WHO'S READY, WHO'S NOT? CIO MAGAZINE, ISACA, & DR. ED YARDENI'S Y2K EXPERTS POLL FINDS BUSINESS DASHING TO FINISH LINEgreenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
WHO'S READY, WHO'S NOT? Y2K EXPERTS POLL FINDS BUSINESS DASHING TO FINISH LINE CIO MAGAZINE, ISACA, & DR. ED YARDENI'S Y2K CENTER POLL
Story Filed: Monday, November 29, 1999 12:01 PM EST
NEW YORK, Nov 29, 1999 /PRNewswire via COMTEX/ -- An informal public-interest coalition of CIO magazine, ISACA, and Dr. Ed Yardeni's Y2K Center today released the findings of their third Y2K Experts Poll. The world's top Y2K professionals, with first-hand knowledge of the technology problem, were invited to participate in the poll. According to Gary Beach, Publisher of CIO magazine, "One in five large companies is racing to finish by the end of December. Some are going to make it, some aren't. Even those finishing will not have enough time to adequately test and verify their work. This concerns me."
The Y2K Experts Poll is a real-time snapshot of Y2K readiness among global, large firms with an average of 1,261 suppliers (9/99: 1,360, 6/99: 1,339). It is developed and deployed by an informal public-interest coalition of CIO magazine, the Information Systems Audit and Control Association (ISACA), and Dr. Ed Yardeni's Y2K Center. Coalition members conducted the poll among Y2K experts in an effort to help the public and their policy officials assess the Year 2000 readiness of organizations around the world. The inaugural poll was conducted in June 1999; the second one was deployed in September 1999. Results of previous polls and the current poll are compared in this release.
HIGHLIGHTS OF THE POLL Project Completion: According to the current poll, most firms are finished with their Y2K project work. Thirty-two percent report their Y2K projects were 100% complete and another 56% said they are 91%-99% done. At the same time, many organizations are taking longer than expected to finish, with 57% indicating they need the last months of the year to finish their Y2K projects, an increase from 43% in September and only 16% in June. Curiously, there are just a few organizations (7%) expecting to have Year 2000 work to do next year.
According to Dr. Ed Yardeni, noted economic forecaster and Y2K expert, "Our sample is admittedly skewed to firms that should be in good shape. The majority of the Y2K experts we surveyed are optimistic their organizations will have a smooth transition, and that the overall impact of Y2K on the economy will be minimal. However, there are some disquieting responses, suggesting there are numerous laggards in finishing the project and preparing contingency plans in time."
Mission-Critical Systems: When asked about the readiness of their mission-critical systems, 59% say they expect they will all function properly, while 33% (9/99: 34%, 6/99: 41%) acknowledge 1%-5% of these mission-critical systems might experience some malfunctions or failures. The group anticipates that an average of 2% of their organizations mission-critical systems may malfunction or fail.
Third-Party Software: A few respondents are still waiting for key third- party software. When asked if they were still waiting for Y2K-compliant versions of mission-critical software programs written by third-party vendors, 15% of the Y2K experts said they had yet to take delivery. "I worry about what impact late arriving software may have on already installed software. Could these tardy fixes possibly create more problems than they solve?" says Beach.
Non-Mission-Critical Software & Embedded Chips: Three-quarters (75%) of the respondents believe up to 25% of their non-mission-critical systems may fail or malfunction as a result of Y2K. However, on average, only 4% are expected to fail. The majority of respondents (86%) do not believe they will encounter problems with embedded chips. However, 13% indicate not all of the chips will be evaluated in advance of the date change.
Supply Chain: The assessment of internal and vendor readiness is consistent with the past two polls. Internal progress assessments are predominantly unaudited, or not checked by an independent third-party. The poll shows many internal Y2K remediation projects have not been subjected to independent assessments or audits. Indeed, 42% say no independent audits have been conducted. Vendor assessments are mostly informal. Poll results show a high level of trust, with 65% of companies simply sending out questionnaires (9/99: 69%, 6/99: 68%) to determine whether their supply partners are ready for the date rollover. While many of the Y2K experts answering this poll have informally assessed their vendors and are confident most will be ready, only 14% actually conducted on-site visits. Everyone else relied on conversations, questionnaires, and phone calls. Interestingly, 16% predict that they might cause problems for some of their customers. More companies (61%) are saying their partners are ready, up from 48% in September and 34% in June. However, on average, 25% of respondents say their vendors are not Y2K ready at this time (fairly consistent with 9/99: 37% and 6/99: 48%).
Confidence in Services Confidence in electricity and phone services is on the rise since the initial poll in June. However, roughly one-third of Y2K experts still expect problems with these services.
Confidence in Utilities 11/99 9/99 6/99 Electricity Expect Problems 31% 36% 46% No Problems Expected 66% 61% 51%
Telephone Expect Problems 34% 39% 47% No Problems Expected 64% 59% 50%
"The supply chain data paint a picture of unaudited, informal internal progress reports and supplier assessments. It appears that the respondents' optimism is based more on hope and trust than fact," observes Yardeni.
Beach concurs, "The lack of third-party verification of suppliers is a red flag telling all of us these companies do not know whether they or suppliers will pass or fail the Y2K test at midnight on December 31st."
Contingency Planning: Some businesses have contingency plans in place, but a few do not. Over a third (33%) are implementing their contingency plans, while almost another third (28%) are still formulating and or have not implemented their contingency plans. A significant portion (38%) are not planning to increase their inventories for the century change (a steady increase from 9/99: 36%, 6/99: 34%). However, 24% are planning to stockpile two to seven days of materials and supplies and 27% say they will store another one to four weeks worth. Those who plan to keep extra inventories on hand also report planning to stockpile materials, supplies and products for an average of 16 days. This number is consistent with both the June and September polls.
Michael Cangemi, Etienne Aigner CFO and former International President of ISACA, noted, "It is clear these large businesses are expecting some form of disruption and should have contingency plans in place to minimize loss of business. However, only 31% are far enough along in the planning process to actually test those plans which leaves these businesses with another level of readiness uncertainty."
Legal Considerations: Fewer respondents (49%) report legal concerns as an issue (9/99: 59%, 6/99: 63%). The majority (69%) report lawsuits against their organizations are not likely (9/99: 63%, 6/99: 59%). Sixty-five percent (65%) report legal considerations are not affecting their organization's ability to publicly share information about Y2K (60% in June and September).
Personal Perspectives: Thirty-six percent (36%) of respondents believe the Y2K problem is a non-event and they are ignoring the hype. On the other hand, 39% believe it's a non-event but are planning to have extra cash and food on hand. Over half (51%) of respondents plan to stockpile extra food at home, a slight decrease from the September (56%) and June (53%) polls. The average number of days worth of food at home is eight, down from nine days in the June and September polls. Sixty-five percent (65%) plan to have extra cash at home, a slight decrease from the September (68%) and June (69%) polls. The average number of days worth of extra cash is nine days, down from ten days in the September poll and nine days in the June poll.
The number of respondents who plan to sell a portion of their stock due to Y2K concern decreased to 4% (from 6% in September and 4% in June).
Nearly half (47%) of respondents are required to be on duty the weekend of January 1, 2000 (9/99: 43%, 6/99: 35%). Nearly one-third will be on call (32%), consistent with the September and June polls.
Conclusion: Yardeni concludes, "The poll results suggest widespread optimism (91%) based on very little hard evidence. Y2K experts remain remarkably optimistic even though many of them report they are not yet completely ready thirty days out from the digital date change and they seem to be falling behind schedule." Cangemi adds, "At this late date, the coalition encourages all organizations that have not fully completed their projects to fashion contingency plans focusing on possible malfunctions and failures of the systems that are still under remediation or in testing."
Demographics: The corporations responding to the Y2K Experts Poll are large (58%) with more than 1,000 employees, global companies (18%) with 63% based in the United States. The November poll generated a consistent sample response, with 1212 respondents (9/99: 993; 6/99: 892). Twenty-one percent of the respondents are from the financial industry, followed by manufacturing, government, and healthcare.
Y2K Experts Poll Background and Methodology: All three Y2K Experts Polls (June, September and November 1999) reached men and women on the front lines of Y2K remediation, testing, auditing and contingency planning. CIO magazine invited 15,000 chief information officers (CIOs) and other high-level executives from its subscriber list to participate in the September and November polls; ISACA invited 18,000 of its worldwide members. The November poll was conducted online November 10-21, 1999. The poll closed with a final, qualified sample size of 1212 respondents. An email invitation from the three coalition members asked recipients to participate only if they were professionally and actively involved in Y2K projects. Respondents linked to the electronic polling form from the email solicitation.
About the Y2K Experts Poll Coalition Members: CIO Communications, Inc. was formed in 1987 to help chief information officers (CIOs), information technology (IT) executives and other senior management executives succeed in their enterprises through the use of information technology. The company publishes CIO magazine, a publication of International Data Group (IDG). Dr. Ed Yardeni's Y2K Center is a public service of the Chief Economist of Deutsche Banc Alex. Brown. ISACA is a recognized global leader in Information Technology (IT) governance, control and assurance with more than 20,000 members in 100 countries. ISACA also publishes Contingency Planning for the Year 2000 with the Canadian Institute of Chartered Accountants.
-- Homer Beanfang (Bats@inbellfry.com), November 29, 1999
I think I have a winning lottery ticket. DARN wishing only seems to work for fortune 500 CIO's.
-- squid (Itsdark@down.here), November 29, 1999.
Warning: DISCONNECT! "Most firms are finished" vs. "Thirty-two percent report their Y2K projects were 100% complete"? Since when is 32% "most"?
-- Steve Heller (email@example.com), November 29, 1999.
It would be most interesting to have some statistics on how y2k is affecting the economy right now. Is this economy really this hot, or are the nubbers dramatically skrwed by y2k preppers and companies stockpiling for y2k. The reason this comes to mind ...I just saw a report on existing home sales being sharply down. Now,if other big ticket items such as boats and cars and that sort of thing are down, isn't that an indicator that the numbers are deceptive? I've always heard that all ships are lifted by the tide(good economy) Are all the ships being lifted in an expected (historically) manner by this tide?
-- citizen (firstname.lastname@example.org), November 29, 1999.
There is evidence that the Administration has cooked the books. Several years ago, Crudele of the New York Post reported that an economist had discovered that the Department of Labor had used seasonal adjustment factors that were strange multiples of 250,000 for several months in a row. Instead of deriving the numbers from the data, they seemed to use plug numbers to "smooth" the time series artificially so as not to spook Wall Street. The odds of actual data falling in the pattern was something like 4 BILLION to one.
The strategy of this administration since the beginning has been to do everything to hype the economy. Make the Stock Market roar so the Baby Boomers make money for retirement, and you can, literally, get away with murder.
-- K. Stevens (kstevens@ It's ALL going away in January.com), November 29, 1999.
Oops! I misspoke...it should be...
The odds AGAINST actual data falling in that pattern are 4 BILLION to one.
-- K. Stevens (kstevens@ It's ALL going away in January.com), November 29, 1999.
Trivial, but CNN bragged about our great economy by reporting that persons are spending on avg. $500 for Xmas. Am I looney, or isn't that figure usually between $700 and 800?
-- Hokie (email@example.com), November 29, 1999.
Whussup wit the thread title, Dude?? I fixed it so it looks like any of your others but......???HUH???
Drop me an e- OK??
-- Chuck, a night driver (firstname.lastname@example.org), November 30, 1999.
Thanks for the effort, I promise I will be more diligent in editing my posts.
-- Homer Beanfang (Bats@inbellfry.com), November 30, 1999.