Over its short lifetime the computer industry has probably given the old Hammer films a run for their money in the scare monetary stakes. While most industries focus on advantages and benefits to sell their wares, the IT industry has generated the "FUD" (fear, uncertainty and doubt) phenomena.
Potential problems with the Year 2000 date seem a classic case in point. Over the past 12 months I've been told that come January 1, 2000 the end of my world could arise if I take a plane trip, get in a lift or even drive a car. In Britain, where I am presently, a government task force has just concluded that it will cost the country £31 billion to rectify the problem.
Are these alarm bells justified?
Apparently not, if you speak to local CIOs. The results of IDC Australia's "Forecast for Management" survey seem to challenge the popular perception that the Year 2000 problem is an overlooked, unscheduled dilemma for most IT shops.
Some 29 per cent of respondents indicate that their systems are already Year 2000 compliant, while a further 56 per cent of organisations say that the necessary projects are under way or planned. Only 11 per cent of respondents report that they have yet to address this issue.
These local findings are supported by a recent Year 2000 study IDC undertook of 500 executives in the US. Despite the many pitfalls that could arise, especially in this era of electronic commerce, less than 50 per cent of US executives surveyed considered these difficulties a major business issue. Those polled included CEOs as well as CFOs and CIOs.
Perhaps the apparent nonchalance is because a majority of respondents claimed that their Year 2000 projects were well under way. Over 63 per cent of CEOs reported that these projects were either finished or well advanced.
Furthermore, around 82 per cent of respondents believed that the required work would be completed during 1998 at the latest.
However, there was some comfort for those organisations offering Year 2000 conversion services. When asked to identify the greatest challenges they faced with their Year 2000 project, the dominant response was assigning sufficient qualified staff to the work. Nearly 20 per cent of respondents saw this as a serious or unsolvable problem. Clearly, assistance from outside resources will be needed, with competition driving up price. This will compound another challenge with Year 2000 projects: quantifying the cost of the work. Nearly 20 per cent of respondents saw this as a serious or unsolvable problem.
IDC's report did identify several methods to calculate costs, but all entailed a fair amount of guesswork and assumptions. Since the figures for Year 2000 conversion work are likely to be "rubbery", it's no surprise to discover that many CIOs found it difficult enlisting top management support.
Even when the top executive is supportive, the CIO faces the challenge of determining where to fund the work. In the US study, the bulk of respondents indicated funding would come from the IS budget.
In addition, 50 per cent of CEOs advocated some form of chargeback arrangement with the business users to recover the costs.
One has to wonder what impact Year 2000 conversions are having on IS projects.
IT budgets are not bottomless. It seems probable that funds will have to be diverted from other IT activities. So while one section of the IT vendor community is salivating about potential business from the Year 2000 problem, another section is discovering that a number of long anticipated sales are mothballed because of it.
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