Hi Dan:
> Dell Computers, as well as a few other major players, take a proactive
> approach to compliance and actually have a VP position for compliance. With
> a little investigation into the benefits of having a first rate compliance
> department with the ability to design for compliance, test to relevant
> standards, compile reports, participate on standards committees, and deal
> directly with world wide agencies I would think that most companies that
> have global markets would see both the short term and long term benefits to
> the bottom line. I would tend to include PC's into the ordinary products
> pile, wouldn't you?
I do agree with (and we practice) a pro-active
approach to compliance.
In my experience, though, I am surprised that
a compliance manager would be a VP position
(in a company making "ordinary products" as
compared to a company making medical products
or similar products subject to a high degree
of regulation).
As you mention, there can be short-term and
long-term benefits to the compliance activities
you mention. However, the benefits must outweigh
the costs of the activities. Quantifying and
measuring the benefits of some compliance
activities is often very difficult.
Management philosophy of the particular company
is another significant variable in the extent
of compliance activity.
Some companies believe that safety certification
is sufficient safety. Others believe that safety
and safety certification are independent although
overlapping activities.
At one time, I knew of a company that addressed
safety not in the product, but in liability
avoidance through instruction manuals, through
insurance, and by passing liability on to its
suppliers. Cost effective, yes. Morally
effective, questionable.
> Companies that choose to take the adversarial approach to compliance by
> cutting corners or only doing the minimum to comply, save dollars in the
> short term, but pay later in lost customers, or worse, lawsuits. One of our
> clients, had a management team that took this denial/avoidance approach to
> NEBS. When the Telecom downturn came, they were left in a position where
> there was lots less demand and what demand there was, was for NEBS compliant
> products. Most of the management team that made those decisions have either
> left the company in recent right-sizing exercises, or are working in lesser
> positions.
Reducing the cost of compliance does not in any
way imply an adversarial approach to compliance.
Neither does cost reduction imply a reduction in
the compliance performance of the product.
For example, some years ago a R&D engineer came
to me and said, "The cost of safety is too high."
My immediate response was, "Not if you design in
safety from the start of the project."
He replied, "No. I mean that safety requires me
to use a power switch and a fuse. These cost
money. The switch serves no benefit to the user
since the unit is left on continuously." (This
was back in the days when the plug was not
considered a disconnect device.)
So, I started a project to determine alternatives
to switches and fuses and other safety components
(for the specific products we were building at
that time).
In terms of EMC compliance, I know one engineer
who keeps track of the number and cost of components
used exclusively for EMC control. His objective
was to reduce the total cost of EMC control. This
in no way is cutting corners of compliance, or
doing the minimum to comply. The result was still
full compliance -- but at least cost.
> It seems that hindsight is always able to find a goat. When I explain the
> benefits of compliance to management teams, I try to focus on the bottom
> line benefits of having a product that is marketable everywhere. The costs
> for compliance, when compared to the total development cost for a new
> product tend to be in the noise. If these costs are amortized over
> reasonable quantities, then the unit cost for compliance tends to be a
> bargain.
There are two kinds of costs associated with
compliance.
The first kind is the cost of compliance in the
product development. I agree that these costs
are indeed "in the noise" compared to the overall
development costs.
The second kind of cost of compliance is the cost
of labor and components that are installed solely
for compliance. For high-volume products, these
costs are far more important than the costs of
development because they affect the price
competitiveness of the product. A flame-retardant
plastic costs more than a non-flame-retardant
plastic. How can we design a product to minimize
the use of flame-retardant plastic yet comply with
the standards as well as being a truly safe product?
For me, this second cost, the per-unit cost of
compliance, is a very significant part of my job.
Best regards,
Rich
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