skills, the EQ skills.

0:23:38.2 Tony Santiago: And yes, applying it to find a job is one thing, but what's happening in the tax field is as the tax cycle moves like it is now, most of the skillsets at the senior level are not technical. The bigger the company, the bigger the tax department, the less technical it is. The more it's their management, leadership. But more importantly now, something called influencing skills. The ability to influence tax policy, strategy, ability to influence controversy settlements and such. And ability to work cross-functionally with a broader group of people. And in some ways lead those groups now which was never the case before for tax. Tax leaders are now absorbing treasure. I have them now absorbing statutory accounting areas, which it makes sense when you think about pillar 2 and what's going to happen there. And I have some that are leading government affairs at large companies while still retaining tax.

0:24:36.8 Tony Santiago: So tax leadership is much broader than it's ever been. We wanted a place at the table 20 years ago, we got it, we did really well. Now we're getting more responsibilities and that's stretching their influencing skills, their leadership skills, their management skills, much more than they ever thought in a quicker period of time. The Gen Z behind them. So the millennials are going to have to catch up on that. And this is a group that's most lived on their phone. And for three years didn't get to meet a bunch of people, go to conferences. So there's an acceleration every tax leader needs to do with their millennials to help them get that broader exposure on influencing skills. And lastly is the Gen Z, which none of us have figured out yet. We all pretend we do. We'll figure that out in the next five or six years. And that will be another issue for the Gen Xers to lead and the millennials to manage those in a very short period of time. So all these points here, they're opportunities and they're challenges. It's not all bad news, but it comes with a... Everything comes with a price, right? We've got the price there to deal with.

0:25:43.4 Cara Griffith: I really love how you lay that out because it's such a... It's an easy way to see what are the challenges that we have, what are the... There are some opportunities in there and there's opportunities for different groups. And it's going to be an exciting couple of years, even if it comes with a little bit of heartburn as well. And there's a ton to unpack with what you said. But I want to pick up on one topic and then we'll jump all over because there's a lot here. But Gina, you are sitting in a place where you're doing a lot of development work with the staff that you have. What can leaders do to really encourage this career development, identify the successors that we need, figure out the right people that we're picking up from these subsequent generations? So what are you seeing from your seat?

0:26:31.9 Gina Salama: Yeah, I think, a lot of it is around intentionality and planning in advance. The tax leaders, you all on this call, you don't have to do it alone, right? There are resources out there within your organizations, right? Talk to your HR departments, take advantage of the performance management lifecycle which hopefully you have in place at your organization. And then also the learning and development teams to be able to offer the right opportunities to your people. First of all, make sure that you know what skills your individuals have, what the gaps are, what their career goals are. And then if you're empowered with that information and the information of what you need, you can build a plan. The opportunities do not have to live right within the group. Think about rotational opportunities within the organization or maybe helping out on a project that the everyday work, I know that tax departments are very overburdened right now with the amounts of work that they have, but the advantage that a lot of roles have is that we know deadlines, we know what the busy seasons are. So if we can plan around that and provide opportunities at those times that are maybe a little bit slower, it's really an opportunity. One example that came to mind is we talk about tax transformation. We talk about finance transformation at a broader level.

0:28:27.4 Gina Salama: And are there opportunities for our professionals to get involved in some of those projects, maybe in a non-traditional way? Sure. Sometimes somebody is pulled in as a subject matter expert, but could they lead something that they really haven't before and gain skills that those consulting skills that Tony said, those influencing skills, project management skills, broaden their network of stakeholders, think about the downstream effects, and really build a technology implementation and get some of those skills under their belt. So I mean, that's one example. There's certainly a lot of opportunity now in the, again, rotational realm with hybrid opportunities. Even if it's a... If the everyday role isn't an office, that doesn't mean that all opportunities have to take place in that physical location. So work with a team that's international and get some experience on that side. So those are... That's definitely, from an experience perspective, something that we see for groups that have that type of opportunity. I think sometimes middle, mid-size or smaller organizations don't always think of things like that. But I would challenge you, again, to think outside of your main group for those types of opportunities. The other... I also mentioned the L&D team. So is there an opportunity to upskill based on trainings?

0:30:13.3 Gina Salama: So working with maybe an L&D department or an HR department to have a training or a certification in AI, in machine learning, in data analytics. They're probably building it anyway for a group that's not tax. So why not have those conversations? There's probably something that can be leveraged. And then maybe the tax specifics are smaller, but these are definitely some opportunities. The other thing that I just want to mention here is, if you're sitting here thinking, “This is never going to work, because I'm already understaffed and my people just do not have the time,” think about how you can leverage some sort of augmented workforce to open up those opportunities. It could be a loan staff through a Big Four, right? But it could also be like Tony mentioned, a lot of the individuals who are maybe leaving full-time work, they want to work part-time. There's contractors and more and more individuals like that, that if you could bring them in to do maybe some of that traditional work to free up others to go get opportunities on a temporary basis, that is certainly an opportunity that's more available than it's ever been before. So it takes some planning, but it's certainly worth prioritizing.

0:31:48.6 Omri Marian: May I add something here?

0:31:51.2 Cara Griffith: Absolutely. Go ahead.

0:31:54.2 Omri Marian: So I completely agree with Gina. One thing that I can see from where I'm at is that some employers are much better at it than others. The opportunity, I think, can come in few... First of all, I think that some employers need to learn to demand these skills. I see a tendency, especially – and don't hate me, the lawyers here among you – especially among law firms, to hire people that are... So hiring partners many times will hire people that look like they looked when they got out of law schools. Top student that can write well and very strong, but probably great. It is important, but there is a missed opportunity. Great students can learn more skills and do more than you were able to do when you were first hired today with the technologies that are available. So learn to demand. And even if you are not demanding, but happen to hire someone with the skill, make use of the skill. So one of the things that I see, and it's a pet peeve I have, I think, is that, for example, we teach... One of our classes is a practicum on tax and data analytics. We throw tons of data at our students and we teach them how to work with the data analytics platform and how to transform this huge dataset into actionable legal advice. Students that come out of this program, that end up in the Big Four, for example, most of the times actually get to use these skillsets and they're assigned to teams that take advantage of this new skillset that they learned.

0:33:46.8 Omri Marian: But I also see students where the skillset, the new skillset that they learned, and has very few parallels when we compare to other candidates, very few graduates come out of law school with ability to work with data and new technologies. And it just goes to waste because they're assigned to do the same things that everyone does all day, every day. And when you realize that, oh, this person actually can work with Alteryx, which is a data analytics platform, but hasn't done so for three years, this went to waste. So from my point of view, what hiring leaders, tax leaders can do when they hire, it's if even if they don't demand the skills, they should take advantage and reward those skills rather than just identify the people that have this unique set of skills that, again, you will all need it in your practices, even if not tomorrow, in the next decade. And start taking advantage of the fact that some people can do that. Let hires who have the skill be entrepreneurial about it. Don't kill their attempt to use their skills. Yeah, that's what I wanted to add.

0:35:07.3 Cara Griffith: Yeah, I think that's such a great point. And it goes both ways too, that we need the students that come out that have those skills to raise their hand and say, "Hey, I learned this and I could use it." And then you need the employers to say, yes, let's go, let's think outside of what we're normally doing. It's so hard to change inertia. And you get employers, and I know we've certainly been guilty of that ourselves, of you know, someone leaves and so you hire to fill that exact job. Well, now it's time to actually rethink what that job looks like. What do we need out of that job and how do we change it? Tony, I wanted to turn to you because this is really a perfect time to raise the question. We, for many years in the tax community, have been so reliant on the Big Four and these professional services firms to train the tax professionals. They go in for a couple of years and then they come out and that's sort of what we have relied upon. Is that tenable for the future? Do we need to stop relying on these professional services firms to act as the training ground for tax professionals? Or is there a better way and what do you think that way might be?

0:36:16.8 Tony Santiago: Well, I want to address that question and yes, we do need to supplement them. It's not replacing them by any stretch. We're still going to be dependent on them. But we need to be thinking out of the box. And I would like to talk to that, but Gina made some really good points I'd like to emphasize because this is something we do with our clients and it is intentional. We have a strategic advisory meeting every year with the client on development of their department. You are going to get tremendous resistance. That is real. They don't have the time. So it's not something you can avoid. So we don't attack it with, let's develop every single person at that department. We go with an 80:20 concept. We sit down and audit the department with them and depending upon the size, it will include their second tier management or third tier, depending on how big the department is. Clearly a-hundred-person tax department, a chief tax officer won't have all the details they need to make these kind of development decisions. So we structure it that way. We tell them all to pick their top 20 percent, this is the 80:20 rule, 20 percent produce 80 percent of results, Pareto's Law is not going to go away tomorrow. They identify those top 20 percent and we focus on them. Then we make sure, like Gina mentioned, they must understand that person's career aspirations and what's behind it.

0:37:34.8 Tony Santiago: And that's normally where there's a disconnect. They call us and we understand more about the candidate in an hour than somebody that's managed them for five, 10 years does. We know exactly where they want to go. Do they really want to be a head of tax? I have clients that we're grooming people to be heads of tax, had no interest to being a head of tax at all. I've got people they want to make data, the Alteryx person, because the person is comfortable with the technology. But guess what, they don't have any interest in that. And I've got other people that they assume are not interested who would be dying to do it. But nobody's talking. They're not taking the time to focus on these conversations. That is your compass. That points you in the right direction and you check with them regularly.

0:38:23.5 Tony Santiago: It doesn't have to be every month, once a quarter, three times a year, you're checking on your, where their compass is. Has it changed for personal reasons or professional? But other than that, you can then build a plan. And as Gina said, there's ways to be creative and not take extra time. In our consulting practice, our interim staffing one, every project we check, is there an opportunity for development of your internal team while we're doing the project? Can we bring somebody in and to free up your team to go get some of the work that they want to do, but you don't have time to do it? Can we teach them how to manage the contractor while they're doing it at the same time and get a double whammy? Can we bring somebody over there and let them second chair the work so the next time they can run with it? And we bring people in who have corporate experience, and use, who understand about knowledge transfer. So, they've been through that ringer.

0:39:09.0 Tony Santiago: So, it's a different element. So, there's going to be many different solutions there. But that little structure that I talk about, sitting down once a year to do it when you have somebody like me there, and yes, we'll bring HR in. Sometimes I brought the CFO in to sit down on the meeting, because a lot of the time that's coming up at the strategic level. I have a global 50 company right now, I'm doing that. And the CFO is not optional. He's coming in to be part of it because we have huge strategic issues that we have to make changes on. But I wanted to cover that briefly before the question on the dependency issue. So, I think, we all know fundamentally between law firms, accounting firms, tax consulting firms, our vendors for the corporate entities, right? They produce probably close to 90 percent of the talent that we end up recruiting, unfortunately. We get some from the government agencies, but it's a small percentage in that area.

0:40:02.1 Tony Santiago: So, the scare is what happens with the model of the professional service firms? Could it undermine the ability of that pipeline to be there? And yes, there was the potential of that public accounting firm started to split and all that, obviously put on the back burner with Ernst backing off of it, but it was a wake up call. And the skillsets that you need to be an advisor, as Omri is talking about, are going to be a little bit different than what you need to be in-house. That's going to have to start to be really thought about, OK? And I do think that there's going to have to be some direction on client companies. I've got some of mine putting internship programs together and then hiring these kids off campus or maybe hiring them a year or two later if they go to professional services, but developing the relationships and getting, it's also opened up diversity, which is always a nightmare for us in tax, on the racial side, not the gender.

0:40:58.9 Tony Santiago: We're doing a better job. We can still do more at the leadership level, but it's getting there quite quickly. So it adds benefits in that area, too. How we would exactly do this, everybody's a little different. Amazon's got a project they're working on. I have a number of my clients. They do tend to rotate these people around. So everything Gina said about rotation is very important. Sometimes just in tax, and sometimes, Gina said, it's even outside of tax, getting exposure to treasury and other related areas and bringing them back in. But you have to optimize your current tax department so you have the ability to do that and give that person away for a while. That's also where you're going to get that. Yeah, it sounds good in theory, but. . . . So we mapped that into the strategic annual plans for the companies. People need to have intentional time to sit down and think that through, and it's multiple conversations. It's not, do it in one hour, but it's, if you want to develop your people, you have to have a plan to develop your people. It's just that simple.

0:41:58.6 Cara Griffith: It's so hard sometimes to even convince managers to have that conversations with their staff of saying, what is your skill set? What are your desires? Where do you see yourself in five years? I mean, this goes outside of tax even, of just the general development. These can be such powerful conversations, and yet it is incredibly hard to convince people to take them on every year and then to follow through with it and then to let leadership know, hey, I've got so-and-so. So I feel some of the pain on this, certainly on a lesser level than all of you.

0:42:30.2 Tony Santiago: You can mentor with them. I've trained my clients’ people on how to approach those conversations. I've had the person above them let them listen into the conversation with the permission of the employee and get that experience. But it's like learning technical. You learn the softer skills very similarly the same way, but you have to be intentional as Gina found at the point home. It's not just happening by luck.

0:42:55.8 Cara Griffith: No, and that's absolutely true. And so you mentioned soft skills, and that was a question that I wanted to come back to because I think that this is a piece that is a little bit different and what the future tax professional is going to need. How do we develop soft skills? I mean, Omri, at the student level to Tony and Gina, once you've got some professionals that may have been a CPA for years and years now, and now we're asking them to actually what your job needs to turn into is a bit more of consulting and advisory. How do you, and it's a question for all of you, how do you develop the soft skills that are going to be needed to help these professionals continue growth in their career?

0:43:36.2 Omri Marian: So, I'll start.

0:43:40.8 Gina Salama: Sure.

0:43:40.9 Omri Marian: It's not something that you can necessarily teach, I think. I mean, you can try to teach, but soft skills are something that some people are just better at, but everyone can practice. I'm a firm believer that the more you, well, practice, well, better, not perfect, but what we've seen, at least in our program, is that introducing mandatory, well, it's not exactly mandatory because I cannot really force students to do that, but I can strongly encourage students to do internships, and it's an integral part of our program. And if you do an internship during your school, this is where you start to develop, assuming you didn't have the skill before. This is where you start to develop the skill because, you start working with teams, you're starting to develop your professional network. You are starting to communicate, which is one of the things I feel lawyers sometimes have – especially tax lawyers, unfortunately – have a hard time doing is to communicate with clients. I would love all my students to do internships during the program, and I would love more employers to take students in for internships. So, some employers understand the benefit of doing that. Others not so much. So I think internships can play a significant role in getting the process started of teaching candidates how to behave as a professional rather than just do the work.

0:45:28.2 Gina Salama: And I would add to that, that I love hearing that. Start at the internship level and then don't wait. I mean, it is something that has to be practiced again and again. Not everybody, but it doesn't come naturally to most people, especially in our profession. So, there has to be those opportunities in the safe space for practice as well. Something that we do is really encourage our leaders to practice using real scenarios. Whether it's email communications or a difficult communication or conversation with a client. We take real scenarios and we make safe spaces to practice with each other, with people that individuals know so that they can start to get more and more comfortable.

0:46:25.9 Gina Salama: And then depending on the situation and the role that someone's in, you could have somebody who is strong then shadow some of the real communications and interactions that we have, either with our clients or with one another. And the more that we practice, of course, the more comfortable that we're going to be. Another recommendation that I have, as I said on the other topic: We're not in this alone. So, if you're sitting in an organization that has a communications team or even an internal comms CoE, talk to them. What kind of resources do they have that they could use, that you could leverage for? Tips and tricks. There's a lot of tricks, especially when it comes to email communication that can be practiced and adopted really pretty easily, with just a guide which is something that I think a lot of our professionals will respond to. This is the formula that we want you to use for your email. So go ahead and practice it and utilize it. And after a while, it becomes second nature.

0:47:37.5 Gina Salama: But it is something that we have to encourage. And all of those other opportunities, I think that we talked about when we talked about how to get our professionals to gain skills go along here as well. If we take people out of their comfort zone, we have them work with different stakeholders on different projects, they're going to have use those types of communication skills that they probably don't use every day on their team, talking to the same people that they do on a regular basis. So all of those opportunities are ways to really strengthen those skills and to identify where the gaps are too. If somebody goes and does a project for three months and the feedback is, well, we couldn't really follow anything that they were saying or they weren't clear, then that's something that we can take in action. So, it's that constant feedback and that constant practice.

0:48:40.7 Tony Santiago: Yeah, I mean, it's tied into our audits of the tax departments and looking at the 20 percenters. They never come with everything, so nobody's perfect. So, those 20 percenters in particular, we will assign a mentor or a sponsor with internally in the company, within tax or internally in the company outside of tax, we'll find somebody. Or in the general market. I have a young lady, African American female working with a retired chief tax officer who also is diverse, the similar types of backgrounds, but he is very strong in his ability to influence. She is struggling with it, predominantly competent, well credentialed, but taking a little bit of a backseat. And early on when we were promoting diversity in tax 25 years ago, we spent a lot of time with the female candidates working on those issues, not being afraid to take the position, not being afraid to show the leadership. And we found men and females to work with them because a lot of times they had to speak to men. And back then it was very dominated.

0:49:50.4 Tony Santiago: So, training them to speak to women was sounding good. They have something in common, but it was not practical to the real world they were going into. And I found people more than willing to pay it forward. And I think tax leaders need to tap into that. They will tap into us, we'll use our network to find people. Somebody works with me on influencing soft skills. I have probably a set of 10 books that I always recommend they read, and then we go over it together to see what they've absorbed. That's how – I'm in the communication business, for God's sakes. That's an easy one for us or my whole team. But yeah, it is so... You can't do everybody. You can't do everything. So I keep talking about building the pyramid and taking the top 20 percent, which will impact the department performance by 80 percent, generally speaking. And then you can do generic stuff to the whole group to help them pick it up. But the 20 percenters will train the others. That's what will happen. So you'll have a filtered down effect, but if you don't get the top performers, it doesn't happen.

0:50:50.7 Cara Griffith: That's a really good point. It's so interesting, as we're talking here, and we're talking about soft skills and the need for that. And then I was looking and thinking about... And the next question, and it was, well, the flip side of that is, how do we get tax professionals that are more comfortable with data and with AI and with all this technology? So, it seems like we're on two sides of the spectrum completely on how do we have people that are good with soft skills, your communicators, and then also your people that are good on the flip side of that. And they're good with data, and they're a bit more of that technologist, and the two usually don't mesh. So it's a very interesting and challenging. Tony, I think you're absolutely correct of saying, you don't have to, take this in pieces, take this in chunks and then figure out who's good at what. But I did want to ask, how, what is the method that we're going to enable people that are already in the workforce, and in those coming into the workforce, how are we going to support that demand for more technological-type skills?

0:51:52.3 Tony Santiago: I think Omri hit it when he said, we're not trying to make them data scientists. OK. And I had a client, I won't name the firm, they brought in a firm for a big tax technology project. Cost them well over $1 million. And they got nowhere. The team fought it the whole way. Well, I brought in a couple of people that are fractional contractors for me, that are experts in the area, but they're in-house practical people. So, the first thing they did was spend three hours with the team relaxing them that this was not rocket scientist stuff. OK, we're not trying to make you something you're not. We're going to make it simple. We're going to show you how to use the tools and once you do, you're going to want to learn more about the tools incrementally. And they did. And the VP of Tech said to me in five weeks, she said, they've put about 53 hours, I think was her number. And she said in 53 hours, they've gotten more results and things done than we did with six months with this other firm. because they just intimidated everybody and scared them. So how you approach it is to make it simpler, make it more palatable, and analogize it to something you did before. Everybody thought, tax reform is going to be crazy. Everybody thought ‘86 tax reforms. Eventually, we get it, guys. OK. We're not... The people in the tax field are all smart, and you just gotta give them a cushion.

0:53:16.9 Cara Griffith: Yeah, I think that's a very good point – that it is all sort of in how you sell it. And we aren't trying to... We're not expecting the tax professionals to suddenly be able to go and write code that's going to actually train the machine. What we're doing is teaching them how to use it, a tool. And so I think that's a good point. Well, I wanted to turn to, we got a couple questions in, and one that I thought is interesting is, as we're looking at attracting new talent into the tax profession, do we have to talk about things like salary? Do we need to talk about the AICPA's five-year education requirements? Are there some of these topics that will need to be addressed in order to make tax a more attractive career going forward?

0:54:04.6 Gina Salama: I can...

0:54:07.4 Tony Santiago: Anybody else who want to speak?

[chuckle]

0:54:07.9 Cara Griffith: Yeah, I might – I'll turn that to Gina first.

0:54:09.9 Gina Salama: Yeah, I can start. I think that there's... We always have to talk about compensation. We always have to talk about requirements, but they aren't the only things. The first thing that comes to my mind when we talk about the candidate attraction is, what are all of the things that you're actually doing today to attract the right talent in this current environment? So if we look at earlier career opportunities, what relationships do you have with universities? Even going back to maybe high schools, depending on how big your organization is, what kind of investment or partnership are you putting in to elevate tax as a career, to educate on all of these new cool things that we're actually doing – as opposed to what someone might think of as a traditional tax profession – that would be appealing, and actually giving some exposure and opportunity to people in the profession today to influence the students?

0:55:23.9 Gina Salama: And then, when we look at experienced hires, yes, the job market is stressful and it's fierce today. But what's your partnership with your recruiters? There's so many times where we go in and we talk tax transformation with our clients, and they say, where we have these open roles, we're filling these open roles. And somebody said it earlier – are these actually the right jobs? And how did you get to that? Who did you work with to make sure that that was right? And then that it was written correctly in the job description and that you're actually sourcing from the right places. Sometimes, depending on how a recruitment organization is set up, you need to put in the work to actually educate and strategize with your HR and your talent teams to make sure that you are accessing the right types of candidate pools. So yes, comp is important. Yes, certification is important, but those are not the only levers that you can pull.

0:56:37.6 Omri Marian: I think as a profession, we can be much better at communicating what it is that we do. Because the perception... We are all here, I think because we actually are... We like what we do. We're, at least to some extent, we're passionate about tax work; otherwise, we wouldn't be here. And I think in that sense, tax is a little bit of a self-selecting group. There are people that know that this is what they want to do, and they're there. But the other people that don't know that have a very, I think in my mind, wrong perception of what tax professionals do on a day to day basis, and we can do better at communicating it. So for example, when I'm in class, when I teach the basic tax class in the second or third class, I talk to them about how Estee Lauder was able to avoid all taxes on the IPO.

0:57:32.0 Omri Marian: So I talk about the Estee Lauder transaction, and then they're all hooked. As opposed to if I explain to them how miscellaneous itemized deductions work or, well, now I don't have to explain that. But if instead I just talk about section 67, then you lose them in a second. So I think we as a tax profession can do much better at communicating how – and honestly, I feel like that – how exciting this profession is, and how important it is for everyone in society other than the clients. And I think that this is something that actually tax practices can do much better work at when they reach out to candidates, rather than as Gina said, the dry job description of someone who can review documents or whatnot, tell people these are the kinds of transaction you're going to be on – something that you would want to hang on your office wall. And we all have transactions we worked on that we're proud of. So, we need to be better marketers, I think, as a profession.

0:58:41.2 Tony Santiago: Yeah, you guys are terrible at that. But I've said that for 40 years. So, everybody's heard me.

0:58:46.2 Omri Marian: Well, you didn't change anything. So...

[laughter]

0:58:49.0 Omri Marian: You failed.

0:58:49.5 Tony Santiago: You've gotten better. Trust me. It used to be a lot worse. Arthur Anderson was on, Why should we hire you? That is what their model. There was no selling. Arthur Anderson. Look, as a profession, it's hard for you to see what somebody like I will see. Tax people are extremely loyal, dedicated people, basically. I did not pick to do tax just randomly. I don't place sales people. That tells you something. I don't place investment banking people; that tells you something. OK. You guys have an ethical base about you. That's a core part of being in taxes. You're not trying to cheat taxes. You're trying to make sure we're here adhere to them. And once you... You need to represent that. It's phenomenally creative. Tax changes more rapidly than any other area in finance. It's why tax leaders are being broadened out, because they can handle the rapid changes. They're used to it. So, you've got these attributes. You have to have people influencing skills. Would you rather comply with the laws or help develop the laws? Tax people are working on policy. I know what certain tax leaders did for their companies during this last reform.

1:00:08.7 Tony Santiago: And the shareholders owe them a lot more than their paycheck, I guarantee. There's so many things about tax that we don't represent as a profession. When it comes to individually recruiting for a position, the big mistake is, we don't answer the question of why would a candidate with the specific profile we're looking for – ? Gina's point is correct. You've got to work on that first. Do not randomly throw a job description together. Explain what you're trying to achieve, but assume you have that. Then you've got to answer this question in 90 seconds. Why would a candidate with that profile be excited about your role? If you can't answer that, you're going back to the drawing board. You don't have a fillable search.

1:00:53.8 Tony Santiago: Then the question is, at different levels – you have to communicate that, at a younger level, you’ve got to put it on a video or an audio, 90 seconds. They're at the gym and they see an ad and boom, they listen to it. And the person doing it has to be impressive, relatable to that level person. So, if you're going after a Gen Y, I want a Gen Y or a young millennium, and I want them to be emphatically enthusiastic. We have a platform to do it that way. All the, all HR, all tax people want to put it in text based. And I go, I'm not even going to put it up. It's a waste of your money, OK? These kids are not going to respond to it. You want to triple, quadruple your response rates, this is how you do it. Even when I'm interviewing for a $5million-a-year chief tax officer job. And yes, your profession, they do exist. So, that's how well you guys do your job. Those people want to know in 90 seconds, “Why me, Tony? Why are you calling me for this job? What is the relevancy?" And if I don't have that down tight, and I cannot get their attention, game over. They're going on to the million other things they got to do. So it is marketing. It is communication. It is influencing skills again. Going to keep coming back to influencing skills. And know what you're looking for and package it tightly.

1:02:20.2 Cara Griffith: I think it's all great advice. I think tax is a great career and more people should get into it. I used to say that state and local tax was awesome because it was one of the very few areas in tax, or in law outside of criminal law, that you get to play with constitutional theories. And I always love them. And I thought it was fascinating. But anyways. I want to thank you guys for joining us today. I want to thank you for sharing a lot of great advice, a great conversation. And and I hope that we can do it again because this is certainly not a problem that is going away anytime soon. But thank you all for joining us and and I hope everyone who was watching enjoyed it and has a great day.