Business

Last updated: 9 april, 2010 - 12:27 GMT

Who Sets Our Standards?

About this programme by Peter Day

The setting of standards - and the policing of them - is a rather boring subject until you think what has been enabled by them: trains were able to run safely only after national railway time replaced the haphazard local time of the pre-railway age ... and the standard rail gauges that they run on.

Standards also make possible the new infrastructure of the Internet, and the interactivity of the mobile phone. Standards are everywhere, invisibly making most of modern life possible. Standards are what this programme is all about.

But whatever the business and social benefits of standards are in terms of health and safety and innovation and cost saving, it is important to remember that standards are not sufficient of themselves.

I was sharply reminded of that when I read a new book by the always interesting Financial Times business commentator John Kay, visiting professor at the London School of Economics. It is called "Obliquity". It is a fascinating subject.

Obliquity is another name for lateral thinking ... the roundabout way that human beings often solve problems more effectively than using pure logic of the kind often enshrined in business standards such as ISO 9000 or 9001.

Rational

John Kay puts it in beautifully clear language: "Happiness is not achieved by the pursuit of happiness. The most profitable businesses are not the most profit-oriented."

This in itself is a very important observation. Planned economies work much less well than the competing chaos of market economies.

Professor Kay then goes on to describe how it is impossible to take a direct approach to many problems. The complexity of the life we live in is too complex to admit of ready made solutions. Computers, he says, cannot do obliquity.

And finally he has a telling section explaining how irrationality can be applied to problems ... and will often work better than rationality simply because many processes that masquerade as rationality plainly do not work.

A gem of a book, this.

Yes we need standards to help us make things, processes, organisations work. But we need to be flexible enough to abandon standards thinking - and rationality itself - when experience tells us that obliquity might produce more useful results.

In the course of making this standards programme, I went along to see another ingenious economist Michael Mainelli, who runs a risk consultancy in the City of London called (curiously) Z/Yen.

Michael Mainelli is also a prof, at an ancient London institution Gresham College. It is still dedicated to enlightening the lay people who crowd into its free public lectures in just the way Sir Thomas Gresham intended when he founded the college more than 400 years ago.

(Sir Thomas is famous in Britain for Gresham's Law, which was actually coined by the Polish scientist Nicolaus Copernicus 40 years before him: that "bad" money drives out "good" ... an observation about informal standards worth remembering in these troubled times.)

Anomaly

Michael Mainelli happens to be a director of UKAS, the United Kingdom Accreditation Service, a company which polices the standards setting organisations themselves.

But he has also lectured at Gresham College on standards, and in one of his lectures he pointed out a glorious anomaly that is not quite Obliquity but is certainly a reminder of how divergent human thinking is from strict rationality.

He pointed out that to publicise this arcane business of standards, various leading international organisations hold an annual World Standards Day. A good idea, yes?

World Standards Day is supposed to be 14th October. In 2006, however, India, Ghana and others celebrated it on 13 October, Nigeria's commemoration was from 12 to 14 October, and the United States observed World Standards Day on 11 October.

There were, I should think, perfectly sound reasons for one day turning out to be so many Standards Days. There is no arguing with Obliquity.

Previous updates - November

October

September

  • The media is going through a 'double-mangle' says Peter Day.

  • In San Diego, Peter Day investigates the company that produces WD40's secret formula.

  • Peter Day looks back on a year of the credit crunch with Simon Johnson, former chief economist for the IMF.

  • Peter Day finds out from the experts how to start a bank.

  • Peter Day looks at the great expectations in landlocked Bolivia and its part in the auto revolution.

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