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When the South African Revenue Service needed a partner to integrate its disparate tax systems and to help its transformation to a high-performance government department, it teamed with Accenture.
For historical reasons, much of South Africa's population of 45 million has not been taxed. This has resulted in an estimated tax revenue gap of $5 billion. The government department responsible for enforcing all tax and customs legislation in South Africa is the South African Revenue Service (SARS).
Employing approximately 15,000 people, SARS collects revenues in excess of US$30 billion annually from multiple tax products. Its main objectives are to optimize revenue yield, facilitate trade and enlist new taxpayers by creating awareness of tax obligations. The progress SARS was making toward these goals was significantly impeded by the fragmentation of taxpayer information across eight IT systems. SARS began a search for an experienced partner with deep technology skills to help them address this issue.
The Service turned to Accenture to help deploy a new system that would integrate the eight disconnected SARS taxpayer systems with its call center—thus creating a single, comprehensive "view" of the taxpayer for call center personnel. This major change program has resulted in myriad benefits— significantly improved revenue collection and tax debt equalisation, effective taxpayer education and increased compliance with national tax laws.
Until recently, many South Africans did not have straightforward access to the South African Revenue Service. Offices were often too remote and telephonic interactions were ineffective because taxpayer calls were not routed to a central facility. Fragmented taxpayer information was stored within eight disparate systems, making it difficult to get a common view of the customer and customer balances without conducting time consuming manual consolidations.
Andre van der Post, who is responsible for strategy, architecture, innovation and research in SARS' technical services division, knew that urgent action was needed: "Organisations were separately registered for income-tax, value-added tax (VAT), pay-as-you-earn (PAYE) and employee insurance, and these organisations often had multiple subsidiaries, each of which appeared as a separate tax account in our systems. One company had 196 different points of tax registration. To provide a perspective on the situation, it could take a member of the Revenue Service staff up to three weeks to consolidate the tax information associated with a major South African corporation, simply because we needed to drill down through so many different systems and screens."
Without a comprehensive view of the taxpayer, the system was also preventing SARS employees from performing tax debt equalisation (the offset of tax credits and refunds against taxes payable) and made it difficult to detect suspicious activity and non-compliance with South African tax laws. To exacerbate matters, there was no clear-cut method of educating taxpayers about their obligations.
The challenges were growing. SARS knew it would have to work with experienced business and technology partners to bring substantial improvements to the South African Revenue Service—and fast.
SARS needed partners that could swiftly transform their existing systems and develop a plan for a new "SingleView" system that would provide the agency's call center agents, tax advisers and case workers with easy and complete access to the full taxation status of citizens and corporations. The SingleView system would also enable the agency to manage the interaction and relationship with taxpayers and improve tax literacy levels through targeted education and outreach programs.
Van der Post states, "The question on everyone's lips was: 'How do we integrate these eight legacy systems quickly and effectively?' After all, traditional solutions can be notoriously complex, expensive, inflexible and risky."
SARS turned to an Accenture-led consortium to work closely with their IT organisation to deploy a Universal Application Network—a standards-based application integration solution from Accenture's alliance partner, Siebel, that would integrate SARS' eight taxpayer legacy systems (containing more than 9 million records) with an existing deployment of a Siebel call center to create a single view of the taxpayer. This consortium consisted of Accenture, IBM and Siebel. Accenture had headed the consortium that had implemented the Siebel Call Centre on behalf of the Revenue Service.
During this project, the Revenue Service and Accenture had developed a strong working relationship based on mutual trust and effective cooperation. Accenture had also demonstrated our commitment to delivery and had proven our ability to deploy Siebel solutions quickly, efficiently and with great attention to quality. Accenture's Siebel experience, proven track record and comprehensive understanding of SARS business needs combined to ensure the company's selection as implementation partner.
The team developed a proof of concept for the SARS team to demonstrate how the SingleView solution would meet SARS' requirements. This allowed SARS' CIO Ken Jarvis to see the benefits of Universal Application Network (UAN)—a standards-based application integration solution from Siebel Systems. SARS was so impressed by the results of this demonstration that it immediately agreed to move forward with a phase-one rollout of SingleView. Says Van der Post: "It was a compelling business case, which demonstrated how rapid application integration would enable SARS to better service taxpayers and increase government tax revenues."
The team worked rapidly, and phase one of SingleView was completed in just four weeks. This first phase involved the integration of the main line-of-business systems, including income tax, VAT, PAYE and employee insurance. This integration provided 200 tax advisers and case managers with a single unified view of individuals' and corporations' tax situations—detailing their profiles, complete tax histories, records of payment and outstanding tax inquiries made through the contact center. Subsequently, the deployment and nationwide rollout of the system to nearly 6,000 users—and integration across 12 different SARS systems—was delivered in less than four months—well ahead of schedule.
The new, user-friendly system contains just six screens of information, and involves only 1.5 hours of training. Having a single, comprehensive view of the taxpayer has resulted in significant savings and newly found value across SARS.
"Universal Application Network is providing millions of dollars a week in savings to the South African Revenue Service by releasing previously untapped value from the systems that we already have in place," said Ken Jarvis, Chief Information Officer for the South African Revenue Service. "Moreover, by using packaged integration and citizen service applications, we have sped our time to deployment by months—enabling us to capitalize on these incredible savings faster than otherwise possible."
By increasing tax collections and reducing costs, SARS estimates that the SingleView of the Taxpayer project has led to return on their investment within one month. This equates to a saving for SARS of US$3 million per day. While it used to take up to three weeks to gather all of the information associated with a company's tax payments and liabilities, Accenture's collaboration with the department has now reduced the time to gather and view this information to within 30 seconds.
This implementation heralds a completely new era for the South African Revenue Service. Accenture has helped SARS to become the first department of the South African government to implement a call center with fully integrated fax, telephone and Internet capabilities.
SARS has seen a complete turnaround—Accenture has helped the department position itself as a progressive, customer-focused government department. With detailed, real-time taxpayer information available, SARS has dramatically improved its service to the South African public, while reducing the overall cost of delivering service—resulting in huge savings in operational efficiencies—and improving productivity.
"Using Siebel's SingleView of the Taxpayer solution to create a unified view across 12 different systems could save SARS almost $3 million each day–which is equivalent to approximately $90 million every month," Jarvis concludes. "Even though a smaller return was achieved during the pilot phase, it meant we received a complete return on our investment in just a few weeks. When we are asked about how soon we expect to receive a return on investment, however, we usually quote a couple of months, simply because so few people would believe a return on investment could be achieved in days. But it's true."
Accenture helped SARS develop a new, more confident outlook. Employees are more effective, providing quicker and better customer service. The SARS workforce has renewed motivation and drive. The new system has boosted morale and employee confidence in performing their jobs. Debt equalisation has been greatly improved, and SARS has increased revenues by enabling their staff to effectively perform tax liability assessments across products through the new, integrated system.
Compliance with tax laws is also improved—enforcement has been bolstered by a new functionality to follow up on late or missing tax returns and payments. By helping the South African Revenue Service integrate its technology systems to streamline operations, Accenture has helped position the Revenue Service as a high-performing government department.
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