Y2K Experts Poll:
Big Business Is Not Ready for the Millennium Date Change Today

CIO Magazine, ISACA, & Dr. Ed Yardeni's Y2K Center Poll Reveals
What Executives Don't Know About the Year 2000 Problem

NEW YORK, June 18 /PRNewswire/ -- A new poll, conducted by CIO magazine,
ISACA, and Dr. Ed Yardeni's Y2K Center reveals corporate confidence is on the
upswing with more and more Y2K project managers coming around the bend towards Year 2000 readiness. However, this does not mean large corporations --
domestic or international - can relax, or that anticipation of potential
disaster is unfounded. According to noted economic forecaster and Y2K expert
Dr. Ed Yardeni, "The good news is 82% of our respondents now believe Y2K will
have little impact on their companies. The bad news is they may not realize
how few of them are actually ready today with so little time left."

The Y2K Experts Poll is a real time snapshot of Y2K readiness among
global, large firms with an average of 1,300 suppliers. The poll was developed
and deployed by an informal public-interest coalition of CIO magazine, the
Information Systems Audit and Control Association (ISACA), and Dr. Ed
Yardeni's Y2K Center. Many computer systems, now set up to read years by
their last two digits, will lose track of dates when the year 1999 turns to
2000 if the systems are not reprogrammed before the turn of the century. The
coalition members conducted the poll among Y2K experts in an effort to help
the public and their policy officials assess the Year 2000 readiness of
organizations around the world.

Highlights of the Poll:
The electronic survey addresses Y2K corporate issues of readiness,
confidence, third-party failures, contingency planning, legal issues, economic
impact, and the personal at-home actions of executives close to the Y2K
remediation process. A closer look uncovers some red flags for corporations,
suppliers, and the general public.

Demographics: Respondents are primarily from large, U.S.-based (55%) and
global firms (20%) with 61% reporting more than 1,000 employees. The majority
of participants are from the financial sector (26%), followed by manufacturing
(17%), government (9%), and healthcare (5%). They represent roughly a three-
way split among information technology (IT) executives, finance executives,
and corporate management. According to Yardeni, "The results are skewed
toward finance, an industry we've expected to make good progress. It's a good
sign our expectations are being met by the financial sector. If they were not
in good shape at this point it would be a major warning about other
industries' ability to complete their Y2K projects."

Y2K Project Completion: The poll's findings include the good news that
1999 Y2K project completion is moving along well, with 72% reporting that are
more than three-quarters complete. But, 92% of responding companies have not
actually completed their Y2K work - and one in ten will not complete Y2K
project work until well into the year 2,000. Furthermore, of those companies
still working on completing their work, 33% are behind their schedule.
Observes Gary Beach, Publisher CIO magazine, "Keep in mind these are huge
firms with lots of time and resources to focus on Y2K, I am concerned that 92%
have not completed their work seven months out from the hard-wall deadline.
The question is in what direction are they trending -- more behind or
catching up? If a significant number of major companies are lagging, what
does that say for small business? Nowhere have I seen data, until this poll,
that quantifies the percent of large firms who have confessed they will not
make the turn of the century deadline!"

Contingency Planning: The survey suggests there is widespread blind faith
among Y2K experts that suppliers will be ready. Some large firms are preparing
contingency plans based on back up and substitutions. "Perhaps, this is a
'better safe than sorry' mentality among Y2K experts," says Dr. Yardeni. In
spite of preparing the plans, only 30% of companies are presently implementing
plans. The poll also finds 50% of companies without a formal plan and/or still
in the process of creating one. This group's contingency planning does not
include significant stockpiling of inventories (i.e., materials, supplies or
products). Thirty-four percent of companies are not stockpiling, followed by
19% of companies preparing with two to seven days of extra inventory.
Mission-Critical Software: Interestingly, there is a disconnect between
readiness confidence levels and the reality of waiting for mission critical
software from suppliers. Thirty-five percent of large firms say they are
still waiting for mission-critical software to be delivered by their
suppliers. In addition, Beach notes, "It is unbelievable at this stage of the
game that large firms are expecting 5% of their mission-critical software to
fail or malfunction."

Supply Chain: Only 12% of large companies, with an average of 1,300
vendors, are actually verifying their business partners' Y2K readiness by
conducting on-site visits. The majority of companies are simply sending out
questionnaires to partners (68%). "I don't think companies are taking the
danger of supplier failure seriously enough. My concern is how the supply
chain, which is heavily interconnected, will be affected by incomplete or no
delivery of mission-critical software and Y2K compliance. They are relying
heavily on trust. Companies are more rigorous when it comes to executing
routine legal contracts. In this case, we are talking about the potential for
serious business impact," says Beach.

Legal Considerations: Legal issues are a concern for 63% of the respondent
group. However, more than half feel that lawsuits against their organization
are unlikely. Surprisingly, when asked if legal considerations are affecting
their ability to publicly share information about Y2K, 25% of those surveyed
say they are in better shape than their lawyers will permit them to state.
Personal Perspectives: The final phase of the survey probes Y2K experts'
personal perspectives on the computer technology problem. Of note, 61% of
respondents are expecting something short of a natural disaster like a
hurricane and 41% of these experts are preparing for it (predominantly
stocking up to one week of food). In addition, the survey asked about the
likely personal and economic impacts of Y2K on the respondents. Generally,
the group expected minor disruptions for a few days or a couple of weeks,
without much influence on their stock investments. "I'm glad to see that large
company Y2K managers are optimistic, but their complacency could backfire if
they don't properly assess the weak links in their supply chains and prepare
appropriate contingency plans," concludes Dr. Yardeni.

Y2K Experts Poll Background and Methodology: The first Y2K Experts Poll
reached men and women on the frontlines of Y2K remediation, testing, auditing
and contingency planning. CIO magazine invited 10,000 chief information
officers (CIOs) and other high-level executives from its subscriber list to
participate; ISACA invited 18,000 of its worldwide members. Conducted online
June 9 through June 16, 1999, the poll closed with a final, qualified sample
size of 892 respondents. An email invitation from the three coalition members
asked recipients to participate only if they were professionally and actively
involved in Y2K projects. Respondents linked to the electronic polling form
from the email solicitation. A second Y2K Experts Poll is planned for
September 1999, 90 days from the turn of the century. Results from the first
poll will be used as a benchmark to trend data from future polls.
About the Y2K Experts Poll Coalition Members: CIO Communications, Inc.
was formed in 1987 to help chief information officers (CIOs), information
technology (IT) executives and other senior management executives succeed in
their enterprises through the use of information technology. The company
publishes CIO magazine, a publication of International Data Group (IDG). Dr.
Ed Yardeni's Y2K Center is a public service of the Chief Economist of Deutsche
Bank Securities. ISACA is a recognized global leader in Information Technology
(IT) governance, control and assurance with more than 20,000 members in 100
countries.

EDITORS' NOTE: Complete findings, as well as visual documentation, from
the June 1999 Y2K Experts Poll are available at
http://www.peoplepolls.com/resultssecurity.asp?surveyid=4&user=forum.
Photo of Dr. Ed Yardeni is available at www.yardeni.com/bio.html.
Photo of Mr. Beach is available at
http://www.cio.com/marketing/releases/photos.html.

SOURCE CIO Communications, Inc.
-0- 06/18/99
/CONTACT: Erin Lynn Marino, 617-489-2006 (Office), 617-803-2322 (Mobile),
888-933-6670 (Pager), elmarino@elmpr.com, or Karen Fogerty, 508-935-4091
(Office), 888-328-4997 (Pager), fogerty@cio.com, both of CIO/
/Web site: http://www.cio.com/