The Year 2000 Problem : A Reality Check
In the 1970 novel Deliverance, James Dickey writes about Lewis Medlock, a weight-lifting, bow-hunting, white water canoeing guy who is not just preparing for the end of civilization, but is positively looking forward to it. "I just believe that the whole thing is going to be reduced to the human body once and for all," Lewis says. "I want to be ready....
In conjuring up Lewis, Dickey tapped into a distinctly American impulse that yearns to trade our motorized, technology-infused era for a simpler, more self-reliant life that is connected to nature, a life that could be lived in 19th century America but which is now all but forgotten. Now, 28 years after Deliverance was published, the fictional Lewis has been joined by a horde of real life counterparts who predict, with various levels of expertise ranging from informed to naive, that the Year 2000 Problem will end civilization as we know it.
One of them is Peter Huss, a computer systems administrator at a small Michigan university, and a man who presumably knows more about the Year 2000 Problem than the average American. Huss is preparing a cabin for himself, his wife and baby, stockpiling food, water and medicine. He plans to withdraw his savings from the banking system and is learning how to grow vegetables and saw wood. He is hoping for the best, but planning for the worst. People like Huss---and several have been reported in the American press---are not necessarily extremists. Many are not particularly religious, and in interviews, don't necessarily believe that the world will come to a sudden halt on January 1, 1990, but they want to be ready, just in case.
Here in America, you can even find a housing development whose sales pitch is the Y2K Problem. Heritage West 2000 encompasses 500 half-acre home sites 180 miles northeast of Phoenix, Arizona---a planned community that its backers claim has been designed specifically for a possible economic recession or depression. It will be a place where families can grow their own food, generate solar electricity, and prepare for a more self-reliant future. That is not the worst idea for a living arrangement, and in various forms from communes to groups of families who have bought land together, Americans have been trying this idea out for some time. Of course, these land sites aren't free of charge. Anyone planning to take up a self-sufficient lifestyle in the midst of the Arizona desert had better come prepared with a wad of cash.
While it's easy to dismiss such back to nature impulses as overkill, the truth is that nobody really knows what the full effect of Y2K will be. Y2K is what mathematician John Allen Poulos calls a complex nonlinear system, as difficult to predict as next year's weather. Citing chaos theory, Paulos maintains that "much economic and political commentary and forecast are fatuous nonsense..." Nevertheless, Y2K has launched an industry of prognosticators, many of whom are predicting dire consequences from the world's most famous software glitch. Edward Yardeni, the chief economist for Deutsche Morgan Grenfell, has become well known for his prediction of a global economic disruption---which he currently gives a slightly better than 50-50 chance. "Of course I'm being an alarmist and I'm getting more alarmed all the time," Yardeni told Forbes magazine. "Unfortunately, anarchy is in the realm of possibilities. This is not likely but it is possible." Yardeni believes that 80 to 90 percent of computer systems will be fixed in time, but that there is a high probability of enough failures to cause a disruption of economic activity.
"This is a global crisis coming," says Joe Boivin, the former director of the Year 2000 Program at the Canadian Imperial Bank of Commerce in Toronto, who is now funding the Global Millennium Foundation, in an interview with CNET. "When you've layered that on top of the current crisis we have in the financial systems worldwide, then it's going to be a big deal and people should not dismiss it lightly."
The doubters have been harder to spot. Paul Kedrosky, a professor of information technology and strategy at the University of British Columbia, has written that Y2K advocates are like "newly hatched mosquitoes....
What do we know?
Between the doomsayers and the skeptics, the prediction game is heating up---and will get many decibels shriller before January 1, 2000 finally comes. And so before the hysteria mounts further, it is useful to look at what we do know with near certainty about Y2K.
Y2K's fixed deadline makes it an unprecedented engineering problem.
In the U.
Y2K is a monument to procrastination.
The Year 2000 Problem is not exactly a surprise. People have been writing about it since the early 1990s. Every COBOL programmer who ever used a two-character field for the year could tell you that the program will need some tinkering after 1999. And yet, despite ample warning, we are only now beginning to see the surge of activity needed to fix the problem, along with the inevitable, and undoubtedly true, predictions that some systems won't make the deadline.
As the days tick away, it is inevitable that programmers will spend marathon, 24 hour sessions, recoding and especially, in testing. The Y2K story will not fade as we approach the year 2000, but will amplify to a screaming pitch.
Y2K will be a gift to lawyers.
Given that Y2K was fully predictable, people who loose time and money from Year 2000 glitches would seem to have a legal case. If they can't get at their bank account funds, if their plane gets canceled for days on end, if the lights go out for weeks or the telephone system collapses---if money or even lives are lost---Americans will sue.
Already, some legislators are preparing bills that would protect companies from lawsuits. One lawmaker in Florida has predicted that litigation could hit $1 trillion for Florida companies alone, and introduced a law limiting liability to companies that inform customers by September 1, 1999 that they would be unable to solve the problem. There's some fairness in this; customers couldn't say they weren't warned. But it's easy to envision that virtually all companies might issue that warning to protect themselves against lawsuits. Already in the U.
We will all do the final testing.
It is now clear that the actual recoding of source code is not the main hurdle to Year 2000 compliance. Rather, it is the testing stage that will give IT organizations the biggest problems. IT managers estimate that testing will represent 60 to 70 percent of Y2K remediation. "Anyone who is planning to get this taken care of in the last quarter of 1999, with just one month or two of testing, is kidding himself," writes Senator Bennett, chairman of the Senate Special Committee on the Year 2000 Technology Problem.
The reason has to do with the interconnectedness of all these software systems. A PC-based local area network running accounting applications may be entirely Year 2000 compliant. But the customer data pulled off of a remote mainframe may not. Banking in the late 20th century represents a graphic of illustrations of how interconnected systems have become. A bank itself may be Year 2000 compliant, but it still must deal with wire transfer systems, automated clearing houses, check clearing providers, credit card merchants, and automatic teller machine networks, as well as electronic data interchange systems and electronic benefits transfer systems.
Thus the testing stage becomes critically important in determining true Year 2000 compliance. And as with any complex software system, the final beta testing is done by the users, but in the case of Y2K, that means all of us.
Y2K is a global problem with local repercussions.
Not only is software interconnected between computers, but between countries. And here all the national differences between available human resources, and even culture, will come into play. Ironically, the least industrialized societies may be best able to cope. Countries like Haiti, Bangladesh, and Cameroon rely less on technology than Japan, the U.
Y2K isn't just 1/
Garth Saloner, professor of strategic management and economics at Stanford University, nots that the Y2K is "not a discrete event where people come to work and half the world shuts down." In an interview in CIO Magazine, Saloner says that "most of the processes for which Y2K is involved start to invoke long before the Year 2000." For example, some databases have used the date 9/
Nobody is making promises.
A look at the official statements of various government and industry groups shows a lot of discussion about contingency plans, but no assurances that the problem will actually be solved. At this stage at least, no one is guaranteeing anything. That's especially notable in what I would call "infrastructure enterprises"---the systems whose potential failure would make the doomsayers right. For example, a paper on Year 2000 readiness by the Nuclear Utility Industry says, "The nuclear utility industry has embarked on a program to identify and remediate Year 2000 problems that could affect facility operations. Despite these efforts, there is some risk of Y2K-induced events."
Obviously, nuclear plant accidents could be catastrophic. But what about simple electrical disruptions? Jon Arnold, chief technology officer of the Edison Electric Institute---whose members serve about 70 percent of the U.
What about communications? A. Gerard Roth, vice president of technology programs for GTE Technology and Systems, said that tests to date have uncovered a failure rate of less that one percent, but warned that it is impossible to certify Year 2000 compliance of the public switched telephone network. He said that foreseeable combinations of calling events, service requests and routing possibilities are so numerous as to prohibit 100 percent testing. Moreover, testing cannot be done on the live network because it would disrupt current operations. As for the international telecommunications network, Roth said that information on the government-owned PTTs (Post Telephone and Telegraph administrations) "has been spotty and what evidence there is suggests a very inconsistent pattern."
And then there is the business of money and the question of whether you should convert your holdings, which currently reside mostly as bits on a computer-into currency or perhaps even gold. Jack L. Brock, Jr., said that while regulators have made good progress, "there are still serious challenges ahead that could threaten the financial institution industry's ability to successfully meet the Year 2000 deadline." He said that with only months to go, "regulators are faced with the daunting task of overseeing the efforts of more than 22,000 financial institutions, service providers and software vendors, with a relatively finite number of examination personnel." By early 1999, he says, "regulators will be pressed to take quick actions against institutions that cannot successfully complete their Year 2000 efforts."
Y2K will have a high cost with few rewards.
A spoof "memo" circulating through the Internet purports to solve the Y2K problem by replacing everyone's computer with an Etch-A-Sketch toy, a proven technology with an excellent repair record, easy maintenance, and no coding necessary. Sure it's a joke, but it does reflect on a more serious argument made in some quarters that information technology has severe hidden costs. In many organizations, Y2K is diverting substantial resources from other projects. Considering what a trillion dollars can buy these days, Y2K is no bargain. Yes, some organizations will use the occasion to upgrade their systems. And yes, some lawyers, programmers and consultants are getting rich. But for the most part, the net result of this massive expenditure in coding and testing will bring us back to where we thought we were, before the Y2K problem was on the horizon.
James Dickey's Lewis Medlock would smile at all this. So perhaps would another Lewis---Lewis Carroll, author of Alice in Wonderland and Through the Looking Glass---whose red queen famously said that in her country, "it takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that." Y2K will require a lot of running, but the best we can hope for is to wind up in the same place.
Y2K in Japan: An American View
How well is Japan doing in coping with the Y2K problem? In the view of one American observer, the track record is mixed. Tony Hampel, Sun Microsystems' group manager for Year 2000 marketing, says that early on, most Japanese OEMs understood the need to deliver Year 2000 compliant products, as well as getting existing products fixed. "As a result, the OEMs were really pinging companies like Sun about products which they may resell. That was great, except that when parts of the Asian economy went into meltdown, that took the focus off the Year 2000 issue. As a result, we feel that the job is only partially complete."
Hampel says that the top-tier Japanese companies have continued to do a good job focusing on Y2K. "But the second-tier companies didn't have the resources any more to continue the Year 2000 project. Consequently, there are a lot of systems in greater Japan which are not Year 2000 compliant."
Hampel predicts that these smaller companies will belatedly recognize that the clock is running, and will mount a last minute effort. But another group of companies won't get to the problem until after systems fail. "There is an argument that says since Japan is made up of many smaller companies, the failures may cause a rather large domino effect, in which one company affects another company, which in turn affects a third. That may paralyze Japan for a little while, although ultimately, they will get past it. You could also argue that many of these second tier companies are not international companies. And so the problem will principally affect Japan internally, but perhaps won't manifest itself on the world stage.