Transformation at the IRS

1. Transformation at the IRS Dennis Campbell Harvard Business School September 2009

2. At most service organizations… No focus Many organizations attract whatever customers they can Resort to product proliferation to satisfy the diverse customer base No alignment And have no clear measure of appropriate fit for employees

3. Focused Entry Targets a select group of customers Designs select set of products/services to satisfy its customer’s needs Selects a precise group of employees to deliver on the service model

4. Focused Entry Focus Targets a select group of customers Designs select set of products/services to satisfy its customer’s needs Alignment Selects a precise group of employees to deliver on the service model

5. Service model Human resource processing Executive training Finance Purchasing IT … {economies of scale} {economies of experience} Shared services Successful Incumbent Response Multi-Focused Firm

6. Matching Operational Design with IRS Objectives

7. Kotter’s Change Process • Phase One: Getting Started • Create a sense of urgency • Create a vision of what the organization will become • Form a change leadership team • Phase Two: Involving Everyone • Communicate the vision often, in a variety of ways • Empower others to take action on the vision • Inspire and celebrate small wins • Phase Three: Ongoing Improvement • Keep interest and effort on further improvements • Institutionalize new approaches, ensuring current leader’s replaceability Source: John P. Kotter, “Leading Change: Why Transformation Efforts Fail,” Harvard Business Review 73(2) (1995); 59-67