Between Supply and Demand: Coping with the Impact of Standards Change

Between Supply and Demand: Coping with the Impact of Standards Change

Tineke M. Egyedi (Delft University of Technology, The Netherlands)
DOI: 10.4018/978-1-60566-320-3.ch012
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Abstract

There is a continuous pressure for improvement in e-business. Increasing technical possibilities, new forms of outsourcing, the ongoing integration of business processes, the expansion of value chains, the emergence of new markets and new players; they affect the infrastructure and underlying ICT standards. Contrary to the inherent stability one might expect from standards, maintenance of and change in standards are rule rather than exception. The benefit of standards change is sometimes obvious. However, it can also pose severe problems (e.g. heavy switching costs and reduced market transparency). This chapter synthesizes research findings on standards change. A conceptual framework is developed to determine under which circumstances standards change is avoidable; if so, in what manner; and if not, which means exist to reduce the negative impact of change. While some change drivers are innovation- related, others stem from the standardization activity itself. They require distinct coping strategies: change control and quality control, respectively. Along these two lines, the chapter discusses strategies to cope with the impact of standards change.
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2. The Value Of Standards

The term ‘standard’ is used in this chapter in two main senses, namely in the sense of committee standards and in the sense of de facto standards. A committee standard1 is a very specific type of agreement. It is a specification developed by a committee for repeated use, or “a document established by consensus (…), that 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” (adapted from ISO/IEC, 2004, p. 8).2 This – adapted - definition covers the standards developed by formal standards bodies like the International Organization of Standardization (ISO) and from, for example, standards consortia (e.g. World Wide Web Consortium, W3C) and professional organizations (e.g. Institute of Electrical and Electronics Engineers, IEEE).

The second sense in which the term ‘standard’ is often used, refers to de facto standards, that is, to specifications that underlie products and services with a significant market share, and to widely adopted practices. An example is the PDF specification of Acrobat Reader3. Initially these specifications were not meant to become standards, that is, to be referred and built to by third parties, but their wide use turns them into such standards. De facto standards, too, undergo changes (e.g. software updates).

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