Jennifer McNeill of computer consultants Cipher Systems in Calgary, Alta. -- and an expert on year-2000 problems -- discussed what to do to reduce your exposure to danger as the millennium nears.
Copyright 1997, America Online, Inc.
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JackBW: Welcome to Business Week Online and another in our series of weekly BW Enterprise chats. These chats are presented jointly by America Online's Your Business Dinner and Enterprise, the edition of the magazine published eight times annually especially for small business and entrepreneurs.
Our guest tonight is Jennifer McNeill (JenMcNeill) of Cipher Systems in Calgary, Alta. She's a computer consultant and year-2000 expert. Also with us is Fred Strasser, editor of Enterprise (SmallbizBNW). I'm Jack Dierdorff of BW Online, the moderator tonight. Now for the first question: Jennifer McNeill, how did you become a year-2000 expert?
JenMcNeill: I've worked with applications software for about 20 years and performed numerous year-2000 conversions for many clients. Our company's expertise is rehosting of legacy systems -- which means: the conversion of proprietary systems to new technology or open systems. I've been providing the conversions since 1980, although our first year-2000 conversion wasn't until three or four years ago!
JackBW: SmallbizBW, what's your first question?
SmallbizBW: It's an arcane point to start on, but the question came across on E-mail today. We reported in Enterprise that some tractors may not start after 2000. Why would that be?
JenMcNeill: Like tractors in the fields?
SmallbizBW: Yes.
JenMcNeill: If there's some type of date-monitoring, I'd suppose it could happen. If it has any type of date-tracking, it has the potential to be affected, though I don't know specifics about tractors -- although I did grow up on a farm.
TottTransp: The tractors have computer modules that may have similar 2000 problems. That is how they start -- the ignition is computer-controlled. Trucks, too.
JackBW: Conversion of your computers for 2000 sounds like a very complex problem, but is there any kind of simple answer for the small business?
JenMcNeill: It depends on how well the applications are running for that small business. If the applications are running adequately, and business is happy with them, then it's critical that the conversion be done as soon as possible. However, if the systems are of a smaller scale, and can be replaced in a short period of time with new applications, then that may be the best alternative. Also, year-2000 solutions are not necessarily cut-and-dried. It may make sense in one situation to convert the applications, and in other situations it might be more logical to replace the applications, depending on their size and scale.
TottTransp: How can I tell if our computer software will have a problem? Test it?
JenMcNeill: Yes. You need to test early with dates after 2000, including Feb. 29, 2000. But you should make sure that you test in an environment that is separate from your production environment. These [tests] are best done on a separate machine, area, or system that allows you to test outside of your essential business environment.
SmallbizBW: How ready do you think small-business owners are generally for the year 2000?
JenMcNeill: I don't believe they're prepared at all. I don't believe that 30% to 40% of them have even considered the problem, but that's not just small businesses -- that's in all sizes of the market.
TottTransp: Will mass-produced software, like Quick Books, Office Pro, Wordperfect, etc., be O.K.?
JenMcNeill: Most of them are. Some of them are providing new releases to handle the year 2000. In some cases, those new releases are quite expensive. And in many cases the software vendors have indicated that none of the older releases are going to be year-2000-compliant. So the users will be forced to go to the new versions.
TottTransp: Will they be be more or less expensive on Dec. 31, 1999?
JenMcNeill: If you're waiting until 1999, business will not be operational. The more expensive versions are available now or will be soon. It's not related to the date of their release.
JackBW: That raises the question of how expensive the conversion will be. Jennifer McNeill?
JenMcNeill: Every company is different. It's as expensive as the costs are to convert or replace the applications that are being used. And that's different for every business. A low estimate is about $1 per line of code to be changed. The price per line of code depends on the language used, and how clean the applications are -- in other words, how good the code is. But these are not the only costs. You also have to include data-file conversion, testing and implementation costs, and any training or consulting that has to be purchased.
Converting database languages like Oracle or some of the older languages, where there are no software tools involved, is very expensive. All the work has to be done manually. Because COBOL is more widely known than many other legacy languages, it is usually less expensive than other languages. But that's dependent on the system and how the code is written.
SmallbizBW: Sounds like it's a good time to move your data over to another program. For us neophytes, what does that entail, and what's the ballpark on cost?
JenMcNeill: To rewrite a system costs about four times more than conversion. There is really not time in most cases to rewrite or reengineer applications. It is a very risky option. Replacement of applications should be performed when the applications are not functional and are smaller in size. Otherwise, conversion should be performed.
TottTransp: Were the current applications designed to fail in 2000 to increase software revenue?
JenMcNeill: If we had wanted to dream this up, we couldn't have possibly ever imagined it as serious a problem as it is. Most application developers truly expect their noncompliant systems to not be in existence at the turn of the century. However, these legacy applications are usually working very effectively in organizations. And replacing them has not been either economically feasible or logical.
JackBW: The latest Enterprise, which quoted Jennifer, lists places to go for help. Any suggestions on this for small business, Jennifer?
JenMcNeill: Unfortunately, most of the year-2000 specialists are working in the large companies. And that leaves very little expertise for the small and midsize companies. If you provide me with the specific system that you're running, I'll be glad to point you in the right direction.
JackBW: What's your E-mail address?
JenMcNeill: cipher@cadvision.com
JackBW: If I may, I'll give the addresses of the Web sites suggested by Enterprise. They are: www.year2000.com, www.itaa.org (the Information Technology Association of America), www.unisys.com/marketplace/year2000/geninfo/usergrps.htm, and www.dcviexpo.com/2000ad/
TottTransp: Do they have lists of what software is in compliance and which is not?
JenMcNeill: If you are interested in the Microsoft products, you can go to their Web page, and they have information on which products are compliant. Otherwise, you need to contact your software vendor directly. All programs are at risk -- from word processing to databases.
SmallbizBW: You touched on this, but how much responsibility are the software companies assuming for noncompliant software? And can you rate their response?
JenMcNeill: They are basically not assuming any responsibility. Many of them are just providing new versions that are year-2000-compliant, but are indicating that the older versions will not be updated at all and will not be available after 2000. The reason for this is that they're having to spend an enormous amount to make their applications year-2000-compliant and are trying to recoup. None of the companies are putting the fixes out for free, and none of them will, because if they do, they won't be in business.
JackBW: Jennifer, are the doomsday scenarios for 2000 overblown? Will there be some sort of meltdown?
JenMcNeill: Not at all [overblown]. In fact, most companies are underestimating the impact it will make on their businesses. I concur with the Gartner Group's estimate that 30% of businesses will fail because of year-2000 problems. The biggest problem that we have is that organizations have left the year-2000 problem too long. And not only are most people not able to make changes in time, but the number of resources we have are dwindling as we speak -- that means, mainly, the people with the knowhow.
TottTransp: Have to leave, thanks for all the answers.
JackBW: Thanks for your questions -- come back to another of our chats.
JenMcNeill: You're welcome, Tott.
SmallbizBW: Can we talk about operating systems?
JenMcNeill: Sure.
SmallbizBW: What should folks look out for there as distinct from software?
JenMcNeill: Many operating systems are not compliant. Check with your hardware vendor, who usually provides the OS. They'll help you determine if you have a year-2000 problem. If you're running PCs that are older than six months (and in some cases, not even that), they are probably not year-2000-compliant -- even if you have a desktop PC.
JackBW: What parts of your computer operations should get priority to make sure they work right in 2000? Payroll systems, for example? Production systems? Etc.?
JenMcNeill: You need to prioritize your applications according to how critical they are to the operations of your business. In other words, any system that you feel its failure will cause problems to your business. I would start by looking at your financials first and continue on with inventory and any other systems that operate on a daily basis.
SmallbizBW: Six months? That's incredible. Stuff was being sold in 1996 that was not year-2000-compliant? Isn't that negligence? Or worse?
JenMcNeill: Unfortunately, there is still software being sold that is not compliant. In my opinion, software providers have a responsibility to provide year-2000-compliant software to their clients, but I can only speak for our company, based on what my beliefs are.
JackBW: What you're saying about the conversion suggests that business needs to budget a whole heap of money for new hardware and software -- plus consulting charges!
JenMcNeill: In some cases, that's what's required. There may be alternatives, depending on what your requirements are. Before you throw everything away that you have and replace it, you need to determine if you truly have a year-2000 problem. You can do this by using a company that has experience in determining whether you have a problem or not. Don't rely on companies that are providing these services that cannot provide references. A year-2000 specialist should have completed projects with specific references you can contact and speak to.
JackBW: Any estimate of how many businesses, in your view, are planning adequately for 2000?
JenMcNeill: In my opinion, only about 30% to 40% are even addressing the problem.
SmallbizBW: Are there any parts of the Internet that are at risk? I would imagine not the World Wide Web.
JenMcNeill: Any applications that are not compliant, regardless of the system, are at risk.
JackBW: Can you share with us any experiences you have had in helping with 2000 conversions that were especially interesting or strange or even amusing?
JenMcNeill: I was working with a company that had purchased software that was certified as year-2000-compliant. In January of this year, when the company started running the application that did three-year projections, they started having calculation problems and couldn't figure out what was causing the problem. The screen showed eight-digit dates, but there was a problem still internally, which caused the system to fail. Our client, along with ourselves, spent three weeks determining that the software was not compliant.
There is also a company we worked with that was providing inventory counts, and any inventory that was dated three years old was to be thrown away. This was a very large manufacturing company. Their system was doing calculations based on future inventory expiration dates. And when they got past three years, all their inventory was dated 1900. So the system automatically deleted that inventory out of the data files. You could imagine what a serious problem this caused for our client.
SmallbizBW: I have a question again about liability. How could that happen? Did the provider not know? Or was this just some screwup in the programming?
JenMcNeill: One of the reasons why you keep hearing how important testing is in 2000 is that it's hard to find all the errors that could occur. Sometimes it's very hard to test every section of the program. In this case, there was liability on the software provider's part, but that didn't help the client when its computers were down for three weeks. It's very easy to say that you are going to sue your software provider when your applications don't work in 2000. But if your system is not operational, and your business can't function, it doesn't matter whether you sue or not, because you're out of business. Not to mention that it's going to take 10 years to get to court.
SmallbizBW: Given the desperation involved -- potentially, anyway -- are there fly-by-nighters flocking to this area, or is it just too complicated to even fake it as a consultant?
JenMcNeill: There are many, many companies that have made themselves year-2000 specialists in the last three months. Many of these companies -- and that includes very large organizations -- have contacted me personally in the last six months, trying to find out any information that I can provide them so they can get rich quickly by providing these services. In most cases, if an organization does not have one completed project -- and preferably many -- you should not hire them.
JackBW: Thanks so much for being with us, Jennifer McNeill of Cipher Systems. The lesson you leave us with is that business should start at once to get ready for the computer switchover to 2000 (it's already late) -- and should also be sure the help they get is from a legitimate supplier.
Look soon for a transcript of this chat, under Talk & Conferences on the BW Online opening screen. Thanks again to Jennifer and the audience, and goodnight to all! You, too, SmallbizBW.
JenMcNeill: Good luck with all your year-2000 efforts! I hope you're all compliant.
SmallbizBW: Nite, Jack.
Copyright 1997 by The McGraw-Hill Companies, Inc. All rights reserved.
