Economic Value of Standardization
The Standards Council of Canada (SCC) retained The Conference Board of Canada to undertake a study to examine the impact of standardization on the Canadian economy. The study was based on research methodology that was originally used in Germany (DIN 2000) and the United Kingdom (BSI 2005) and adapted to the Canadian situation. The study involved four components: a review of the standards-oriented economics literature; an empirical analysis of the impact of the Canadian collection of standards on Canadian labour productivity; a series of interviews with senior executives from the private and public sectors; and an in-depth examination of the benefits of specific aspects of standardization in two Canadian companies. '''Key findings''' The empirical analysis clearly showed that standards play an important role in enhancing labour productivity, measured as output per hour worked. Over the study period of 1981-2004, standardization accounted for 17 per cent of the growth rate in labour productivity which translates into approximately 9 per cent of the growth rate in output (real GDP). The impact, over time, of this positive contribution to output growth is substantial. In 2004, the level of economic output (real GDP) would be expected to be $62 billion lower if there had been no growth in standards over the 1981-2004 period. The findings from the interviews provided significant qualitative data in support of the benefits of standardization. Interviewees underlined the benefits of participating in the standards development process. They also mentioned the importance of standardization as the basis for continuous improvement, innovation and new product development. Interviewees indicated that standardization helps to establish a level playing field for business and without quality management standards that bolster and validate credibility, many would not be in business. The study also examined the benefits of specific aspects of standardization in two Canadian companies, SaskPower and INFASCO. In one instance, ISO 14001 and its benefits were examined; in the other, ISO 9001 and ISO 17025 and their benefits were analyzed. The case studies provided useful insights into the rationale for standardization, the challenges of implementation and the rewards of achieving and maintaining certification and accreditation to ISO and IEC standards.
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- Member publication
- Standards Council of Canada