This is nothing new for a trained business administrator, as you learn about standard warfare in the first few semesters. For true art, they were raised by US economists Carl Shapiro and Hal Ronald Varian in their groundbreaking article "The arts of standards wars," which appeared in the California Management Review in the year 1999. In it they describe in detail which strategic advantages it brings to a company when technical standards are formulated in their favor and recommend a variety of strategies that managers should adopt. One of them is to complain to standardization committees in order to reconcile them as far as possible with their own product characteristics or production processes. If one succeeds in pushing products of its competitors out of the norm at the same time, one has secured a sustainable competitive advantage.
"I would say that influencing technical standards is a core business for lobbyists because it allows them to control entire markets, enforce their production processes and keep their competitors in check."
Lobbying expert Martin Pigeon
Ene mene muh ...
Standardization processes are not just about functionality and security. It's also about market dominance. Although standards are theoretically only voluntary recommendations, they often prove to be in practice inevitable. If a product or process falls outside its scope, the company suffers significant competitive disadvantages. It simply does not come close to any orders that refer to the applicable standard rule.
"I would never work with a company that does not conform to standards or does not have the appropriate approvals. Because all contracts contain the passage, according to the standards'. When building itself you can already deviate. But should it eventually come to a legal dispute, we are fully liable as architects - regardless of whether a building damage with the deviation has ever to do. From a legal point of view, all then primarily refer to compliance with standards. "Says Bernd Pflüger from BUS Architekten.
... and you are out!
Monica Nicoloso, owner and managing director of Pottenbrunn brickworks, knows what a small production plant means if its product is not found in any standard. For decades, the family-owned company produced chimney systems and sold them with an Austrian Technical Approval (ÖTZ). Until in the year 2012 instead of the ÖTZ a BTZ (building permission) was introduced. However, gaining this for the small business entailed such financial expense and risk that it simply ceased to be approved. The result: "We no longer produce today. Without a license no chimney sweeper will take our fireplaces off. And cooperation on standardization is not possible for us because of time and cost reasons, "says Nicoloso. A hundred and fifty year company history came to an end.
Martin Galler, Managing Partner of Progal, also knows that standardization committees can decide on the advent and demise of technologies and companies. The company specializes in dry-laying walls using electro-physical methods. In the year 2014, Galler learned quite by accident that the Önorm B3355, which regulates wet masonry drainage, should be updated. He then contacted Austrian Standards, where he was advised to oppose the standard. He did so and applied at the same time for inclusion in the working group AG 207.03, which was entrusted with the update. This was followed by a one-and-a-half-year confrontation with other members of the working group who had tried to exclude his electrophysical procedure from the norm. Factual arguments hardly played a role, as the arbitration board of the ASI finally stated. Hundreds of hours of work and numerous reports, counter-opinions, meetings and documents later, it was finally clear that his drying process would be kept in the norm. His conclusion: "It would make sense for governments to pay more attention to the balance in standardization bodies and improve their communication. After all, it was only by chance that I learned that our electrophysical process was in danger of being forced out of the market. "
A look at the composition of the aforementioned working group 207.03 illustrates quite clearly the problem of the often missing balance of standardization committees. In it, ten manufacturers each face two users, public institutions and research institutions. In the working group 207.02, which deals with the standardization of screeds, plaster and mortar, the relationship is even more striking. Therein, ten manufacturers face no single user, an independent expert and two public institutions to decide what to sell and what not.
Ernst Nöbl, a retired cultural and environmental engineer with decades of experience in standardization committees, reports on the unwanted ecological consequences of many a norm. As an example, he cites the European standard for sewage treatment plants, which among other things regulates the quality of the effluent water: "The standard only indicates the values in relation to the inflow. The result is that sewage treatment plants are sold in Austria with nitrogen and phosphate content well above the legal maximum. "
In his view, engineering should be given more weight in the (standard) standardization bodies and norms restored to their original function as voluntary recommendations. "The companies are tearing themselves apart in standardization committees. This also gives you a clear competitive advantage. Planners and engineers, however, less. The time required does not pay for them that much, "says Nöbl.
A look to Brussels
Since about 90 percent of the standards in force in Austria are of European or international origin, one can not avoid looking in the direction of Brussels. Over and above 11.000 lobbying companies, we are always impressively aware of how we can contribute "constructively" to the EU pesticide regulation, the EU data protection directive or the free trade agreement TTIP, for example.
On the other hand, there is - worldwide - a single consortium of 40 environmental protection organizations, which checks the ecological compatibility of international standards and norms. ECOS (European Environmental Citizens Organization for Standardization) is represented on all 60 technical committees to ensure that pollution is reduced and that resource and energy efficiency systematically find their way into practice. "In the EU, we are one of four officially recognized stakeholders whose participation in European standardization processes is also supported by the EU. This compensates at EU level for the fact that civil society interest groups and small and medium-sized enterprises are not systematically involved in national standardization processes ", says ECOS.
In turn, the Corporate Europe Observatory is a Brussels-based NGO, which guards and systematically analyzes the work of its lobbyists. Commenting on the importance of technical standards, lobbying expert Martin Pigeon responds: "I would say that influencing technical standards is one of the lobbyists' core businesses, as it allows them to control entire markets, enforce their production processes and compete with their competitors Keeping the chess [...] If you go into detail, you realize that the lobby wars for regulation is an absolutely central component of international trade and that there is a lot of politics going on in the name of standards. "
More transparency required
In fact, technical standards and norms govern 80 percent of world trade and control access to most markets. They influence the design, functionality, manufacture and use of almost everything that is produced. But as detailed as they define product characteristics and production processes, so vague is the process of their own emergence. Too often it is not comprehensible who has actually defined a standard and whose interests it finally stands for. Therefore, standardization processes must be open and transparent in order to have a degree of legitimacy.
The Austrian standardization system
• Overall, in Austria, 23.000 standards (ÖNORMEN) apply.
• Standards are recommendations whose application is generally voluntary.
• Except, the legislator declares a standard to be binding or refers to it in laws, ordinances, notices, etc. (approximately 5 percent of all standards).
• Around 90 percent of the standards in force in this country are of European or international origin.
• Standards are developed by Austrian Standards, which provides project management as a neutral service provider.
• Applications for the development of a new standard or for the revision of an existing standard are free of charge for the applicant since 2016.
• Participation in the standardization committees is also free since 2016.
• Costs incurred by the participants for the time spent traveling, attending, preparing and reviewing the working sessions.
• All members of a committee must agree to a standard so that it can be decided (unanimity principle).
• The transparency of the Austrian standardization process is ensured, for example, by the following free online publications:
• requests for the development or revision of standards - with opportunities for comment,
• draft standards - with opportunities for comment,
• companies and organizations that send participants to the individual committees,
• tasks and current projects of each committee,
• National work program showing which current project proposals and draft standards are publicly available for comment.
• Balance of the standardization process should be ensured by the fact that the committees always represent all interest groups of a specialist area - ie manufacturers, authorities, consumers, testing centers, science, interest groups, etc.
• Openness should be ensured by allowing participation in standardization bodies to be open to everyone. However, one must have the appropriate know-how and know the practice.
• The necessity and appropriateness of standards is reviewed in public appraisal procedures or surveys. It is open to everyone to express their opinion and to propose changes to the project application.
• Once the committee has finalized a draft standard, it will be published online for comment by all interested parties.
Source: Austrian Standards, May 2017
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