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3 Literature review
A number of researches and publications have been done concerning the benefits of standardization. Three of these research publications that have been referred to in this report include the following. The first is a recent CEN (European Committee for Standardization) publication of a stu Temple and Williams from the UK in 2002. The book describes the key role of standards to create markets, to assist innovation and encourage investment. The following are some points noted in the book:
The CEN publication indicated that there has been little research on the overall benefits of standards to the society, but what there is, is very supportive of the view that standards provide major benefits to the society. The book also stated that standards function by reducing variety, ensuring interoperability, maintaining, and providing information. These functions together, form part of an interlocking systems of standards, which are a vital element in the infrastructure supporting markets. Whilst industry is a major beneficiary of standards activity, standards play a major role in ensuring that competition prevails. Some other points that the publication made are that modern standards bodies aim to reflect the needs of the key stakeholders: industry, citizen, government and the constituencies that the government seeks to represent. These constituencies may include the environment and the well being of the future generations. The publication also stressed that governments need to consider standardization policy as sitting alongside innovation and competition policy and accept some responsibility for the health and vitality of the standards infrastructure as a whole.
The second publication on “the economics of standardization” by Swann Peter from the Manchester Business School is published by the Department of trade and Industry (DTI) in 2000 in the UK. The publication stressed that standardization is a key part of the microeconomic infrastructure, thus, it can enable innovation and act as a barrier to cause undesirable outcomes. Standardization does constrain activities but in doing so creates an infrastructure for subsequent innovation. Well-designed standards should be able to reduce undesirable outcomes. Moreover, standardization is not just about producing norms for given technologies in given markets. Standardization helps to enhance credibility and focus on markets of new technologies. Companies can reduce costs and increase quality through standardization. They can reduce the risks they face - both technological risks and market risks. Participants can learn much from their fellow participants. Standardization also increases competition, which does not necessarily increase profitability of all companies. However it is in the interests of the economy as a whole. Standardization increases the volume of trade, increasing imports as well as exports, and makes an important contribution to macroeconomic growth..
The second publication also states that like the &hard& infrastructure (such as roads and railways) there is a strong public good element to the standardization infrastructure. However it is clear that traditional public standards setting procedures are under pressure. It is widely perceived that they are not &fast enough&. Intense global competition and rapid rates of innovation have lead to ever-shorter product life cycles. This has created a competitive imperative to define standards quickly and that has put formal standards bodies under great pressure. The DTI publication also pointed out that uneven representation in the standardization process can lead to shortsighted standards. The &ideal model& for the involvement of national standards bodies and government in the standardization process has two components. The first is to correct the typical imbalance in participation and the second component is to keep the standards infrastructure in &good shape&.
The third is a publication by The German Institute for Standardization (DIN) on a study to determine the value of standardization to corporations (DIN 2000). The study was developed from questionnaires sent to over 4,000 companies in 10 industry sectors, selected at random in Germany, Austria and Switzerland. The final report on that study, entitled “The Economic Benefits of Standardization,” is available in English from the DIN website
The following are quotes that are made in the
1.“Companies are generally unaware of the strategic significance of standardization”. Although the persons involved in the standards development process are aware of the significance of the standards to their company’s success, often this awareness does not extend to the corporate decision-makers. In addition, the decision to participate in the standardization process is often made only on the basis of how time-consuming and costly this will be. The economic payback of participation in standards development is not always obvious, but the survey showed that companies actively involved in the standards process are more likely to see both short- and long-term cost benefits than those that do not participate.
2.”Having influence in the content of a standard is an important factor in gaining competitive advantage”. Being part of the standards development process allows the company to gain “insider knowledge” and to exert greater influence on the substance of the standards.
3.“Standardization can lead to lower transaction costs in the economy as a whole, as well as to savings for individual business”. The interviews with representatives of major firms as well as small- and medium-sized companies revealed that the costs of developing standards are not easily quantified. However, the businesses interviewed rated the effect on transaction costs as positive, noting that transaction cists drop considerably as a result of standards, since they make information easily accessible to all interested parties.
4.“Standards have a positive effect on the buying power of companies”. Standards can encourage competition within the marketplace, and can be used by businesses to exert market pressure on companies further down the value-added chain. Businesses are therefore able to use standard to broaden their potential markets. Companies also have increased confidence in the quality and reliability of suppliers who use standards.
5.“Businesses not only reduce the economic risk of their R&D activities by participating in standardization, but can also lower their own R&D costs”. The economic risk of research and development is lowered when a company can influence the content of standards to its advantage. In addition, the expense of R&D can be reduced when participants in standards work make their results generally available, eliminating duplication of research efforts.
6.“Lower accident rates are partly due to standards. Participation in the standardization process increases awareness of product safety”. The development and implementation of safety standards contributes to the reduction of accident rates, and raises awareness of safety features and practices. Representatives of consumer organizations see their involvement in the standardization process as having increased the industry’s awareness of the importance of product safety. Standards are of great use to states in drawing up legislation, and are often referenced in legal cases.
7.“An effective dissemination of innovation via standards is a precondition for economic growth”. Innovation is an important factor in maintaining competitiveness and economic growth, but is of limited value unless this innovation is effectively disseminated. Standards are one means of disseminating new ideas and technologies, and the study showed that they have a positive influence on innovation potential and on international trade.
3.1&&Standards and standardization
Standardization is essentially an act of simplification, as a result of the conscious effort of society. It calls for a reduction in the number of some things. It not only results in the reduction in the complexity but also aims at the prevention of unnecessary complexity in the future. Standardization is a social as well as an economic activity and should be promoted by the mutual cooperation of all concerned. The activity of standardization results in a recorded and agreed document based on a general agreement. (Sanders 1972).
Standards are documented consensus agreementscontaining safety or technical specifications or other precise criteria to be used consistently as rules, guidelines, or definitions of characteristics for materials, products, processes and services. In many cases, they provide uniformity, which allows worldwide acceptance and application of a product or material. The aim is to facilitate trade, exchange and technology transfer, remove technical barriers to trade, leading to new markets and economic growth for the industry (SFS 2002a).
SFS-EN 4.&&Standardization and related activities. General vocabulary(ISO/IEC Guide 2:1996), defines a standard as a document, established by consensus and approved by a recognized body. This document provides for common and repeated use, rules, guidelines or characteristics for activities or their results, aimed at the achievement of the optimum degree of order in a given context. They are developed by a recognized body, often in response to community or industry needs, through a process, which involves uniform agreement and public consultation with stakeholders. However, by defining common requirements, standards enable a common basis of understanding to exist between different parties. This in turn promotes both efficiency and reliability. In many scenarios it can bring major competitive edge and advantage to businesses. A standard serves as a basis for comparison, it is a single reference point against which other similar things can be checked or measured for accuracy or compliance. More precisely, standards are defined as coherent and consistent, documented, sanctioned or approved agreements. Further, according to SFS-EN 45020, standards contribute to making life simpler, and increase the reliability and effectiveness of goods and services.
Standards have been in existence for many years. At some point in time, standards were thought of as being restrictive, reduce innovation and of little importance. This perception has transformed over the years as more people come into contact with standards both at the office, in the manufacturing workshop and in everyday activities (Bensson & Maskin 2000). Today, standards are recognized as being essential to helping companies be innovative, reduce costs, improve quality and maintain competitiveness in the national and international market. As countries industries become global, standardization issues continue to grow more complex. These issues become critical to the survival and prosperity of companies marketing internationally. As more international trade agreements are implemented, domestic manufacturers face growing competition from international sources. Standardization provides a way to help reduce barriers to trade thereby increasing innovation amongst companies (Maskus et al. 2000).
3.1.1&&Nature of standards
Standards requirement has taken on an increasing importance as a determining factor of competitiveness (DIN 2000). While on one hand, it is easy to compare prices, on the other hand, it is much more complex to compare levels of quality. The existence of a unanimously recognized quality system of reference creates a very important clarification tool in this area. Another very important factor for intensifying standardization is the emergence of new techniques and technologies. All the principles and techniques, which concern different parties, require the setting up of common rules, which facilitate interoperability and connectivity between products. In the economy ofa country, these techniques play a considerable and important role in addressing issues related to for example, the increasing expansion of electronic data interchange and precision in the mechanical engineering world.
Standards are interdisciplinary in nature and vary in character, subject and medium. Standards cover several disciplines dealing with technical, economic and social aspects of human activity. Basic disciplines such as language, mathematics, physics, etc. are covered by standards. Standards are developed by technical committees, which are coordinated by a specialized body, and ensure that barriers between different areas of activity and different trades are overcome by making standards consistent and coherent. Because of the complexity and the inter-relationship between standards in different areas, it is difficult to group standards into specific classes, however for simplicity standards may fall into categories, which may be broadly grouped as mandatory standards and voluntary Standards (WSSN 2002).
Mandatory (or Regulatory) Standards are usually created by government agencies or departments and are enforced by legislation, which ensures that they are adhered to. Sometimes, standards may be written into a contractor referred to in a regulation which would make them part of that contract or regulation. Mandatory Standards, often guides or codes, which are written in a mandatory form with phrases consisting of the word, &shall& meaning the statement is mandatory. Mandatory standards are common in areas
usually matters associated with automobile safety food, drugs, and environmental controls (WSSN 2002).
Voluntary standards are created by non-government organizations and hence do not have the backing of government legislation. They are therefore effective only if there is a very wide consensus for their acceptance by the potential users and beneficiaries of the standards. Sometimes these standards become mandatory when a governing body refers or stipulates them in legislation or regulation .Unless standards are mandatory, a company or institution is not bounded by law to conform to it. However, it is in a company's interests to adhere to relevant standards and to be involved in the standardization process. Adherence or compliance to a standard has an effect on consumer perception of a given product or service compared to another similar product which does not comply (WSSN 2002).
Standards, be they mandatory or voluntary may also be grouped into different categories. According to SFS-EN 45020, basic standards have wide range coverage or contain general provisions for one particular field. A basic standard may function as a standard for direct application or as a basis for other standards. Some basic or fundamental standards are concerned with terminology, metrology, conventions, signs and symbols, etc. Terminology standards exactly express what a specific word or term usually means, accompanied by definitions, explanatory notes and illustrations, thus eliminating misunderstandings and ensuring widespread understanding. An example is the controls of a tractor. Product standards specify the requirements to be fulfilled bya product or a group of products to establish its fitness for purpose. In this case the standard is critical in establishing conformity and interoperability (SFS-EN 45020). They apply in areas, which define size, shape, frequency, speed or other dimensions or qualities of a part of product, e.g. 540 rpm (the nominal speed of a tractor power take-off shaft in revolutions per minute).
Organization standards deal with the description of the functions of the company and with their relationships, as well as with the modeling of the activities such as quality management and assurance, maintenance, value analysis, logistics, systems management or production management etc. Under this, process standards specify the requirements to be fulfilled by a process, to establish its fitness for purpose. Service standards on the other hand establish the requirements for a specific service (SFS-EN 45020). Test methods standards define testing methods so that the physical properties of performance levels of a product or material from a company can be measured (SFS, 2002a). Test method standards, sometimes supplement other provisions related to testing, such as sampling, use of statistical methods and sequences of tests.
Quality and performance (design) standards define the characteristics of a product or specify the level and the performance threshold to be reached by a service. These standards, including &Codes of Practice&, determine how adequate something is for its given purpose, as well as defining the level of
e.g. child safety restraints for cars. Such standards are fundamental to most building and engineering areas and may be designed to define how things should be done optimally to guarantee certain levels of safety, conformity and reliability. Some performance standards specify the outcome of a product without actually articulating the way in which the desired outcome is to be achieved (WSSN 2002).
3.1.2 Conformity assessment and certification
Conformity assessment is an activity to determine directly or indirectly, whether the relevant requirements of a product are fulfilled. The typical examples of conformity assessment activities are sampling, testing, evaluation, verificati registration, accreditation etc. The ISO/IEC Guide 2:1996 mentions certification as an asset and an advantage, both for the producer and for the purchaser, consumer or distributor. It gives an incontestable added value to the product or service bearing its mark. Certification is a procedure by which a third party gives written assurance that a product, process or service conforms to specified requirements. It is distinct from the other systems of proof of conformity such as supplier declarations, laboratory test reports or inspection body reports. Certification is based on the results of tests, inspections and audits and gives confidence to the customer on account of the systematic intervention of a competent third body. For the manufacturer or service provider, it valorizes the goods or services, opens up markets and simplifies relations. For the user, it provides assurance that the product purchased meets defined characteristics or that an organization's processes meet specified requirements. Certain product certification marks may represent an assurance of safety and quality. Certification enables one to distinguish apparently between identical
it offers to everyone a possibility of appeal in the event of dissatisfaction (WSSN 2002).
Certification may cover the company as a whole or some of the company’s products. Organization certification demonstrates the conformity of, for example, an organization's quality or environmental management system to an established model such as the ISO 9000 or ISO 14000 series of management system standards. Product certification attests that a product complies with the safety, fitness for use or interchangeability characteristics defined in a standard, and in a specification supplementary to standards where they are requested by the market (WSSN 2002). Confidence in a product is enhanced when the product is certified and is known to adhere to certain standards and principles. Similarly, companies that have their management, production process or product quality certified have an advantage and value over their non-certified counterparts. Complying with certain product standards is increasingly important and in certain cases, if standards are adopted in the laws of government, it may even be illegal to supply a product without independent certification (Temple & William 2002).
3.1.3&&Participating in standardization work
The role of standards cannot be underestimated in the area of production and manufacturing. Participating in standardization work enables one to anticipate and therefore to make one’s products progress simultaneously with standards development. Standards play a favorable thanks to knowledge transfer in the standardization process. In this way, standardization process provides a strong ground for innovating and developing products. Standardization also facilitates and accelerates the transfer of new technologies in fields, which are essential for both companies and individuals, in the form of new materials, information, systems, techniques, new systems of manufacturing, etc. Participating in standardization signifies introducing solutions adapted to the competence of one’s company and equipping oneself to compete within competitive economic environments. It signifies acting on standardization, not enduring it, a factor for strategic choice for companies (DIN 2002).
Industrialists use standards as the indisputable reference, simplifying and clarifying the contractual relations between economic partners. A standard represents a level of know how and technology, which renders the presence of industry to its preparation indispensable. Standards committees provide a forum and the platform where peer companies and competitors can come together for mutual benefit. Through standards committee activities, companies can play a leading role in the development of national and international standards that affect their industry, hence enhancing technical strength and improving their position on the market. Through participation by all competent parties concerned, standards reflect the results of joint work involving all relevant interests including producers, users, laboratories, public authorities, consumers, etc. validated by consensus. Standardization is a continuous process based on actual experience and leads to material results in practice (products – both goods and services, test methods, etc.); they establish a compromise between the state of the art and the economic constraints of the time. Standards are
reviewed periodically or as dictated by circumstances to ensure their currency.
3.1.4 Standardization process
Standards are usually created in many ways. Seldom, governments create standards, and this can be at various levels, for example municipal, provincial and federal. They can be created directly by legislation, or alternatively, governments normally delegate responsibilities for defining and recommending standards to committees or working groups. The working groups normally consist of individuals or organizations with expertise in the relevant disciplines, capable of handling the task.
Mainly, standardization takes place outside of government, which in some cases affords them an objective viewpoint. There are also international standards organizations created and empowered by multiple governments. Standards published by formal standards organizations are de jure standards. De facto standards are those implemented that are not developed, or otherwise sponsored by a formal standards body. They become de facto standards by virtue of their acceptance in the marketplace (WSSN 2002).
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Generally, in theory, there are seven stages or phases involved in the development of a standard, with consensus and transparency being of paramount and fundamental importance (figure 1). This means that there must be general agreement among stakeholders with no major dissension and the process itself must be open for scrutiny and comment to the public (ISO/IEC 2001). The standards development process may vary slightly according to the local conditions and accepted procedures under which it is made.
Referring to figure 1, an initial and formal request is issued to the standards body from the community, industry or government body stating the need for the specific standard. After issuing, a study is conducted to determine if the proposed standard will provide a technical and economic advantage without hampering trade. It will also evaluate the availability of the necessary knowledge to draw-up and develop the standard. After this initiation comes collective programming, which includes an examination on the basis of the identified needs and the various priorities of the stakeholders, followed by a decision to register the work program of the organization involved.
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A draft standard is then drawn up by the interested parties. A standardization committee formed from all interested parties, including producers, administrators, users, consumers, and laboratories, seeks input from its members and the interests they represent. All interested parties must agree on the draft standard (consensus). The standard is validated through public enquiry to ensure wide consultation at the appropriate level, be it industry, national or international. This is done in order to make certain that the draft standard conforms to the general interest and does not give rise to any major objection. If this process goes through successfully, the text of the standard is approved for publication. This is a simplified model of the standardization process, but in most cases the steps in the process do not go smoothly and have to be looped back many times till everyone is satisfied and comes to an agreement. Following review, a standard may be confirmed without change, go back for revision, or be withdrawn (figure 1). The application of all standards forms the subject of a regular assessment of its relevance by the standardizing body, which makes it possible to detect the time when a standard must be updated to meet new needs. Figure 2 is an illustration of how standardization takes place at the national level in SFS. The actual model varies in content from country to country and national from international (figure 2).
3.2 International standardization
Standards are drawn up at international, regional and national level (figure 3). The organization and coordination of work at these three levels are ensured by common structures and cooperation agreements. When similar technologies in different countries or regions have non-harmonized standards, technical barriers to trade may arise. Some years ago, because of many stiff independent national specifications, innumerable small changes had to be made to for example agricultural machinery before it was possible to market them in another country. Export-minded industries have long sensed the need to agree on world standards to help rationalize the international trading process. International standards contribute to making life simpler, and helps to increase the reliability and effectiveness of the goods and services we use.
The International Organization for Standardization, ISO is a worldwide federation of national standards bodies from more than 148 countries (January 2004), one from each country. International standardization began in the electrotechnical field: the International Electrotechnical Commission, IEC was created in 1906. Pioneering work in other fields was carried out by the International Federation of the National Standardizing Associations ISA, which was set up in 1926. The emphasis within ISA was laid heavily on mechanical engineering. ISA's activities ceased in 1942, owing to the Second World War. Following a meeting in London in 1946, delegates from 25 countries decided to create a new international organization &the object of which would be to facilitate the international coordination and unification of industrial standards&. The new organization, ISO, began to function officially on 23 February 1947. The first ISO standard ISO 1:1975: Standard reference temperature for industrial length measurement was published in 1951 (ISO 2002). To date (January 2004), ISO has published over 14 000 International Standards. ISO counts over 2981 technical work bodies made up of technical committees, subcommittees, working groups and ad hoc groups.
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Currently, ISO aims at reducing the time involved in developing international standards. The July 2003 issue of the TMB communiqué for ISO for example has listed time frames for development of international standards. The “accelerated” track aims at producing standards within two years, the “default” producing standards in three years and the last track for complex standards projects, a foreseen time frame of four years. In addition to the above, from 1 September 2003, there are new time periods after which standardization projects will be automatically cancelled. Projects, which have not been moved for the last two years, will be automatically cancelled (instead of 3 years). Also projects, which have not reached publication stage after five years will be automatically cancelled (instead of 7 years). There are also attempts made at reducing standardization at the regional level in CEN.
3.3 Regional standardization
At regional level, standardization work in Europe is conducted by the European Committee for Standardization CEN. Founded in 1961, CEN draws up standards in the region and the
annual report states CEN to have a current membership of 22 national standards organizations, 12 affiliates, a number of associates, counselors and corresponding members. At the beginning of the year 2004 six new members Estonia, Latvia, Lithuania, Po-land, Slovenia and Cyprus joined the organization. CEN has witnessed strong development amongst its member states made up of European Union members, the European Free Trade Association EFTA members, and some Eastern and Central European countries. The aim of CEN is to eliminate internal European trade barriers resulting from differing national technical standards. It also has an aim to stimulate industry and trade and therefore promote safety, economy, and efficiency through the creation, harmonization, and promotion of European standards.
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The CEN Technical Board (CEN/TB) is in charge of the coordination, planning and programming of the work which is conducted wi technical committees, working groups. The secretariats of the technical committees are decentralized in the different EU member states. CEN is composed of over 270 technical committees, has published some 9018 European standards and approved documents at the end of 2003. Over 6000 documents are under study. The European Committee for Electrotechnical Standardization (CENELEC) founded in 1959, fulfils within the electrotechnical sector the respective functions as CEN. The European Telecommunications Standards Institute ETSI is youngest of the three European standards preparing organizations responsible for creating telecommunication standards within the region (CEN 1995, CEN/CENELEC, ANSI 1996).
The time involved in developing European standards has been reduced. Currently, the time for CEN enquiry has been reduced to 5 month instead of the former 6 months (figure 4). Furthermore, the total project time involved in preparing EN standards has now been shortened to 36 months. There are also other timeframes such as the “UAP”- a timeframe unde total project time 12 months, “Target”- a timeframe foreseen to become the favorable solution for general work and also the average project time goal of 36 months, and “Tolerance”- a timeframe for complicated or delayed special of cases maximum project period of 54 months (CEN 2002b).
The drive for international standards to support international trade is what led to the Technical Barriers to Trade Agreement mentioned earlier and agreed as part of the GATT Uruguay round. The directives based on the “New Approach” made under Article 95 of the EC treaty specify health and safety requirements and sometimes other essential requirements (ER) in broad terms. Thus, although the application of the standards remains voluntary, European policy on technical barriers is inextricably bound up with standardization. The significance of European standardization has also increased greatly after 1985 when the EEC made a decision on the new approach towards technical harmonization. According to it, an attempt is made to restrict the essential demands, which are placed on the products in corporate legislation. Thus to facilitate producing and marketing demands of products, standards are drawn up in accordance with in European standardization organizations. However, they are not compulsory to the manufacturers. Instead the authorities cannot set supplementary demands to the standard that is related to the directives products.
Hebner (1999) points out that this agreement gives preference to international standards as a basis for the individual countries' standards and encourages developers of national and regional standards to defer to international standards. The underlying principle of the European Community’s New Approach is to make use of standards so that legislation can be more goal-based, thus contributing to better regulation policy. In effect, responsibility for implementing regulation is shared with industry, since industry through the standards bodies is entrusted with drawing up the standards, which give presumption of conformity. Furthermore, there is no need to amend legislation in the light of technical progress, provided that the standard is maintained. (Emond 2001)
Another organization that has played an important role in international trade and issues related to international standards in the World Trade Organization WTO, the predecessor of General Agreement on Tariffs and Trade GATT. The last negotiations of the GATT Uruguay Round gave birth to the WTO, which was established on 1 January 1995. As of 5 February 2003, there were 145 members and some other observers. The Agreement on Technical Barriers to Trade WTO TBT is one of the 29 individual legal texts of the WTO agreement that obliges members to ensure that technical regulations, voluntary standards and conformity assessment procedures do not create unnecessary obstacles to trade. The Annex 3 of the TBT agreement is the “Code of good practice for the preparation, adoption and application of standards” related to standards. In accepting the TBT Agreement, WTO Members agree to ensure that their central government standardizing bodies accept and comply with this Code of Good Practice and agree also to take reasonable measures to ensure that the local government as well as non-governmental and regional standardizing bodies do the same. The Code is therefore open to acceptance by all such bodies. The TBT Agreement recognizes the important contribution that international standards and conformity assessment systems make to improve the efficiency of production and facilitate international trade. Therefore, where international standards exist or their completion is imminent, the Code of Good Practice says that standardizing bodies should use them, or the relevant parts of them, as a basis for standards they develop. The WTO also aims at the harmonization of standards on as wide a basis as possible, encouraging all standardizing bodies to play as full a part as resources allow in the preparation of international standards by the relevant international bodies (WTO 2003).
3.4 National standardization
Different countries have their own national standardization systems. Usually, the sole national standardization body participates in the regional or international standardization work with the help of standards writing bodies of different fields of interest. At national level, standardization work is conducted by standards committees, which can obtain assistance from groups of experts. These committees or working groups are made up of representatives of the industrial circles, research institutes, public authorities and consumer or professional bodies. The structure of standardization varies from one country to the other. A typical national standardization working process is shown in figure 2.
Some national standardization systems have their standardization grouped according to specific industries. These industries or federations may be totally independent, functioning as a standards writing bodies, or consist of specialist individuals involved in national standardization. Sector-wise (agricultural and forestry machinery sector) standardization is a condition existing within a particular industrial sector when the large majority of products or services conform to the same standards. It results from consensus agreements reached between all economic players in that industrial sector - suppliers, users, and often governments. They agree for example on specifications and criteria to be applied consistently in the choice and classification of materials, the manufacture of products, and the provision of services. The aim of industry-wise standardization is to facilitate trade, exchange and technology transfer through enhanced product quality and reliability at a reasonable price, improved health, safety and environmental protection, and reduction of waste. Others include enhancement of compatibility and interoperability of goods and services, simplification for improved usability, reduction in the number of models, and thus reduction in costs and increased distribution efficiency, and ease of maintenance of products (CEN 2002).
3.5 Standardization in Finland
3.5.1&&Initiation of standardization in Finland
At the instigation of the Finnish Engineering Machinery Manufacturers Association, an initiation meeting was held in 1922 to start standardization in Finland. Present at the meeting were representatitives from the Ministry of Defence (Puolustusministeri&#246, the Finnish Railways (Valtionrautatiet), the National Board of Navigation (Merenkulkuhallitus), the Swedish speaking Technical Association in Finland (Tekniska Föreningen i Finland), the Association of Technicians (Suomalaisten Teknikkojenyhdistys)and the Finnish Engineering Machinery Manufacturers Association (Suomen Konepajainsinööriyhdistys). After a briefing about standardization work in foreign countries, the parties present at the meeting acknowledged the need to centralize standardization in Finland. In 1924 a standardization committee, the predecessor of the present Finnish Standards Association was established in Finland. Some of the key tasks of the standards association board were to:
-&&raise interest in standardization and to promote it in the field of technical and industrial production sectors,
-&&act as the central standards organization in Finland and cooperate with other countries’ standards organizations,
-&&confirm as Finnish standards, the proposals that have been drawn up in the right order after thorough assessment and
-&&promote the use of standards in institutions and municipalities in the country, as well as in industries, trade and agriculture.
There were also conditions that had to be fulfilled in order to confirm draft standards as Finnish standards. These included:
-&&the proposed standards have to bring general benefits and produce economic interests and benefits for all,
-&&the properties of standards proposals have to be able to stay unchanged long enough taking into consideration event changes and development trends,
-&&the proposal must consider scientific, technical
thereby have an advantageous purpose in these aspects.
In addition, the standards proposal has to lead to simplifying and solving problems related to standards without displacing the normal needs of the product being standardized. It was also proposed that the standard proposal for the products of Finnish industries should be fitted, if possible to the conditions of international trading countries for the benefit of industries and technical related fields.
The economic depression experienced in Finland at the end of 1920 also affected standardization work, so that standardization work became active again after the latter half of 1930’s. The activities of the standards committee were also revived when support was provided by the government and the general economy of the nation improved. As a consequence of the Second World War, the Work Efficiency Union of Industries (TeollisuudenTyöteholiitto) to which the Finnish Standardization Board (Suomen Standardisoimislautakunta)and the Rationalization Board of Industry of Finland (Teollisuuden Rationalisoimislautakunta)belonged, was established in 1942. Negotiations and active interests in 1942 about reorganising standardization work resulted in the establishment of the Finnish Standards Association (Suomen Standardisoimisliitto)at the end of 1946. The essential difference between the earlier and the new organization was the division of labor between a central organ, and the profe dealing with different areas of speciality (Kaartama 1984).
In 1947 when the Finnish Standards Association had gained ground, an attempt was also made to specifically clarify what standardization was. The 1947 annual report stated that, “standardization is a fight against the biggest problem of welfare spending, this spending can be found in the form of time, money, raw materials, work and labor. Especially under national conditions, standardization is a poor man’s weapon for achieving better living standards. It is a road to better welfare of the people”. Standardization work continued for the whole of the 1950's and a structure of operations got established. On the 13th of December 1951, the government strengthened the regulations concerning the use of the mark of the standards association. However, using the Finnish Standards Association’s mark on products begun only at the end of the year 1960. The association also started marketing the use of their mark purposefully for industries during the first half of 1970’s. In the 1960's more attention than before was paid to the operation of the office of the association. Publication and printing methods were renewed, cash on delivery was introduced into the billing of standards and the total area of operation of the association also enlarged. During that same transformation time, the EFTA countries agreed on technical regulations and compulsory standards notification process and this notification tasks was assigned to SFS in Finland (Kaartama 1984).
The largest marketing campaign on standardization was connected with the introduction of the International System of Units (SI) during the 1960’s. The association began to regularly publish a news magazine (SFS-tiedotus) in November 1969, which gave more information to the public. The paper gained affirmative criticisms and proved to be an extremely important means of communication about standards work progress.
&&The decade of 1970 marked a turning point in the operation of the association. The most important change in the administration of the union was the separating of the tasks of government and that of the standardization board. The board, which had representatives from different fields, could then concentrate on establishing SFS standards and giving instructions concerning the drawing up of standards. In 1975, nine ministries became members of the association whereas the formally separate civil service and departments (Valtion virastot ja laitokset) were removed from the membership of the association. In 1980, the Ministry of Trade and Industry (Kauppa- ja teollisuusministeri&#246 set up a GATT information center concerning the technical barriers of trade in SFS. The establishment of such a center was a requirement for all GATT members. Later in 1982, the Association of Informative Labeling of Products (Tavaraselosteliitto)was also closed down and its operations were moved to SFS. The Standards Association awarded the first quality system certificate to Kemira’s personal protection equipment in January 1990. Certification enlarged remarkably after that and on the 31st of October 2002, certification work was moved Inspecta Oy.
In 1989 a regulation concerning the language of standards made it possible to refer to foreign standards without necessarily translating them. Due to this, standards which do not have much use in Finland, even if they were connected for example to the legislation of the EU do not need to be translated into Finnish. New rules about standardization were laid in 1993 such that the managing director of SFS confirms all the SFS standards, which are in accordance with European or international standards. The Standards Board confirms all other SFS standards.
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Presently, the Finnish Standards Association SFS serves as the central standardization organization in Finland. SFS is an independent non-profit making organization. SFS works in cooperation with trade federations and&&industries, research institutes, labor organizations, consumer organizations as well as governmental and local authorities. Members of SFS include professional, commercial and industrial organizations, and the state of Finland represented by the ministries. At the end of year 2003, the number of SFS standards was over 17 000 (figure 5 & 6). SFS standards are voluntary documents and are generally drawn up by standards-writing bodies of SFS. In practice the representatives of the various industries, organizations and individuals cooperate with SFS or its standards writing bodies and also contact the standards association when they want to make a suggestion for a standard.
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The two biggest standards writing bodies in SFS are the Technology Industries of Finland (Teknologiateollisuus)and the Finnish Electrotechnical Standards Association (Suomen Sähköteknillinen Standardisoimisyhdistys SESKO). Standard are prepared by reference or working groups who draw up the standard proposal. Representatives of manufacturers, users, authorities and research institutions are present in these committees. National committees could also be assigned European or worldwide standardization tasks. In Finland, the practical work is done in the working groups. When a standard proposal is ready, it is sent for commenting and approval by all the parties whom the standards concern. When the received answers have been processed and appropriate changes done to the proposal, final voting is taken to decide its acceptance (figure 2). All European standards are confirmed in Finland as SFS standards, and existing national standards conflicting with them are withdrawn. The management standards compilation work is taken care of by cooperation with the 15 standards writing bodies as shown in figure 7.
Today most SFS-standards are prepared by implementing international ISO or European CEN standards, and only a few a purely national standards are published.
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3.5.2 Cooperation of Finland in international standardization
Electrical engineering in Finland had international standardizing cooperation already in the first decade of the 20th century. In other fields, the corresponding operation began only at the end of the 1920's and Finland participated mainly through Sweden. In 1937 Finland also took part in the technical work to standardize automobile rims and tyres. During the years 1938-40 Finland was part of the International Standards Association’s (ISA) council.
To promote international cooperation the standardization board of Finland took a positive stand in establishing an international standardizing board already in 1924 at the initial stages of its establishment. In 1939, the board actively participated in international cooperation. The board had the task of arranging the international conference of standardization. It took place between the 26th of June and the 7th of July 1939 in Helsinki.
International standardization activity subsided during the world war years. After the war, the United Nations made the initiative to establish a new organization because they realized that, after all that has happened during the war, the old organization could not be brought back to life again. This resulted in the founding of the present International Standardization Organization ISO in London in October 1946. When business activity and rebuilding after the war recovered, the demand for the foreign standards also increased in Finland. An agreement was made with the Bank of Finland on the supply of the necessary currency to secure the supply of foreign standards. In 1947 there were already connections to 28 different countries from which the association conveyed standards to Finnish industries. During the years , the chairman of the Finnish association professor Edward Wegelius was also the chairman of the International Standardization Organization ISO. Finland got its first international secretariat task within ISO in 1959, ISO/TC 6/SC 5; Quality definitions and test methods for paper and pulp. Finland still has this responsibility and is taken care of by Keskuslaboratorio Oy, a research institution of the wood processing industry. The general assembly of ISO was held in Helsinki in June 1961. Finland participates in all the three international standardization organizations. The Finnish Standards Association SFS is a member of ISO whist the Finnish Electrotechnical Standards Association (SESKO) takes part in the International Electrotechnical Commission (IEC) and the Finnish Communications Regulatory Authority (FICORA) take part in the International
Telecommunication Union’s (ITU) work (figure 3).
3.5.3 Cooperation of Finland in European standardization
Finland participated in the European Standardization Organization’s (CEN) operations since the 22nd of March 1961. The significance of European standardization has increased greatly after 1985 when the EEC made a decision on the new approach in technical harmonization.
Furthermore, the EU uses standards also as a support for legislation for example in machinery safety, in public procurements and building. Currently, Finnish Standards Association SFS participates very actively in CEN (including Finnish Electrotechnical Standards Association (SESKO) and the Finnish Communications Regulatory Authority (FICORA)). All standards drawn up by CEN must be confirmed as national standard in Finland and conflicting standards must be withdrawn.
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