Y2K Symposium. . . The State of the World. . .
Part 2 May 2, 1999
This is part two of our special coverage of the BrainStorm
Year 2000 National Symposium Series that took place in
New Orleans, LA March 29 - 31, 1999. The next BrainStorm
Conference is in San Francisco on June 28-30. Stay tuned
for special discounts from Year2000.com.
Covered by Jon Huntress, jon@year2000.com, for the Year
2000 Information Center: year2000.com
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********** The State of Other Nations
Stephanie Moore of the Giga group gave a report as to
how the rest of the world was doing. This was timely as
many press stories are beginning to feel better about the
Y2K situation of the United States, but are questioning
how the rest of the world is doing and what effect this will
have on the US.
She began by telling the audience how difficult it is to
get meaningful information from many countries. For
instance in Saudi Arabia, getting any information is
challenging, but in Russia there is a general lack of
awareness at the management level. She emphasized
that every company needs to make contingency plans
if they deal with foreign companies, regardless of what
country they are in. Make sure that any company,
business partner, supplier or subsidiary that affects
your bottom line is compliant. If they aren't, you must
have a back-up plan.
I noticed in the press very recently that Russia had
asked for 8 billion pounds for help with Y2K. Stephanie
pointed out that only a year ago they thought they had
very few problems. This means there is a real question
here as to whether this was a new projection of Y2K
costs or just the discovery of a new "cash cow." I think
the latter. Just as some managers have discovered
during the last two years that they could fund their pet
projects by tying it into year 2000 compliance, I expect
some will see this as a whole new source of foreign aid.
Stephanie reported that, in most foreign countries, there
is a general level of ignorance at the executive level, and
most small- and medium-sized concerns have not done
very much. In France, the IT people are working on the
problem, often in secret, while the managers ignore them
and the issue. There is general feeling in Europe that the
year 2000 problem is an Anglo-American conspiracy.
Stephanie recounted an interesting story that happened
to her when she was being interviewed about Y2K on
French TV. The interviewer was polite and knowledgeable
and asked her the right questions during the interview,
right up until the end. Then he popped his zinger question.
He asked Stephanie if all this concern about Y2K was just
hype so American consulting firms could get more money
out of France. The question took her off guard to such an
extent that she had no answer, which is just the way he
wanted the end of the interview to go.
She said the United States is the only country working on
contingency planning and the only country with extensive
executive-level awareness. The United Nations is trying to
raise awareness of the problem but often has to pay the
airfare of delegates to go to the conferences to ensure
their presence. Italy is doing almost nothing while, on the
Pacific Rim, they are at least talking about it. She said
the main obstacle to success is that the executives still
have little or no understanding of the problem.
This highlights the main reason this problem is so pervasive
and misunderstood. The year 2000 problem is very difficult
to understand, especially for someone with no knowledge of
what software is or how it is made. I think the main year
2000 problem is the general level of ignorance beyond the IT
circle. Some people say we could have avoided this problem,
and I even heard that statement at this conference from
presenters who should know better. If everyone knew then
what we know now this might be true, but the executives in
the rest of the world are where our executives were one, two
and three years ago. While this attitude shows the
marvelous effectiveness of 20/20 hindsight and gives good
ammunition to the lawyers, it doesn't help solve the problem
one bit.
Because of the ignorance problem, there is no way we could
have done this any differently. I wish the education process
could have gone faster, but it didn't. And judging from the
relatively stable number of people who think the end is
coming, it still isn't happening. We have to work now with
what we have, not with how we wish things could have been,
or spend our time singling out those to blame.
There are other obstacles to consider. Stephanie said there
is a huge disconnect between the CIO and IT departments
and the CEO. In many cases, the executives sponsor, but
don't empower. This is also fairly common over here. The
executives are leaving the business decisions to IT when
these people don't have an enterprise view and can't make
these decisions.
Worldwide difficulties that exacerbate the problem are the
Asian financial problem, Japanese banking, and the Russian
economy. Difficulties also come from the introduction of
the EMU in most of Europe. Stephanie reported that many
IT departments are stealing money earmarked for EMU
transitions in order to fix Y2K.
I found a news story a few months ago out of Europe, urging
IT people to work on the EMU because there was another
whole year to work on Y2K. Stephanie said that year 2000
affects everything, not just the financial system software,
and is much more serious than the introduction of the Euro.
But many who are involved with the Euro think just the
opposite. She pointed out that most of the work on the Euro
is coordinated while the Y2K solutions are individual, often
unique, and created in isolation of everyone else. This will
cause lots of problems when it comes time to test the
systems with other systems.
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Editorial coverage continues:
So where are the nations of the world relative to each other
and fixing their systems? According to Stephanie, Latin
America, the Pacific Rim, and Eastern Europe were in the
awareness/inventory stage of finding what and where the
problem is. Europe is in the impact assessment phase, which
is repair and fix. The US, UK, Canada and Australia are in
the testing implement phase, which is installing and testing
the fixes.
In Asia, the situation is mixed. China says it is addressing
the problem, but of 500 companies asked, 53% still don't
know what Y2K is. China has the added difficulty of having
lots of pirated software because of their differing perceptions
of intellectual property. Japan is supposedly having troubles
with contingency planning and supply chain issues because,
to ask a supplier or a customer how they are coming along
with their fix shows a lack of trust and is impolite. Stephanie
said the general thinking is that Japan has underestimated
the problem and that their lack of contingency planning shows
that the managers still don't understand the problem.
She said Germany, Belgium, France, and especially Spain
are behind and in significant danger of year 2000 failures,
even though they are ahead on the Euro. The utilities over
there are not in bad shape and they are doing some creative
things. The French electrical utility is asking all their
major customers what their electric needs will be for the
week before and after new years. There is less job-hopping
going on in Europe and, while there is almost no contingency
planning, the people of Europe have had a forced education
in contingency planning that is superior to anything on our
side of the pond. This is because of what Stephanie called
"human induced" infrastructure failures, or strikes. They
have so many strikes in Europe that people are accustomed
to having parts of their society going down or being
inaccessible for protracted periods. They know what to do.
The bad news is that, while Britain is ranked high, many
companies are not ready. The U.S. Government ranks
Germany on the same level as Japan. In Germany there
is little public information available and a general reluctance
to discuss or plan. Italy just set up a committee to deal with
Y2K and Spain is one of the least prepared. Interestingly
enough, in another session, one of the speakers cited the
Gartner Group statistics on Europe and was contradicted by
a Swedish man sitting just behind me. He said the Gartner
numbers were just guesses and in Sweden they had a more
accurate index called the "Garlic Belt". He said that the
level of year 2000 compliance is inversely proportional to the
consumption of garlic in Europe, meaning that, as you go
South, the consumption of garlic goes up and the level of
compliance goes down. The "garlic belt" tends to confirm
Giga's findings.
This illustrates the major problem in trying to assess how
the rest of the world is doing. Meaningful statistics just
aren't there. It may well be that how a company or country
deals with disruption is more important than how many
systems are fixed. I have been exchanging mail with an
engineer in Latvia named Lucas. Two years ago, I asked him
how he thought it would be. At that time, he was about the
only person in Latvia who even knew there was a problem. He
predicted the worst, but then added, "But look what they
say can happen. Intermittent power, scarcity of goods and
services, no gas, no garbage pick up. We HAD that for fifty
years under communism. We can do that!"
Stephanie didn't really cover the third world in her session
but, at the end, she said there were far fewer things to go
wrong because their infrastructures are older and simpler
and the countries, as a whole, still remember how to do
most processes with paper and pencil. But she said there
is just no way to predict if it will be business as usual or
what the impacts would be.
Next week will be contingency planning.
Best practices,
Jon Huntress
jon@year2000.com
The Year 2000 Information Center
year2000.com
This coverage is Copyright 1999 Year2000.com Partnership
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