Do you remember a fellow named Bran Ferrin (vice president of Disney Imagineering), speaking at ACORD’s annual conference in 1998, and his belief that the Internet was the equivalent of fire for mankind? Did you chuckle?

The late Michael Dertuzos (director of the MIT Computer Lab) spoke to us in 1999 along the same lines. I recall him waltzing around the stage while flailing his arms about, suggesting that cyberspace was not “somewhere out there”, but something that becomes part of our everyday lives whether we realized it or not.

Very often many people dont realize this, while others lack appreciation for the intensity of its potential influence.

I often talk about the digital dividethe gap between business and information technology that every good chief information officer must bridge to succeed. Perhaps my biggest challenge is helping business people understand IT and industry standards in the face of an ever-changing and increasingly complex world.

Sometimes its helpful to step back and look at the big picture. I often look at other disciplines that deal with change and complexity to look for parallels that I can translate back to our business. So lets go back to the beginning where it all startedthe “Big Bang,” of course.

The physicist Theodore Modis points out that evolution has not been a continuous, uniform process. While change is ongoing and continuous, the rate of change and its associated complexity will vary. He counsels his students that evolution (of any kind) includes jumps and growth spurts with periods of stability in between. He goes on to say, “The 20th Century alone features more turning points in the history of mankind than the previous five centuries put together.”

Squeezing together all these turning points or milestones has made life more complex, and many people are unable to cope with the new world order.

So what does this have to do with technology?

On his chart of 28 canonical milestones starting with the “Big Bang” and the origin of the Milky Way, he lists the Internet as number 28. Fire is number 15.

Mr. Modis points out that the year 2028 may represent the peak of the S-curve that resulted from the last few historical milestones, including the Internet. He claims that we are traversing the only period in the history of the universe in which a single lifetime (of 88 years for the Baby Boomers) can witness changes coming from as many as three evolutionary milestones.

The issue is our ability to deal with change and complexity.

The bottom line is that the Internet is a really big deal in terms of human evolution, and we have yet to seriously plumb the depths of the meaning of connecting every person on earth to a common network.

Larry Downes, author of “The Strategy Machine And Unleashing the Killer App”–and the keynote speaker at this week’s 2003 ACORD Conference–describes the importance of open standards in a big-picture way.

One of his points is that the uncertain future will bring new devices, new technologies and new trading partners as well as a number of surprises along the way. Therefore, building an IT infrastructure that can anticipate what we do not know is difficult.

Standards (particularly domain-specific, industry-promulgated standards from my point of view) can provide the transparency and flexibility that allows us to be opportunistic in the future. When considering the value of industry standards, one should not get lost in the details, but look at the big picture.

Aside from lowering application development and integration costs throughout the organization, standards have a pervasive and systemic influence on all business relationships involving information exchange. The bigger picture can easily be overlooked when one focuses on the numbers.

Yes, industry standards do provide immediate benefits, but there is also a long-term positive and systemic effect on the business itself. And we dont always talk about that very much. A few do.

Those who do recognize that standards are a long-term investment in business and trading partner relationships. In addition, while lowering the cost of manufacturing and simplifying data exchange with trading partners is important, data standards in a marketplace can change the marketplace itself. They can not only enable a higher degree of process flexibility, but they can also hasten the development of plug-and-play applications or the integration of new services from a variety of solution providers.

IT executives at insurance companies who embrace a consistent and longer view of industry standards do not view standards as the elixir for all ills faced by IT. They deploy a sensible and pragmatic approach for todays challenges but know that the “network effect” will prevail over the long run.

Buying a quick (and what may appear to be reasonable) proprietary fix without regard for the long term is not a sustainable IT strategy. We need to begin to “seed” a new generation of suppliers of software and services that build on industry standards to provide the means to assemble solutions and shape a process to meet changing needs.

I often view IT as a portfolio of strategic investments (spreading the risks) and use industry standards as a long-term hedge on those investments. As you know, most IT spending is devoted to maintaining existing systems, so harmonizing future investments within an industry standards framework will certainly lower maintenance costs, while enabling creative development that can actually transform products and services in new ways.

IT solutions come and go, but industry data models and standards endure since they are technology agnostic and platform independent. Even the syntax used for industry standards (todays W3Cs XML) can change dramatically, while domain-specific vocabularies and dictionaries remain “relatively” consistent over time.

We can learn something from physicist Theodore Modis as he looks at the big picture. Yes, the next quarter financials are important to shareholders and Wall Street. Yes, we want to maximize the return on investment on our IT investments today.

Yet I encourage you to step back and think logically about the big picture. Reflect on the human genome, modern physics, the Industrial Revolution, the printing press, agriculture, rock art, fire and stone tools.

Also consider that unlike previous generations, we will bear witness to the consequences of the most recent evolutionary milestones within our lifetime and can influence them prior to reaching a period of stability (the top of the S-curve).

Those who fail to recognize the longer and less conspicuous trend beneath the daily ambiguity will not be able to fully appreciate the impact of ACORD Standards or the price that they will pay as a result.

Gregory A. Maciag is president and chief executive officer of ACORD, the non-profit, standards-setting association based in Pearl River, N.Y., with offices in London.

IT solutions come and go, but industry data models and standards endure.


Reproduced from National Underwriter Edition, May 12, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved. Copyright in this article as an independent work may be held by the author.