(Editor's note: If the success of a technology or product depends on "interoperability," standards do matter. Still, standardization processes, if not done right, can stifle innovation. When to start the standardization process (or not) often feels more like an art than a science. What's your own experience? Join the conversation.)
Do industry standards still matter? With so many standards and so many standards bodies, where's the value? These questions are often asked in today's business world.
There often comes a point in the development of an industry when the ecosystem that has sprung up around it grows sprawling and unruly. At this stage, "standards compliant" might mean nothing more than a given product's ability to operate with others from the same vendor. It might seem as though standards--and the investment and confusion that they entail--are strangling, rather than supporting, innovation and market growth.
It's at precisely this stage, however, that building consensus around standards can trigger the industry's next surge.
Consider the example of environmental standards in information technology, where pressure has increased to improve energy efficiency and reduce the environmental footprint of equipment and practices. There is certainly no shortage of standards and regulations designed to "green" IT--and that's the problem. Different standards and regulations have been adopted in different technology areas and countries, and the burden to tailor products for each of the varied environments is suffocating development. In commodity markets, with very thin profit margins, any nickel or dime added to the cost of readying a product for the marketplace greatly affects that product's competitiveness.
Indeed, today the postproduction costs to recertify a technology for standards and regulatory compliance from country to country or region to region are hindering the drive toward a greener IT industry. Consolidation of the many disparate environmental standards into a set of common standards that is recognized globally would reduce the cost of certification, resulting in more competitive products and more capital to invest in addressing environmental issues.
It's a dynamic that is part of a growing industry's natural life cycle; indeed, health care might be entering this stage now. And, certainly, overarching standards adopted across utility jurisdictions will be a key requirement in the advancement of the smart grid, for which many of the enabling technologies already exist.