When Regulators Run Amok

Power-wielding bureaucrats need a “spiritual” awakening

Published: Wednesday, June 29, 2011 - 14:05

Standard: “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” (ISO/IEC Guide 2:2004—“Standardization and related activities—General vocabulary”).

The International Organization for Standardization states “[ISO] standards ensure desirable characteristics of products and services such as quality, environmental friendliness, safety, reliability, efficiency, and interchangeability—and at an economical cost.”

The International Code Council (ICC), which does technical evaluations of building products, components, methods, and materials, operates by “providing the highest quality codes, standards, products, and services for all concerned with the safety and performance of the built environment,” according to its “Blueprint to 2015.” The council’s mission also includes “protecting the health, safety, and welfare of people by creating better buildings and safer communities.”

Standards are important for business well-being. As the speed of shared information increases, and the time it takes for international travel decreases, the global business community continues to draw closer. Standards help facilitate all that worldwide elbow-rubbing by providing a shared understanding of requirements for almost any business or technical endeavor. Adopting national and international standards such as those provided by ISO, ICC, ANSI, and NIST, helps to ensure partners and clients that services and products will meet their own standards of quality. Indeed, standards are a good thing, helping to enhance rather than stifle business growth.

Regulation: “A document providing binding legislative rules, that is adopted by an authority” (ISO/IEC Guide 2:2004).

What’s the difference between standards and regulations? Standards are guidelines. Regulations are standards with teeth.

What must be remembered is that at some point the rubber hits the road. All the standards in the world don’t make a hill of beans until they are translated into physical reality. No matter how big a corporation is, all products and services are rendered in the real world, at the local level. Hence, the importance of local governing bodies to enforce the regulations that provide teeth to the standards. The devil, of course, is in the details of the enforcement.

Although many standards are voluntarily adopted, many are not. Unfortunately, many compulsory regulations are the direct result of local government agencies taking the enforcement of standards to unrealistic lengths. In some agencies, the people in charge become so detached from the intent of the standard, and so enamored of their own power, that they write and enforce regulations that are directly opposed to the “optimum degree of order in a given context.” This distortion of standards has the effect of hindering businesses from getting off the ground at all. Instead of acting as a guide and partner, some regulators become the largest single hurdle that business owners will ever face.

Nowhere do most of us experience this kind of outrageous behavior than in our local government agencies that handle business licenses and permits.

Here’s a real example. In our city, when Mr. Joseph decided to use his dog-training skills and experience to launch a training, boarding, and grooming facility, he had no idea just how ridiculous and unprofessional some agency officials could be.

With the aid of his local county Small Business Association, Joseph put together an extensive business plan that included market analysis, funding options, marketing plans, and, of course, city permits.

Right away the city planning department required a $3,200 nonrefundable application fee just to get started. No money? No plan review, no discussion, nada.

Joseph anted-up and was told that his plans would be forwarded to all the applicable intra-city departments and a hearing would be set ASAP.

“As soon as possible” turned out to be six weeks later. The hearing was held, and a permit was issued. Unbelievably, as Joseph and his planning-department case handler were about to leave the city chambers, the handler informed Joseph that he would now have to contact the other appropriate departments. It turned out that after $3,200, two months, and a scheduled hearing, the city had not taken even the first step in its process. The setback cost Joseph another four weeks and $700 for a rezoning permit.

The kicker here was that just to apply for the permit, Joseph was required to physically lease a property. And to stay on schedule for opening business doors to the public, thousands of dollars had to be shelled out for equipment, outfitting, and supplies, with no kind of assurance at all that a permit would actually be granted. With determination and crossed fingers, Joseph invested the capital and pressed on.

All told, it took four months for Joseph to obtain two simple permits for a mundane business operation.

As this story illustrates, motives other than quality and public safety sometimes come into play when enforcing regulations that interpret standards. Some public officials have lost sight of the fact that standards and regulations exist to improve, not to inhibit.

On a national scale, there are also regulators that exhibit the same disregard for quality and safety by writing and enforcing mandatory regulations in direct opposition to the spirit of the standards they are meant to enforce.

I’m not saying that regulation in itself is bad. Sometimes you need to enforce what might otherwise be, in a perfect world, a “voluntary” standard. People don’t always volunteer to do the right thing, and so we create regulations to nudge them. However, it’s a sad thing when otherwise sensible standards or regulations are spoiled by over-zealous and unaccountable bureaucrats who have lost sight of what their job is: to interpret the letter of the law within the context of its spirit.

About The Author

Ryan E. Day

Ryan E. Day is Quality Digest’s project manager and senior editor for solution-based reporting, which brings together those seeking business improvement solutions and solution providers. Day has spent the last decade researching and interviewing top business leaders and continuous improvement experts at companies like Sakor, Ford, Merchandize Liquidators, Olympus, 3D Systems, Hexagon, Intertek, InfinityQS, Johnson Controls, FARO, and Eckel Industries. Most of his reporting is done with the help of his 20 lb tabby cat at his side.