The serial number of the OP's bicycle is from 1988. It's from so late in the year, that I would expect it to be a 1989 model. Further supporting 1989 is the lack of the round Campione del Mondo decal and the absence of any form of residue, outline or paint colouration in the region where it would normally be located.

Edit: Yes, that's a Syncro II shift lever, set in friction mode.To set it to index mode, you pull the serrated knob outwards and turn it counter-clockwise. There's a pretty strong return spring. If you pull it out and it won't turn, you haven't pulled it out far enough. When you release the serrated knob, it will nestle close to the lever body, indicating that it is in index mode.