ITAA's Year 2000 Outlook January 9, 1998 Volume 3, No. 01 Published by the Information Technology Association of America, Arlington, VA ITAA's Year 2000 Outlook is sponsored in part by BDM International, Inc., CACI International Inc., IBS Conversions, Inc., Softworks, Inc. and Y2Kplus, Inc. Airlines Seek Clearer Signal on Air System Readiness When it comes to dealing with the end of the century, some jobs just can't pay enough. One such position must surely be held by Thomas J. Browne, appointed last month to head the Air Transport Association's (ATA) industry-wide Year 2000 program. Browne' s unique assignment will include assessing the Y2K preparedness of the Federal Aviation Administration (FAA) and, as the really big date deadline approaches, deciding whether the nation's air traffic control system (among many other related systems) is re ady for takeoff. Browne is incoming just as FAA Y2K Program Manager Loni Czekalski is outgoing, having retired last month. The Government Accounting Office (GAO) had been critical of the failure of FAA to give Czekalski sufficient authority to address the Year 2000 probl em, according to sources familiar with the GAOís FAA concerns. The ATA represents airlines with 95 percent of U.S. passenger and cargo traffic. If ATA scrutiny determines that the FAA efforts are falling short, the association will advise the airline industry and each airline will make an individual determination. The airlines would likely channel their collective response through ATA. Such a response could range from lobbying Congress for more money and manpower, to replacing government systems with operable private industry systems, to offering expertise to hel p FAA make the fixes, to, in an absolute worse case scenario, grounding the nation's air fleet (a possibility that Browne thinks is extremely unlikely). On the job less than four weeks, Browne may be already feeling the pressure. The ATA official, an expert in airport finance issues, will conduct the program with member company representatives and a Y2K consultant, who starts with the organization next w eek. For now, at least, Browne appears to be cautiously optimistic about the route FAA has charted for Y2K fixes. ATA representatives have met three or four times with FAA officials on Y2K readiness and, according to Browne, "the air traffic system appears to be on target for the Year 2000. I am fairly confident that the mission critical systems will be there and we can turn our attention to more rudimentary matters. The less critical may not be fixed. Then the question becomes can we do something with old er techniques in the interim. Using radio signals for satellite signals is a simple example." He quickly adds, however, that his impression is based on high level FAA briefings, not in-depth analysis. "I'm not ready to make a judgment as to the actual status [of the FAA] or have a comfort level," Browne said. Rather than fly blind, the ATA will set up a regular series of meetings with the FAA, assessing the Y2K preparedness of government run systems like air traffic control, airport security, airport operations, and air surgeon records. The ATA team will comm unicate this status information to the association's 27 member airlines and, as necessary, help the airline industry form contingency plans. Such plans may have to stretch to cover everything from inoperable badge readers to holes in radar coverage. Browne acknowledges that ATA is concerned about the situation; otherwise, the association's board of directors would not have approved an industry-wide Y2K program. He says that part of the concern grows out of recent media reports on the federal governm ent's slow response to the issue. For instance, a recent Congressional forecast pegged the U.S. Department of Transportation completing its conversion long after the turn of the century. If true, that could mean plenty of rough air for U.S. air carriers . "I don't know if it's 2010 or 2000. My job is to go find out," Browne said. Federal Banking Regulators Set Explicit Guidelines Federal bank regulators sent early Christmas greetings to the nation's banking system, laying down "safety and soundness guidelines" for Y2K business risk but dropping a requirement that banks obtain certification of vendor compliance. The guidance issue d by the Federal Financial Institutions Examination Council (FFIEC) last month emphasizes the scope of the Y2K problem, clarifies the role of board members and senior managers, and drops the bid for formal certification. Casting the scope of Y2K efforts as the "enterprise challenge," the new guidance notes that "the regulatory agencies are concerned that many financial institutions view the Year 2000 issue solely as an information system (IS) problem rather than a broader , enterprise-wide challenge. Many institutions may not have adequately funded their Year 2000 programs and may lack the necessary resources to properly address the issue." The FFIEC's enterprise-wide view of the century rollover includes close cooperati on between bank business units and operational and risk management functions, monitoring vendor progress towards Y2K compliance, performing comprehensive mission critical system testing, and keeping tabs on credit risk. The FFIEC guidelines leave little room for doubt that bank board of directors are in charge of Y2K programs and provide explicit direction on how this duty is to be conducted. According to the guidelines, a board must require quarterly status reports fro m management detailing the organization's Y2K progress and must be notified immediately if important milestones are missed. The FFIEC says that these reports should also include status information on key vendors, business partners, counter parties and lo an customers; internal and external system testing results and contingency planning. Noting that the guidelines are surprisingly explicit, Gregory Cirillo, a partner with Williams Mullen Christian & Dobbins, indicates that the federal regulators may be trying to rattle a few cages in the banking community. "I've never seen guidelines tha t are this clear," Cirillo said, adding that a bank board which breaches the guidance by not holding meetings or acquiring reports may be risking director and officer lawsuits. And the FFIEC may have intended for banks to see the situation in just this l ight, Cirillo suggests. "Safety and soundness are magic words in the banking community," he noted. Howard Amer, Assistant Director, Division of Banking Supervision and Regulation at the Federal Reserve Board, characterized the likelihood of the new guidance becoming a possible benchmark for downstream litigation an "ancillary consequence." According t o Amer, "If an attorney were to characterize [the guidance] as a constructive tool, that person would probably not be wrong. But that was not our intention." Still, Amer allows that six months of FFIEC banking examinations have uncovered reason for concern in smaller banks and credits unions--and even in a small number of larger financial institutions. In terms of the latter group, Amer says these are sophist icated organizations with the budgets and management resources to fully comprehend and address Year 2000 but have not despite a blizzard of news coverage, association group programs and communications from regulatory agencies. "How can you reconcile such an organization not having a full fledged remediation program?" he asks. Amer says some banks that have not started Y2K planning or programs have already received Notification Letters from the Fed, the first step in a more intrusive enforcement action. While dropping its earlier requirement for certification, the FFIEC guidelines call for financial institutions to perform due diligence inquiries with vendors and implement appropriate internal testing or verification processes to assure vendor compliance . The FFIEC suggests that banks develop contingency plans and establish trigger dates for executing them. Congressmen Say Y2K a State of Union Matter U.S. House of Representatives Technology Subcommittee Chairwoman Constance A. Morella (R-MD) and Rep. Bart Gordon (D-TN), ranking minority member on the subcommittee, have called on President Bill Clinton to include a call for Y2K action in his upcoming S tate of Union address. In a letter this week to the President, the two House members wrote, "We understand that you intend to lay out your priorities for the country as we prepare to enter the next millennium. We cannot, however, meet a new era of oppor tunities if, two years from now, our nation's computers are moving backwards instead of forward." Warning the President that the consequences of the Y2K problem could be "catastrophic," they wrote that the State of the Union speech could help raise aware ness for the issue and "spur both government and industry" to get on with fixing it. Also in the letter, Reps. Morella and Gordon asked President Clinton to issue an Executive Order or directive to federal agencies giving Y2K correcti Study Finds Feds Shifting Resources to Y2K A recent study by market research firm INPUT finds federal agencies planning to reduce or cancel IT projects in response to the Year 2000 software conversion. The study, based on interviews conducted at 24 federal agencies and from secondary source mater ial, finds 94 percent of respondents anticipating such moves and 44 percent expecting non-IT project cuts to pay the Y2K tab. The study finds that some agencies either plan to or have already requested additional funds from the Office of Management and B udget. "Y2000 Preparedness and Its Impact on the Federal Government" looks at a variety of issues, including vendor selection considerations, conversion funding and analyses of specific civilian and defense agencies. Not only budget will be redirected accordin g to the INPUT research. The firm estimates 46,000 full time equivalents within federal agencies will be shifted to perform this work. The study finds that approximately $140 billion will be spent in the U.S. over the next three years for Y2K conversion project components, with the largest share (29 percent) going for internal staff and the smallest share (five percent) for new hardware. INPUT pegs the federal governmentís Y2K repair bill at $10.9 billion. Of this total, the market research firm sees $8.1 billion as contract dollars available to vendors. Business to Business Affiliated Computer Services, Inc., Dallas, TX, has acquired CARA Corporation, a professional services company. Apple Computer, Inc., San Ramon, CA, has been awarded a Y2K follow-on contract by BlackHawk Information Services, Inc. Reasoning, Inc., Mountain View, CA, has entered into a Y2K partnership agreement with CTA Incorporated. Crystal Systems Solutions Ltd., Herzlia, Israel, has won a Y2K conversion contract with Ford Motor Company in the UK. Viasoft, Inc., Phoenix, AZ, has been awarded Y2K conversion contracts by two banks. Sponsor Advertising BDM International, Inc. Are you confident that your renovated software applications are millennium-ready? Have you also validated the associated hardware, firmware, interfaces, third party software, and non-information systems that keep your business running? If not, BDM can help you mitigate business risks across your enterprise with our BDM SMART ValidatorSM solution. SMART Validator helps you to objectively validate that each and every automated system affected by Year 2000 performs as intended. SMART Validator provides customers with detailed processes, checklists, compliance statements, and guidelines to validate a nd maintain compliance beyond Year 2000. With 37 years of large-scale project management and testing experience backing our solutions, you can count on BDM and SMART Validator to help you prove Year 2000 compliance across your organization. (800) 794-6085 e-mail: year2000@bdm.com http://www.bdm.com. CACI International Inc - Restore 2000 Tired of hearing about Y2K problems - and more interested in hearing about solutions? Join hundreds of other organizations who have turned to CACI for answers. No matter where you are in the Y2K conversion process, CACI can help. CACI's software reengin eering legacy cuts the problem down to size, and allows flexibility for mid-course adjustments, emerging tools and results-testing. Certified by ITAA as meeting the highest standards for Y2K conversions, our Y2K methodology, Restore 2000SM, helps organizations meet their conversion needs while protecting their existing technology investments. CACI offers a three-phase conversion met hodology covering every detail: assessment, planning, and remediation, testing and audit. January 1, 2000 - let CACI help you look forward to this deadline! CACI International Inc CACI, with 35 years of experience in technology and software solutions. CACI: Y2K solutions, process reengineering, software reuse, systems engineering, simulation, electronic commerce, imaging and document management, product data management systems and marketing systems. Worldwide Headquarters 1100 North Glebe Rd. Arlington, VA 22201 http://www.caci.com e-mail: npeters@hq.caci.com IBS Conversions, Inc. IBS Conversions, Inc., founded in 1982, is the first service organization to receive ITAA*2000 Certification for IBS/Solution 2000TM methodology, products and services. IBS is a recognized leader in automated conversion/migration software and consulting having translated millions of lines of code for companies worldwide. IBS/Solution 2000 IBS/Solution 2000TM is a full suite of Year 2000 services and products: Full project Analysis, Pilot Project and Repair, staffing and management/methodology Scan/Repair Conversion Factories for Mainframe and AS/400 environments Project Methodology Qwik-Sizer Analysis Licensing Scan/Repair Tools for AS/400 Y2K Projects License Conversion Factories/Tools to other Consulting Firms http://www.ibs2000.com SOFTWORKS, Inc. HOT DATE 2000/SIMULATE Preparing for the new millennium isn't easy, especially in the data center. Ensuring an accurate conversion could be a daunting task. That's why SOFTWORKS has created HotDate 2000/SIMULATE. HotDate 2000/SIMULATE is a comprehensive identification, testing, and simulation utility created to locate the programming changes needed to prepare for the Year 2000. Using a simulated Year 2000 environment, HotDate 2000/SIMULATE locates and tests pote ntial date problems the Year 2000 will cause to your individual programs, applications, and entire system. HotDate 2000/SIMULATE is transparent to your applications and supports all programming languages. For more information about HotDate 2000/SIMULATE, call SOFTWORKS at 800-727-4422. Http://www.softworkscc.com Y2Kplus, Inc. Y2Kplus provides a portfolio of "best of class" software products and outsourcing services that address Year 2000 issues. These offerings are available both to IT Solution Providers and IT organizations. Since no one vendor has "all of the answers", we fe el this portfolio approach, with tools from multiple vendors, makes the most sense. Y2Kplus addresses the following needs: … Renovation Preparation to enable you to prepare complete and accurate packages of software components ready for mainframe code renovation; … Code Renovation tools and services for Mainframe COBOL, Assembler, PL/1 and Natural; Mid range COBOL systems: DEC, HP, DG, NCR, Unisys, Wang, Bull & Tandem, AS/400 RPG & COBOL end to end renovation or client/server migration. … Testing tool to analyze, convert, warp test data dates and compare test results. For more information about any of the above offerings send an email to info@y2kplus.com, call Dave Ehlke at 781-863-8111 or visit our web site at www.y2kplus.com Calendar January 12, '98 Year 2000 Symposium Pentagon Info: 703-521-5231 Arlington, VA http://www.spmn.com/direct_satellite2.htm January 15-16, '98 Security Industry Association Y2K New York, NY http://www.sia.com Conference and Expo January 20, '98 Washington DC Y2K Group Meeting Washington, DC http://www.bfwa.com/bwebster/y2k January 20-22, '98 Software Quality Engineering - Y2K Pasadena, CA Info: 800-423-8378 Software Testing http://www.sqe.com January 22, '98 U.S. Air Force Y2K Software & Wright-Patterson AFB Info: 305-899-1239 Support Solutions Technology Day OH January 26-28, '98 DCI - Managing Y2K Projects: The Orlando, FL Info: 508-470-3870 Key Issues External & Internal http://www.dciexpo.com January 26-28, '98 Software Quality Engineering - Y2K Orlando, FL Info: 800-423-8378 Software Testing http://www.sqe.com January 29-30, '98 DCI - Testing For Y2K Compliance Orlando, FL Info: 508-470-3870 http://www.dciexpo.com February 2-3, '98 Financial Institutions Y2K Millennium Orlando, FL Info: 800-931-6722 Bug" Legal Liability Conference February 4-6, '98 Software Quality Engineering - Y2K New Orleans, LA Info: 800-423-8378 Software Testing http://www.sqe.com February 9-10, '98 DCI - Testing For Y2K Compliance Phoenix, AZ Info: 508-470-3870 http://www.dciexpo.com February 10-12, '98 AFCEA's 3rd Annual Virtual Gov't College Park, MD http://www.afcea.org Conference & Expo February 11-13, '98 DCI - Y2K Issues and Answers Phoenix, AZ Info: 508-470-3870 Conference http://www.dciexpo.com February 17, '98 Washington DC Y2K Group Meeting Washington, DC http://www.bfwa.com/bwebster/y2k February 18-20, 98 Software Quality Engineering - Y2K Austin, TX Info: 800-423-8378 Software Testing http://www.sqe.com March 9-11, '98 DCI - Managing Y2K Projects: The Washington, DC Info: 508-470-3870 Key Issues External & Internal http://www.dciexpo.com March 10-12, '98 DCI - Testing For Y2K Compliance Washington, DC Info: 508-470-3870 http://www.dciexpo.com March 17, '98 Washington DC Y2K Group Meeting Washington, DC http://www.bfwa.com/bwebster/y2k March 18-20, '98 SPG Year 2000 Conference & Expo New York, NY Info: 508-652-1010 http://www.spgnet.com March 23-24, '98 IBC's Y2K Legal Compliance Conference New York, NY Info: 508-481-6400 http://www.ibcusa.com/conf/2000legal April 6-9, '98 Year 2000 National Symposium Atlanta, GA Info: 508-393-3266 BrainStorm Group, Inc. lindaodonnell@compuserve.com April 20-22, '98 SPG Year 2000 Conference & Expo Orlando, FL Info: 508-652-1010 http://www.spgnet.com April 21, '98 Washington DC Y2K Group Meeting Washington, DC http://www.bfwa.com/bwebster/y2k April 29-30, '98 Y2K Info Net Technology Conference Toronto, Info: 905-454-8577 Canada June 22-25, '98 Year 2000 National Symposium Chicago, IL Info: 508-393-3266 BrainStorm Group, Inc. lindaodonnell@compuserve.com June 29-July 1, '98 SPG Year 2000 Conference & Expo Chicago, IL Info: 508-652-1010 http://www.spgnet.com August 10-13, '98 Year 2000 National Symposium San Francisco, CA Info: 508-393-3266 BrainStorm Group, Inc. lindaodonnell@compuserve.com September 23-25, '98 SPG Year 2000 Conference & Expo San Francisco, CA Info: 508-652-1010 http://www.spgnet.com November 9-11, '98 SPG Year 2000 Conference & Expo Boston, MA Info: 508-652-1010 http://www.spgnet.com ITAA's Year 2000 Outlook is published every Friday to help all organizations deal more effectively with the Year 2000 software conversion. If you would like to receive this free publication, please sign up on the web at https://www.itaa.org/transact/2kout looksub.htm. Copyright ITAA 1998. All rights reserved. The Information Technology Association of America, 1616 N. Fort Myer Drive, Suite 1300, Arlington, VA 22209. Internet: http:\\www.itaa.org