Writings - Freelance Articles
GMAC Prepares For Y2K
Campbell-Ewald - February 6, 1999
Richard Baker is still working on his plans for the New Year. As director of GMAC Financial Services’ Year 2000 progress office, it’s his job to make sure that after the celebrations, GMAC employees worldwide can get back to work.
International offices are making “excellent” progress toward bracing themselves for the bug, Baker said recently, from his office in Detroit. But the preparations are still under way.
In general, GMAC’s situation mirrors that of the greater corporate world, where the United States leads the world both in its progress on the Y2K threat and the need for a thorough response.
“We operate in a lot of different countries with a lot of different cultures, and the awareness level is certainly higher in the U.S.,” Baker said. “But then again, compared to most countries in the world we have a greater reliance and dependence on the computer. ... It’s a double-edged sword.”
For GMAC Financial Services, the task is further complicated.
“We have many more systems, and in particular date-intensive systems, because of the nature of our business,” Baker explained. Tracking vehicle loans and payments over a number of years naturally requires a longer-term relationship with a customer than the initial sale.
“GM sells the car and says thank you and goodbye to the customer,” Baker noted. “We live with that customer for the next four or five years.”
That means, in most cases, that GMAC and the customer will be wed through the millennium. GMAC is examining four major areas of its operation—computer applications, infrastructure, suppliers including vehicle dealers, and facilities—to assure that the marriage continues to run smoothly.
Making sure the computer applications are up to snuff involves fixing millions of lines of code within the hundreds of computer applications and systems that may be thrown off by their failure to differentiate the year 2000 from 1900, due to the fact that many computer programs only record two digits of the year—for instance, “00”—rather than all four digits.
GMAC has documented over 300,000 different components that may be affected in its 300-plus offices worldwide, from the PCs and software packages on employees’ desks to mainframe computers.
“That’s a long chain with a lot of links,” Baker said. “If one of those links breaks, the chain breaks.”
Checking on the suppliers involves more than making sure their products keep working when the date rolls over.
“We have to not only look at if they provide us a product, like a computer company providing us an application ... but looking at the company itself to make sure that they are addressing the Year 2000 concerns so that they’re going to continue to be a viable company come January 1, 2000,” Baker said.
That’s particularly important for providers of services, and “interface companies” like banks, to assure that the services are not interrupted and the transactions continue to flow.
Suppliers also include dealers, and GMAC has distributed Y2K Self-Assessment kits to individual dealers to check their readiness. It’s up to the dealers themselves to make the actual preparations.
Reviewing facility readiness involves assuring that the elevators keep running, the heating and cooling systems keep operating and employees can get through the front door and any card-swipe security systems on the morning after the millennium. GMAC is contacting its various landlords around the world to make sure the facilities are certified as Y2K-ready.
One area where work needs to be done is developing contingency plans in the likely event that something does go wrong.
“Despite the best efforts of everybody around the world, odds are something’s going to pop somewhere, be it a supplier or some component,” Baker said.
“What contingency planning is intended to do is assess GMAC and look at our most critical business processes. We then determine what we need to do or can do now to prepare ourselves if or when something happens and a system goes down or a computer goes down or we lose electricity, whatever it may be.”
The company is working with its regional management in Europe, Latin America and Australasia to identify the critical systems and develop ways to operate them manually if needed. “If a retail system goes down in branch X or country Y, they can go to the shelf and pull off the documented process and say ‘OK, this is what we’re going to do until the system’s back up,’” Baker said.
Another part of contingency planning involves establishing a command center for each of the three regions that will communicate with the main command center in Detroit. With the millennium hitting in Australia before Europe or North America, problems that develop in specific components in Australia can be relayed to other offices before they hit. Aside from giving other offices in other time zones advance warning of problems, the command centers can also work to create a fix that works for components around the world.
As for the big day itself, Baker’s not sure whether he’ll be pulling an all-nighter. The fact that Jan. 1, 2000 falls on a Saturday means that any problems may not manifest themselves for another two days—when offices open for business the following Monday. GMAC officials are considering several different ways to deal with the day itself.
Options being explored include holding a “mock year end” in mid-December by advancing computer dates to mimic the millennium’s arrival, or bringing all the systems down on Dec. 31 and turning them up gradually on Jan. 1 for a “soft landing.” Also possible is a combination of approaches.
“What you do on the mainframe may be very different than what you do on a desktop computer,” he said.
One step that will be taken is to have an employee from each office go into the office Jan. 1 or Jan. 2 to make sure that the elevators and heating and cooling systems work and the security system lets them in the door.
“It’s going to be really interesting,” he said.