History And Background Of Global Standardization

The true meaning of global is based on the understanding that common rules are necessary so that nations around the world will basically accept the diversity and cultural differences of each country and will mutually succeed in the same market. Furthermore, International Organization for Standardization (ISO) defines a standard as "A document, established by consensus and approved by a recognized body, 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."

The Asian Economic Crisis, beginning in 1975, contains factors that cannot be evaluated by only global standards. The crisis does not indicate that crony capitalism which rejected global standards was at fault and hence punishable as a criminal. However, "clarity and information" should be required as minimum standards. For more history of standards, it is interesting to note that the earliest standards were made to enforce honesty among people. Human society has exchanged goods and services on the basis of physical measurement. Unfair dealings and incorrect measurements were resented and systems were developed to enforce honesty.

Standards serve as reference documents that are used in context of contracts or international trade on which the commercial transactions are based. They also represent a level of technical expertise and technology, and are used by the industrialists as the indisputable definitions that simplify and clarify the contractual relations between economic partners. The role of standards is thus important to all of the business partners. When dealing with business partners in same country, the standards followed are generally the same. This, however, is not true when the business is done globally. The standards and practices followed may differ from country to country. To ensure compatibility of the business partners that are geographically separated, harmonized international standards can play an important role in removing technical barriers to trade.

The life cycle of standards generally comprises seven major parts for (1) Identification of need; (2) Collective programming; (3) Drawing up of the draft standard; (4) Consensus; (5) Validation; (6) Approval; and (7) Review. The lack of unique or harmonized standards for similar technologies causes technical barriers to trade. Rationalizing the international trading process