Information Technology Association of America's Year 2000 Outlook
Originally posted 4 June 1999 at www.itaa.org
 

Naval War College Sets Sights on Y2K

By BOB COHEN, Editor

Drawing a box around the Year 2000 problem is a little like shoveling fleas with a fork. The problem jumps around much too much to make the effort manageable, much less productive.

But now the U.S. Naval War College has taken a stab at some big picture theorizing. The intent of this effort is to prepare the Department of Defense to deal with what it does not know about the Y2K rollover, and to respond to the new and unforeseen challenges unleashed around the world.

The Y2K International Consequence Management project is the brainchild of Vice Admiral Arthur Cebrowski, who heads the war college and saw the Year 2000 computer glitch as a natural for the kind of future gazing his organization does best. Dr. Thomas Barnett serves as project director. Barnett views the Year 2000 in nothing less than historic terms, saying that the date drama will tell anyone willing to listen important things about the global economy and the nature of crisis in highly interdependent network systems-be they technical, social, economic, or governmental.

The war college team drew its Y2K box with the help of a series of experts and through a series of workshops, starting last December. They began by looking at the types of outages and disruptions that could occur and parsed these into a series of "onset models," from isolated and short term to widespread and sustained. This led to the development of a series of scenarios covering everything from the trivial to the tumultuous, a series of phases during which Y2K driven events will unfold, and a list of possible behaviors and outcomes for each "networked" group.

For example, during the Y2K "mania" phase-the period marked by a dramatic acceleration of problem awareness, anxiety and preparation predicted for summer and fall-successful network distribution and service players are expected to stockpile supplies while their less financially fortunate counterparts will lack the cash and fail to do so. Businesses will respond in the same timeframe by creating alternative arrangements with business partners while shunning the unprepared Y2K "lepers" in their midst.

Later, during the "count down" phase, governments get to grapple with issues like "authority on tap," referring to the need to stick to known authoritative bodies and avoid late introductions of special governance situations. Such moves, according to the war college project, are likely "to be met with suspicion or resistance by many in the population."

Barnett says he feels confident that the matrix is on target for the early phases of the Year 2000, but allows that anything after the problem onset phase is a best guess.

While the project is intended to help DoD find its way in what may be something of a strange new world, at least temporarily, the project staff received a dose of equanimity when they took their work to Wall Street last month. "We got our heads turned around," Barnett said, referring to the decidedly different way financial gurus view the possibility of digital danger. Barnett said this group was much more likely to see Y2K as part of the normal workings of the market, with companies wise to the workings of the new economy apt to succeed. "They view the Y2K crisis as different in degree but not in kind" as other market perturbations, such as the woes which hit Asia’s financial markets.

Doomsday scenarios set in play by computer dates do not appear to fit the Wall Street vision. But why should the viewpoint of this sector receive greater credence than others, particularly when the outcome is so quintessentially unknowable?

"They are the fastest conduits to a panic response," Barnett said, noting that if people were doing strange things with their money, these brokers and dealers would be the first to know.

The war college researcher offers several reasons why the financial markets may have a better crystal ball. First, he said, they demonstrated a pure market reaction by sensing the risk posed by Year 2000 and responding to it. Second, the global financial market it has changed. "In 1996 and 1997, there was a lot of gypsy money floating around the planet," Barnett said. Then came the financial ricochet from Asia to Russia to Brazil. Naïve impressions about emerging markets disappeared, the fiscal behavior of some governments changed for the better, and the transparency of hedge funds improved. As a result, Barnett suggests that Y2K will play out on a sturdier global financial stage.

That doesn’t mean, of course, that Barnett is ready to call the date risks removed or his project moot; on the contrary, he says Y2K has the potential for dramatic global impact. Asked how dramatic, he breaks the question down into two parts. In talking about a particular country, he says, first look at the degree to which its systems are distributed: not just technical networks, but the economy, politics and society. Barnett says he is less worried about countries with free markets. "Where would you like to spend a natural disaster outside the United States?" he asks. Probably not in more centralized economies like China and Russia. Next, he looks at how well the country in question plays the new economy, accounts for shifting alliances and hedges global bets. Those that play well, he says, will do relatively better with Y2K.

The war college effort continues as Barnett and company brief DoD joint staff, CINCs and intelligence agencies about this model and its findings. Find the work on the web at http://www.nwc.navy.mil/dsd/y2ksited/y2kproj.htm.