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OCR for page 194
APPENDIX
B
The Taxpayer as Customer
Mary Batcher, Statistics of Income Division
Paulette Sewell, Taxpayer Service Division
Internal Revenue Service
Many federal agencies have turned to total quality management as a
means to improve the quality of their products and services and to make
better use of their resources. The identification of customers and develop-
ment of service standards for customer interactions are key components of
total quality management. Unfortunately, the notion of having accountabil-
ity to customers is somewhat novel in government. Funding is appropriated
for agency activities as part of the overall governmental budget process, and
there is little direct link to the customers each agency serves. Hence, with
rare exceptions, there has historically been very little market pressure to
build a customer focus into governmental operations. However, as agencies
come under tighter fiscal constraints and closer scrutiny by Congress and
the media, there is increasing interest in the quality movement (with its
potential productivity gains) and, as a corollary, increased attention to the
identification of customers and their needs.
The question of how to develop a sense of the taxpayer as customer
should be preceded by some assessment of who the customers are. A1-
though in some sense taxpayers are the customers of all federal agencies, in
reality the number of agencies that provide a direct service to taxpayers is
probably limited. Some exploration of who the primary and secondary
customers are would certainly be beneficial. The needs of the primary
customers must be met, and taxpayers may enter the loop only indirectly
through one of the primary customers, such as Congress. While the public
is always there as a consideration, in some cases a primary focus on taxpay-
ers may not improve service at all.
194
OCR for page 195
APPENDIX B
195
For those cases in which the taxpayer is a direct customer, the experi-
ence of the Taxpayer Service Division of the Internal Revenue Service (IRS)
may be of interest. Within the IRS, the Taxpayer Service Division was
created with the sole purpose of providing customer service to the taxpayer.
It is the unit of the IRS that is responsible for answering taxpayers' ques-
tions about filing their income tax returns and their account and payment
status, providing assistance in filling out tax returns, distributing tax forms,
operating outreach programs to the taxpayer, and so on. For most taxpay-
ers, Taxpayer Service is the point of first contact with the IRS.
The organization of taxpayer services into a separate division contributes
to building a sense of the taxpayer as customer into the culture. The message
that customer service merits its own separate structure is not lost on employ-
ees of the Taxpayer Service Division. This message is first imparted during
the personnel selection process, and it is reinforced through training, the
performance review system, and the reward and recognition system.
Employees who will have contact with customers are selected with
customer interaction skills in mind. Not everyone is able to perform well in
a customer-service role and selection factors reflect that. The training that
customer assistance staff receive includes a heavy emphasis on the impor-
tance of the taxpayer as the customer and customer-contact standards and
skills, in addition to basic training in tax law, as needed. Customer-contact
standards are considered a critical element in effective job performance, and
employees are monitored against the standards by managers as part of per-
formance assessments and by quality reviewers to identify areas where ad-
ditional training or job aids may be needed. If training and managerial
intervention fail, employees who cannot provide courteous and effective
service are removed from customer-contact positions. By contrast, employ-
ees who provide exceptional customer service are recognized in a variety of
ways, ranging from cash awards to small items of recognition, like certifi-
cates for correctly responding to a test question.
The above are areas of strength for the Taxpayer Service Division that
might well be emulated in other environments. Additional steps can be
taken, as well, to strengthen the sense of customer focus and the quality of
customer service. They include the following:
.
Develop a market segmentation approach whereby the various cus-
tomers, internal and external, are identified, their needs are assessed, and
strategies for addressing those needs are developed.
.
Create a career path for customer-contact staff. In most governmen-
tal applications, customer-contact personnel are relatively low graded and
must move into other areas to advance.
· Involve customer-contact personnel in the development and commu-
nication of standards for customer contacts. These standards should be
OCR for page 196
96
QUALITY IN STUDENT FINANCIAL AID PROGRAMS
continuously revised as the quality of service increases. Customer-contact
staff should play a role in the revision of standards and should be as aware
of the importance of the standards to the agency as are the top executives.
All of the above are factors that contribute to the development of a culture
that values the taxpayer as a customer.
The related question we were asked to address in this paper is: How can
an awareness of the taxpayer as customer be managed statistically? Before
anything can be managed statistically, it must be managed operationally.
This means that customer-contact standards must be developed and commu-
nicated to the employees, and managers must do their job of observing
behaviors and coaching.
Given effective operational management practices, statistical manage-
ment becomes a matter of measuring the system's performance. However,
there are measurements that are designed to provide feedback at the work-
unit level and measurements for the broader resource allocation and policy
levels. At the work-unit level, measurement should be frequent, timely,
specific, and detailed, and perhaps, it should only address key areas. Esti-
mation procedures should be simple enough that staff in the work unit or
local support staff can perform the calculations. There should be enough
flexibility in the measurement system to allow the emphasis to change quickly
based on operational needs or information from other indicators.
To be most useful at the policy level, measurement should be frequent
enough to assess trends and should sample across the universe, rather than
addressing only key areas. Measurement at this level requires more strin-
gent confidence and precision in the estimates. There is also greater toler-
ance for statistical elegance in the estimation procedures.
The test-call program for measuring the accuracy of the IRS telephone
assistance service is an example of a measurement system designed to meet
upper management's need for data to inform resource allocation and large-
scale system management. Data are generated weekly at a level of detail
adequate to provide overall accuracy rates by call site and by area of tax law
nationally. Results are available to IRS executives by Wednesday morning for
the immediately preceding week. This allows monitoring of overall accuracy
and an assessment of call-site accuracy trends, but it does not provide the kind
of detailed information that is useful in local management practices and deci-
sions or that can be used to address a downward trend. That kind of detail is
provided by local test-call and call-monitoring programs. Local call-site man-
agers are held accountable for achieving a specified accuracy rate. They,
therefore, support these local measurement efforts and use the results to guide
improvement efforts. The merit of improvement efforts is determined by the
national accuracy rates. Taken together, this combination of measurements,
one at the national level and the other locally controlled, has proven to be an
effective statistical management tool for the telephone assistance service.
Representative terms from entire chapter:
service division
