Collaborative Activity: Strategic Leadership and Change Paper Review

Strategic Leadership and Change

May 15, 2017

Dr. Terica Pearson, PhD

“The Internal Revenue Service is the agency responsible for the collection of taxes and related activities arising from laws enacted by the federal government. The origin of the 1RS dates back to the Civil War when the first income tax was enacted to pay expenses of war in 1862” (Moen, Davies and Lavin, 2014). The structure of this organization with clear and concise management levels with one level that each other level is accountable to.

Throughout its conception, it has come under scrutiny. Around 2014, “it was also reported that the 1RS had not been fiscally responsible when holding training and development conferences for its employees in recent years” (Moen, Davies, and Lavin, 2014). “Strategic leadership involves dealing with issues commonly addressed by a firm’s top management team. Strategic leadership, on the other hand, involves dealing with how to respond to changes in the external environment” (Norzailan, Othman and Ishizaki 2016). This is the only example of reasoning for a change in the strategic leadership of the organization.

The Internal Revenue Service (IRS) has recently begun a period of change and transition. This government agency must be able to continue to function without catastrophic failure at any level. This organization needs to be able to function transparently to limit possible conflicts or ethical issues. The leadership of this organization must use all the skills available to ensure that the changes are not made known, but also explained, reviewed and if necessary provide training prior to implementation. The executive leadership structure when properly aligned should be able to address such issues. Leaders at every level must take steps to eliminate any undo resistance to the changes by being transparent.

Executive Leadership Structure

An organization must have the right type of people in place to make sure that things run smoothly. The IRS keeps the leadership tight with all the different departments and the management is in top notch condition. When you are trying to take a team of people to the next level you need an executive team that can give you a clear purpose about what they need to be doing. The current executive leadership of the IRS is broken into 3 commissioner-level sections all accountable to the Commissioner. Each section has a Deputy Commissioner that is responsible for the mission and enforcement of their prescribed duties.

During the years 2014-2017, the IRS developed several executive strategies that give central directions to obtain in the organization’s mission and vision. To facilitate the changes that are necessary and to remain transparent, the executive level must ensure that the plans are made available to the lowest level. While providing high class technology systems, processes and tools, care must be taken during the planning and implantation of changes that these services are not disrupted. The leadership will implement a strong enterprise risk management system that will aid them in determining future challenges and issues that can be addressed before they have any negative impact operations. The IRS is making sure that they have the right type of people that can work in a very secure place and be very trust worthy.

Mission Statement and Strategic Vision

The Internal Revenue Service’s mission statement is “Provide America’s taxpayers top quality services by helping them understand and meet their tax responsibilities and enforce the law with integrity and fairness to all” (IRS, 2017). The mission statement addresses both the internal stakeholders, the employees, as well as the external stakeholders, the taxpayers. It states what needs to be accomplished and how it should be done. Although the mission does seem to lack enthusiasm, the complexity of the industry makes the vision suitable and achievable.

The tone of the mission statement would suggest that its long-term vision is adaptive; however, the change factor could cause some to resort to resistance. Resistance can come from unfamiliarity and comfortability. When an individual has been in a certain frame of mind for so long, they tend not to want to change anything that will alter their routine. The mission statement’s long term vision is to help taxpayers to understand the law and their responsibilities in association with the law. As the laws change, so will the Internal Revenue Service’s approach to informing the taxpayer about the change. The taxpayer is notified of the change and given time to adjust to the change. When a circumstance prevents a taxpayer from legally proceeding with a claim, they are notified via mail. In the mail, the Internal Revenue Service gives the taxpayer a brief explanation of the law and other resources to research the law themselves. If any additional information is required to process the claim, the requested information is provided or the availability of the information is provided. This is the most adaptive approach for this organization due to the amount of clientele involved.

The Internal Revenue Service has strived to accomplish its vision using several different approaches. As the laws evolve, so does the approach to informing the taxpayer about the evolution. Although it is impossible to make it understandable for the billions of individuals involved, the attempt to do so is present. Keeping the changes as transparent as possible will help to eliminate any possible confusion or mistrust.

Change

The nature of the Internal Revenue Service has changed wildly in past century. First it begins with a plan. The plan aims at a vison that incorporates changes up to the executive divisions. At times change included removing executive appointees, when the system was determined to be corrupted. “A sequence of high-level leadership changes occurs within the agency, including Tax Exempt and other Government Entities” (Anonymous,2013). For the transformation to occur within the agencies different leadership teams help transform and breakdown the organizational problems within the agencies.

“The Treasury Department focuses in the restructuring of the organization” (Rainey, Thompson, & Riccucci, 2006). The process begins with nominating and appointing new executive leaders. The newly executive leaders had extensive financial experience acquired through operational strategic experience and leadership skills. These new teams and set of plans create reforms within the legislations to acquire new skills and then divisions are developed. “The link between leadership and strategy was firmly established in the early 1960s with application of strategy to business planning” (Lussier & Achua, 2014, p. 396).

With change, there is always resistance and challenges. The Internal Revenue Service knew there would be resistance and challenges along the way. To make the process as smooth as possible they restructured their organization over time. When changing an organization, especially at a large scale it is important to have a solid plan and time line in place. The Internal Revenue Service has a plan that will be implemented in phases over years.

Even with a plan in place and a time line planned there is still resistance. To assist with the resistant, they posted their plan to the public to show transparency to the tax payers to ensure that the restructure will be a good change. The Internal Revenue Service focused on education and customer service which increased jobs. They provided ample amount of training for employees to ensure that all the employees had the same knowledge and comprehension.

When an organization is dealing with resistance to change, management should look at the communication to the staff and affects of the environment of the workplace. Some leaders may have to change their approach. The culture of an organization must have trust and a great rapport to express their concerns freely. “When the staff is allowed to be a part of the discussions of the change to come, they are more willing to not resistance incoming and outgoing changes” (Torben, 2013).

To be more effective, a leader motivates their personnel by training, guiding them, and through mentorship. “When the whole team is on the same page with the vision and mission of the organization there is less resistance (Oreg & Berson 2011). When a leader is able to have awareness for the environment that they are in, it can allow the management and staff to look at change as an opportunity to make their organization better.

“The concept of organizational competencies is one of the most misunderstood and misapplied concepts in organizational management. Organizational competencies are often thought to be simply employee skills rather than the compelling cross company core competencies that drive integrated Business execution and management alignment” (Anonymous 2017). The IRS has set in place internal training programs which will aid in the completion of the changes that are currently taking place and those that are forthcoming.

The IRS is a very complex organization in a competitive business environment which is constantly changing with fast technological advancements. An entrepreneur is expected to interact with these environmental forces which require him to be competent in various settings such as, intellectual, attitudinal, behavioral, technical, and managerial aspects. Entrepreneurs are challenged to be adaptive to any change that presents itself. In the case of the IRS this would mean constant monitoring and adjusting the strategic plans to accommodate changes.

Conclusion

Change, regardless of the organization is a factor that every individual, entrepreneur and leader must face. The Internal Revenue Service has evolved from just a tax collection agency to a multi-level organization that collects, analyzes and enforces the laws that govern the largest single collection agency in the United States government. The foremost strategy of the leadership is to plan, reviewed and implement changes necessary for the continued seamless operations of this organization. One other goal is that for the viewpoint of the public, this must appear to be transparent.

The changes have all be well planned, reviewed and are currently being executed in stages. This approach to the proposed change has limited the amount of resistance that is seen in an organization this large. A factor that every level of leadership has utilized is strong communication skills. By removing the doubt or undue concern by communication, the employees and lower level managers could adapt more easily to the changes.

Communication in the form of memorandums, emails, posters and training were vital factors that the strategic planning envisioned. Leaders must use all means necessary to be able to implement the change as directed with an awareness of the individuals in their team or department. Adapting their leadership style to be mindful of the emotions and concerns of their employees can also aid in the smooth flow during change.

The executive levels of leadership within the IRS have displayed the necessary skill sets and traits that are necessary to plan, review, train and implement changes within this organization. The strategic planning that the leadership has undertaken is demonstrated by the low level of resistance. They have made the changes known to the lowest level employee, trained new programs and policies before implementation. By accomplishing the training before it was to be implemented helped to reduce the stress employees may feel regarding changes.

References

Anonymous. (2017). Organizational Competencies. Retrieved from http://www.blandi.org/training-programs/organizational-competencies/

Anonymous. (2013). IRS Leadership Changes.  Retrieved from https://www.pwc.com/us/en/tax-services/publications/insights/irs-leadership-changes.html

Internal Revenue Service. (2017). Retrieved from https://www.irs.gov/uac/todays-irs-organization

Lussier, R. N.& Achua, C.F. (2014). Leadership Theory, Application, & Skill Development (6th ed.). Boston, MA : Cengage.

Moen, D. H., Davies, T. L., & Lavin, A. M. (2014). Taxpayer Perceptions of the Internal Revenue Service. Journal of Business and Accounting, 7(1), 67-81. Retrieved from https://search.proquest.com/docview/1630677865?accountid=458

Norzailan, Z, Othman, R. B., Ishizaki,H. (2016) "Strategic leadership competencies: what is it and how to develop it?", Industrial and Commercial Training, Vol. 48 Issue: 8, pp.394-399, doi: 10.1108/ICT-04-2016-0020

Oreg, S., & Berson, Y. (2011). Leadership and employees’ reactions to change: The role of leaders’ personal attributes and transformational leadership style. Personnel Psychology, 64, 627-659. doi: 10.1111/j.1744-6570.2011.01221.x

Rainey, H.G., Thompson, J., & Riccucci, N.M. (2006). Leadership and the Transformation of a Major Institution: Charles Rossotti and the Internal Revenue Service. , (), 596.

Torben, R. (2013). Retrieved from https://www.torbenrick.eu/blog/change-management/change-is-not-the-problem-resistance-to-change-is-the-problem/