IT Landscape Thrusts and Strategies 1999 Forum

Mr David T E Lim, Minister of State for Defence and Chairman National Computer Board Speech - IT Landscape Thrusts and Strategies 1999 Forum

Mr David T E Lim, Minister of State for Defence and Chairman
National Computer Board
Speech - IT Landscape Thrusts and Strategies 1999 Forum
Singapore, 29 January 1999

Good Morning Ladies and Gentlemen.

1. We live with Information Technology everyday. Sometimes, we use IT deliberately - such as when we surf the net, or use email. But often, we are not conscious of how IT works in our lives - such as when we ride in lifts, or wash our clothes, or bake a cake. In the last 2 decades, IT has moved beyond specialised computing devices into appliances and systems we use everyday. IT is very much a part of our lives today.

2. The upside of this is that we are able to enjoy higher and higher levels of comfort, convenience, and capabilities. Today, you will hear several speakers talk about the new and wonderful things which e-commerce and IT can offer to enhance our lifestyles. But our higher level of dependence on IT also makes us vulnerable.

3. The Millennium Bug or Year 2000 (Y2K) problem is one such threat. I would like to take the opportunity today to share with you the status of Y2K readiness in Singapore and the issues we need to address.

The Y2K Problem

4. The Y2K problem started in the 1960s when computers were still rather big, rather expensive and not very powerful. Computer programmers saved on costly and precious computer memory by storing only the last two digits of the year, for example "98" instead of "1998". But because of this, come year 2000, computers and chips with such types of code may become confused, thinking that "00" means the year "1900" instead of "2000". All kinds of computers and appliances with computer chips - such as mainframe computers, personal computers, fax machines, lifts, traffic lights, manufacturing plants or telecom switches, could fail if they have this Y2K problem.

5. The Organisation for Economic Co-operation and Development estimated in 1998 that there are 25 billion computer chips embedded in computers and other machines and equipment worldwide. Experts estimate that between 1% to 3% of these chips may fail. That adds up to several hundred million pieces of equipment. The Gartner Group, a US-based technology consulting firm, warns that the total cost of Y2K failures could run into hundreds of billions of dollars worldwide. It is a serious problem that requires a lot of effort and resources to rectify.

Government Action Plan

6. However, this is a problem that can be contained, and its effects minimised, if we put in effort. In 1995, the government took a number of actions to ensure that the Y2K bug would not seriously affect key business infrastructure and public services. We have worked with all essential service providers, such as power, water, telecommunications, public transport companies, banks and government hospitals, to ensure that they will be ready to deal with the problem.

7. The NCB also set out to create national awareness of the Y2K problem, and the impact it could have on businesses. We have worked closely with industry to promote understanding of the problem through joint seminars, video tutorials, newsletters and other media. A Y2K handbook was published last year to guide companies in drawing up a Y2K action plan. And a website was also set up to provide information, and to help companies locate Y2K consultants and tools. To raise public awareness, NCB launched a Y2K-in-action logo which we give to companies and organisations that are willing to commit publicly to take action on this issue.

8. We have also paid special attention to reaching out to Small and Medium-Sized Enterprises, or SMEs, as many might not have the resources of larger corporations to deal with this problem. To help the SMEs, the government will pay for up to 70% of consultancy cost of drawing up Y2K implementation action plans.

Y2K Progress in the Public and Private Sectors

9. With less than a year to go, it is timely for us to take stock of what we have achieved, and what more needs to be done. The NCB is monitoring the progress of the Y2K conversion programme within government agencies. The government agencies are in turn, monitoring the readiness of the key infrastructure systems and service providers within the sectors they supervise.

10. Ninety per cent of the government agencies have completed their Y2K checks and conversion programmes to date. I would therefore like to assure the public that all key government agencies, infrastructure systems and service providers will be Y2K ready by the middle of 1999. Agencies that have already completed their Y2K conversion programmes are now doing inter-agency testing.

11. In the course of their work, many agencies discovered various subsystems and equipment, which needed replacement, and have taken action to remedy the faults. By taking timely action, they will have averted many problems which would otherwise have affected their operations. We can feel reassured that for these agencies major problems are not likely to occur. But no matter how thorough the tests, we should be prudent and prepare for the unexpected. The government has set up a cross-ministry committee to co-ordinate the development of a national contingency plan, to ensure that essential operations will continue to run smoothly, and any problems dealt with quickly and efficiently, when we reach the year 2000.

12. Private sector companies have also been working to solve the Y2K problem. A recent survey commissioned by Temasek Polytechnic indicates that almost all companies are aware and doing something about the Y2K problem. However, there remain a small percentage of companies - about 5% - who are still unsure about what to do. Industry feedback indicates that these are likely to be SMEs. I would encourage these companies to address their Y2K problems urgently, and to take advantage of the various forms of assistance available from the NCB.

Continued Efforts Required

13. Every effort must be taken as we are now in the final year of preparation. For businesses, the consequences of not solving the Y2K problem can be serious. Computer errors in using dates and time can affect not just operations, but also accounting, payroll and invoicing systems. Even if operations continue to run, companies may incur losses because of billing or accounting errors.

14. You must also consider whether your suppliers are similarly prepared. Problems in their systems could spillover and affect your operations. The survey by Temasek Polytechnic showed that while only a small percentage of companies have done nothing so far about the Y2K problem, almost one quarter of the companies surveyed have yet to address the potential Y2K problems they may face with their suppliers.

15. Unlike other deadlines, Y2K is non-negotiable. A foretaste of what can really go wrong took place on 1 January 1999.

• In Sweden, police were unable to issue temporary passports because the year "99" was treated as end of file, and the computer program failed to work.
  
  
• In the United States, a company was unable to close the 1998 payroll because the software was unable to translate dates that included year 2000.

16. These problems arise from computer coding problems similar to the Y2K problem. While thankfully nothing catastrophic happened in these two examples, it shows that computer coding problems are very real, and can result in actual failures and system stoppages.

17. Organisations, which are not yet Y2K ready, should therefore intensify their efforts to tackle the Y2K issues now. The problem can be managed, but it cannot be done at the eleventh hour. I urge all companies, especially SMEs, who have not yet made efforts to deal with the Y2K problem, to do so urgently, before it is too late.

18. Modern technology, like ancient fire, can be a productive servant, but an unforgiving master. Information technology will continue to bring benefits to our lives. But for now, we must put in the effort to act effectively and decisively and nip the Y2K problem in the bud. Then we can welcome the new millennium with confidence, ready for the challenges and the promises it brings.

Thank you.