BUGS. BOMBS. THE Y2K computer problem has been compared to both. Increasing media attention to the now rapidly approaching fixed deadline of this massive project provides a crescendo of dire predictions that at times nears hysteria. The striking contrast between certain commentators' depictions of Western Civilization in smoking ruin and the bland legalese of corporate notices designed to reassure shareholders does little to create public confidence that the situation is well in hand. What's the truth?
12 … 11 … 10 … As we count down to the Year 2000, project managers turn their attention to risk analysis, contingency planning, and crisis management—and ponder the interdependencies of modern life.
The Good News. Y2K consulting and research firm Cap Gemini released their latest Millennium Index in November 1998. For the first time since its inception, the Index, which tracks the preparedness of private and public organizations in Europe and the United States finds that countries have made real progress. Cap Gemini Vice Chairman Geoff Unwin noted that during 1998 larger organizations “have heeded the warnings and taken decisive action.” Additionally, the Index also discovers that, compared to Europe, U.S. organizations are dedicating much more effort to business continuity planning.
Substantial progress was made in 1998, judging by the amount of IT dollars spent on the problem. As of November 1998, an estimated $494 billion has been spent—with $238 billion of that invested in the previous six months alone. As a result, the Index states, the major economies are roughly halfway to fixing the problem … um, that is, the problem as it was defined when those budgets were set.
The Bad News. Compared to the Index released in April 1998, the November Millennium Index estimates that the total cost of dealing with Y2K has increased to $858 billion from $719 billion. If total costs continue to escalate at the same rate, the completion date will slip beyond the Year 2000. The November Index also reveals additional hazards: a high-risk timetable, inadequate testing, and potential failure of supply chains.
Failure of supply chains is perhaps the gravest problem because it is so hard to scope. In the 1992 election, the slogan “It's the Economy Stupid” was the watchword; for Y2K the equivalent may be, “It's the Business Network, Stupid.” Robbins and Rubin, authors of Evaluating the Success of a Year 2000 Project (Information Economics Press, 1998), point out that “there are no stand-alone companies in the world today. Every organization is tied to a set of others for everything from utilities to finance to news and information. Even if your organization is dealing with the Year 2000 problem effectively, your network and transaction partners may not be at your level of Year 2000 readiness. Suppose they all are doing well and your organization is not. Do you know your liability if your company brings them down?” Small businesses in this network are especially vulnerable.
Jeannette Cabanis ([email protected]) is Acting Editor-in-Chief for PMI Headquarters Publishing Division.
“Opportunity in Crisis”: An Interview With William Ulrich
William Ulrich, president and founder of Tactical Strategy Group Inc., is one of the world's leading authorities on Year 2000 issues. Ul-rich keeps close tabs on developments in Y2K project management as well as on the evolving picture of the possible consequences of the Millennium Bug. PM Network asked him to comment on the trends in Y2K project management and how they are affecting project managers.
Ulrich: The shift recently has been to reassign some project managers to contingency planning efforts. Eventually they will be reassigned into crisis management. Some of the same people who were being drawn on for remediation projects are now in testing; some will be shifted into contingency then to crisis … this shifting of project managers from early stages of the effort to the later stages is likely to continue into 2000.
A lot of companies are talking about shutting down all non-2000-related activities in the fourth quarter of 1999. Other types of project s are going to be put on hold for a time.
All that shifting will stretch the skills of project managers, won't it? Basic IT project management skills will transfer from remediation to testing … they are familiar with that. If they are responsible for a systems area they will be asked to do contingency planning as well, and this will increasingly be a big requirement for non-IT project managers. At lot of the contingency work needs to be done outside the IT area, in the business units … There's lots of opportunity if they are familiar with the business issues. They have to have industry skills.
How are we doing, compared with where you thought we might be last year at this time?
The public sector is doing as badly as I would have thought. The federal government is getting D and F grades on most of their major projects. By contrast, the private sector is doing well at certain industries, at the higher end … for instance, many financial institutions and bigger manufacturing companies in the U.S.—out-side the U.S a lot of companies are in big trouble—are doing well. In the utilities and telecommunication areas, I think those organizations are behind. They have trouble mobilizing, and as much or more technology as banks. Health care is lagging, as are small and mid-size companies. Just in the last month I've had small companies call me just trying to get started. Big companies got a jump on this. This causes a lot of concern because the small businesses can impact the big ones if they fail—the supply chain issues.
What can a concerned project manager do to be sure these issues are being looked at close to home?
Contact the Center for Year 2000 Community Action Plan. CYT-CAP (949/475-6810) is working to bring community-level private sector/public sector partnering to communities.
Will Y2K be a success story for project management?
Good project management is what really has made this thing work and if you had good people they are the ones that made this thing happen. Providing good status reports, rolling those up to a project office, and keeping the whole thing on track and under control is what it's all about.
The role of the project office is something that you should not disband after Y2K. They need to stay intact to take over projects in the future. This will have a beneficial effect on business generally. For companies that can find it, there is opportunity in a crisis situation; other companies will stumble through this and not gain value.
William Ulrich can be reached at [email protected].
Another problem:Y2K is not just a mainframe issue, but can also affect newer technologies such as mid-range, client/server, Local Area Networks, and PCs. PCs use the same internal chips that are also embedded in all sorts of other devices, such as elevators, access control systems, medical devices, air-conditioning systems, and process and flow control systems. At Brainstorm's April 1998 Y2K conference in Atlanta, Ga., Kevin Schick of AnswerThink Consulting related that he had decided—”just to see"—to have all the new, certified Y2K-compliant PCs at a company tested … and found nearly 70 percent of them had date-related problems. The best rule of thumb is to consider your systems “guilty” until proven “innocent.”
Resource constraints will seriously hamper the completion of Y2K projects. There simply are not enough IT professionals to go around. Both internal IT departments and external service providers are already facing difficulties staffing their Year 2000 projects, and this problem will increase this year.
Europe, and companies doing business there, must also face the smaller but still enormous euro-currency conversion problem. Y2K expert Capers Jones calls the European Community's decision to schedule the completion of conversion to a unified currency— the “euro”—for the calendar year 2002 “one of the most unwise public policy decisions in all of human history.” Because Western European countries have been devoting most of their available surplus software resources to the currency conversion problem, the European Union will probably not be much more than 65 percent compliant at the end of the century, according to Jones.
More Potentially Very Good News. If Stephen Covey had been looking for an object lesson in interdependence, he couldn't have done better than Y2K. We are all now so interconnected across the globe that many thinkers have compared the global computer and telecommunications network to an “externalized brain” or a vast “neural network.” What will happen when various portions of this brain are at least temporarily paralyzed by a stroke can be viewed with dread, or as a lesson for our times, on a millennial scale. Like the stroke patient who recovers and vows to quit smoking, to exercise, diet, and spend more time with the kids, our world may find this lesson instructive in helping us to realize what's really important, what you can do without, and how important collaboration and cooperation are to our mutual survival.
Speaking before a Y2K conference in Atlanta last spring, Visa founder and organizational development visionary Dee Hock noted that the decisions that led to the Y2K problem were, on the surface, financially sound and technically competent—within the context of isolated, mechanistic organizations. “We are ’roaming the heavens with the engines of hell,'” Hock said, “trying to operate in a global, interdependent world from within organizations based on 19th-century concepts.” The failures of many systems will push the interconnectedness of modern life to the surface, Hock predicted, and force us to develop new concepts of organization, concepts more able to deal with global opportunities and challenges.
Many writers wax poetic about the possibilities for renewal inherent in Y2K failures. Lisa Marshall and Lloyd Raines of Syntax Communication Modeling Corporation (www.syntx.com) point out that the very feature that is most challenging to business—dealing with all the possible failures in the supply chain—is the one that contains the most potential for future growth.
“It may be this simple computer glitch that pushes nations and individuals to the mirror to see who we really are at the dawn of the twenty-first century,” write Marshall and Raines in an article in the year2000.com archive. “The lessons we learn about how to problem-solve collaboratively between now and 1 January 2000 provide us a template both for approaching extraordinary challenges like Y2K and for the ordinary challenges of the global economy.”
Marshall and Raines suggest that companies take the reorganization, enhanced communication and camaraderie necessary to succeed on this project and use them to transform the way we do business, not just for this year but for good.
“Y2K creates both the opportunity for and the need to transform the ways we work,” they write. The mindset of collaborative leadership will help project leaders to survive the crunch and also grow their teams in important ways. The collaborative leader must believe that, when trusted with critical information, reasonable decision-making authority, and involvement, people throughout organizations “rise to the occasion”; that all of us are smarter than any of us; and that communication and learning are the keys to effectiveness.
“A s pressures increase with the passing of each month, you're helping cultivate attitudes, behaviors, and relationships that result in constructive, practical preparations … and helping to build the new workplace: a more positive and resourceful atmosphere in which to get the work done,” they conclude.
If ever the mantra about communication being the most important project skill had a test case, Y2K is it. Gillian Albers of Amroth Inc. advises companies to start now to build the channels that will make it possible to deal with the issues that will certainly arise. “You will want your staff, your customers, your partners and your suppliers to feel confident that if a problem does occur, you can handle it.” This will require a corporatewide strategy. Albers suggests treating your Y2K project “like a major new product release,” with internal and external communications planned and geared up. Projects that fail to use good communication will fail their companies.
And, for the project management profession, this may be the long-awaited ace-in-the-hole ROI argument. Already consultants and writers are urging companies to create a project office (see “Tell Me Again Why I Need a Year 2000 Project Office” by Patrick Canniff, year2000.com archive). These offices, once successful in coordinating such an important project across the enterprise, are unlikely to go away (see interview with William Ulrich).
Unfortunately, we're unlikely to hear the success stories of some until it's too late for others, thanks to the litigious society we live in. Companies are being advised to keep mum their Y2K progress and make no claims or promises, a strategy that Y2K consultant Peter de Jager scoffs at and is actively trying to undermine by offering to post company success stories on his website. We think he's right. If your organization has used project management to successfully develop and meet a Y2K plan, we'd like to hear about it. If project management is going to be the deciding factor in who sails through this glitch and who goes down on the reef, PMI would like to be able to document that as further proof of the value of the discipline. Send your Y2K success stories to [email protected]. We know project management works: Let's not keep it a secret.
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