ISO AND ITS MEMBERS

Why and when industry needs standards Stage 1 : The pioneers – formation of the association

Looking at the parallels between the growth and maturity of industries and their associations and the type of standards and related products they require, Dr. Stevens outlines below his, as yet untested, theory on the maturation of industries and their associations.

In the early stages of industry development an association is often formed. This is usually the result of the efforts of a small number of enthusiasts who have been driven to create the organization through interest, a desire for transactional benefits (i.e., mutually beneficial business relationships), concern (e.g., consumer related issues) or for anti-competitive “ in-clubs ” or lobbying. The organizational model is likely to consist of unpaid enthusiasts with members active in evangelizing benefits of the association to nonmembers. At this early stage members rely on an intuitive sense of what are appropriate rules to follow and what constitutes “ best practice ”.

By Dr. Peter Stevens, General Manager of Strategic Marketing, Standards New Zealand

New Zealanders like to think of themselves as individualists, and we take pride in the success of entrepreneurs and innovators. New Zealanders love, for example, to point out with pride to overseas visitors that ‘ Bungy Jumping was actually invented in New Zealand’ ? The founder of bungy jumping, A.J. Hackett, for many epitomizes the leading edge of New Zealand’s burgeoning adventure tourism business : doing things ‘ at the edge ’ and ‘ making a buck ’ at the same time. A.J. Hackett’s historic, and controversial, jump off the Eiffel Tower ignited the bungy jumping industry around the world. Then there were a few accidents, and a few deaths. For A.J. Hackett Ltd, the business, there was a clear need for clear codes of practice to be developed to protect all in the business. In 1998 a New Zealand standard (NZS 5848 :1998) was published to provide a basis for safety and risk management. This has been subsequently made into an joint Australian/New Zealand Standard (AS/NZS 5848 :1992 & 2000) and is one of the most widely used New Zealand-originated standards worldwide. The company’s General Manager, Graham Whorskey, believes the Bungy

Stage 2: Early converts – growth

Jumping Code is important in helping to protect the value of the bungy business and in preventing backyard operators. “ The concept of bungy rides is often used as a low-entry business option within the adventure tourism industry. Having workable Standards and Codes of Practice which operators can realistically follow will help ensure the safety of the public and operators,” he says. What is the message here ? As someone who spends a good deal of time thinking about who needs standards and why, I have developed the following theory on the relationships between industry development and standards based around four significant stages :

The next stage in the growth of the organization representing an industry reflects increased membership, and a visible and thriving association. Members join the association because they can see some tangible benefits from doing so i.e., industry knowledge, contacts, preferential purchasing privileges etc. The organizational model at this point may have progressed to include a paid president and administrative secretary with unpaid board or industry volunteers or representatives. With the progression of the organization the association may wish to take a leadership role in their respective industry and have a vested interest in ensuring that industry participants conform to what the association believes are minimum levels of service and/or professional ethics. To help ensure these levels are met, industry Codes of Practice are developed. Members of the association may volunteer to develop these Codes of Practice, drawing on equivalent overseas organizations. Ideally, professionals from independent organizations such as Standards New Zealand facilitate the development of Codes of Practice. ISO BULLETIN JANUARY 2003

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Stage 3 : Early maturity By now the association should have developed its credibility within its industry and prospective members regard it as a key tool towards advancing in their chosen field of endeavour. Membership of the association becomes a primary conduit for information about new developments in the industry and the Codes of Practice established in Stage 2 provide easy-to-follow guidelines for recommended practice in the industry. The organizational model of the association may now include a professional management team which is employed to manage the association. Board members are elected to their positions for a fixed term and may or may not receive some stipend for their services. To be elected to the board is an acknowledgment by their peers of leadership in the association and the industry in general. Complementing the association’s drive to promote itself and the industry it represents are educational programmes to increase recognition of the Codes of Practice with the general public and purchasers in general. Progressive associations will begin discussions with educational providers such as polytechnics or universities to foster diplomas in their field to increase the professionalization of their industry and turn out graduates trained to the requirements of the Code of Practice.

Stage 4 : Maturity The association has become the organ that speaks for the industry and or interest groups and the media approaches it as the most appropriate source for comment on issues of relevance. Preferably the association will adopt a proactive stance on generating media events. At this point the organizational structure will include a largely voluntary membership base, with joining the organization seen as a vital step towards achieving professional success. The management team is made up of professionals including specialists not necessarily drawn from the industry or association itself (e.g., marketing specialists, accountants, information specialists). Now that the organization has reached full maturity there is a strong desire for

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ISO BULLETIN JANUARY 2003

codification of pre-existing codes of practice into national documented standards. National standards are created using an internationally endorsed methodology. The presence of national standards signals maturity of any industry or organization, whereby the standards become a principal tool of industry self-regulation. Standards provide endorsement of processes and outcomes that lead to credibility, recognition and transparency. A set of national standards can have a positive economic impact on the members of the association, codifying best practice and providing a set of tools that can be used to measure directly conformance with agreed practice. Certification to these standards can provide endorsement for the vendor. Such endorsement can lead to a position of competitive advantage if certification is not widely practiced, or alternatively provide a barrier for entry for those outside the industry if certification is ubiquitous. So that’s my theory – agree or disagree? Any feedback would be welcome and I can be contacted either at Standards New Zealand, Private Bag 2439, Wellington, New Zealand or e-mail me at [email protected]