ITAA's Year 2000 Outlook July 10, 1998 Volume 3, No. 26 Published by the Information Technology Association of America, Arlington, VA Bob Cohen, Editor bcohen@itaa.org Read in over 70 countries around the world ITAA's Year 2000 Outlook is published every Friday to help all organizations deal more effectively with the Year 2000 software conversion. To receive a subscription to this free publication, please sign up on the web at https://www.itaa.org/transact/2kout looksub.htm. ITAA's Year 2000 Outlook is sponsored in part by CACI International Inc., DMR Consulting Group Inc., and Y2Kplus Clinton Y2K Speech Expected President Clinton and Vice President Gore are expected to make a major speech Tuesday, July 14, on Year 2000 at the National Academy of Sciences in Washington, D.C. Among the issues the President is expected to raise in the context of Y2K readiness is th e need for legislation encouraging a free flowing and substantive exchange of information. It is also expected that the announcement and subsequent legislation will correspond with previous statements of Y2K Czar John Koskinen. This includes the ability of companies to share as much goodfaith, factual Y2K information as possible in as short a time as possible--without those statements being used against them in subsequent legal actions. The President is expected to announce other initiatives to facilit ate national preparedness, including a Department of Labor job bank for Y2K workers. Doctors to Equipment Marketplace: Reveal Thyself Physicians, nurses and hospitals are working to cure a new bug: Year 2000. The National Patient Safety Partnership is a newly announced coalition of health care organizations focused on eliminating date glitches from medical equipment. As a press confe rence this week in Washington, DC indicated, there are many potentially sick machines out there and treatment is in the hands of others-- some 16,000 medical equipment manufacturers. And these medical box docs may or may not be talking, even to one of their biggest customers, the Department of Veterans Affairs. Dr. Kenneth Kizer, Under Secretary for Health at the VA, said his agency's survey of 1600 manufacturers in the last 10 months has turned up 692 companies willing to "certify" that their products are Y2K compliant. He said 32 manufacturers have reported a total of 182 devices not compliant and no longer supported, and 102 manufacturers produce 673 models that are not compliant and are being fixed. Another 53 companies are still analyzing their equipment for date problems. Kizer said 30 percent of compan ies failed to respond to four separate queries. VA is a member of the new coalition, along with the American Hospital Association, American Medical Association, the Association of American Medical Colleges, the Joint Commission on the Accreditation of Healthcare Organizations, the American Nurses Assoc iation, the Association of American Medical Colleges, the Institue for Healthcare Improvement and the National Patient Safety Foundation at the AMA. Although the VA appears to be playing a leadership role, the Food and Drug Administration, which has also been actively engaged in this area, is not a participant. The coalition prescription for the "Millennium Bug Syndrome (MBS)" called for: · Healthcare practitioners to familiarize themselves with Y2K issues and take steps to reduce risks and inform populations served; · Healthcare consumers to likewise becoming familiarized with their vulnerabilities; · Medical device manufacturers to identify and disclose Y2K status information While not specifying who or how it should be done, Kizer said the group also wants a single national clearinghouse to provide this medical device information to the public. Noting that MBS is 100 percent curable and that no patient need necessarily be harmed as a consequence, Kizer went through a series of scenarios in which medical devices might do just that. Non-compliant electrocardiograms, for instance, may fail to date stamp output strips properly. Such information is important in allowing physicians to compare and sequence test results and note changes. In most instances, that glitch could be a minor nuisance, forcing medical personnel to jot down the date and time. But heart attack patients may require numerous electrocardiograms, increasing the likelihood that manual date stamping could be overlooked. More dire consequences included the possibility that patient monitoring device alarms may fail to sound. For the individual going into ventricular fibrillation, an alarm failure could lead to what Kizer called an "untoward" outcome. He said other date dependency questions remain to be answered about linear accelerators, devices which are used to dole out radiation therapy to cancer patients. Sterilizers are basic to health care and time driven, he said, but, as far as MBS is concerned, some of these d evices are yet to receive a clean bill of health. Ditto for some million dollar plus magnetic resonance imaging machines and computed tomography scanners. The group stressed that it is relying on the medical device industry to make the necessary fixes and called for compliance information to be made available no later than January 31, 1999. For the time being, the group seemed willing to let the marketplac e heal itself and shied away from suggestions about setting a hard equipment replacement date or demand measures intended to force disclosure of status information. Rather, Kizer appeared to hope that market pressure will have the desired result. The si tuation is similar, he said, to how automobile makers handle recall notices. "The experience may influence how you deal with them in the future," Kizer said. Merrill Lynch Study Finds Y2K Global Preparedness on the March International corporations are aggressively attacking the Millennium bug, according to "Y2K: Implications for Investors," a report released this week by Merrill Lynch. In a statement, Rosemary Berkery and Andrew Melnick, directors of Global Securitie s Research & Economics, say the worldwide survey of thousands of corporations finds companies "reasonably confident of their own Y2K preparations, but uncertain about those same efforts by their suppliers and customers…Few companies expect earnings to be noticeably affected by Y2K expenses although the cost of compliance is reported to be higher in the U.S. than elsewhere." A release on the 450-page report, based on a survey of thousands of companies, appears to downplay some of the more pessimistic viewpoints expressed about the issue. "We do not see Armageddon, but like every space flight so far, there is an element of t he unforeseen. If there are glitches, and there always are, companies expect to manage their way through them as they do in power blackouts…" The report finds most U.S. firms surveyed expecting to be fully compliant by year-end 1998. According to the report findings, European firms view Y2K, combined with the EMU, as an opportunity for systems upgrades, while Japanese firms may leverage the si tuation to migrate from proprietary to open systems. Industry researcher Howard Rubin says he generally agrees with the report's findings. Rubin, who admits to being accused of an "upbeat" take on the date dilemma, says corporate activity on Year 2000 has increased tremendously since last April. He says m ore companies are thinking about contingency planning and that international forums are beginning to address the issue too. Rubin, who is a consultant to financial institutions, disagrees that firms in Europe are finding Y2K/Euro synergies. They are add ressed as separate issues, he says, with Euro commanding the attention of strategic thinkers and business decision makers, while Y2K is more apt to viewed as just a nuisance. Dr. Leon Kappelman, chair of the Society for Information Management Y2K Working Group, says, "the statement released about the report does not correlate well with any other studies that have been published to date. I'd need to see who and what they asked , but no studies I have ever seen indicate most companies in the U.S. expect to be fully Y2K compliant by 2000 much less 1998." Kappelman continued, "The study appears to lack face validity. It flies in the face of everything we know about the Year 2000 from other studies. You have to wonder who they are asking…I would have to guess they're not talking to Y2K project managers. I hope it is true…but I hope my hair grows back too." SBA Official Exits Small Business Administration (SBA) Chief Operating Officer and Y2K head honcho Chris Sale is leaving the agency to take a job as comptroller of the Office of Management and Budget. SBA recently launched a program to assist small businesses in grappling with the Y2K issue. Closer to Home Survey Finds Hungry Vendors The second in a series of ITAA IndustryPulse Y2K "Vendor Capacity" surveys finds a majority of firms still seeking new assignments. The capacity survey seeks to measure the extent to which heightened customer demand for Y2K repair services is placing on available supply. The current survey, conducted in May, 1998 and representing over 100 respondents, indicates that approximately 79 percent do not feel they have all the business they can handle and 75 percent do not expect to be turning down new busines s any time soon. Only 37 percent appear to be meeting their annual Y2K sales projections. Business to Business PRC Inc., Reston, VA, has been awarded a Y2K testing contract by the US Department of State; a Y2K services contract by Baltimore Gas and Electric; and a Y2K management and services contract by the Department of the Census. NeoMedia Technologies, Inc., Fort Myers, FL, has entered into a strategic channel relationship with Soporte Tecnico Interactivo to expand its Y2K distribution and support capabilities in Mexico. Peritus Software Services, Inc., Billerica, MA, has won a Y2K contract with BankBoston to perform Y2K renovations. ITAA Y2K Information Center Solution Providers Directory http://www.itaa.org/script/2000vend.cfm ITAA*2000 Certification Program http://www.itaa.org/2000cert.htm Outlook Archive http://www.itaa.org/script/get2klet.cfm Legislative and Litigation Table http://www.itaa.org/Y2Klaw.htm Calendar http://www.itaa.org/y2kcal.htm Vendor/User Status Questionnaires http://www.itaa.org/questmain1.htm Copyright ITAA 1998. All rights reserved. The Information Technology Association of America, 1616 N. Fort Myer Drive, Suite 1300, Arlington, VA 22209. Internet: http:\\www.itaa.org