Since this legislation was highly anticipated and its various iterations closely studied by many organizations, some companies managed to implement changes to policy and practice immediately. On January 25, 2018, Institute for Supply Management opened a special survey that asked members of the Manufacturing and Non-Manufacturing Business Survey Committees to (1) report on their organizations' familiarity with and activity generated by the law and (2) assess how the new tax code might impact their businesses.

Nearly two-thirds (65 percent) of responding supply executives report that their finance and executive leadership is familiar with the TCJA. They also report that a majority (50 percent) of supply management leadership is familiar with the law. Among respondents with an opinion, those expecting a positive change regarding selected organizational, strategic, and tactical considerations far outnumber those expecting a negative change.

Supply Executives Speak

Among the comments from supply executives on what the TCJA means to their businesses:

Manufacturing sector

• "The company has increased its 401(k) match by one percentage point, specifically due to the TCJA."

• "Expect an increase in material costs and pressure on inflation. Overall, the new tax laws are expected to lead to an increase in revenues, demand for our products, and profit and growth for the business."

• "(Changes in) the amount of debt interest that can be deducted for tax purposes will have a direct impact on our business."

• "Return on initial investment increased, so our board can approve expansion plans quicker, hopefully in 2018."

• "It will increase our business sales and revenue. It gives us the ability to increase the company infrastructure and research and development (R&D) spending. Overall, it shouldn't make us more competitive in the short term but does give us a long-term advantage for investments, which should lead to a more competitive company."

• "It will result in (significant dollars added) to our bottom line. We do not know what we will do with this yet."

• "Our business requires enormous capital investment. With this tax reform, future capital investment will be more favorably received."

• "The TCJA is allowing us to invest in our organization a bit more aggressively, which will in turn create more jobs locally. And with the increased requirements for raw materials based on the plant expansion, we should have a fairly positive affect on the economy."

• "We believe money will be reinvested in businesses, and individuals will consume more products and services, increasing our revenue and net income. The supply-demand curves are already changing, which will drive commodity price increases. The increase in demand of products will increase pricing for products. Finding talent will be a significant challenge going forward. Our company is already looking at our salary competitiveness and recruiting activities to maintain talent to support the business."

• "This bill positively impacted our company's overall plans. Merger and acquisition (M&A) considerations in 2017 that were questionable due to unknowns were approved for 2018 based on (the TCJA's) passage."

Non-manufacturing sector

• "Improved net income and cash flow due to lower taxes. Assuming increased capital and other spend by our customers, which should increase revenues."

• "It will go back into the business in terms of paying off debt and maybe some M&A. Possible increased training. It will not affect pay, except for possibly a few executives."

• "Largest single impact is the decrease in tax benefit from the write-off of scrap inventory."

• "May reduce tax collection on a local and state basis."

• "Net positive impact, as it will be with the rest of the economy."

• "Our company has issued (US)$500 bonus payments to all hourly, non-bonus eligible employees. Company has also issued five shares of restricted company stock, vesting in five years, to all hourly employees."

• "Positive impact on our clients will have a positive impact on us. When the corporate tax rate drops, it is a positive for most companies."

• "Specific look at additional acquisitions that were not planned are now being examined."

• "The most profound impact will be the reduction in federal excise tax on imported merchandise. It will increase our profit margin slightly, but the largest impact will be from competition in the pricing arena from a retail perspective. On the domestic side, suppliers will have working capital to invest in equipment and, therefore, be more efficient, and their service levels should increase."

• "We are looking forward to using the tax savings on new opportunities to expand our company. As a result, we are going to need more people, goods, and services."

• "We suspect that there will be a ripple effect among our industry, as we serve many sectors. Therefore, if our clients feel confident about the reform and see positive results from it, they will increase their budgets to align with revenue. Thus, we should see an uptick in business as it relates to quotes, quote conversions to orders, and product delivery. We anticipate our net margin/profit to increase slightly due to the reform, but not significantly due to the extreme price competitiveness in our industry."

Familiarity with TCJA

Respondents say that their executive and finance leadership (65 percent) is more familiar with the TCJA than their supply management leadership (50 percent). These proportions do not vary between our manufacturing and non-manufacturing respondents. A slightly higher proportion of manufacturing respondents (32 percent, compared to 28 percent of non-manufacturing) report that organizational planning is underway or has been completed. However, regarding function-specific planning, a slightly higher proportion of non-manufacturing respondents (12 percent, compared to 9 percent of manufacturing) report that function-specific planning is underway or completed.

Selected Organizational Considerations

What impact might the TCJA have on key organizational results and behaviors? Supporters of the TCJA believe firms will prosper and be more likely to bring international profits to the U.S. While approximately 40 percent of respondents say they don't know TCJA's potential impact regarding these matters, those who believe the new tax code will likely have a positive impact on revenue, net income, and the repatriation of profits far outnumber those who anticipate a negative impact.

Selected Strategic Considerations

Respondents were asked what impact the TCJA might have on important strategic actions. Might the law induce their firm to expand? What about R&D investment? Would they undertake capital investment within the U.S. or abroad? As with the issues detailed above, 30-40 percent of our respondents say they don't know the TJCA's impact on these topics; however, among those expressing an opinion, those who expect the law to likely spur business expansion and R&D investment far outnumber those who believe the law will hinder such activity.

Regarding where capital investment may occur, 7 percent of manufacturing respondents expect non-U.S. capital investment to decrease, while 4 percent believe non-U.S. capital investment will increase. Interestingly, only 1 percent of non-manufacturing respondents expect non-U.S. capital investment to decrease, while 4 percent anticipate non-U.S. capital investment to increase. This may reflect the perception that maximizing non-manufacturing opportunities abroad could necessitate local investment in those markets.

Selected Tactical Considerations

Compensation and training budgets are typically annual exercises, so the tax-reform impact on budgets for (1) salary and merit increases and (2) employee training and development are classified as tactical considerations in this report.

On these issues, 35-45 percent of respondents indicate that they don't know the TCJA's potential impact. However, zero respondents expect salary and merit-increase budgets to be negatively impacted, while 15 percent of respondents expect those budgets to increase. A small proportion of respondents (3 percent in manufacturing and 1 percent in non-manufacturing) anticipate employee training and development budgets to decrease due to the TCJA. Fifteen percent of manufacturing respondents and 12 percent of non-manufacturing respondents expect those budgets to increase.