What is an Industry Association?
An industry association also known as trade association,
trade or business group, business association or sector association, is a body
founded by companies operating in a specific industry. An industry association
participates in improving the industrial relations, advertising, education,
lobbying, redressal of disputes. The main function of an industry association
is to protect the rights of various companies in the industry, to upgrade their
status and to promote and establish collaboration among various companies in
the industry.
European Wind Energy Association (EWEA), Association of British
Travel Agents (ABTA), Confederation of British Industry (CBI), SemiconductorIndustry Association (SIA), Bicycle Manufacturers National Association,
Associated Chambers of Commerce, and Industry of India (ASSOCHAM) etc are some
of the famous industry associations in the world.
Significance of Industry Association:
The significance of industry association is quite critical. As not
only they keep the industry environment favourable for business, but they are
also the voice of the companies in the industry. Industry associations provides
growth opportunities to its members, cooperation among various businesses, as
well as addressing any conflict among various industries and resolving them by
methods of arbitration, discussion, and mutual settlement.
Role of Industry Associations:
Different industry associations have different roles. Each
industry association has its own set of objectives, goals, and mission. But the
common objective of almost any industry association is to safeguard the
interest of members of the industry and to provide them support whenever such
need arises. The role of Confederation of British Industry (CBI) will be different from
what role Semiconductor Industry Association (SIA) plays. There are a
number of factors which plays a key role in determining the degree of role of
an industry association will play in the specific industry. Following are some
of the standard roles of Industry Association:
Voice of the Industry: There
is no doubt that industry association is the voice of the industry. On behalf
of its members industry association presents themselves in front of government,
external stakeholders, or judiciary system. Not only industry association
fights for the rights of its members but it also promotes awareness in the
industry from time to time.
Research & Development: Industry
association promotes various companies to come together and collaborate in
boosting the research and development process of the industry. Collaboration in
the field of R&D is found in electronics industry. Semiconductor Industry
Association promotes the joint efforts of various companies to boost R&D.
Networking: Industry
Association makes it possible for the industries to network with the industry
professionals from everywhere. This networking helps the industry in long term,
by introducing efficient products and technologies, recruiting exceptional
talents, and implementing proactive strategies.
Promoting open and Fair Trade: This
is one such role which is applicable to all industry associations. The reason
being is in today’s competitive world companies often uses malpractices to
promote sales and revenue of their company, hence it is necessary that all
companies should follow fair practices. Thus, industry associations lays down
the policies, rules, and guidelines to be followed for open and fair-trade
practices.
Epilogue:
Industry Associations offers creation of standards, best practices,
educates the members, development initiatives, acts as a bridge between
industry and government, technical standards, leadership roles, and regulating
competitive environment. Thus, the role of Industry Association is quite
significant. They do face some challenges, but the pros outweighs the cons by a
huge margin.
