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How might the use of "standardization" permit a firm to enhance profit?

Please answer the question completely (e.g. premise and supporting facts) and please provide/document your reference.

How might the use of "standardization" permit a firm to enhance profit? Discuss fully.

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How might the use of "standardization" permit a firm to enhance profit?

Standardization greatly influences the competitive ability and the strategies of firms in today's global business environment. They are powerful tools for businesses by supporting innovation and increasing the productivity. According to researches, firms which are actively involved in standards work more frequently reap short and long-term benefits with regard to costs and competitive status than those which do not participate. The cooperation between the firms to promote standardization is advantageous because of the resulting synergies that can help to reduce costs and increase profits.

Companies benefit from the standardization with the help of decreasing transaction costs in the economy as a whole. Standardization can help businesses avoid dependence on a single supplier. This is because the availability of standards opens up ...

Solution Summary

The 487 word solution presents a concise response to the question with good explanations of the results of standardization in various business processes.

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