Year 2000 will separate 'leaders from laggards'

Year 2000 problems and other factors will force more than half of IT departments to pull out of systems development within three years.

Along with millennium problems, issues such as European monetary union, internationalisation, localisation of business, mergers and acquisitions, privatisation, identity code changes (such as changing telephone numbers) and inflation are turning the spotlight on the development effort within large organisations.

These are the findings of the latest report from analysts CSC Index. The Year 2000 Problem report is based on a survey of 179 of the largest companies in the world.

CSC Index says that millennium problems are forcing IT departments to divide between 'leaders and laggards'. Laggards are likely to drop out of applications development altogether.

According to the report, companies expect to spend, on average, $10.8m (#6.6m) to fix year 2000 problems, but CSC Index analyst Brian Morris claims that figure is already out of date.

'I think you can safely double that figure now. The more companies look into the problem, the more they realise they have to spend,' said Morris.

Is it a good idea to move to new systems if the year 2000 problems are too big?

'If companies haven't started work on fixing problems yet, they have to put someone in charge, give them absolute authority and get on with it,' said Morris. 'The priority has to be to fix the year 2000 problem, not new development.'

Morris points to the example of one process manufacturing company which is implementing new systems while the fixes for the old systems go on.

'It's insurance,' said Morris. 'There is no guarantee that a new system will be ready.'

In other words, going for new development over year 2000 fixes could mean that at the turn of the century a company will have two systems that don't work.