Mike Hofman

Y2K Survival Strategies

 

Think different
Company: Christidis Lauster Radu Architects, New York City
Stats: 15 years old, 12 employees, $1.1 million in revenues
System: A LAN that links 12 PowerPCs to three servers
Strategy: Thank you, Steve Jobs!
Estimated cost of Y2K remedy: Zero

Chuck Lauster loves talking about the Y2K bug. Why not? It's not his problem. Architect Lauster is principal and founder of an all-Mac shop. Macs are made Y2K ready and have been for years. The programming code for the Mac operating system readily distinguishes between 1900 and 2000 because it uses all four digits to record years. IBM-compatible PCs use just the last two. Hence the bug.

"This has always been a Mac office," Lauster says with pleasure. But then there's that pesky outside world to think about. Lauster designs buildings that are full of chips. Some systems could be affected by the millennium bug. Might a security system break down? What if the elevators stop running?

"We point out these problems to clients routinely now," Lauster says. "Some people don't realize that the machines they're using are really computers. We have clients who choose to install systems that have this problem. Of course, we mention that for Macs, Y2K is not a problem."

Batten down the hatches
Company: Spencer Reed Group; Overland Park, Kans.
Stats: 8 years old, 125 employees, $50 million in revenues
System: A wide area network connecting about 150 workstations to 27 servers, spread among 24 regional offices
Strategy: Making payroll is Job #1
Estimated cost of Y2K remedy: $75,000

Spencer Reed executive vice-president Bill Solon has to get the checks into the mail. The staffing company employs more than 2,500 temp and contract workers and has to pay each one every Friday. No checks, no workers -- and no business for Spencer Reed. "What our company does, besides finding people, is make sure they get paid," he says. "When your relationship is based on that paycheck, there's not much room for system problems."

If the payroll system goes down in any given week, the company can kiss a big piece of its workforce good-bye. "A lot of times, temps and contractors don't feel loyalty to their employer," Solon says, "so the problem if the check is late or inaccurate is more serious."

There's not much loyalty on the customer side, either. Solon has already heard from a number of Spencer Reed customers demanding assurances that the company has Y2K-proofed its systems. He knows he has to do his best to provide a smooth transition to the new millennium, or he'll risk losing both workers and customers to an aggressive competitor.

His response? A statement in writing that Spencer Reed will test and upgrade all its technology. He's also developing a backup system to issue paper checks on the first Friday in the year 2000, just in case.

Of course, any pledge that Solon makes has to be conditional. There's no way to be absolutely certain that the bug won't bite. "I am developing some language that I'm going to give them," he says. "But we feel like we're not going to have any system problems getting paychecks to people on time."

The best offense is a good defense
Company: Survival Inc., Seattle
Stats: 12 years old, 10 employees, $3 million in revenues
System: A LAN that connects 12 PCs to one server
Strategy: Send in the marines, figuratively speaking
Estimated cost of Y2K remedy: $5,000

For Lee Brillhart, survival isn't just an imperative -- it's a market. He is chairman and CEO of Survival Inc., which makes flak jackets and chemical-warfare-survival kits for the U.S. Air Force, the Secret Service, and other deadly customers. There's no way he'll let some puny computer glitch bring his business to its knees.

Brillhart's company doesn't have a lot of sensitive technology. "Our production line is not superautomated," he says, though he does have some PCs to tend to. "We're reviewing our internal stuff and we've downloaded some software patches."

But Brillhart subcontracts out a lot of his production to smaller firms. It's their systems that concern him. "We're worried about what their exposure to this might be," he says. "So we'll have somebody go in and make sure that their systems -- which may be older -- are repaired."

Survival Inc. is spending $5,000 to hire consultants, who will go in and test the three subcontractor systems it is linked with. "They supply some pretty important stuff to us, so we want to be darn sure they're in good shape," says Brillhart.

Of particular concern: inventory and material resource planning, or MRP, data. "We use a package for MRP, inventory management and control, and for purchasing management," Brillhart says. "We base a lot of our operations decisions on it. What if there is any erroneous data in there -- the wrong information about what we have in stock at a satellite location or a vendor location?" That's why he's sending his own strike force out to every subcontractor.

Fully 75% of Brillhart's sales come from the government. Unlike other government contractors, he won't fret about whether his big customer can upgrade its technology in time. "It doesn't matter whether or not they're Y2K compliant," he says. "Their systems are so poor that we get most of our orders by fax or phone anyway." Imagine that -- old-fashioned commerce with hardly a computer in sight. It gives you hope that maybe we can survive this Y2K thing after all.

Mike Hofman is a reporter at Inc.

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Mike Hofman was previously editor of Inc.com and a deputy editor at Inc. magazine, which he joined in 1996. The site was nominated for a National Magazine Award for Digital Media in 2010, and was named the best business website by Folio Magazine. In 2006, Hofman was part of a team of writers nominated for a Webby Award for best business blog. He lives in New York City. @mikehofman