BCS News - Call for EMU action

The first phase of European monetary union (EMU) is now less than 18 months away, and time is running out for managers who have sat on the fence alongside the politicians.

Whether or not the UK joins in the first phase, most IT departments will need to make changes to payroll, sales and accounts systems - to name a few - if they are to trade or operate across EC boundaries.

The BCS has been working with the Bank of England to assess the likely impact of a single currency on IT systems. The bank produces a quarterly guide, Practical Issues Arising from the Introduction of the Euro, which until now has largely focussed on the effects of a single currency on the financial community. A BCS working party on the effects of EMU is working on a similar guide for the IT community. John Ivinson, chair of the working party, said: 'We are trying to get across the idea that EMU affects everyone - especially in the commercial sense.'

He warned against yoking the issue with the year 2000 problem, which is largely a technical issue and may be addressed by the IT department.

The issues raised by the introduction of EMU are primarily business issues.

Companies and government departments have to make far-reaching business decisions about how they wish to trade and serve their customers before work can begin on IT specifications. The BCS publication on EMU will outline areas where business decisions have to be made.

Organisations need to look at central business aims to see if they might benefit from preparation for EMU, rather than just reactively coping with change. Ivinson pointed out that building societies, for example, could prepare to offer mortgages in euros abroad. Now could be the time to reassess trading and sales goals.

Systems which interface with suppliers and customers are in urgent need of review; most organisations will have to prepare for pricing and reporting in two currencies. Dual pricing will not be compulsory, should the UK join the EMU, until 2002.

Yet Ivinson said: 'I don't think it matters whether or not it is a legal requirement; it is a requirement if customers say they want it. They may want card statements or mortgage statements in two currencies, and even shopping bills. If organisations are to be seen to be customer-driven they will have to respond to customer requirements.'

Ivinson hopes the BCS paper on EMU will spur businesses into action.

'There is a lack of awareness of the implications. People feel they have too much to do today to worry about the Euro,' he said.

This 'don't worry it may never happen' attitude has been fuelled by the apparent lack of progress on EMU. The European Monetary Institute's annual assessment of countries' progress towards meeting convergence criteria for 1996 concluded: 'At present, a majority of member states do not fulfil the necessary conditions for the adoption of a single currency.' The report also points out that countries are willing to cook the books to make sure they qualify.

Ivinson emphasised that the problem is not going to go away. 'There are issues such as what key will denote the euro on your keypad, and will you need to change all your print routines and fonts if new keyboards are designed and released? What about ticket dispensers, such as those on the London Underground? Are they going to manufacture and replace all the ticket machines? There are all sorts of ramifications.'