Banks, telcos fly ahead of rest race to beat bug

By CHRIS BARTON

Will New Zealand computer systems and date aware equipment come through Year 2000 unscathed?

It's a question the Year 2000 Readiness Commission has been grappling with for some time. In its latest August survey of New Zealand businesses, 36 per cent of respondents believe Y2K will have no disruptive effect at all on their organisation; 56 per cent say disruption will be to a minor extent; 4 per cent that the effect will be significant; and just 4 per cent that it will be disastrous.

The same question asked among key utility providers gives a similar response - except that most believe there will be some minor disruptions. Ninety per cent of respondents in the electricity sector think a minor disruption is likely, with 7 per cent saying it will be significant. Other sectors seeing minor disruption include local government (82 per cent), public hospitals (84 per cent), telecommunications (100 per cent), air transport 74 per cent and banking and finance 69 per cent.

The August survey is the fourth of a planned five surveys conducted by the commission this year. The last is underway now and will be published in November.

It is worth noting that organisations respond to the surveys on a voluntary basis, and that the results only provide an indication as to the country's Y2K readiness because there is no audit as to the responses validity.

But based on responses to date, it is possible to see some trends emerging. Most organisations in dealing with the millennium bug follow a three-stage process - assessment followed by fixing or remediation and then testing of all equipment, especially the pieces that have been fixed.

The table below shows the progress to date with the sectors sorted according what percentage of equipment essential to their business continuity have been tested for Y2K compliance. The worrying signs here are that with only four months to gom the business and the retail sector have only done one third of their testing. On the positive side, banking and telecommunications have almost finished.

Given that most people think minor disruptions are likely, it is important for all sectors to have plans in place to deal with disruptions to their businesses and services. Such plans are usually designed to minimise the loss or damage that might occur.

On this front the August survey shows most sectors are still struggling to get plans in place. Those notably behind include air and land transport, large businesses, and electricity sectors. Interestingly the oil industry and public hospitals have made huge improvements in the latest survey with more than 70 per cent having finished their plans. Of constant concern to the commission is the number or organisations which say they do not need a plan. Among the reasons given for taking this position are that: the problem will only affect us for a short time; that there will be no problems; and firms do not know what to do until it happens.

The survey also asks when will all Y2K preparations be finished? The results show that if the bug to hit tomorrow, only the telecommunications sector would be ready, all other sectors still have quite a way to go.

In reading the last table it is important to note when sectors are predicting they will be ready. If the electricity sector, for example, meets its stated aim, 74 per cent will be ready for Y2K by the end of September. The worrying trend, however, is that for the last three surveys a number of sectors have been consistently missing their finish deadlines.

The most notable examples of deadline creep are large business, local government, land transport, public hospitals, all of which have between 35 and 50 per cent of respondents finishing in the last quarter. Based on their record to date there must be some doubt as to whether they'll meet those dates.