Y2K laggards spoil impressive response

By ADAM GIFFORD

A significant minority of New Zealand businesses have failed to develop business continuity plans in case they are affected by the Y2K bug, to the disappointment of Y2K readiness commissioner Basil Logan.

"With that one exception we are where we wanted to be," said Mr Logan, summing up the commission's work over the past year.

"We'd like to see more businesses recognise it would pay to manage risk with business continuity plans. As it is, 42 per cent of companies, including 17 per cent of companies with more than 50 staff, said they didn't need one."

It's not too late though. There are sample continuity plans on the commission's web site at www.y2k.govt.nz as well as through chambers of commerce, citizens advice bureaus and similar organisations.

Late starters can at least get PC fixes from all major retailers.

Mr Logan said business continuity planning is "understanding what is critical for your business to continue, and what might happen if it's not there.

"For example, who are your critical suppliers? You might want to open an account with a second suppler, just in case."

It's not just a question of what happens at midnight on December 31.

Computer problems because of bugged software or hardware or corrupted data were likely to be a threat throughout the year, and companies had to be aware of those risks.

Mr Logan said in the key infrastructure area service providers were in good shape and contingency plans were in place.

"Large business as a whole has done a good job and now less than 10 per cent of small businesses say they are not going to do anything. That's realistic, the three-employee firms probably aren't dependent on technology.

"Worldwide it's more like 40 per cent say they don't plan to do anything, so I think we have reached out to the wider community."

The situation didn't look so promising at the beginning of last year.

"There was a feeling among many in the Government the market would take care of its own, and in the public sector the accountability regime applying to chief executives would do the same," Mr Logan said.

After pressure from Ohariu MP Peter Dunne and others, new Prime Minister Jenny Shipley appointed Mr Logan to head a task force to report on the country's preparedness.

The task force report in September 1998 found the private sector was only thinking about survival over the next six months, not 15 months out. It said private and public sector organisations were "under-informed and over-confident" about their ability to manage their Y2K risks effectively.

The Government balked at three of the task force recommendations: allowing full tax deductibility for Y2K projects, mounting a mass media public education campaign, and passing "good Samaritan" legislation to allow sharing of Year 2000 information without liability problems.

But it did ask Mr Logan to head a readiness commission.

While New Zealand remains out of step with many other countries on tax, the commission got the Government to backtrack on the awareness campaign and the disclosure law.

"We were concerned we might get everything right but not succeed in managing the problem, because the public did not perceive we got it right," Mr Logan said.

"I think the public information programme worked. The results are spectacular - 80 per cent of New Zealanders plan some preparation. There is a high level of confidence in services, but people realise it is sensible to protect you and your own.

"The other important win was to get it accepted disclosure of readiness status is in everyone's interest. We got government and local government to lead that, and business came in behind."

Peter Dunne said while the commission was established too late and was poorly resourced, "it has done a really good job."

"It got away from being seen as a government plaything and exerted genuine independence. I was pessimistic but full credit to Basil Logan getting out from under, and through dogged persistence he got people to treat this more seriously."

Mr Dunne said raising Y2K awareness had few advantages for politicians.

"Until comparatively recently people have not wanted to know, it's all too frightening and scary, and the more you raise it as an issue the more you are seen as a doomsayer."

Mr Dunne believes the chances of major disruption have been minimised and any Y2K problems will be "localised, unexpected and sporadic."

That view is matched by Paul Swain, who took over the technology portfolio from National's Maurice Williamson.

"I'm impressed and extremely pleased with the work they have done. They set themselves targets and met those targets," Mr Swain said.

"It's pleasing 99 per cent of New Zealanders are aware of the Y2K issue and 80 per cent of households are making some form of preparation.

"I expect major public and private sector agencies to be now ready for key issues and problems. There are of course no guarantees something untoward is not going to happen but I think any problems will be localised and they will be of short duration."

Ross Stewart from IT recruiters Wilson White Group, who has made it his mission to raise awareness of Y2K among the business community, said the commission's work meant "New Zealand has done as much as it can do, and as good as anywhere in the world.

"That's not to say everything is fixed but we've given it a bloody good shot."