Tech firms battle Y2K with industry consortium

A number of technology companies have teamed to battle the Year 2000 technology problem within the computer industry's supply chain.

3 min read
A number of technology companies have teamed to battle the Year 2000 technology problem within the computer industry's supply chain.

Up to 27 companies, including Dell Computer, Cisco Systems, Motorola, Solectron, and Sun Microsystems, today announced the High Tech Consortium (HTC) - Year 2000 & Beyond, in an effort to reduce the impact of Year 2000 issues on the high-tech industry as a whole, with a focus on the supply chain.

Back to Year 2000 Index Page The HTC's goals as an organization are to pool resources and leverage shared information about the Y2K readiness of suppliers that provide "crucial" components to the HTC's 27 member companies.

The technology industry created the High Tech Consortium out of necessity, not convenience, according to Guy Rabbat, HTC executive committee member.

The HTC understands individual high-tech companies are in different stages of assessing and responding to the Y2K challenge, and that it would be impossible for an individual company to assess every one of its suppliers. The HTC will provide a single source for companies to assess, report, and share suppliers' levels of Y2K readiness, Rabbat added.

"We need to have a single standard, where everyone can talk the same language," said Rabbat. "This assessment will have value beyond the Year 2000."

Since many of the high-tech industry's largest companies share the same suppliers, the HTC provides a forum for the world's technology giants to efficiently collect, monitor, and share information on the Y2K readiness of key suppliers and service providers.

A study by PricewaterhouseCoopers of 3,000 companies that supply 12 member companies found that each member shared between 20 and 50 percent of its suppliers with other members.

The HTC provides standardized tools and methods to assess, mitigate, and plan for potential Y2K disruptions. Suppliers are assessed by trained representatives from HTC member companies that post their findings on the Data Sharing Service, a secure, Web-accessible database. HTC members that subscribe to this service can monitor their suppliers' Y2K status and track improvements as they are made.

"I think this is a very important move," said Tom Oleson, an analyst with International Data Corporation. "We're recommending that a lot of other industries look at this," strategy as well.

The HTC's goal is to ensure that suppliers' Y2K programs are successful. After an extensive assessment by the HTC, suppliers can use the results to show their customers that they are Y2K-compliant, saving time and money. The HTC assessment process also allows member companies to identify alternate sources if key suppliers are not prepared for Y2K disruptions.

If a supplier isn't yet compliant, the HTC will ask them to continue their Y2K work and report back periodically to show progress until they become compliant.

The HTC was started by Cisco Systems and Solectron as a resource for the high-tech industry. For $15,000, a new HTC member receives numerous benefits, including standardized Y2K assessment and contingency planning tools; reduced costs of both assessing suppliers and being assessed by customers through standardized methods and information sharing; and access to research, shared practices, and global Y2K programs.

HTC members also have special access to current fee-based services, including HTC Methodology Training, a two-day course introducing the tools, methods, and reporting practices of the HTC Standard Supplier Assessment Methodology, and the Data Sharing Service.

The new consortium was created in the wake of the passage of the Year 2000 Information and Readiness Disclosure Act, intended to promote the sharing of information between companies on how to best battle the Y2K bug.

The new law provides limited liability protections to encourage companies to share information about products, methods, and best practices, while protecting consumers from misleading statements. But the act does not provide liability protections for failures that may arise from Year 2000 problems, such as selling products that do not work.