Standards underpin all forms of business. They range from informal agreements between partners, through internal codes of practice and guidelines, to formal requirements recognised in law. Examples include:
- de facto or informal standards, produced by the unaided market
- de jure standards, developed formally by recognised organisations
- regulatory standards, produced as part of the regulatory process
Informal Standards
An informal standard can be something as simple as a guideline on how to answer telephone calls or a trade association’s code of practice for its members. Whether devised for application within a single organisation or arising across an industry, such standards can bring many business benefits through improved interoperability and market access.
Businesses, associations or organisations can develop their own informal standards or employ external consultants, such as the British Standards Institution (BSI), to help them.
Formal Standards
Formal standards are publicly available documents, established by a broad consensus of industry experts and representatives of government, business and society. They include technical standards, used by business to align products or services with market or regulatory needs, and Quality-Management System standards (QMS), which establish best practice for the management of processes.
Regulatory Standards
Some laws and regulations might refer to certain standards, or use them as the simplest way of showing compliance. Of particular value to business is goal-based regulation, whereby government criteria can be met though the collaborative development and application of standards. This flexible system allows businesses to conform in the most appropriate and efficient manner.
