An Empirical Investigation of the Universal Effectiveness of Quality Management Practices: A Structural Equation Modeling Approach Journal Article

Writer: Cho، Young Sik ؛ Maysami، Ramin ؛ Jung، Joo ؛ Lee، C. Christopher ؛

Supply and Operations Management May 2016, Volume 3 - Number 1 (‎10 page(s) - From 1102 to 1111 )

Keywords: Factor analysis Quality management Contingency theory Survey research Structural equation modeling

Abstract:

Institutional theory argues that the isomorphic nature of quality management (QM) practices leads to similar QM implementation and performance among QM-embedded firms. However, contingency theory questions such 'universal effectiveness of QM practices'. Considering these conflicting arguments, this study tests samples from the U.S. and China to examine whether the 'universal effectiveness of QM practices’ across national boundaries actually exists. First, the confirmatory factor analysis was performed to examine the validity of the survey instruments developed in this study. Then, the hypotheses were tested using the structural equation modeling (SEM) analysis. The SEM test results indicated that the positive effect of behavioral QM on firm performance was more significant in the U.S. sample than in the China sample. The test results also presented that the relative effect of behavioral QM versus technical QM on firm performance was noticeably different in service firms, according to national economic maturity. The study’s findings demonstrated that a firm's contingency factors, such as national economic maturity and industry type, could result in the heterogeneous implementation of the firm’s TQM program; consequently, the findings weakened the 'universal effectiveness of QM practices'.

Machine summary:

"Appendix: Survey Questionnaire Technical Quality Practices  We have a comprehensive and structured quality planning process which regularly sets and reviews short and long•term goals (SP1)  We have a mission statement that has been communicated throughout the company and is supported by our employees (SP2)  Our suppliers have an effective system for measuring the quality of the materials they send to us (PM1)  We have well-established methods to measure the quality of our products and services (PM2)  We have undertaken benchmarking in relative cost position (UB1)  We have undertaken benchmarking in operating processes (UB2)  We regularly review our product quality and procedures (IA1)  We regularly review other firms’ processes in bringing new products to market (IA2) Behavioral Quality Practices  Senior managers actively encourage change and implement a culture of trust, involvement, and commitment in moving towards "Best Practice" (MC1)  There is a high degree of unity of purpose throughout our company, and we have eliminated barriers between individuals and/or departments (MC2)  Our company has effective ‘topdown’ and ‘bottomup’ communication processes (EI1)  Employee flexibility, multi•skill, and training are actively used to support improved performance (EI2)  We have an effective process for resolving external customers’ complaints (CI1)  Customer complaints are used as a method to initiate improvements in our current processes (CI2)  Our suppliers work closely with us in product development (SI1)  We work closely with our suppliers to improve each other’s processes (SI2) Firm Performances  Defects as a % of production volume (QO1)  Cost of Quality (error, scrap, rework, inspection) as a % of total sales (QO2)  Your company's customer satisfaction level (CS1)  Customer satisfaction with regard to our products/services has increased over the past three years (CS2)  Growth In Sales (BP1)  Growth In Market Share (BP2)  Net Profit Margin (BP3)"

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