THE YEAR 2000
Dealing With the Millennium Bug
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"All of us have a responsibility to ensure the highest priority is placed on the Year2000 Project within our business units, so that we're ready for business as usual when the new century dawns. Our goal is that, by year-end 1998, all systems supporting Norwest businesses will handle the year 2000 without visible effect on our customers."
Dick Kovacevich, Chairman and CEO, Norwest Corporation.
The Year2000 Problem
The Year2OOO problem, issue, challenge. The Millennium Bug. Y2K. Whatever you call it, every organization must deal with it. Ignoring it could put you out of business. Correcting it may be the largest systems project you've ever undertaken. And the time to get started is now!
At one second past midnight on January 1, 2000, many of the world's computer systems will stop operating properly - or entirely. Why? Because, after December 31, 1999, most computers won't know what year it is. Is the problem really serious? Will it affect your company in any significant way? We believe the answer to both those questions is yes. We've produced this special brochure to alert Norwest customers to the urgency of the Year2OOO issue and the importance of dealing with the Millennium Bug before it bites you.
Q: What is the Year2000 problem?
A: Most of us are accustomed to writing the year in shorthand, that is leaving out the century and just writing the last two digits - '97 for 1997, for example. When the calendars roll from 1999 to 2000, we'll know that '00 means 2000. Unfortunately, our computers won't. Most com-puter programs were written to provide two digits for dates, not four. So, when the year changes to 2000, a computer may incorrectly read '00 as 1900.
Q: How will that affect my organization?
A: The Year2OOO problem affects any computer program that produces information based on time or date. For example: accounts payable and receivable, inventory tracking, and interest calcu-lations. When computers use the wrong dates in calculating billings, earnings, and date-sensitive information, the result will be errors in calcula-tions, invoices, and processing - and, in some cases, complete computer failure. Consider the information your business needs that requires the calculation of how much time has passed from one event to the next. When was this product produced? When is this invoice due? When should this machine undergo maintenance? When must we make payment to avoid late charges? When will this perishable product no longer be safe? Now consider what would happen if your com-puter could no longer make those calculations.
Q: Does this affect all computers?
A: Yes, because essentially all computers use dates for part of their processing. The starting point for most dates is built into the computer. Software uses the date provided by the computer for calcu-lations using data that is entered or stored in files. If the hardware, software, or data uses a two-digit year, the entire system is at risk. The size of the computer is riot a factor; the risks are the same from PCs to mainframes. The problem is particu-larly serious because almost all large computers and many PCs are linked together to process information and manage other systems and devices. Errors in or failure of one computer could have wide-ranging impact.
Q: Are computers the only system at risk?
A: Unfortunately, no. Any electronic devices controlled by computers may be affected. These include elevators, heating and cooling systems, utilities, leased equipment, building access controls and security systems, vaults, phones, fax machines, clocks, and more. Many of these automated systems contain microchips that are triggered by date-sensitive information.
Q: How did we get into this mess?
A: The seeds of the Year2OOO problem were plant-ed decades ago when programmers instituted the practice of representing dates as two digits instead of four. At the time, two digits saved two valuable commodities: money and memory. They saved labor costs at a time when most data was keyed onto 80-column punched cards then fed into a computer. They saved computer memory when there was very little memory available. Even when memory ceased to be an issue, money remained one. The thinking went, why spend money to fix something that isn't broken? And the year 2000 seemed very far away.
Q: How difficult is it to get out of it?
A: It isn't that the solution is so difficult. It's that the problem is so massive. To change from two-digit to four-digit years, organizations have to analyze every hardware and software system operating in the company - every platform, application, database, internal and external interface - to discover every line of code in which date references are imbedded. Then the programs must be rewritten or replaced and integrated back into your operation. It's not as simple as giving "find" and "replace" commands to your computers and computerized systems. We all wish it were.
Q: How long will this take?
A: We can't speak for your organization, but Norwest has approximately 100 million lines of code installed throughout the corporation in main-frame and distributed systems. We estimate that it will take one million plus people-hours to assess, repair, replace or retire, and fully test our systems.
Q: How much will it cost?
A: Norwest and other companies that have begun to tackle the Year2OOO problem have found it to be larger and more costly than originally expected. The IRS has ruled that Year2OOO re-programming costs can't be amortized; they must be expensed. It's important to plan ahead for the costs, so they don't cause cash flow problems for your company. Plus, the longer you wait, the more expensive it will get, as the supply of programmers able to fix the problems will rapidly diminish as demand for their services increases.
Q: Aren't there off-the-shelf correction programs we can use?
A: There are tools available to help you assess where date-sensitive problems may lie, and it's probably worth investigating them. However; each company's systems are unique. Your programs may be written in a variety of programming languages. The symbols used in various programs to represent dates are likely not consistent. Your applications may have been revised or modified over the years, and they may connect and inter-connect to other applications in unique ways. If you wait for an off-the-shelf solution, you may find your company in serious trouble when the millennium rolls around.
Q: If I get my systems fixed, what about my vendors systems?
A: You're right. The Year2OOO problem does go beyond your own systems and programs. Consider your payroll processor; your stock transfer agent, your foreign manufacturers, your employee benefits providers. You will need to contact every supplier and organization you exchange information with or rely on to make sure their computer fixes are compatible with yours, and yours with theirs. You will want to test the interfaces between your companies to make sure everything works. You should also contact vendors that have supplied you with any automat-ed systems - computer hardware, software, and computerized equipment - to learn when and how they plan to make their products and services Year2OOO compliant.
Q: How soon will the Year2000 problem become a concern?
A: It's a serious concern NOW! Financial institu-tions such as Norwest must have their systems re-programmed and tested by December 31, 1998. In our view, 1999 should be a year to re-test to ensure all systems are "Go" by January 1, 2000. If yours is among the 65% of organizations that have not yet begun to assess the impact of this critical problem, start today! This is one deadline that is not negotiable.
Q: How do we get started?
A: By becoming aware of the urgency of the Year2OOO problem, you've taken the first step. Now it's time to assess your systems and formu-late your Year2OOO battle plan. Call in your systems programmers for their advice, and treat them well. They could be your most valuable allies as the 1900s draw to a close.
There are many facets to the Year2OOO problem. Make it your business to be informed. The Internet is a vast resource on the subject. For starters, check out , , and . If you would like to know more about Norwest's Year2OOO project, talk with your Relationship Manager or Banker, or call 1-800-805-6571.
-- Tim Castleman (aztc@earthlink.net), September 19, 1999