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More About Standards

Authors Note: Last month, a dealer asked why there are no standards in our industry. To reacquaint yourself with that response, please visit Heres the second part of my response.

For an example of an industry with rigid sets of standards, lets examine the building industry. Need a 2×4 to build a house? Theres a standard. Need drywall? Screws? Pipes? Each product is manufactured to a standard. And each is considered a commodity.

Builders pay little attention to the brand name of the studs. There arent new and exciting forms of drywall every 12 months. And pipe manufacturing requires standards to insure interoperability. While I wont disparage the sheer pleasure that commodity manufacturers must take in their work, its evident that price, and not product innovation, drives the marketing and success of these products.

Lets look at the installers of these commodities. From the general contractor on down to the drywall hanger, each service provider is state licensed. This protects the state from unscrupulous building practices that may endanger the public. It protects the consumer from purchasing a shoddy product. And it protects the trades from price competition by limiting the competition. Because building construction is a public safety concern, the states are eager to impose codes and standards.

Turning our attention to the computer industry, we find standardization self-imposed by manufacturers. Computers are a collection of standardized parts, using standardized code, configured in a standardized fashion. Who demanded standardization? Well, the U.S. government, for one, who buys lots of computers and doesnt want to be beholden to any one company, and foreign governments with the same concern. Dont forget about big multi-national companies and software companies that dont want multiple platforms. Did I mention IT managers? They couldnt care less about standardization. They like complexity. (Ultimately so should you.)

And now to your original question: Why cant manufacturers band together like old frat buddies at the 10th reunion? Because they dont want to. Unlike the building industry, your DVD players lack of discrete on/off codes is not a public threat. The keypad in your bedroom isnt a part sourced by NORAD.

Increased confusion in the market, properly nurtured, is a boon to manufacturers for several reasons. Markets suffering from confusion tend to permit high profits to the most efficient manufacturers. Confused markets permit a higher degree of experimentation, with decreased downside from failures. And, unfortunately, a lack of standards lets unscrupulous manufacturers enjoy a host of specification deceit, and as a result, an ability to make a shoddy product, claim otherwise, and sell at a premium. Customers and dealers dont know what -3dB at 30Hz sounds like, or how many watts are pumping from their 100w amplifier, so manufacturers indiscriminately slap these specs on products to boost their value. You think these manufacturers want standards?

Heres why your trade organizations dont create standards: Because theyre powerless. No trade organization ever dictated a set of standards to its manufacturing members. No manufacturer would pay attention. Trade organizations exist to facilitate communication between its members, not to impose order on a marketplace. Order is either imposed by government agencies or powerful interest groups, like really large customers. Our industry has neither, and as such, will continue along its path of fractured innovation for the foreseeable future.

Your job is to find a way to profit from the confusion.
Interested in having your CI business questions addressed in this column? Send them to [email protected]. Please include your full name, company name, and address.