Finance departments must adapt to IT warns KPMG

Finance departments across Europe will be overhauled during the next ten years as they are forced to become more like their long-time poor relations, the IT and HR (human resource) departments.

This is part of the message from Solutions 98, Hyperion Solutions' European User conference, which began this morning in Amsterdam.

Paul McCunn, service leader for Executive & Management Information, KPMG Management Consulting, said: "Almost all finance functions can be done elsewhere. They can be outsourced, or taken on by other parts of the business, or done by a computer, for example."

He likened finance to IT 25 years ago. Work was handed in to dedicated computing departments which would punch various cards before returning results. Today, those calculations are often done on the desktop, or at the most via client-server or mainframe set-ups. The same decentralisation is taking place with finance.

The key driver for change is research which shows only 10 per cent of a finance department spending contributes to a company's bottom line revenue.

"IT and HR have in many cases learnt to add value," McCunn continued. "Finance is going to have to swallow its pride and learn as well."

However, far from painting a bleak future of finance professionals being routinely discarded, KPMG believes those who adapt will prosper. The parts of an operation which don't obviously add value - for example, those outside manufacturing and sales - will often be headed by finance professionals who also understand IT, HR and marketing.