Dealing With Y2K

Many executives, it appears, are taking an ostrich-like approach to the Year-2000 issue--burying their heads in the sand, hoping that any potential problems will bypass them with no serious ill effects. Some see it as a problem for "the information-technology guys" to deal with--and are only vaguely aware of how they and their companies might be affected. Yet others, whove given the "Y2K" dilemma more than passing thought, view the impending turn of the century with trepidation. Because of inadequate data fields in many software applications--including embedded "firmware" in various types of equipment--all sorts of computer-system failures are conceivable when the clock ticks off the final seconds of 1999. (Indeed, some systems have already experienced problems where coding of future dates is involved.) Unless the software is corrected, breakdowns are possible in everything from business financial systems and manufacturing systems to ATM machines, airlines, credit-card systems, and even the computer systems of the Internal Revenue Service. During a casual conversation at the Assn. for Manufacturing Excellence (AME) conference in San Antonio last fall, one executive declared: "On Dec. 31, 1999, Im going to go to the ATMs and get out as much money as I can. After that, Im going to use my gasoline credit cards to fill up the tanks in all of my cars. Then Im going to stockpile a good supply of firewood--and just wait things out. "You know," he added wistfully, "Ive heard that some people are planning to celebrate the arrival of the year 2000 by flying in a Concorde jet around the world--to greet the next century in every time zone of the world. I sure wouldnt want to be on that airplane." A consultant with a background in information technology was equally apprehensive about potential calamities. "It wouldnt bother me a great deal if the IRS computer system failed and they couldnt collect income taxes--but if the Social Security system goes down, Id feel sorry for all the people who depend on getting those government checks every month." Quipped an auto-industry purchasing executive: "I understand that--as of right now--the only U.S. government agency that is fully Year-2000-compliant is the Bureau of Cemeteries & Graves. And the only reason they are compliant is that theyve always required a four-digit date field to record birth and death dates." A big concern for manufacturers, he added, is the potential for problems that may arise because of "embedded software" in production equipment--as well as possible failures in suppliers computer systems. While some worry about "horror stories" that may be spawned by Y2K computer snafus, others envision a potential bonanza--including lawyers who are excited by the prospect of big-bucks litigation. Edward Korus Jr., an information-technology staffer at Motorola Inc., notes that there have been predictions that litigation--by shareholders, employees, customers, and others--could saddle businesses with as much as $1 trillion in legal costs stemming from Y2K issues. "Ive even contemplated going to law school," he quips. "Lawyers who have training in COBOL programming will be valuable." For now, Korus is directing his efforts at minimizing the impact of Y2K problems at Motorola--as part of a company-wide team organized by the Corporate Computer Services Group. Speaking at a rather sparsely attended session at the AME conference--yet another clue that many manufacturing execs have failed to grasp the implications--Korus asserted: "This is perceived to be an information-technology problem. But it is not. It is a business problem. And every industry is affected. . . . Some people are saying that it is already too late [to implement solutions if a company hasnt begun to address the issue]. But it all depends on your particular organization and how your managers operate." Motorola is taking a responsible approach, Korus stressed, in part because CEO Christopher Galvin--grandson of the companys founder--fostered an "awareness" campaign that included a 10-minute video shown to employees. The company also formed an enterprise-wide council to drive Y2K initiatives from the top down. Motorolas goal is to have all of its computer systems fully Year-2000-compliant by Dec. 31, 1998. To avoid potential problems, the Schaumburg, Ill.-based company developed a six-phase plan: Phase I: Preliminary assessment. Phase II: Identifying all software applications that may be affected. This was a "tedious" task, Korus noted, because many home-grown and embedded systems had to be analyzed. Phase III: Determining the scope of the problem. During this phase, project-management teams made decisions on which systems were most in need of attention. They also defined the skill levels required and prepared cost and time estimates. Phase IV: Conversion planning. This phase, which Motorola is now completing, included refining cost estimates, conducting detailed analyses of specific solutions, and project planning. Phase V: Conversion. Much of the work in converting to Y2K-compliant systems involves testing, Korus emphasized. "You need to know which systems are connected." Equipment with embedded firmware, including programmable logic controllers (PLCs), must be tested to determine whether the firmware deals with dates that stretch beyond the year 2000. "The hardware itself may not be affected by dates, but secondary systems to which it off-loads data may need the dates--even if the PLC doesnt." During testing, he observed, companies must pay attention not only to their own computer systems and in-house equipment, but they also need to be aware of the potential for problems with customers and suppliers systems. Phase VI: Deployment. Companies that hope to sidestep the problems by purchasing new Y2K-compliant systems will still have to test those systems, Korus observed. Where companies dont have adequate time to address all of the potential Y2K problems--and complete all of the necessary software repairs--a "triage" approach makes sense, Korus advised. "In information technology, you have to sort your systems into those that are mission critical, those that are affected somewhat, and those that pose no serious problem," he said. Mission-critical systems are those that are "absolutely required" for a company to continue operating. In "affected somewhat" systems, computer failures wouldnt shut down the company. And the third group includes systems that the company can live without--or which are not affected by Y2K issues. "Initially," Korus advised the AME group, "100% of your efforts should be directed toward the mission-critical systems. There is not much time left. . . . But many companies still havent gotten the message."