Calculating the cost of year-2000 compliance

The cost of updating or replacing information technology for Y2K compliance is highly situational and depends on an organization's specific internal and external factors. A model for cost estimation is presented, indicating 4 main categories of cost influence: 1. the organization, 2. the extent and complexity of its Y2K problem, 3. how it will solve its problem, and 4. the availability of resources to achieve the solution. Cost estimation should include the costs of project management, direct labor, and identification of affected software, affected data, and alternative solutions, testing, and implementation. The difference in estimated percentage cost found between top IS managers and Y2K project managers indicates that managers need to work toward a shared vision of Y2K projects within their organizations, especially since this difference appears to increase as projects progress into later-planning stages.