MERRILL LYNCH Y2K REPORT:
Any comments?
Merrill Lynch Paints Rosy Y2K Picture
(07/10/98; 9:45 a.m. ET)
By Jeff Sweat, InformationWeek
Merrill Lynch, sounding a rare optimistic note about the year
2000 problem, says in a new report that most corporations will
have their systems in compliance in time for the millennium.
The company's Global Securities Research and Economics unit
released Thursday its assessment of the year 2000 problem,
Y2K: Implications of Investors. In the 450-page volume, which
draws from a survey of 3,000 corporations, Merrill Lynch says
most companies are two years into their year 2000 efforts and
still have a year and a half to finish them.
"Microsoft, Latin America, and communism all changed
radically in a lot less time," the report says.
The report says most U.S. corporations expect to be fully
compliant by the end of 1998, though Merrill Lynch officials
could not provide exact numbers. However, according to the
report, those companies are worried about compliance among
their suppliers and customers. Despite those concerns, Merrill
Lynch says it's unlikely the disparate systems among trading
partners will create year 2000-related problems.
"The very complexity and dispersion of these systems is, in
fact, insurance against a complete shutdown of commerce
when the millennium starts," the report says.
Few of the companies surveyed say they expect earnings to
suffer significantly, though the study says many of them may
see a short-term revenue decrease if year 2000 problems affect
key operations and companies can't resolve problems quickly.
The study says management practices such as just-in-time
inventory and outsourcing could exacerbate year 2000 glitches
by increasing a company's vulnerability to outside forces.
Regions around the globe reported varying degrees of
compliance. European companies, pushed by both the year
2000 and the Euro, are typically upgrading their systems,
though Merrill Lynch would not give specific figures. About
72 percent of Asian companies say they will be year
2000-compliant, with India claiming 97 percent compliance, and
the Philippines, 86 percent compliance. In Indonesia and China,
fewer than half the companies say they will be compliant. |
