Telecommunications
International Business
The Public Service

SESSION 3- Sectoral Implications

Telecommunications, Ron Balls, BT and ITU Year 2000, Task Force Chairman

Ron Balls began by restating the Y2K problem and then addressed the audience in respect of telecommunications. The Year 2000 Task Force, of which he is Chairman, was set up by the ITU to enable telecommunications operators to conduct a self assessment of their own position in respect of Y2K readiness, to enable the Y2K Task Force to be aware of the position of all the telcos, to publish this information on the ITU Y2K web site, and finally to establish Y2K contact points in every telecommunications administration. In short, to raise the awareness of over 2,000 carriers worldwide.

The structure of the task force comprises five groups reporting to the chairman as follows:

Information management concerned with offering guidance through the Web site and publications;

Inter-carrier testing concerned with service continuity testing;

Contingency planning concerned with business continuity;

Development concerned with supporting the Lesser Developed Countries;

Other Groups concerned with the liaison with other telecommunications and standards bodies.

The methodology adopted for the Y2K problem was to send out a questionnaire to all carriers to the person responsible reporting to the Main Board and assess the level of competence in a number of area such as Systems, Products, Networks, Equipment Suppliers etc. The levels of confidence relating to full compliance ranged from high for full compliance down through medium to low with no programme in place and no plans to create one.

The response to the questionnaire had been good with the majority of telcos initiating action plans both internally and with their suppliers. For instance BT, his own company, has committed £350 million to becoming Year 2000 compliant.

Mr Balls concluded by running over the vast amount of information available on the ITU web site, a review of the three development workshops held so far (a fourth to be held shortly in South America), a status report on the inter-carrier testing of the major carriers, and an overview of where the world's telcos stood on the whole issue. As for supporting information, he gave out brochures on the ITU-T SG2 Year 2000 Task Force and a summary of the responses from all telcos to the Y2K questionnaire as well as task force contacts and web site addresses.

 

Finance and Banking, Robert Fabri, Project Consultant, Mid-Med Bank Ltd

Robert Fabri began his presentation by saying that banks, as with water supply, electricity supply, and telecoms, are all part of the supply chain and are highly interdependent - all users of advanced technology

Banks rely heavily on "payroll-type" systems for statements and on telecommunications for ATMs and other types of cash dispensers.

He continued with a case study of the Mid-Med Bank and its Project 2000 with the aim of being compliant by June 1999. The aims of Project 2000 were to test the hardware, software and associated equipment, raise the awareness of the bank's staff and the business customers and assess the service providers

by scoping - assessing size of the problem;

by impact analysis - looking at the risk of failure of each component;

by renovation - amending or replacing non-compliant systems;

by validation - testing of all systems under Year 2000 conditions.

For the Bank the mission critical system is the main accounting system which processes all customer and internal accounts, and which provides front-office functions. It is planned to have this system fully 2000 Year compliant before the end of 1998 in order to run a full year's business cycle without changes before the end of 1999.

In his closing remarks Mr Fabri referred to the formation of a Joint Year 2000 Council in the banking world to share ideas on the Y2K problem. He said that he believed that it was vital for banks, companies and countries which had not yet addressed Y2K to do so without further delay. They should realise that no one can get an extension to the December 1999 deadline. The threat is serious and real. The deadline is fixed and no government or country can extend it.

 

International Business, Derek Nicholas, Consultant, Unilever

Derek Nicholas began his presentation with a brief overview of Unilever. It is 33rd largest company in the world in terms of net profit and 38th in turnover and has 291,000 employees in 90 countries, and is run from headquarters in the UK with the extensive use of IT and telecommunications.

To solve the Y2K problem Unilever formed a multinational team and allocated $350 million for business continuity. In respect of telecoms, a firm line was taken on replacement with typical examples as follows:

Telephone exchanges and internal PABXs replace if more then 5 years old

Mobile phones, pagers, answering and fax machines - replace

Modems, multiplexers, routers and switches - replace if more than 3 years

Voice mail systems and fax servers - replace or repair.

Unilever's millennium programme started in 1995 with a general company awareness programme; accountability was given to businesses in July 1996.

Internal compliance targets were set for October 1998 and regular monitoring to ensure that this was on schedule was undertaken at the corporate level.

The corporate guidelines were supported by a training package targeted at every employee.

Finally, and most importantly, a dialogue was undertaken with the myriad of suppliers that Unilever is served by, and programmes to achieve 2000 year compliance agreed with every single one. However, in general terms, it should be noted that if a plant is non-compliant, corporates might choose to relocate plants with the consequent loss of jobs to both the industry and distributors alike.

 

The Public Service: Perception of the Year 2000 Impact on Government Services, Peter Bugeja, Divisional Manager, Information Systems Division, MITTS

Peter Bugeja started by explaining what makes the Y2K problem special - the deadline cannot be missed, the deadline is fixed, the time allocated bears no relation to the size of the task, and the problems and deadline are worldwide.

For instance, recent research indicates the average time for addressing the problem - 1.5 years for a small business, 2 years for a medium-sized business and 2.5 years for a large business.

Turning to the difficulties with Government, he said that Government had its own agenda and saw the Y2K problem as a high cost non value-added project; few realised that critical systems may fail before December 1999.

The reason that Governments should take a leading role is that many of the critical systems are under their control. Peter detailed four areas as follows:

Financial - inland revenue, social security benefits, payroll systems and accounting systems;

Health - hospital systems and medical equipment;

Transport - civil aviation systems, national airline systems, and vehicle registration and roadworthiness systems;

And military and international security systems.

All the above systems are in question and if Governments cannot collect taxes and pay salaries/benefits, or maintain essential health systems, both economies and lives will be at risk.

Mr Bugeja completed his talk by saying that both time and skills were in short supply, and that Governments should take action now by identifying critical systems, prioritising them and concentrating on risk management.