ITAA's Year 2000 Outlook March 20, 1998 Volume 3, No. 11 Published by the Information Technology Association of America, Arlington, VA Bob Cohen, Editor bcohen@itaa.org ITAA's Year 2000 Outlook is sponsored in part by BDM International, Inc., CACI International Inc., DMR Consulting Group Inc., IBS Conversions, Inc., Softworks, Inc. and Y2Kplus, Inc. Congress Considering Y2K Committee Speaking last Wednesday at the Washington DC Y2K Group, Sen. Bob Bennett (R-UT) said it is his "high expectation" that he will be named chairman of a special Congressional committee on Year 2000. Bennett said Majority Leader Trent Lott (R-MS) and Minorit y Leader Tom Daschle (D-SD) will announce the creation of the new committee within a week. Bennett said that at present responsibility for the issue is spread throughout Congress, with no single entity designated to deal with Y2K matters in the Departmen t of Defense, the Internal Revenue Service, Federal Aviation Administration and other agencies. The special committee is expected to have government-wide oversight; in particular, working with appropriations committees to make recommendations and pursue the situation at agencies considered behind the century curve. Bennett said he hoped that Sen. Chris Dodd (D-CN) would be named as ranking democratic of the new committee. Also of interest, Bennett seemed more than a little skeptical of the ability of John Koskinen, the federal government's new Y2K czar, to move the meter on the government's calendar crisis. Bennett said Koskinen lacks name recognition and expressed concer n that Cabinet Secretaries will not return his phone calls. "I would have appointed Al Gore," Bennett said, calling him both the "high tech" and "reinventing government" vice president. But hold the phone. Bennett says Koskinen has assured him that his calls will be returned, and that as Assistant to the President, Koskinen holds the highest title handed out by the White House. Bennett said he is "cautiously optimistic" that Y2K will not trigger a financial meltdown in the banking community. He said that the banking system will have problems, but banks are focused on the right priorities. He gave high marks to the oversight ro le being played by the Office of Thrift Supervision (OTS). Referring to a recent General Accounting Office report, the senator said only one percent of the nation's thrifts have been judged "unsatisfactory" on Y2K grounds. Of his own "CRASH" bill to force public companies to disclose Y2K status information, Bennett said Securities and Exchange Commission (SEC) Chairman Arthur Levitt convinced him that a regulatory approach could be implemented faster and with essentially th e same results. According to their calculations, even if legislation passed the Congress in June, the SEC would still have four months to write the implementing regulations and the public would have another 90 days to comment. Bennett said his bill, whi le on hold, will remain "a hammer if we don't get voluntary compliance." New Survey Finds Failures Not Waiting for Year 2000 Over one in three companies polled have already experienced Y2K-related failures under actual operating conditions, according to the results of a new ITAA IndustryPulse survey. Conducted last month, the survey found 44 percent of respondents indicating t heir organizations have experienced such failures under actual operating conditions and 67 percent reported failures under test conditions. ITAA emailed its survey questionnaire to over 2000 readers of this publication. Conducted to explore a variety of "demand side" marketplace issues, the vast majority of recipients work outside the information technology industry. Results are based on a total response of 450 individual replies. Last year, ITAA conducted a similar poll of the vendor community. Companies reported that while they foresee Y2K placing a significant strain on the capacity of vendors to provide high quality products and services, they were not experiencing excessive p ressures within their own organizations. A significant percentage indicated that while they continue to invest in the Year 2000 marketplace, vendors were not meeting their revenue expectations. While there may be an expectation gap between buyers and sellers, the January 1998 results indicate that there is no doubt about the critical nature of the Year 2000 issue. Ninety four percent said the Year 2000 constitutes a crisis both for the U.S. and the world. If left unaddressed, 93 percent predicted their organizations will be damaged by the Millennium bug. This concern seems to synch up with the manner in which the message is being communicated. Sixty percent of respondents indicated that they do not think the issue is being over-hyped by the media. Reactions, however, were a bit more guarded when the foc us turned to consultants and vendors. Respondents were almost evenly split on whether or not such firms are hitting the hype button over this issue. Companies also appear to be split relative to their Y2K spending plans. Thirty-two percent told ITAA that they will spend 10 percent or less of direct IS budgets this year on the Year 2000; 38 percent said they would spend 11 percent or more. Respondents were surprisingly positive about the response of their organizations to the Year 2000. Thirty five percent said their companies moved quickly on the issue, while another 31 percent their firms picked up the slack after initial delays. At the same time, however, 45 percent of respondents identified their firms as still in the early stages, either in the awareness or assessment phases of the Y2K cycle. Twenty five percent of respondents expressed critical or negative views of their company's ability to get on with the program. Fifty-six percent of those polled said they expect to pursue the century conversion with existing tools and staff. Having said this, however, another 55 percent admitted that they will have to add staff and tools to make it happen. Hybrid approaches ap pear to be the order of the day, with 79 percent expecting to use a mix of internal and external products and services. Not to be outdone by the vendors in last year's survey, companies reported spotting something of a demand wave sloshing through the marketplace too. Fifty seven percent told ITAA that the ability of vendors to offer high quality Y2K products and services is now limited. Seventy seven percent said such marketplace limitations would be in place by mid-year 1998. Does this perceived demand crunch translate into actual problems finding good help? No. Only 21 percent reported such difficulty finding Y2K s ervices; just 29 percent expressed some degree of trouble finding the right tools to get the job done. Perhaps success just comes down to having the right mental attitude. Despite the dire predictions often associated with the Year 2000, 84 percent of respondents appear to be "reasonably confident" that their organizations will be Y2K OK. Sixty nine perc ent expressed similar confidence about their top competitors; sixty percent gave the thumbs up to their suppliers; and fifty six percent said their customers will likewise succeed. Y2K Czar Puts Freeze on Heavy-Handed Role Testifying before Congress this week, Y2K Czar John Koskinen defined a vision for his new commission which is long on enthusiasm and short on specifics. Sharing his plans with Representatives Stephen Horn (R-CA), Connie Morella (R-MD), and several other congressmen, Koskinen made it clear that he does not intend to reinvent any wheels inside government. "From my perspective, I think it is important for the Council not to interfere with or duplicate the good work that is currently underway in the agencies and is being done by the CIO Council and other interagency management councils. The Council should a lso build on, rather than try to replace, the important oversight role that OMB is playing in monitoring and reporting information gathered from the agencies," he said. Koskinen said his Council will be a catalyst for improving the government's Y2K efforts, but it will use existing structures and resources to do so. Koskinen, who will preside over a three-person staff, said the work of making Y2K corrections remains wit h the agencies, themselves, as does any necessary outreach to regulated industries and private sector groups. The Y2K Czar said the Council will be not only a catalyst but also a facilitator to promote the exchange of ideas and a coordinator to ensure effective use of resources across government. To perform these roles, Koskinen said he is meeting with agency heads, their deputies and CIOs to monitor individual agency efforts. His meetings seek to identify risks and obstacles. He said he also plans regular meetings with the President's Managemen t Council, the Chief Information Officers Council, the Chief Financial Officers Council and several other groups to encourage the spread of information and best practices. He said he also plans outreach to state and local governments, the private sector and foreign entities. Koskinen told a group of reporters after the hearing that he expects the government's newly announced $4.7 billion Y2K budget estimate to grow incrementally. Amounts involved are not so big, he said, that the government cannot cope with them and he added that money should not be an excuse for delay. He emphasized that his role is not to generate reports but to identify problems in the government's approach to the Year 2000 conversion issue. He also tried to bring perspective to the crisis proportions o f the issue. "This is not Armageddon," he said, adding that "the solutions are not unknown. It's time consuming but not a problem no one knows how to solve." Business to Business Alydaar International Ltd., a wholly owned subsidiary of Alydaar Software Corporation, Charlotte, NC, has entered into a Y2K partnership agreement with C.I.S. in Poland. Sterling Software, Inc., Los Angeles, CA, has announced the addition of VISION:Stimulate and VISION:Dager to the VISION:Solutions suite of tools, methodology, education and consulting services. Complete Business Solutions, Inc., Farmington Hills, MI, has been awarded a Y2K contract by the Consolidated City of Indianapolis/Marion County. Peritus Software Services, Inc., Billerica, MA, has entered into a Y2K software license agreement with the State of New Jersey. Sponsor Advertising BDM International (TRW Systems and Information Technology Group) Do you need help juggling all your Year 2000 responsibilities? With BDM and our SMART/2000+SM solutions, you have a partner to help address your most critical business priorities and technical requirements – from risk assessment, program management, and conversion, to independent test and compliance validation. We deliver project tracking, configuration management, and control metrics that help ensure enterprise-wide integrity and minimize your risk from start to finish. We have a mature process, a dedicated team, and experience that demonstrate the strength of our solutions. Gain the upper hand now by calling BDM: (800) 794-6085 e-mail: year2000@bdm.com http://www.bdm.com. e-mail: year2000@bdm.com http://www.bdm.com. CACI International Inc. -- Restore 2000 CACI leverages 35 years of information technology experience and over 10 years of reengineering systems - solving the same problems Y2K poses - to offer a total solution to the Year 2000 challenge: Restore 2000SM. The Restore 2000 methodology applies a comprehensive three-phase process to your information systems: Assess, Plan, and Remediate. Furthermore, we give you the option of buying our methodology or our services - both backed by CACI experience and Y2K expe rts. The Restore 2000 methodology is ITAA*2000 certified. In addition, software development processes at CACI have been independently certified as being at Level 3 of the Software Engineering Institute (SEI) Capability Maturity Model. Achieving SEI Level 3 provides clients further assurance that CACI solutions successfully and effectively deliver Year 2000 compliance while allowing you to save money, reduce risk, and minimize systems disruption. With approximately 3700 employees worldwide and FY97 revenues in excess of $270 million, CACI provides a depth of experience and expertise you can rely on. We've performed Year 2000 conversions for many of America's biggest enterprises, including major he alth insurance providers, retail clothing manufactures, gas companies, airlines, and government agencies. Superior functionality backed by decades of experience - CACI's Restore 2000. Worldwide Headquarters 1100 North Glebe Rd. Arlington, VA 22201 http://www.caci.com e-mail:npeters@hq.caci.com DMR Consulting Group Inc. DMR Consulting Group Inc.(formerly DMR TRECOM), an Amdahl company, is a global consulting organization of over 7,000 employees providing a comprehensive range of information technology services. Our Year 2000 Practice comprises a comprehensive offering of consulting, assessment, remediation, testing, and implementation services utilizing a formal methodology (APM/2000), best-in-class software tools, and six global conversion centers. We have mul ti-disciplinary experience in most mainframe, mid-range, and client-server/desktop environments. APM/2000 includes: · Program Management · Enterprise-Wide Assessment · Impact Analysis · Conversion Delivery · Testing and Implementation Year 2000 Risk Management Consulting Services include: Program Review, Stakeholder Readiness Assessment, Risk Management and Vendor Compliance Research. Contact: Stephen Frycki Managing Director, Year 2000 Services - US Phone: 201-200-3923 Fax: 201-200-9046 Email: fryckis@dmr.com Websites: http://www.dmr.com IBS Conversions, Inc. IBS Conversions, Inc., founded in 1982, is the first service organization to receive ITAA*2000 Certification. 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 poten tial 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. Y2Kplus has offerings that address the following needs: * A comprehensive Renovation Preparation offering to enable you to prepare complete and accurate packages of software components ready for mainframe code renovation. * A powerful Code Renovation set of offerings that will renovate: * multiple languages including COBOL, Assembler, Pl/1 and Natural code for mainframe systems; * mid range COBOL systems running on DEC, HP, DG, NCR, Unisys, Wang, Prime, Bull, Tandem, and IBM AS/400 platforms. * A Re-engineering tool for mid range COBOL systems that will enable you to rehost to other platforms, thereby providing "value beyond year 2000". * Code Renovation outsourcing services for all of the above systems plus IBM AS/400 RPG. * Data Commander, a testing tool that enables you to warp test data dates to allow you to do future date testing by updating your current test data stream and then compare results of test runs before and after 2000. * Services for development and management of Comprehensive test plans and strategies to help your organization create effective baseline tests, improving the quality of risk mitigation derived from forward date testing. For more information, please send email to info@y2kplus.com, visit our web site at www.y2kplus.com or call Dave Ehlke at 781-863-8111. Calendar http://www.itaa.org/y2kcal.htm 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/2koutlooksub.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