Half of State Businesses Ignoring Y2K Warnings, SBDC Finds

PULLMAN, Wash. — Results of a survey of small and midsize businesses in Washington concerning their Year 2000 computer preparations have left researchers at the state Small Business Development Center wondering if the glass is half full or half empty.
In their 12th annual survey of state business owners and managers, SBDC researchers at WSU asked respondents whether they are taking proactive measures to solve potential Year 2000 computer problems for their businesses. The response was split almost evenly, with 52 percent saying “yes”and 48 percent saying “no.”
This result presents a problem for SBDC researchers. Does this response indicate a positive reaction to the potential problem, or is it a cause for alarm?
“If we consider that less than a year ago national surveys indicated that only a few small businesses were doing anything about the Y2K problem, then our survey result can be seen as a positive development,” said Stuart Leidner, SBDC coordinator for research and innovation. “The increased media attention to the problem over the last year may have motivated half of our businesses to take action.
“However, a mid-1998 survey conducted by Wells Fargo Bank found that half of the small and midsize businesses that were aware of the problem had no intention of doing anything about it,” he added. “If that is the case, then our survey may have confirmed that despite the publicity, half the state’s business owners have decided to wait it out and hope for the best.”
Leidner said that whether one interprets the results as positive or negative, one fact remains — half of the state’s businesses are not addressing a potential problem that could start affecting them this year. He noted that some experts predict that up to 70 percent of the Year 2000 computer problems will occur before 1999 is over.
“This situation is not confined to any specific industry group,” Leidner added. “The same pattern shows up whether we are looking at manufacturing, retail or business services. Simply put, there are a large number of businesses that have not addressed a potential problem even though time is running out.”
In addition to asking about preparations for their own operations, the survey asked business owners if they were aware of whether their suppliers or vendors had addressed the Y2K issue. A majority (56 percent) said they were not.
Even if a business does not use computers — and fewer than a quarter of the nation’s businesses fit that description — their suppliers, vendors, and customers often rely heavily on computerized distribution and purchasing programs that could experience Y2K-related problems. Leidner cautioned that even if business owners are comfortable with their own operations, they still should make themselves aware of the preparations made by those on whom they depend.
Frequently called the Y2K or “millennium bug,” the terms refer to a computer problem in which computer programmers used two-digit numbers to indicate the year. Many computer programs may not recognize 00 as the year 2000 and, as a consequence, calculate the date as 1900 or some other default year.
The Year 2000 question was asked as part of an annual survey of 805 small and midsize businesses that was conducted by the Washington Small Business Development Center at WSU in the College of Business & Economics.