"Bye-bye, Y2K blues"
Year 2000 bug busters mostly glad to
tackle other tasks
Jeff Pappone
The Ottawa Citizen - January 10, 2000
The highly ballyhooed Y2K
boom turned out to be a
bust for many
Ottawa-area consultants.
Instead of reaping a
financial windfall they saw
their revenues fall as
companies resolved their
own Y2K problems while
holding back on other
projects.
Now, with the Y2K scare
behind them, many of
consultants say they're
eager to return to their
core businesses and are
predicting that the year
2000 will spark more than
enough growth to forget
the pre-Y2K doldrums.
The Y2K slowdown of the
last quarter of 1999 has
already begun to show
signs of a turnaround,
said Rakesh Prasad,
president of Ohm
Engineering Inc.
"I've been getting calls and already have set up meetings with new
clients," said Mr. Prasad. "All the government departments were
told not to do anything new until the New Year."
With Y2K out of the way, companies can devote their time to
developing new business systems and executing plans, such as
e-commerce and Internet strategy, all of which were placed on hold.
The two-digit dating method was used on every level of computing,
from mainframes to date-sensitive electronic equipment such as
security systems.
Without the Y2K upgrades, many systems would have interpreted
the date as the year 1900, causing computer systems to
malfunction or to produce errors.
Mr. Prasad said he added Y2K consulting to Ohm's services not to
create growth, but as a way to keep revenues from declining.
The Ottawa-based consultant did so after some of his clients told
him they needed help to tackle the bug. But, Mr. Prasad said he
never considered moving away from the core business of
Web-based training.
The Y2K fix accounted for about 15 per cent of Ohm's revenues,
but Mr. Prasad estimates his core business dropped by about the
same amount as clients held off spending late in the year.
Alex Beraskow, managing partner of IT/net Consulting Inc., said it
was the same for his company. While It/net did some Y2K work, it
was a short-term strategy, he said.
Businesses that targeted the Y2K fix as the driver for revenues
were hit particularly hard.
"In the last three months, Y2K was detrimental to our business
because everything stopped," said Narindar Khabra, president of
Ibiska Telecom Inc., an Ottawa telecommunications consulting
company, which helped its existing clients with the year 2000
changeover.
"Revenue in the last quarter was down -- most clients did not spend
much money," he said. "You couldn't depend on Y2K business
because you knew it was going to end."
"The amount of Y2K business never turned into the bonanza it was
supposed to be," agreed Tim Beasley, Sierra Systems
Consultants Inc.'s vice-president for Eastern North America.
While Sierra did some testing for clients, its revenues from Y2K
work weren't significant, he said. "We probably left some money on
the table. We see (the passing of the Y2K alarm) as a relief."
Many organizations fixed the problems using in-house workers.
Canadians spent about $15 billion to $20 billion to prepare for Y2K
with an additional $900 million to be spent on Y2K in the coming
year, according to the Canadian Information Processing Society
(CIPS), Canada's largest association of IT professionals.
It was this state of preparedness that averted the blackouts,
computer system failures and other "disasters" many thought would
occur at one second past midnight on Jan. 1.
CIPS ran an informal survey among chief executives last week and
there were no reports of damage as a result of Y2K. Those
interviewed were in IT sectors such as healthcare, utilities,
manufacturing, food and financial services. They reported that
everything was running smoothly.
"So far, those that we've spoken to have reported no problems with
the systems that they manage," said CIPS president Robert
Langlois.
"Any small problems that occurred did not seem to be Y2K related.
This is not to say that there won't be any minor glitches in the
weeks to come, but the major disasters some were predicting have
been avoided."
Many of the companies said that good things came out of the Y2K
preparedness efforts. Improved practices were implemented, IT
systems standardized and upgraded, contingency plans were
sharpened and good project management methodologies will now
be carried forward.
"Companies will now have the opportunity to devote their time to
developing new business systems (and get back to) plans that
were placed on hold as a result of the Y2K effort," Mr. Langlois
said.
"Issues such as e-commerce, intranets, privacy, customer
relationship management, and the importance of professionalism
and professional certification can now be addressed.
"We also have to remember that the reason why we can move
forward and focus on other IT issues is largely due to the IT
professionals in the industry who were able to deal with the Y2K
issues early enough."
Among the few victims of the Y2K scare was Agiss Software
Corp.,of Ottawa, which declared bankruptcy in July after the
demand for its services failed to materialize.
On the other hand, Montreal-based Cognicase Inc. began 1999
with only about one-quarter of its revenues coming from Y2K.
Cognicase realized the limitations of focusing too much on Y2K
and acted accordingly, said Jean Marotte, vice-president of
operations for outsourcing. The company began weaning itself off
Y2K revenues about a year ago as part of its vision to migrate its
business to e-commerce services after the year 2000 fix.
"We had a long-term plan and it developed as we expected," Mr.
Marotte said. "We are focusing on e-commerce now, mainly for
business-to-business."
The company's Y2K related revenues dropped to less than one per
cent in the last quarter of 1999.
"We have made the transition -- we're expecting really good
business for 2000," he said. "Companies put things on hold
(before Y2K hit) and they will start spending again, with most of the
development in e-commerce."
Mr. Marotte doesn't think Cognicase is alone in its plan to lessen
its dependence on Y2K revenues but feels there could be some
companies running into trouble.
"Some big consulting firms were heavily into Y2K," he said. "Those
focusing only on Y2K are going to have to change fast."
Many companies are following Cognicase's lead in moving to the
Internet, said Mr. Beraskow of IT/net Consulting Inc.
"The Internet is a whole new business that is going to surpass the
year 2000 business," he said. "The smart ones should be
preparing to embrace e-business in a big way."
The Y2K scare is not completely over, however.
This year is a Leap Year and many companies, as a precautionary
measure, will be continuing to monitor their systems until March 1.
"There are two tests," said Mr. Beraskow. "One was the rollover on
January 1 and the other is coming up on February 29 to see if the
Leap Year works. If people didn't code correctly, Feb. 29 could
cause problems."
Few expect that to happen, but no-one is taking a chance. |
