While many larger organizations have robust Standards adoption and implementation practices, often the same cannot be said for Start-Ups and small businesses. For a variety of reasons, Standards adoption tends to be a focus area that Start-Ups and small businesses ‘graduate’ to prioritizing after other challenges and needs have been met. Is this the right approach though? Is Standards compliance really too resource intensive for small businesses? And how do those costs compare to the many potential benefits of Standards compliance? Let’s take a look:
Benefits
Industry standards, such as those developed by the International Organization for Standardization (ISO), offer numerous benefits to businesses. These standards provide guidelines, best practices, and requirements that help organizations improve their processes, products, and services. Here are some of the key benefits of adhering to industry standards:
- Enhanced Quality and Consistency: Standards are designed to ensure consistency and quality in products, services, and processes. By following these standards, businesses can deliver more reliable and consistent offerings, leading to increased customer satisfaction.
x - Global Recognition and Market Access: Standards are recognized worldwide and often required by international markets. Compliance with various standards can open doors to new markets and improve the organization’s reputation, making it easier to conduct business globally.
x - Improved Efficiency and Productivity: Standards promote efficient and effective processes. By implementing these standards, businesses can identify and eliminate inefficiencies, reducing waste, and optimizing their operations. This, in turn, can lead to improved productivity and reduced costs.
x - Enhanced Customer Trust: Adherence to respected industry standards signals a commitment to quality, safety, and reliability. Customers are more likely to trust businesses that comply with internationally recognized standards, leading to stronger customer relationships and loyalty. This is particularly important for Start-Ups and Small Businesses where establishing a positive brand identity in the market is particularly important.
x - Risk Mitigation: Standards often address risk management and compliance requirements. By following these standards, businesses can identify and mitigate potential risks, ensuring a safer and more secure working environment.
x - Competitive Advantage: Certification to a specific standard can provide a competitive edge, especially in industries where customers prioritize quality and safety. For example, being ISO-certified can differentiate a business from competitors and give them an advantage when bidding for contracts or attracting new customers.
x - Supplier and Partner Relationships: Many organizations require their suppliers and partners to meet specific standards, such as ISO certifications. By being ISO-compliant, businesses can strengthen their relationships with other stakeholders in the supply chain.
x - Continuous Improvement: Standards often emphasize the importance of continuous improvement. By embracing this philosophy, businesses can foster a culture of innovation and evolution, leading to ongoing enhancements and staying ahead of the competition.
x - Legal and Regulatory Compliance: In some cases, standards align with legal and regulatory requirements. Adhering to these standards can help businesses ensure compliance with relevant laws and regulations.
x - Environmental Sustainability: Standards related to environmental management (e.g., ISO 14001) are available as well. By implementing these standards, businesses can demonstrate their commitment to sustainable practices and reduce their environmental impact.
Industry standards provide businesses with a framework for excellence, helping them improve their operations, gain customer trust, expand their market reach, and stay competitive in today’s globalized economy.
Costs
The process of developing, implementing, and maintaining a certifiable process standard is not without cost of course.
Cost elements of a ‘typical’ standards adoption framework for standard adoption include:
- Requirements identification: Typically includes both an in-depth assessment of the specific criteria delineated in the standard(s) being sought along with a GAP analysis comparing those criteria to the organization’s current process or methodology.
x - Scope definition: Is essentially an evaluation of the reach or ‘footprint’ within the organization that the standard will apply to. Is the standard intended to be applied across all departments, offices, vendors, and partners? If not, how far across the organization should the standard be implemented to maximize effectiveness against your priorities?
x - Development of Documentation: The creation of necessary documentation that embodies both the standards to be adhered to and the processes for adhering to them is a critical component of standards implementation and compliance.
Organizations with smaller headcounts or that are more organizationally straightforward often have greater flexibility when determining whether to create the necessary documentation and training content in-house ($) vs. needing to hire a consultant ($$).
- Implementation: Primarily comprised of training and first use of the new procedure(s). It may also include the assignment of role responsibilities and ownership for each step beforehand if not included in the initial documentation development phase.
x - Audit: Both internal and external/3rd party audits are typically a required element of establishing and maintaining a certification standard. Costs for these audits are typically evaluated in terms of the number of man-days required to implement the audit. Additional costs for resolution of any noncompliance items identified during the audit may also be incurred.
Costs for each of these elements are often correlative to the size and complexity of the organization and therefore typically good news for most Start-Ups and Small Businesses from a cost perspective. While each of these elements may seem involved and time consuming, it is not unheard of for organizations to be able to implement a certifiable standard for as little as a few thousand dollars.
ISO and Alternatives
It’s important to reiterate that Industry Standards are a collective discipline or ‘field of practice’, referring generally to the concept of codifying a specific criteria, process, or methodology. While there are certainly several dominant ‘brands’ in this space, it is important to understand that the discipline is distinct from these brands.
ISO
ISO is one of the most prominent and respected standards organizations globally. It is known for developing and publishing international standards in various fields, covering a wide range of industries and sectors. ISO standards are used by businesses, governments, and organizations worldwide to ensure quality, safety, and efficiency in their products, services, and processes.
Currently, the organization has over 24,362 standards, which are included in the ISO Standards catalog, which is broken down into various segments, such as healthcare technology, railway engineering, jewelry, clothing, metallurgy, weapons, paint, civil engineering, agriculture, and aircraft. In addition to producing standards, ISO also publishes technical reports, technical specifications, publicly available specifications, technical corrigenda, and guides.
ISO’s reputation as a leading standards organization stems from several factors:
- Global Recognition: ISO standards are widely recognized and adopted internationally, which promotes consistency and facilitates global trade and cooperation.
x - Industry Diversity: ISO covers a broad spectrum of industries, from technology and manufacturing to healthcare and services. This diversity enhances its impact on various sectors.
x - Consensus-based Approach: ISO’s standards development process involves a consensus-based approach, with input from experts and stakeholders worldwide. This fosters cooperation and acceptance of the standards.
- Quality Management: ISO itself follows stringent quality management principles to ensure the credibility and relevance of its standards.
- Continuous Improvement: ISO revises and updates its standards regularly to keep up with advancements in technology and evolving industry needs.
Alternatives to ISO
While ISO is very highly regarded as a comprehensive standards body, there are several alternatives to ISO certification depending on the specific industry or field, along with numerous process specific certification or permitting requirements that can be utilized in a similar fashion. Some of these alternatives include:
- Industry-specific certifications: Many industries have developed their own certification standards that are tailored to their specific requirements. These certifications are often more focused and may carry more weight within the industry. For example, in the information technology field, certifications like Cisco Certified Network Associate (CCNA) or Microsoft Certified Solutions Expert (MCSE) are highly regarded.
- Regulatory compliance: In some industries, compliance with specific regulations and standards is mandatory. These regulations are enforced by government or industry bodies and may require organizations to meet certain criteria or follow specific processes. Compliance with these regulations can serve as an alternative to ISO certification. g. civil attorneys are required to adhere to federal and state Rules of Civil Procedure applicable to their practicing jurisdiction.
_ - Quality management frameworks: While ISO is a widely recognized standard for quality management, there are other frameworks available that organizations can adopt. One such framework is Six Sigma, which focuses on process improvement and reducing defects and variations. Lean Manufacturing is another approach that emphasizes efficiency and waste reduction.
_ - Industry best practices: Organizations can also adopt industry-recognized best practices without pursuing ISO certification. These best practices are often developed by industry associations or expert groups and are widely accepted within the respective industry. For example, in software development, organizations can follow Agile or DevOps methodologies without seeking ISO certification.
_ - Customer-specific requirements: In some cases, customers may have their own specific requirements for suppliers or service providers. These requirements may include quality standards, data security measures, or environmental considerations. Meeting these customer-specific requirements can serve as an alternative to ISO certification.
_ - Regionalization: Region or location based standards within specific fields of discipline also play a role. Several examples include: the International Electrotechnical Commission (IEC), American National Standards Institute (ANSI), the European Committee for Standardization (CEN). There are many others, each serving their specific region and industry. It is not uncommon to see various specific elements of regional standards copied or ‘incorporated by reference’ where one region may be much more mature than another in a specific field or discipline. An example of this would be wind energy regulations in the U.S. incorporating European specification and performance criteria through reference of the IEC standards.
There is of course no limitation or requirement of exclusivity when it comes to determining which standard – from which standards body – an organization may seek to adopt. If the business determines that it may be worthwhile and practical to operate to comply with competing standards, they are free to do so at their election.
The most appropriate standard(s) to pursue certification thereof will depend on the specific context and requirements of your organization. They provide businesses with a framework for excellence, helping them improve their operations, gain customer trust, expand market reach, and to remain competitive in specific markets.
To learn more about specific standards, standards bodies, or to discuss how StageGate Partners may be able to help your business take advantage of standards compliance, contact us today for a free consultation
