An alarming number of Australian small businesses are still struggling to secure Year 2000 assurance from their suppliers and service providers, according to the latest research from Year 2000 watchdog's, the year2k Industry Program. The body last week [subbed] released figures from the Australian Bureau of Statistics (ABS) which claimed that despite widespread recognition of internal problems, few organisations have sought Y2K assurance from their supply chain, service providers or customers which could cause a flow-on effect into their business dealings.
According to Maurice Newman, the chairman of the year2k Industry Program, many SME's have not placed Year 2000 contingency plans high enough on their agendas. He cited an ABS finding that revealed a meagre 20 per cent of all businesses have sought some form of assurances from suppliers, service providers or customers about their state of year 2000 readiness.
"This is not good enough and suggests businesses are being self centred and inwardly focused in their year 2000 projects," said Newman.
Even fewer organisations (13 per cent) have contingency plans if disruptions were to occur.
"Clearly the need to encourage businesses to be more active in their contingency planning and review of their supply chain is central, and these will be the strong messages throughout 1999," Newman claimed.
The ABS results also found that only 52 per cent of micro businesses - less than five employees, are undertaking year 2000 work, while 20 per cent of small businesses and 50 per cent of medium businesses have not taken any action.
Newman stressed that as $125 billion of Australia's gross domestic product comes from the SME sector, Australia can't afford for the SME market to collapse as a result of insufficient Y2K preparation.
"There is still a significant gap between awareness and action," he said.
And to rub salt into the wounds for larger organisations, Greame Inchley, the year2k Industry Program's CEO warned that "15 per cent of businesses greater than 200 employees have already experienced 2000 problems."
He claimed this is concerning given "that 19 per cent of businesses with greater than 200 employees, the bigger end of town, have not yet commenced work on the year 2000 problem."
"Just because your doing the work, doesn't mean you're going to be ready on time," Inchley claimed. "We find that in nearly all cases there is slippage, because you fix one problem and it leads to another problem which leads to another problem. People underestimated how much effort would be required to fix this problem""As we get closer to the first of January 2000, the availability of people and the availability of equipment will become more and more scarce," he said.
The ABS conducted the research in October 1998, surveying 6500 businesses from industry segments including utilities, manufacturing and telecommunications. The final results of the survey will be released early in 1999.