Standards vs Dominant Design
Standards and Dominant Designs: Are they Complementary or Substitutes?
Abstract – The ordinary approach towards Standards and Dominant Designs is considering them as synonymous. This essay argues the potential confusions generating because of this common belief providing evidences that might support the different meaning of the two terms. While one may argue Dominant Designs are characterized by persistent architectures within developed or new industries, the networks effect and the interconnectivity are the crucial features of Standards. Despite that, standards play a relevant function as part of dominant designs. The first section of the paper underlines the background of both standards and dominant designs highlighting the different theoretical foundations they derive from, whilst the second part mainly focuses on the complementary role of standards and dominant designs. Practical evidences are provided in order to support this argument. The last part of the essay discusses the implication in the market deriving from this distinct, still complementary, relationship between Dominant Designs and Standards. Other implications for corporate strategy are argued in the final part.
I. Introduction
THERE is a frequent overlap when people discuss the concepts of Standards and Dominant Designs. It is ordinary among managers, engineers as well as a narrow part of the economic literature that considers the concept of dominant design and technological standard as synonymous, or the same implications for the two terms.
Actually, the two notions derive from different backgrounds and fundamentals as well as lead to diverse consequences from the market point of view, the firms’ performances and the management ones.
The aim of this brief essay is trying to put in light these differences in order to avoid this common
misinterpretation providing evidences that dominant designs and standards are complementary to each other rather than two substitutes.
Abstract – The ordinary approach towards Standards and Dominant Designs is considering them as synonymous. This essay argues the potential confusions generating because of this common belief providing evidences that might support the different meaning of the two terms. While one may argue Dominant Designs are characterized by persistent architectures within developed or new industries, the networks effect and the interconnectivity are the crucial features of Standards. Despite that, standards play a relevant function as part of dominant designs. The first section of the paper underlines the background of both standards and dominant designs highlighting the different theoretical foundations they derive from, whilst the second part mainly focuses on the complementary role of standards and dominant designs. Practical evidences are provided in order to support this argument. The last part of the essay discusses the implication in the market deriving from this distinct, still complementary, relationship between Dominant Designs and Standards. Other implications for corporate strategy are argued in the final part.
I. Introduction
THERE is a frequent overlap when people discuss the concepts of Standards and Dominant Designs. It is ordinary among managers, engineers as well as a narrow part of the economic literature that considers the concept of dominant design and technological standard as synonymous, or the same implications for the two terms.
Actually, the two notions derive from different backgrounds and fundamentals as well as lead to diverse consequences from the market point of view, the firms’ performances and the management ones.
The aim of this brief essay is trying to put in light these differences in order to avoid this common
misinterpretation providing evidences that dominant designs and standards are complementary to each other rather than two substitutes.
References: 1. Chiesa, R. Manzini, and G. Toletti, “Standard-setting processes: Evidence from two case studies,” R&D Manage., vol. 32, no. 5, pp.431–450, 2002; 2 3. C.Hill and G.Jones Strategic Management Theory: An Integrated Approach, Sixth Edition. New york: Houghton Mifflin, 2004; 4