InformationWeek
Defining The Business Value Of Technology
August 24, 1998
Consult The Experts On Year 2000 Woes
Check experience, references before hiring
By Ilan Greenberg
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ith only 494 days until Jan. 1, 2000, many business executives recognize that not all of their companies' IT systems will be year 2000 compliant by then.With resources already stretched to their limits and time running short, these managers are hiring consultants to help them plan for contingencies in dealing with potential system failures caused by the millennium bug.
Year 2000 contingency-planning consultants, for the most part, identify a company's crucial business functions and conceive ways for workflow, customer care, and other vital procedures to continue unabated should an IT system fail. Some consultants review and validate audits on contingency procedures and train senior managers on contingency-planning methods.
Deciding to hire a contingency-planning consultant raises a host of issues, including the type of consultant to retain, as well as how to pay for the services, manage the relationship, and evaluate the results.
Who are these year 2000 contingency-planning consultants? There are three categories: companies specializing in IT services, management consultants, and specialized firms that do disaster recovery, emergency management, and contingency planning.
Executives seeking contingency-planning services should first look at consultants already on board performing other year 2000 tasks such as remediation and testing. Ideally, contingency-planning services should have been arranged when the contract was initially signed, but it may not be too late to renegotiate the contract to include contingency planning.
Another advantage of employing incumbent year 2000 consultants for contingency planning is that they're familiar with the systems and can more easily identify steps to work around potential problems. Companies can expect to pay up to $12,000 a month per consultant; nonetheless, these one-stop shops present the best option for companies with massive year 2000 projects.
Experience Wanted
Some companies may prefer to retain a firm that specializes in contingency planning, disaster recovery, or emergency management because of its experience handling clients' failures. Indeed, isn't a year 2000-induced failure of an IT system a disaster or emergency that requires a contingency plan? These specialized firms provide expertise in failure analysis, which enhances contingency planning by identifying where system failures are most likely to strike, causing vital business procedures to break down. Since they conduct emergency planning as their core business, these consultants are staffed with more contingency experts than other consulting outfits.
Some consultants offer experience in specific industries, too, such as financial services, health care, retail, and manufacturing. These firms promise a richer understanding of a particular company's business. Businesses with obscure or highly specific procedures should consider a consultant with expertise in that industry.
In choosing a contingency-planning consultant, look for one that has been certified by either of two industry standards bodies, the Disaster Recovery Institute International and the Business Continuity Institute. These organizations test individual consultants as well as consulting firms for their technical abilities and skills.
When interviewing potential consultants, ask about their experience tackling similar projects, plans to maintain and revise their services, and level of technical expertise. Also, have them provide references. Ask those references how end results compared with what was promised, whether the consultant met deadlines and stayed within budget, and why they picked that consultant. In addition, have the references list the consultant's strengths and weaknesses.
Before selecting a consultant, pit the finalists against each other by having them make an on-site presentation in separate meetings. This should help managers decide which consultant would do the best job delivering what is promised. The prospective client-to-consultant meetings will also help determine which contractor would most easily fit into the client company's culture.
Be prepared to answer some questions from prospective consultants. Describe the basics: company profile, corporate culture, IT environment, company sites, number of employees, vital business procedures, and on-staff experience in contingency planning. Consultants also want to know the scope and aim of the project, as well as the role they'll play.
What's the best way to pay for year 2000 contingency planning services? Regardless of the type of contingency-planning company picked, a total project fee is distinctly better than a daily rate. While a daily rate can be less expensive than the total project payment, the year 2000 staff crunch means a daily rate--absent a contractual obligation to stay on-site--could spell disaster.
With a company's ability to conduct business at stake, year 2000 contingency planning is not a suitable project for cutting corners. Strategies used to limit costs for other types of IT projects, such as bringing in less-experienced consultants to be supervised by experienced managers, should be avoided. Using such cost-cutting strategies is risky and shortsighted.
In fact, the importance and the difficulty of contingency planning demand the most-experienced consultants available. The only time compromises should be made is if the consulting firm ideal for your company is reluctant to take on new work. In this case, flexibility in staffing may be the only way to retain that firm. Even then, managers need to weigh the advantages of a consulting company's expertise against the disadvantages of the diminished resources the consulting company will be able to devote to the project.
A big part of the year 2000 contingency consultant's job is to prioritize business procedures--deciding which systems can fail without significantly damaging the company and which can't go offline at all. The liaison between the company and the consultant should be a manager well versed in the entire year 2000 project and the business procedures at stake. That's because contingency planning takes into account a web of subtle technical and business relationships. For example, it may not be obvious to the consultant that an automated workflow system could be tied to the process in which the human resources department approves the firing of an employee.
Few, if any, contingency-planning consultants are willing to shoulder any legal liability should disaster strike. Managers need to retain as much leverage over consultants as possible, whether in terms of compensation or other areas that may arise. For example, clients should specify in their contracts that the consulting firm must return on-site to review the contingency operation for several months past the beginning of 2000.
With just more than 16 months till 2000, companies needing contingency-planning assistance have no time to waste.
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