Y2K Reality Check: Small Business

Lighten up on the spiky headed, cannibal mutants, wearing spandex and dog collars, storming your secluded, fortified rural villa. A more likely, plausible and real Y2k effect is an economic meltdown due to the collapse of small business. Small to medium business entities, or SMEs to be precise, are not doing well in getting prepared for Y2k. Clueless in SME land is being charitable. In general, SMEs don't "get it" about Y2k. They don't understand what it is, what Y2k can do to their business; especially, haven't spent much, if any, money to fix it. In short, with 108 days till Y2k ground zero, SME don't take things too seriously.

This SME lack of Y2k interest has been highlighted in survey after survey over the last several years. At first, it was SMEs didn't know about Y2k. Then, it was SMEs didn't care about Y2k. After that, it was we know about Y2k, sort of, but we still don't care. If asked, we do have a Y2k policy only we can't really explain it and we're sure not actually spending any money on it. SMEs official Y2k policy is called Fix on Failure, or FOF for short. FOF is becoming quite popular throughout the business community because it sounds better than saying we're doing nothing and rolling the dice as to whether we can function in February 2000.

Now FOF is a fascinating concept in general and positively mind-boggling for a SME. It's the official plan for about one third of the SMEs to do absolutely nothing about Y2k at all until January lst, 2000. One third of the SMEs, employing between 1 and 1000 employees each, plan to open for business on 1-3-2000 and see what happens. Up to one third of American business and employees, this being a conservative estimate, are nonchalantly placing themselves at risk over Y2k. These "paycheck to paycheck" employers and employees are gambling their economic survival that Y2k will be the fabled bump in the road. If Y2k is not, economic road kill will liter America and the world. They are gambling that Fix on Failure is a valid response to Y2k since Y2k won't be a catastrophic failure. If this assumption is wrong, SMEs, and their employees, will be bankrupt within 90 days. Let me repeat that for emphasis: If they are wrong, they are bankrupt in 90 days. FOF applied to a failing emergency parachute means you hit the ground at 130 miles per hour.

Obviously, the FOF policy permeates the American and global economy. In those cases where failure results in inconvenience, and not catastrophe, it is a valid choice. Personally, I don't agree with this, but the bureaucratic culture and mindset makes it inevitable. The "if it ain't broke don't fix it" attitude, means it will break and then you will fix it. Since prevention is always cheaper than the cure, this means you will spend more money and time dealing with failure than in preventing failure. The key to understanding why FOF is so popular is to realize these higher dealing with failure costs are future costs. In other words, current earnings or current employees won't be affected or blamed.

Until FOF was brought to my attention, I always wondered why everything in general was so screwed up. Now I know why. It is the intentional, deliberate and planned policy for government, business and everyday people to let things fail and then fix them. This explains why Y2k was ignored for decades and is still not taken seriously by many people. If it fails, we will just fix it. We do it all the time is their attitude. Perhaps Y2k's scale of failure overwhelms people and prevents them from seeing the implications of widespread systemic failure. We are talking failures, mutual plural, and not failure, singular. So the blissfully ignorant SME buys a new computer or piece of software and thinks it has solved its Y2k problem. The hard questions: will you have electrical, phone or banking services are left unasked. Can you pay your employees and if not, will they show up for work? What about your supply chain? What about your distribution system? Well, what about them? Who cares if you have a fancy new PC with a new piece of software on it, if civil order has broken down and there is gasoline rationing?

These are the kinds of hard headed questions every small business owner needs to be asking. Only they aren't being asked by many, if not most, of the people who need to be asking them. Fix nothing until it breaks, and then do it as cheaply as possible. Half-assed, half baked or just-cheapskate human nature: welcome to the real world of Y2k. We will fix no problem, until it is too late.

SMEs haven't taken into account Y2k is a series of failures over an extended period of time. Y2k failures have been happening all thorough 1999 and will continue right on into 2001. To assume your SME will not have a Y2k failure, but if it does it will happen on January 3rd, is not reasonable. You may or may not even recognize your SME has a problem until your January or February billing cycle is corrupted by bad data. There are numerous 286, 386 and 486 Personal Computers in daily use at SMEs. For instance, my dentist uses a 286 and a knockoff printer to print patient receipts and bills. No bill; no payment. Earth to SME. Am I getting through to you? A brief history lesson for those of you who have no idea what I'm talking about. 286's are 1979 technology, 386's are 1986 technology, and 486's are 1990 technology as is their software, unless updated. The Pentium didn't achieve market dominance until late 1995 and even many of them, the75, 100, 120, aren't Y2k compliant.

Facts. Just give us the documented facts. Fair enough. Before me is the August 1999 issue of the Portland, Oregon Metropolitan Chamber of Commerce monthly newsletter. 12 pages of the usual business propaganda written in early to mid July 1999 for the August issue. In the entire issue there is one small print reference to Y2k on page 8. The "Members Making News" section says Portland General Electric(a small blob of the big Texas blob called Enron) "has reached a major milestone, substantially completing Year 2000 work on its mission critical systems-those systems necessary to safely and reliably deliver electricity to customers." This Y2k gem is next to the news a local Public Relations firm received the Silver Anvil award for Crisis Communications for "efforts on behalf of Keiko the Killer Whale."

Y2k isn't a crisis, but Keiko is? Next year, PGE will have achieved a major millstone when one is placed around its CEO's neck if the power fails. The anvil will also be tied around the PR head guy and then both of them will be thrown into the stinking Willamette River. Regarding that miserable creature Keiko, many, many, Oregonians would like a Keiko burger to go with their Keiko soda pop.

Here we are with 108 days to go and the Chamber of Commerce doesn't even bother with Y2k. One ad from Microsoft about the perils of software piracy; one class on computer networking and one puff piece about PGE "substantially completing" Y2k work. Weasel words from lawyers. Small business is going down, down, down. I can read the Chamber newsletter from a supposedly Y2k aware city and see with my own eyes how they ignore Y2k. The reason they do is the SMEs don't want to hear about it. Black and white. Just the documented facts. Between one third and two thirds of SMEs are unprepared for Y2k. This statement of objective, documented facts mean the American, and global, economy is in for serious, serious medium to long term disruption.

Have you personally prepared for the possibility of a 50% reduction in economic activity next year(See Personal Preparations for Y2k)? Do you work for a SME? Will you have a job in February 2000? Will your SME have any customers in February 2000? How many SMEs will fail? What level of failure will impact society in general and the economy in particular? It's obvious they haven't thought of this. You must take personal responsibility for your life. You must be accountable for your life. Not the US government. Not the banks and their corporate whores. Not the SME you work for. You and you alone are responsible. Do you have three months survival salary, in 1's, 5's, 10's and 20's stored safely? Do you have gold and silver in various sizes in equal amounts? We're talking around $5000 per person, $2500 in small bills and the rest in gold and silver. How about food and water? Think. Act. Prepare. Now!

Go buy a propane single burner stove and 2 or three one pound propane bottles. Buy a one quart pot and lid and also some strike anywhere matches. Get several dozen thick paper bowls, for hot water, plastic spoons, paper towels and plastic cups. Have several gallons of clean water in plastic jugs. Go to the store and buy those instant oatmeal pouches, where all you do is add one cup hot water to two pouches. Buy some shelled walnuts, sunflower seeds, peanuts, dried fruit and brown sugar. Boil one cup water. Empty two pouches into a bowl. Add water and stir. Add fruit. Eat and live. Throw utensils and bowl away in large garbage bag.

Put all this in an empty Xerox copy paper box that are everywhere at the place you work. Store it until January 2000. Cheap Y2k insurance, $100 or less. Sneer. Laugh. Government gruel and pneumonia in a Red Cross Shelter or your own oatmeal and fruit.

Your decision. 107 days. 107 days. 107 days.

WHO WILLS CAN-WHO TRIES DOES-WHO LOVES LIVES

Doug McIntosh

20 September 1999

-- Andy (2000EOD@prodigy.net), September 18, 1999

Answers

Andy,

Good article. Is there a link for this? I want to bookmark it.

-- Linkmeister (link@librarian.edu), September 18, 1999.

Yup,

http://www.gold-eagle.com/editorials_99/mcintosh092099.html

enjoy :)

-- Andy (2000EOD@prodigy.net), September 18, 1999.

WHO WILLS CAN--WHO TRIES DOES--WHO LOVES LIVES. WOW JESUS SAID THAT.

-- message?? (dogs@zianet.com), September 18, 1999.

Andy,

Very good article. My brother is employed in a SME and he acknowledges that his business is at risk due to y2k but believes in the 3 day BITR. I will send him this article and see if I get a response from him. Thanks again

-- y2k dave (xsdaa111@hotmail.com), September 18, 1999.

Good post, Andy. Even Sen. Bennett stated in July, 1.4 million small businesses were seriously at risk. I doubt this number has changed much. It isn't until you you do the follow-up thinking that makes this a significant number. How many large businesses use small business vendors for goods and services? How many businesses will fold just because their customer base disappears? Unemployment begats unemployment. And if the post office doesn't make it - well...staggers the mind & puts a knot in the gut.

-- April (Alwzapril@home.com), September 18, 1999.

To those who don't know

SME = Screwed, Most Enscrewed

FOF = Fu$%ed On Failure

FLINT = Zzzzzzzzzzzzzzzzz zzzz zzzzzzzzzzzz zzz zzzzzzzzzzzzz zzz

-- Andy (2000EOD@prodigy.net), September 18, 1999.