On the night of April 14, 1912, the Titanic struck an iceberg on its maiden voyage and sank into the icy waters of the North Atlantic claiming 1,523 of her passengers. The ship traveled with a mere 20 lifeboats. The 20th century was still new, and yet there was an unreasonable, almost unquestioned acceptance of new technology and its ability to make life easier and better.

What is most interesting about the Titanic are the lessons learned from this tragedy, and how these can help us to better prepare us for the Year 2000 computer crises.


I believe the sinking of the Titanic could have been avoided at three different times: before the ship struck the iceberg; after the ship struck the iceberg, but was still afloat; and after the ship sank.

Likewise, the year 2000 crisis also has three different points in time of avoidance or minimization of catastrophic results: now (i.e., before the first waves of Year 2000 failures occur); on the date of January 1, 2000, and during the 18-24 months after that date.

In this article, I am offering you the opportunity to peer into the terrible, yet avoidable circumstances and mistakes, that caused the Titanic cataclysm. Hopefully this will help you better navigate similar icebergs on your own Year 2000 horizon – and steer clear. I will attempt to ferret out the hype and myth from the reality surrounding these calamities.

In next month’s installment, I will present a series of "icebergs" that your "Corporate Year 2000 Ship" must sail through in order to weather the Y2K storm. I believe that while most of the iceberg lies hidden underwater, and big chunks of ice may fall in your path at any time. Knowing where the potential dangers lie and what you can do about it should help you better steer your course, stay afloat, and allow you to reach your destination.

Before The Crash

Before the Titanic ever struck the iceberg, it had received a total of seven warnings from other ships’ wires -- all coming within twenty-four hours of the event. Each indicated that the Titanic’s particular route posed abnormally high risks, due to an exceptionally cold winter and the presence of atypical ice flows. The last warning, was not even delivered to the ship’s captain for fear he would be disturbed while entertaining passengers. The risks were ignored and not managed.

Today, many executives and even CIOs have ignored the press and consistent warnings of impending doom from industry pundits, experts, television, magazines, radio, video tapes, conferences, newspapers — almost everywhere. In 1998, some of the early failures have become popularized and related to false expirations of loans, magazine subscriptions, credit cards, etc.

However, most companies still don’t believe that this crisis will affect them, or are otherwise paralyzed from moving. Numerous respectable surveys show that less than 15 percent of all companies in the United States are beyond the awareness and planning phases. It is simply too late to first become aware and plan for the year 2000 in mid-1998.

The only hope (the only possible "silver bullet") will be contingency plans that will allow companies to "muddle-through" in the year 2000 and 2001, while they get the rest of their "act" together. There are some who claim that it is a "non-event," meant to create work for consultants and lawyers. Unbelievably, there are still others who are convinced Bill Gates will not let the industry sink and that he will provide the silver bullet, and save the day, at the last moment.

A psychological attitude of massiveness, safety, and pleasure in the day’s activities pervaded the Titanic and its passengers. No real thought was ever given to the possibility of tragedy or other common maritime calamity.

Many, if not most, company executives today still believe "It cannot happen to us" or "how hard can it be?" The feeling of "unsinkability" still is alive within such companies. These organizations believe computers have always worked even though they frequently had some problems. Staff or consultants, have always been able to address those problems, even in production. This denial of the reality and immensity of the Y2K problem -- and its ability to impact all systems, PCs, embedded chips, telecommunications, infrastructure, etc., is simply denied.

No boat drills ever took place on the Titanic that would have allowed the passengers and crew to practice the procedures to follow in the event of a crash or need to evacuate. Likewise, virtually none of today’s companies have a fully documented, tested and communicated a contingency plan that outlines the steps, procedures, logistic, systems and people necessary to keep the company going in the event that mission critical systems are severely impacted or are not Year 2000 compliant in time.

Trying to decide if a ship is sinking is clearly not the best time to strategize and execute a plan. The Titanic carried only 20 lifeboats. Even if fully loaded, these lifeboats couldn’t hold 50 percent of the passengers. That’s NOT a contingency plan! However if the ship is "unsinkable," why worry?

You worry because with so much at stake, it is critical to plan for the unexpected! Yet many companies today are afraid or unwilling to accept that year 2000 compliance can, and in many cases will, require huge resources in dollars, outsourcing, facilities, tools, management, planning, doubling up staff to implement concurrent contingency plans and remediation efforts, public relations, etc. For instance, why are some more progressive banks and companies budgeting $250,000,000 to $500,000,000 while other similarly situated companies are budgeting a mere $20,000,000 to $40,000,000? Which group is heading for the Y2K iceberg?

The Titanic’s crew was not privy to the evacuation/load performance test results before the ship was launched. These tests, performed months earlier, proved that the Titanic’s lifeboats could be safely and fully loaded (60-65 persons) before lowering away. This becomes terribly important later when the crew ordered several boats to be lowered away at half capacity or less for fear that the boats might break off and crash into the ocean.

Just how many test results and systems and operations limitations are being communicated today to company users and operators of systems, so that they will fully appreciate the limits they can expect from their systems when 2000 comes?

A striking comparison to the Y2K crisis is the story of a nearby ship, the Californian. The vessel, within line of sight (approximately 16 miles away), actually tried to send a message to the Titanic to alert it, prior to the time it stuck the iceberg. Titanic’s own wireless office wouldn’t accept the message. Its operators were sending greetings from passengers to the shore and did not want to be disturbed. The Californian’s wireless operator then went to sleep, which was normal in the year 1912 since there was no requirement for a twenty-four hour wireless monitor. The Californian did not realize the Titanic was in trouble until several hours after the Titanic sank and the Carpathia was finishing retrieving survivors.

At first, many CIO’s clamored for Board support but many Boards did not want to hear bad news, high impact problems and requests for crushing budgets. Now, however, boards are clamoring for more information about the Year 2000 icebergs. However, the CIOs, technologists, and consultants have yet to finish accurate and complete assessments. Who is asleep now?


Afloat After the Crash

After the Titanic first struck the iceberg, it sank within two hours and forty minutes. Frantic calls for help were responded to by many, but the nearest responding ship was almost five hours away. By then approximately 1,500 passengers would freeze to death (not drown) in the North Atlantic.

As of mid-1998 over 50 percent of companies surveyed by groups including Andersen Consulting, Howard Rubin, Capers Jones, the Gartner Group and others have not even completed their assessment phase. Frantic calls for help to overworked consultants (who are unable to give guarantees in any event) have created backlogs of requests.

The Big "6" accounting/consulting firms announced in July 1998 that they are ALL getting out of the Year 2000 remediation business because of time constraints, staffing conflicts and potential litigation. In some industries, such as entertainment, competitors are actually joining forces to help each other share systems solutions. Similarly, companies in the securities industry are also participating in cooperative efforts. Yet, in many cases, even if you can get help, it will be too late to make the January 1, 2000 cut-off date. Thus, contingency and degraded interim systems will have to be employed to keep the organization afloat and alive until the real remediation systems (the rescue ships) arrive.

The Titanic was unprepared for the disaster. Due to the lack of testing and communication, many passengers wasted valuable time moving from deck to deck trying to find where the lifeboats were being launched. In comparison, many companies are losing precious time trying to determine what the best tool or methodology is to launch their assessment and remediation efforts. These companies should just settle on one of the better tools in each category (scanners, parsers, capture playback tools, test bed and test suite tools, test data generators and comparators, etc.) and get started! Some start, then change, and then change again. No one vendor has the corner on the market, and no one tool will do it all. So start now and get the benefits that each can bring by automating some of the process.

The belief of "unsinkability" proved to be a continuing problem on the Titanic as well. When the ship struck the iceberg, this false belief proved even deadlier as time went on, because passengers refused to board the lifeboats. They exclaimed, "Why risk our lives in the freezing Atlantic adrift in a tiny dark lifeboat, when we are already on this warm and safe ‘unsinkable’ ship?" The belief in the ship’s hype, and the disbelief that such a tragedy could happen to oneself personally, cost many lives.

The later it gets the more some companies today believe that they missed the boat and become further paralyzed. Get off it and do what you can now! Sell off parts of your business if you must. Simplify your product lines; outsource certain capabilities; change the fundamental way you do business to buy time while remediating your systems. The key is to save as many of your company’s assets, customers, suppliers, contracts, relationships, competitive advantage situations, etc., as possible, until the time the remediated or replacement systems become available.

Ad hoc and unrehearsed plans also caused loss of life on the ocean liner. For instance, the crews on the half-empty lifeboats were instructed to immediately row to one of several designated gangplanks to pick-up more of the passengers to fill the life boats. Testimony shows that not a single passenger was picked-up once the boats were lowered. The lifeboat survivors, afraid of being swamped by others, continued to move away from the sinking ship.

The inter-dependency of each group to the other in the chain was broken; the main crew, the staff lowering the lifeboats, the crews in the lifeboats, the passengers remaining on the ship and the panicked passengers in the water never really appreciated their inter-dependency, and their need to work together.

In addition, other important rules were not followed, or not known. The starboard side crew followed a "women and children first" rule, allowing male passengers on to a lifeboat that had available space when no more women or children were available. The port side crew, however, practiced a "women and children only" rule, meaning that once a wife and child got into a life-boat, even if there was still room left and the husband or an older brother were ready and waiting, they would not be allowed to board the lifeboat.

I see a similar misapplication of corporate and IT rules such as the "triage rule," which usually states: mission critical applications and utilities must be worked on first, while other less critical systems are deferred temporarily and still others need to be abandoned altogether. However, with time running out, many companies are only planning time and resources for the first group. But, the truth is that time must also be spent on working with the less important systems to assure that these don’t inadvertently corrupt the "fixed system" with bad or ambiguous dates.

It is still amazing to me that most companies developing plans and budgets still have not adopted and communicated standards, methodologies and a project office that they intend to follow throughout the Year 2000 remediation, including techniques and procedures for developing and testing contingency plans. With no well-developed and communicated directives in place, different solutions implemented throughout the company may never work together -- and will cost much more in dollars.

Importantly, systems that will be abandoned must be stopped in a planned and careful manner so that their former users can still get their work done without these systems. Just think how your work day would be affected if I took some of your desktop systems away on January 1, 2000 without warning, re-training, or giving you other means to get the tools, data and information you need to do your job?

The Titanic sank with only 12 square feet of its total area damaged by the iceberg -- a few inches wide but for some 200 feet long. Although little was ruptured, significantly less than 1 percent, but in all the "right" places. Had the Titanic struck the iceberg 15 seconds earlier or later, some experts say catastrophe likely would have been avoided. Moments earlier, an impact would have allowed the Titanic to strike the iceberg head-on and likely would have resulted in flooding to only 1 or 2 compartments at most. An impact 15 seconds later would have hit the ship further back (or almost not at all) and destroyed at most 3 bulkheads (or 4 watertight compartments) – a rupture the Titanic could have withstood.

The Year 2000 is an insidious bug requiring meticulous remediation. In systems that handle thousands or millions of transactions per day (or more) even a less than 1 percent error can mean hundreds, thousands or even more errors made daily. If you are "lucky," your systems will fail fully so that at least you know you have a problem. If you are not so "lucky" it will take longer for your files to be corrupted slowly. Rebuilding them can be a mammoth effort in many environments.

After the Ship Sank

All of the lifeboats except one refused to return to help other passengers in the freezing water onto their lifeboats for fear of capsizing their small vessels. Only six passengers of the 1,500 in the water were saved.

The Year 2000 analogy again is that not enough companies are assisting or otherwise obtaining compliance assurances from their partners, to guarantee the ongoing flow of goods, supplies, services and money. A company cannot just sail forward into the sunset on its own. It must go back and carry along with it those other critical organizations that allow it to continue to survive and thrive. It must share its year 2000 plans, know-how, secrets, staff, resources with those partners that are not as far along or are unable to do it on their own. What good is surviving if your suppliers can no longer supply you, or your vendors are out of business? What if your customers can’t pay because of non-compliant systems that don’t allow them to collect their own receivables? What if you lack your key contracts? We can only survive if we help others and stay in synchronization with their solutions and challenges.

It seems that just as the lifeboats never returned to pick-up passengers, we in management and IT are not learning from our mistakes either. We seem not to have learned that virtually all non-trivial systems fail and have "bugs." We seem to have forgotten that it always takes longer to develop a system than we originally plan. Over eighty percent of all large projects are either behind schedule, over-budget or lack intended functionality. We forget that new technologies and tools themselves contain "bugs," errors and a high learning curve. We forget that our "fixes" will introduce still new errors.

Lastly, according to international maritime rule in 1912, rockets fired high up into the air that burst and came apart like "flying candles," constituted signals for help that must not go ignored. For reasons that are still unclear, the Californian misinterpreted those rockets as "party rockets" and, therefore, never came to the aid of the Titanic.

It is unclear what boards of directors and management must be thinking by ignoring the SEC rules and requirements to adequately disclose Year 2000 problems and efforts in 10K, 10QW and 8K filings. Most companies included dismal boilerplate disclosures, or half-disclosures, or no disclosure within their March 1998 SEC filings. Ignoring truthful -- even potentially blockbuster disclosures -- won’t stop the fireworks; instead, it will more likely blow up in their faces and potentially lead to more litigation, more jobs lost, and more lost investments.

There’s a lot that can be learned, about the hype of unsinkability and infallibility, but it’s not consistent with history. And those who refuse to learn from history, are doomed to repeat it.

--Warren S. Reid is president of WSR Consulting Group, LLC, in Encino, Ca. He is a nonlawyer who acts as a litigation strategist and expert witness in complex systems failure litigation. He can be reached by fax at 818-986-7955, via email through his website at