Executive Summary:Even businesses which have conducted Y2K compliance audits may still have problems with supplies, operations and shipping due to the failure of "embedded systems." Identification of these computer-controlled non-computer devices is critical to meeting the Y2K preparation goals of the business. Once identified, each device must be upgraded, repaired, replaced, or bypassed; if the latter, a contingency plan must be developed and tested in advance of December 31, 1999, to insure that the business process can be conducted without reliance upon the affected device. To be successful, these remediation measures require the cooperation of business management, suppliers, outside consultants, and the business technical staff. In addition, the workers using or affected by each device must be made a part of the remediation process, to insure that any contingency plans will fairly reflect actual conditions.
Your business is 60 days away from the most unusual challenge to its successful operation you will ever face. The obstacle in your path is not money, a lack of customers, or an inability to produce goods, although all those things may occur if you are not prepared to meet this challenge. It is safe to say that you have never experienced this kind of business problem before, and you will never experience this kind of business problem again. This unique business problem is the "Y2K" or Millennium Problem.
Some writers have called this problem "The Y2K Bug." It isn't a bug. It was not an accident. It is a design defect, overlooked for years. In the early days of computing, when machinery was expensive, the storage space for programs was small and also expensive. Instructions had to be as concise as possible. It became a matter of pride among programmers to write the most complex routines using the least amount of code. And therein lies the problem.
It was realized early on that a date such as March 12, 1954, could be written as 08/12/54, rather than 08/12/1954. If the date was stored to be used without calculation, the leading century designation ("19") could simply be tacked on when printing. If two dates were subtracted (to determine the elapsed time between the two), the century designation was irrelevant, since it was the same for both. Thus, two field spaces could be saved each time a date was written; and in a large program, "... that adds up to real money."
In the modern era (after 1970), a few programmers began to write about the problem which would inevitably occur when we started writing dates in the twenty-first century. Suppose one of the steps in calculating the value of an annuity is to determine the length of time it has been in force. We need to subtract the issue date from the termination date: so, for an annuity issued July 12, 1942, and terminated July 12, 1973, our program tells us that 31 years have elapsed. But what if the annuity is issued on July 12, 1973, and terminated on July 12, 2004? We know that this annuity has the same term of 31 years; but the computer program will not give this result; the program will attempt to subtract 1973 from 1904, not from 2004; and will given an irrational result (minus 31). The program will not run.
A similar thing happened to Marilyn J. Murray, author (with her husband Jerome) of "Computers in Crisis: How to Avert the Coming Worldwide Computer Systems Collapse" (written in 1984). When her computers would not correctly process financial data linked to dates in the twenty-first century, she began to investigate, and discovered the major implications of the design defect. While the Murrays' book was critically important for its time, it was largely ignored. Even when the Dilbert cartoon strip featured a series of panels about Y2K in September, 1996, most American businesses had not begun to plan.
Fast forward to October, 1999. Now, everyone knows about Y2K. Yet, amazingly, between 35% and 45% of American small businesses have still done nothing. For many of them, it is probably too late.
You, however, are not in that minority. You have called in computer consultants to check your software and replace your hardware. You have, on the advice of your lawyer, sent letters to your suppliers, demanding to know of their Y2K compliance. Perhaps, if you are a supplier of parts to a larger company, you have been called upon to make promises and representations about your plans. Maybe, if you use receivables financing, your bank has made similar requests. You have done what you believe you should, and you face January 1, 2000, with confidence.
And yet ...
January 1, 2000 is a Saturday; and it will probably be a cold one. When your first shift reports at 7 am on Monday, January 3, 2000, they cannot get into the factory, because the gate in your parking lot will not read any card keys. Someone finds a mechanical override, and the lot begins to fill - twenty minutes late. When your shift supervisor opens the door, he is greeted by the site of burst, dripping water pipes in a stone cold plant. He doesn't have time to appreciate the full extent of the problem before your security alarms start blaring. Your foreman knows the proper code to deactivate it, but the code is not accepted. The police do not show up in their usual five minutes, because they have reports of alarms going off all over town.
When you get to your office, you find that the water pipes in the office building have also burst, and it is as cold as the factory. Your new copying machine is ruined. An irate tenant (you own a large office building adjacent to the factory, and rent part of it out to some consultants) wants to know what you - after all, you are the landlord - are going to do about the lack of heat and the water damage. Another tenant is standing beside him, screaming that the elevator won't move. In the middle of this, your secretary tells you that she can't get the phone system to work, and something seems to be wrong with the fax machine.
What does any of this have to do with Y2K?
What this has to do with Y2K is "embedded systems." An embedded system is a computer chip which controls a device not itself a computer. You can deduce from the hypothetical factory situation some devices which may be controlled by embedded systems: parking gates, security systems, heating/ventilation/air conditioning controllers, elevators, telephone systems, and fax machines. The fact that a device has an embedded system in it does not mean it will fail on January1,2000; the embedded system must also keep track of the date as a necessary part of its operation. So, for example, your microwave oven probably won't shut down, because most of them do not need to keep track of the date. But, your business fax machine does. So does your business telephone system. And so do many hundreds of other devices: those few we have mentioned here, and countless others, ranging all the way from medical devices such as EKGs, ultrasound scanners and IV flow controllers to milking machines to CNC lathes, drills, mills, routers, etc.
If you can't make products because your factory is uninhabitable, you can't ship products. No shipments, no sales. If your factory is OK, but your supplier's factory is too cold, you have the same problem. If you don't sell, you don't have receivables, and your banker cuts off your credit line. Pretty soon, you can't pay your employees.
What can you do now, given that the "Turn of the Millennium" is less than 9 weeks away?
First: Don't panic.
Second: Prioritize. That begins with understanding that the hunt for embedded systems must be your number one commitment.
Third: Call your managers together. Given each one of them a pad of paper, and assign each a specific room or section of the factory. Don't forget the exterior areas of the building (such as the parking lot) and the basement, attic, and unattached storage areas. Tell them to go there, and make a list of everything they see which runs by electric power, whether supplied by mains or batteries. Tell them to make sure they look all around them, up to the ceiling and down to the floor.
Fourth: When each manager comes back to you with his list, tell him to answer the following question with respect to each item on the list: "if we did not have that item, would any aspect of our business process be affected?" If the answer is "yes," then have him rate the effect on a scale from "minimal" to "catastrophic." If your sales manager has a small television set in his office, the business process might be minimally affected if it wasn't there. On the other hand, if you run a metal stamping company, the loss of a high-output punch press might be catastrophic.
Fifth: Beginning with the catastrophic loss items, determine whether they are susceptible to a Y2K-induced failure. Let's take the example of the heating system in the factory. It uses gas-fired overhead furnaces, with electric blowers. The gas valves, of course, are electrically controlled, and connected to a thermostat. In some factories, the thermostat may be a plain unit which the foreman turns up or down at the beginning and end of the day. Such devices don't depend on date-tracking embedded systems. New factories and office buildings might have an elaborate HVAC controller, which varies the temperature according to the day of the week and time of day. Such units may well have date-tracking chips.
Another thing to keep in mind when you are fact-finding is what kind of information the embedded systems are looking for. In the hypothetical example of the elevator that wouldn't move, an embedded maintenance logging system which tracked dates broke down. Many machines have "smart" controls which shut them down if a regular maintenance cycle is completed. Remember, though, that the critical factor being tracked is not necessarily the number of days which have elapsed between maintenance; it may be the number of cycles of operation the machine has performed. If your suspect machine has a work-cycle tracking system -- such as most punch presses -- it may not have a date tracking system; and if it doesn't, you may not have an Y2K-induced embedded systems problem.
If you can't determine whether an item is likely to fail, call the supplier or installer. Find the work orders or sales documents for the items, and make sure you have the model and serial numbers at hand. If the supplier can't tell you what you need to know, ask for the name of the distributor; at this late date, don't settle for an "I'll get back to you on that." If that line of inquiry doesn't work, call the manufacturer. While this line of inquiry is being pursued, have one of your IT people (or whomever in the office has some Internet savvy) try to find a Web site for the product. Failing that, check the lists at www.vendor2000.com/vendlist.idc or www.mitre.org or www.ksu.edu for information about manufacturers. With luck, you'll get your answer. Then, you can decide whether you can (and want to) upgrade the device; or whether it might be time to replace it with a newer model.
Suppose you get nowhere. Do you know when the device was manufactured? If it's pre-1965, the odds are that it doesn't have a date-dependant embedded system. If it was made after that date, or if you can't determine when it was made, assume the worst: the device will fail. That leads you to the next step: how you will continue the normal course of business if the device does fail? Suppose the device is a CNC lathe. Could you make parts on a "manual" lathe? Can you find another CNC lathe which you could lease on a short term which the manufacturer will guarantee to be Y2K compatible? Whatever plan you come up with, you must test it before year-end. Your contingency plan must actually work if it has to, or it will be no plan at all.
If (and when) you get all the catastrophic failure problems resolved, you can work your way to the less severe items. Obviously, this is a big job. You can't do it alone. Even you and all your managers can't do it all along.
If your business does not have its own IT staff, you may be able to locate consultants through organizations such as The Service Corps of Retired Executives (SCORE), or by calling the SBA. You can also get information on loans which may be available to help you with Y2K remediation.
Private Y2K remediation consultants may be hard to find at this late date. If you do locate one, expect to pay a premium price for his services. Make sure you talk to one or two of his clients before signing a contract.
Above all, you need the cooperation and assistance of your employees. The men and women who run the equipment on the factory floor are more savvy than you or your managers when it comes to "work-arounds." They also know how processes are inter-related; so if you need to design an alternative to step five of your widget production line, they can be your most helpful consultants.
Don't forget retired workers. If you have upgraded to computer-controlled tools in the last few years, talk to the people who made your products "in the old days." How did they do it? Could they show your present workforce (and you) how to do it again?
Your workers must be part of the contingency plan. They need to test every scenario under actual conditions, to spot deficiencies and suggest improvements. Your contingency plans must work on January 1, 2000 and thereafter. Only your employees can help you meet that goal.
Be sure you document every step. This will be especially important if you have unanticipated failures after January 1, 2000. Also, keep careful records of how much you spend on your remediation effort. You may be able to recover part of your expense from your insurance policies (ask your lawyer about this) under the "sue and labor" doctrine. Ask your accountant about deducting unrecovered costs from your taxes.
Finally, plan first, then act. It's true that time is running out, but you will achieve your best results if you have all your managers and employees ready, and go about your work in a calm and logical manner.