Y2K Is a Public Confidence Problem, Not Just a Technology Problem

by Lloyd Borrett
The Age, I.T.1 Platform, Tuesday 28th April 1998

As the Year 2000 deadline approaches steadily, concerns about the potential impact of critical systems failing are increasing within the general community.

Once upon a time the most often asked question of an IT professional at a social function was, "What computer should I get my kids for school?" Now it's, "Just how bad is this Year 2000 computer problem going to be?" People are worried.

At a recent family function the topic came up and all eyes turned to me. Then the question came, "Just how worried should we be?"

To be honest, it wasn't something I'd thought much about. But I replied in fun with, "I don't worry because I'm prepared. I generate my own electricity using a 30-year old diesel generator. All I need is a few 44 gallon (200 litre) drums of diesel in stock and I'll have power for at least 6 months. So I'll be right."

"Ah… but aren't you concerned about how you'll get to work? That Holden Calais car of yours must have computers everywhere," came a good humoured response.

"Well maybe the Calais won't start on 1 January 2000. But I've got a 1973 HQ Monaro GTS in the shed on stand-by," I replied. "Not a hint of an embedded system anywhere, so the Monaro will start and run just fine. A lot to be said for a car thats most complicated components are the distributor and carburettor. Remind me to get in a stock of 44 gallon drums of leaded petrol," I laughingly added.

"Are you THAT concerned about the problem," someone cautiously asked.

"No not really," I replied. "It just so happens that I have these things. I don't have a Year 2000 strategic survival plan."

But should I?

Let's face it, the IT industry has a poor track record of delivering solutions that work on-time and on-budget, especially on really large, complex projects. Maybe we all need our own Year 2000 survival plan. Recent industry reports seem to suggest this would be a prudent course of action.

The Year 2000 Implementation Director at the ANZ Banking Group spoke at an IT industry millennium conference earlier this year and was reported as saying, among other things, that the bank's millennium compliance work is not expected to be complete until well after 1 January 2000 (ComputerWorld, 6 March 1998). It would seem we have due cause for concern. These seemingly frank comments and plain assessments of the situation were later repudiated by the Chief Information Officer of the ANZ Banking Group as incorrect (ComputerWorld, 20 March 1998). But who should we believe?

Already some organisations have come out and said that they will not be ready in time. They're admitting that the problem is so extensive that there is no way their organisations will find and fix all of the Y2K problems in time and that it will not be "business as usual" until well beyond the start of the millennium. (One just hopes they don't really mean 1 January 2001, the actual start of the new millennium.)

The Federal Government seems to have been sweeping the problem under the carpet for years. Budget allocations are seen by many industry observers as hopelessly inadequate. Recent reports (The Age, 18 April 1998) are suggesting that the Government will soon have to come out and admit that many departments are unlikely to be operational on 1 January 2000. The way our governments and politicians work these days, they'll probably now put more money into reassuring us that everything will be fine than it would have taken to fix the problem had the Y2K related work been commenced in a timely fashion years ago.

The real problem is that many organisations still don't even seem to be aware that there really is a problem. They don't know what they'll have to do to fix it. They don't even know when it will begin to effect them.

A leading confectionary company recently admitted that they were now having problems because the "Use By" date on some products was now into the year 2000 and that some systems weren't coping with this. Like they didn’t see this coming? This problem hit some companies in related industries more than five years ago. Inspires confidence doesn't it?

At Expert Software Services we’ve been working on Y2K related issues for corporate and government clients for many years now. Identifying systems that will need to be replaced or fixed, plus preparing appropriate implementation plans and executing them. However, it’s somewhat frightening when we come across Y2K related problems in programs that were written only recently. It would seem some programmers still have no idea as to what Y2K is all about!

But the Y2K problem never was only a technology problem. It's always been a business problem. It now appears that many organisations have realised this far too late.

Financial pages have recently been filled with discussions, advice and arguments about the tax deductibility of Y2K expenditure. That business is now so keen to receive a favourable ruling from the Australian Tax Office would suggest that a lot of companies are only just realising how much Y2K related problems will cost to fix. Yes, the bean counters have finally woken up to the problem.

The legal pages are now full of talk about how to protect your organisation from being sued as a result of failure to deliver products and services to clients due to Y2K related problems. Naturally there are also pages about how to prepare your organisation so that you can successfully sue a supplier for failure to deliver due to Y2K related issues. Yes, the lawyers have jumped on the gravy train.

But just how bad could it be? Well ask the people of Auckland. The impact of losing power to major parts of that city for an extended period was horrendous. Imagine if the loss of a significant number of other essential services, government services and business services were added into the mix. It could take many months to fix. Is that bad enough for you?

But it gets worse. The real issue is Public Confidence.

To actually implement a personal Y2K survival plan, I need to ensure I have access to my money. Taking it out of the bank 3–6 months prior to 1 January 2000 and putting it under the bed would seem to be a wise move. After all, can I trust the banks to get it right? But what if Public Confidence is such, that a significant number of us did this? The resultant run on the financial institutions in this country would make the Pyramid Bank saga look minuscule.

Certainly the Federal Government wants more of us to be shareholders. But would you want to be holding shares in a company that takes a major financial hit because of Y2K problems? No. Well maybe you should sell your shares in that company and invest in another. Are you sure that the other company is safe? No, well just exit the market. Isn't that what Kerry Packer and others did when they saw the stock market collapse of 1987 coming? Well everyone can see this one coming. Oh dear, so the Crash of 1999 is likely to be the biggest in history.

Still think the Y2K problem is only a technology problem?

Well already some organisations don't. Perhaps that's why the ANZ Banking Group was so quick to react to those bad Y2K media reports.

I recently received a mail-out from one organisation, the sole purpose of which was to reassure me that this company would not be in any way effected by the Y2K issue. Well I'm just amazed at how good their risk assessment skills must be. This international conglomerate has taken into account the technology issues, the financial issues, the legal issues, the third-party supplier issues, plus public confidence issues and been able to make such a favourable determination. Simply brilliant really. Plus they have the foresight to make sure I'm aware that they're on top of the situation and that I can count on them. Awesome.

Just one problem. I happen to know the IT Manager of that organisation. And here in Australia this organisation's Y2K project has only recently got under way. Locally they're only just starting to realise the scale and complexity of the Y2K problem. Oops!

So, just how confident are you? How's your organisation going? Who can you believe? When will you have your personal Year 2000 Strategic Plan in place?

Hey, I don't have all of the answers. I'm still trying to figure out when the run on the banks is likely to begin and how long the impact of Y2K problems might last. Then I'll know when I'll need to go to the bank and how much money I'll need to take out and put under the bed. But at least I won't have to buy a generator and a Y2K compliant car.