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July 29, 1998
Economic Impact Bigger Than Corporate Risk?
A survey of Y2K managers by Data Dimensions, Inc. found that 84 percent felt the date-change problem would be troublesome for the U.S. economy, and 60 percent felt it would have a high-cost impact on international trade.
Still, only 40 percent thought their company was at serious legal risk because of business interruptions or losses.
"This is consistent with what we've encountered all too often," says Larry Martin, president and CEO of DDI. "Companies acknowledge that Year 2000 is very likely a problem, but not for them. It illustrates why so many companies are so far behind in becoming compliant. They just don't think it's their problem."
Only 28 percent of the respondents felt management had a high level of Y2K understanding; 33 percent said management's understanding is low. But despite those responses, 48 percent of the respondents felt the Y2K communication in their businesses was high.
Survey participants rated business and consumer systems, transportation and distribution, interconnected financial service, computer systems, telecommunications, medical and scientific, and government agencies as sectors highly susceptible to the millennium bug's bite.
But categorizing risk by industry can be misleading. "Regardless of how great the risk to a particular sector, everyone is at risk," says Martin. "That's because even if you're a big company that's totally in compliance, you might depend on a small company for a part or a supply. And if that company stops production or is unable to deliver, you've got a problem," he says.
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