Why research proving the value of standards couldn’t have come at a better time

In testing economic times, ensuring you have every competitive advantage possible is more vital than ever.

Standards help to ensure organizations are as efficient and well-functioning as possible, providing the strength and flexibility to not only make it through tough times, but find ways to develop and identify opportunities even when facing adversity.

Now there is clear evidence of just how much standards contribute to issues like productivity, innovation and competitiveness.

Boosting productivity, turnover and innovation

A 2021 BSI survey asked 1,000 UK firms in 16 key sectors to think about the general and detailed effects of standards on their operations.

Here are some of the key findings:

• 55-85% of firms see standards as having a net benefit
• 81% of firms see standards as providing an ongoing boost to productivity
• All sectors except automotive see more benefits than costs from using standards
• All sectors identify a significant increase in turnover as a result of using standards
• The largest benefit was for healthcare, finance and professional services
• Most firms see standards as widening markets for innovation
• Standards are seen as providing a boost for competitiveness, especially in export markets

Standards are major drivers of GDP and productivity growth

A recent report from the Centre for Economics and Business Research (CEBR) analysed organizations’ responses to the BSI survey on how standards impact their business, and together with other inputs was able to get a picture of how standards affect the wider economy.

The positive economic impact is clearly shown in the numbers. CEBR’s economic modelling indicates that around 23% of all UK GDP growth in the last hundred years can be attributable to the impact of standards, together with 38% of all productivity growth. Standards have added around £161 billion to the UK annual GDP since 2000.

Broader benefits of standards

It is important for individual businesses to know how standards can benefit them.
However, there is also a broader benefit to the adoption of standards, for example by creating level playing fields in particular sectors, improving interoperability, reducing safety risks and so on.

Standards have an incremental and cumulative effect that we often take for granted. For example, they can help businesses become more efficient, and in turn, keep prices down. This is a significant benefit (never more so than during periods of inflation), but one rarely reflected on when making a purchase.

As the CEBR report makes clear, finding a methodology to measure the impact of standards is far from simple but it is undeniable that standards benefit individual businesses, sectors, and the wider economy as a whole.

One celebrated example of this is the standardization of the freight container - 40 ft long (12.192 m) to be exact - a major driver of globalization. Not only did it lead to a huge reduction in the cost of shipping, it also allowed many countries that were previously isolated from global trade to put their products on the world market.

Wider impacts of standards

It should be remembered that standards do more than just impact growth and productivity. Standards that address health and safety or the environment deliver benefits that are not primarily economic, even if it benefits the economy indirectly. However, these ‘hidden’ benefits are important and should be recognized.

For example, work-related ill health costs British businesses £16.2 bn each year, with an average cost of £8,800 for each non-fatal injury. When you factor in possible legal proceedings, investigation, time off work, recruitment costs, lost knowledge and expertise, reduced staff morale and possible reputational damage, failing to take care of workers can prove very costly.

A business that uses standards to help reduce risks to employees, for example by using the BS ISO 45001 series to design an occupational health and safety management system or BS 8484 to create a policy on lone working to help address personal safety, may avoid the harm to workers and drain on the business caused by a health and safety incident.

Net Zero impact

With the UK committing to hit net zero carbon emissions by 2050, and growing consumer pressure for business to take action, it is no surprise that many organisations are looking to standards for support. The CEBR report found that environmental standards are making a tangible difference.

89% of companies reported the positive impact of standards within the first three years, while 34% reporting a benefit within one to two years of implementation. Environmental standards also help to reduce the risk of breaching environmental regulations and the associated reputational damage.

Are you making the most of your membership?

As is evidenced by the CEBR report, standards can help your business compete better on several fronts. Furthermore, your membership of BSI can ensure you get the most from those standards.

For example, BSI members have an expert team of researchers at BSI’s Knowledge Centre on hand to help identify relevant standards or understand changes to standards.