You're reading: Local firm turning Y2K problem into profits

Low-level programming experts find market in West

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The Y2K problem, a software glitch that could cause computers to mix up the years 1900 and 2000 next Jan. 1, epitomizes that adage. While doomsayers fill media outlets with cataclysmic predictions about the effects of Y2K, enterprising software companies line up to alleviate the problem.

Tessart, a Kyiv-based software consultancy, is one company doing just that in Ukraine.

Founded in 1996 by a group of five programming enthusiasts with a Macintosh computer and start-up capital of just $400, Tessart has profited from a rush of programming orders from computer operators in Western countries. In 1998, Tessart had an annual turnover of Hr 1.7 million ($485,000) and employed 54 programmers. Most of that business was in designing solutions to the Y2K problem, although the company also develops specialized software for airlines, airports and other computer-intensive businesses.

The secret of Tessart's success is simple: hire the right people and give them the opportunity to sell their skills.

Tessart director Volodymyr Bilodid, one of the five founders of the company and a programmer with 14 years' experience, said once his staff understood that programming could be a profession rather than just a hobby, the business was born. The only other thing he had to do was find a market for their skills.

Luckily, the market came to him. Around the time the company was founded, worries over the Y2K bug were coming to a head in the industrialized – and highly computerized – countries of the world. Skilled programmers, which Ukraine had in abundance, were in extreme demand.

Programmers from the former Soviet Union are famous for their in-depth knowledge of low-level programming, gained through meticulous training on old Soviet computers. In contrast to programmers in the West, who tend to piece together high-level programs using tried-and-tested toolbox programs whose inner workings they might not even understand, Ukrainian programmers are used to assembling computer code from scratch, bit by bit, byte by byte. That gives them the skills to bury into and comprehend arcane computer code written decades ago, and makes them uniquely suited to locating and fixing the two bytes that have caused the Y2K bug.

But those skills also make Ukraine's programmers prized in the West, and Tessart has to pay well to hang on to its best workers.

'The only resource we have in abundance and don't have to pay for is intellect, but there's a danger that it will be fully drained,' Bilodid said. He was shy about giving payroll figures, but said programmers' wages were 'high enough for them to feel comfortably off.'

Even so, Tessart hasn't entirely escaped the brain drain. Two of the company's programmers recently left to take up jobs abroad.

But the rest of the staff are paying back the company's investment by working hard.

'As of today, we have completed 84 projects, and none of them failed, and none of them was late,' Bilodid said.

The company designs specific software for each of its clients, and has also designed a universal program to repair the year 2000 bug.

Among the company's biggest clients, Bilodid named Delta Airlines and four large American airports. He said companies and government agencies from abroad are also among Tessart's customers.

Nevertheless, the seriousness of the Y2K problem has yet to hit home in Ukraine, according to Bilodid, who said not one Ukrainian client has approached Tessart for Y2K solutions.

Bilodid said Ukraine is not ready to deal with the bug simply because of low public awareness of the problem.

'Their attitude is still 'These damned programmers created the problems to make us pay them money to fix it, but we won't give in to them,'' he said.

According to Bilodid, he once called a large Ukrainian bank and offered to fix Y2K bugs in their computer systems, but bank officials denied that they had any Y2K problems.

'We can't persuade companies that they need us until they come to realize it themselves,' said Oleksandr Shapoval, Tessart's marketing director.

Tessart is not underestimating the seriousness of the Y2K problem, though. They've even offered to upgrade the Health Ministry's computer systems for free.

Shapoval said Tessart had chosen to help the ministry because it will potentially face the greatest problems when the Y2K bug starts causing disruption.

'Apart from having a lot of medical equipment that has to comply with the year 2000, the ministry will have a lot of people to save when there is no electricity and heating,' he said. Tessart's offer was not gratefully accepted, however.

'We had to persuade them that this is important,' Shapoval said.

To do that, the company bombarded the ministry's information department with hundreds of pages of documents on what the problem is, what the consequences will be, and how other countries are dealing with it. They even took a ministry official to an international conference in Yalta to demonstrate that the situation is every bit as serious as they say.

Even so, Bilodid said the ministry has little enthusiasm about the company's work, and only grudgingly puts up with visits from Tessart's consultants.

'At any rate, we can at least thank them for not hindering our work,' he said.

Though faced with widespread Y2K complacency, Bilodid hopes attitudes to the problem will change, not just in the Health Ministry but throughout Ukraine.

The company's 1999 business plan envisages raising orders in Ukraine from next to nothing to 15 percent of the company's total. Meanwhile, the United States will continue to provide the bulk of Tessart's clients – around half of all the company's business – with the remaining orders coming from European countries.

'The closer the problem comes, the more people will wake up to it,' Bilodid said.