The Fortune Article.
First, one of the reasons we have been slow out of the blocks..
The majority of U.S. manufacturers have not even completed the year 2000 effort's first phase: plantwide assessment. Only after they take an inventory of software and embedded systems and estimate the impact of potential failures can they begin work on remediation, renovation, and finally testing and certification. Says Daniel Miklovic, senior manufacturing analyst at Gartner: "We advise clients to identify potential problems, correct those they can, require certification from vendors when they can't verify themselves--as will often be the case in an embedded system--and replace what they can't verify if they cannot convince themselves the problem is minimal. And document, document, document."
Organization charts partly explain why manufacturing is late in addressing the year 2000 mess. Factory managers are generally isolated from the infotech bigwigs at corporate headquarters. For a while, many higher-ups thought the woes were largely confined to mainframes that run financial and telecommunications systems. They expected few, if any, problems down in the plant.
At first, factory types who warned of impending troubles were regarded somewhat like alarmist Chicken Littles, says Terry Landano, a manager grappling with the 2000 challenge at BASF Corp. in Mount Olive, N.J. Her company, a subsidiary of Germany's BASF, makes paints and plastics for the auto industry as well as fibers, vitamins, and chemicals. Landano recalls: "The top executives would ask: 'What, are you kidding? How could these two little digits be such a problem?' "
So for a long time manufacturing companies snoozed, including GM. When he arrived at the automotive giant a year and a half ago to take over the CIO job, recalls Ralph Szygenda, he was amazed "that most people assumed that the factory floor didn't have year 2000 problems." Szygenda, with experience in manufacturing at Texas Instruments, didn't settle for assumptions. He shook GM out of its slumber by turning to outside companies such as Deloitte & Touche and Raytheon Engineers & Constructors, specialists in solving the problem, which sent in 91 experts to assess the automaker's situation. Supplemented by squads of GM technicians and programmers, these experts fanned out through GM's 117 facilities in 35 countries. What they found shocked even the factory-wise Szygenda.
"At each one of our factories there are catastrophic problems," says the blunt-talking executive. "Amazingly enough, machines on the factory floor are far more sensitive to incorrect dates than we ever anticipated. When we tested robotic devices for transition into the year 2000, for example, they just froze and stopped operating."
SECOND, The supply chain problem is just as we have discussed....
Attacking the year 2000 problem has exposed another major area of vulnerability for GM: its 100,000 suppliers worldwide. Will all be compliant? Modern manufacturing's mastery of just-in-time parts delivery and business-to-business electronic commerce has created a beast that can bite it. Szygenda knows all too well how, on occasion, labor strife or a problem at a key supplier has shut down GM plants. "Just-in-time delivery has streamlined our supply chain to make it highly sensitive to any interruption," he says. "Production could literally stop at our plants if suppliers' computer systems are not year 2000 compliant.
He sketches the grim possibilities: "Let's say that a key sole-source supplier of brake valves shuts down as a result of a year 2000 problem. As a result, on day two, two plants that produce master brake cylinders and clutch master cylinders have to stop production because they don't have those valves. On day three, as motor vehicle assembly plants begin to run out of parts, production falls to about one-third of usual volume. By day four, all assembly plants shut down. And with no orders coming in because of the shutdown, hundreds of plants supplying parts to the assembly lines also shut down, from major engine plants to mom-and-pop subcontractors. That's the worst-case scenario--and yet it's a very real threat."
Surveying its suppliers last year, GM found plenty of cause for concern. The survey showed that awareness of the year 2000 threat was low among U.S. suppliers and even lower among those in Europe. One key global supplier didn't even know a problem existed.
THIRD, a topic to research.....
Foxboro, a Foxboro, Mass., maker of industrial controls and automation equipment that's part of Britain's Siebe PLC, began ferreting out year 2000 time bombs a year and a half ago. It checked its manufacturing systems, including the hardware and software, as well as telephone systems, elevators, and security systems. "It seems that every time we had a meeting," says Foxboro's R. Michael Skelley, director of information services, "we were adding new devices to the list."
Foxboro has also been directing the year 2000 job at all the Siebe companies. The task, which among other things entails checking more than 8,000 PCs around the world, has occupied 1,000 programmers and technicians at the group's 230 worldwide sites. Meanwhile, Foxboro's customers have been checking whether the software it makes can handle the millennium transition. The S.D. Warren paper mill in Westbrook, Me., uses an older Foxboro control system to run papermaking machinery. It will need a year 2000 update, which Foxboro plans to have ready in plenty of time.
Wonderware is now a "Siebe company", this is a potential source of conflict between TAVA and Foxboro. Part of good DD is looking at potential negatives here. I'm putting this out here so the good minds on this thread, long AND short, can look into the Foxboro issue. What kind of database do they have? While there is probably plenty of Y2K factory work to go around, this is the first I've heard of Foxboro, we should check them out. They could be competition or they might even be a customer for the TAVA CD and database. I figure the shorts will be more enthusiastic researchers than the longs here.
Zebra
BTW Do you think those 100,000 suppliers of GM might find a use for the TAVA CD, or do you think that Raytheon will go out and remediate them, one-by-one?
Calculated Risk, you asked for the future pro-forma,
How about 20% of just those suppliers, 20,000 customers at $30,000 each? I get $600 million in sales. |
