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6 (3), 343–362

Social Impact of Implementing a Quality Policy

in European Organizations

Roland Pepermans, Rosette S’Jegers,

Rudy Moenaert, and Anne Buelens
Vrije Universiteit Brussel, Belgium

This paper presents results from an extensive European study about the perceived
social impact of the implementation of a quality policy in various organizations. In
the first two qualitative research phases the extent of a social impact was delimited
whereas the companies’ quality policies were specified through the objectives
pursued. In a final research phase a questionnaire was sent to 765 companies in the
15 countries of the European Union. The data showed the social impact was
viewed as mainly related to the employees’ commitment, to upward
communication, job security, career attention, quality of union/management
dialogue and training—all showing a positive relationship with the
implementation of the quality policy. Furthermore, it was shown that the
company’s objectives when implementing a quality policy related in a significant
way to the reported social impact. The most pervasive relationship linked a
positive social impact to a quality policy aiming at efficiency, effectiveness and
organization quality. The taking of ISO-9000 as a main objective was shown to
relate to a more formal, bureaucratic and structured organization, while a basic
externally-oriented competitiveness orientation showed no significant relationship
with the potential social variables as included in the study.

In a publication by the Total Quality Forum (Voehl, 1992, p. 17), total quality has
been defined as:

a people focused management system that aims at continual increase in customer

satisfaction at continually lower cost. Total quality is a total system approach (not
a separate area or program), and an integral part of high-level strategy. It works
horizontally across functions and departments, involving all employees, top to
bottom, and extends backwards and forwards to include the supply chain and the
customer chain.

Requests for reprints should be addressed to Prof. Dr R. Pepermans, Centre for Work,
Organizational and Economic Psychology (WOEPs), Vrije Universiteit Brussel, Pleinlaan 2, 1050
Brussels, Belgium.

© 1997 Psychology Press Ltd


This statement advocates that people, i.e. all employees, are an essential part or
supplement of the successful total quality policy. It is assumed that “the
principles and practices associated with total quality impact all the traditional
HRM (Human Resource Management) approaches” (Petrick & Furr, 1995, p.
16). Voehl (1992) advocates “respect for people” as one of the four pillars for his
“House of total quality”. On these pillars, its roof or superstructure, consisting of
four sub-systems—social, technical, educational and managerial—can be built.
An integrative and successful quality approach can therefore only be achieved if
a number of social practices in managing the human resources are installed.
Introducing a quality policy on itself seems insufficient in order to arrive at a total
quality company if it is not combined with some in-depth changes in the social
texture of the organization. This lines up with Hackman and Wageman (1995):
“When implemented well, TQM (Total Quality Management) can help an
organization improve itself and, in the process, better serve its community and its
own members” (p. 339). This paper will therefore explore what social effects are
reported in those companies that say they are in some way on the quality track,
and whether the “House of total quality” is close to being reached in European
Summarizing a major line of agreement in the quality literature related to its
social impact, it can be hypothesized that for the majority of organizations, total
quality management is creating more opportunities for success (Marchington &
Parker, 1988), given the higher quality of people employed and their stronger
orientation toward employee involvement (Harrison, 1993). As a result, a
favourable social impact of the implementation of a quality policy is to be
assumed (Hill, 1995).
However, when starting an investigation of the social effects of a quality
policy implementation (QPI) in a European context, it becomes crucial to define
the nature of the quality policy that is understandable and acceptable to a number
of organizations and in a number of countries. On the meaning of “quality” one
notices a broad variety of definitions that exist, each with some personal, or
author-specific emphasis (e.g. Crosby, 1995; Deming, 1986, 1990; Feigenbaum,
1983; Hackman & Wageman, 1995; Johns, 1996; Juran, 1979; Legge, 1995;
Nicholson, Schuler, & Van De Ven, 1995). On the one hand, deducing a single
definition from these, although possible, would never incorporate all the fine-
tuning that individual authors include. Furthermore, it would be a definition
given by academics, which could be met with hostility from organizations.
Therefore it was decided to have the organizations themselves describe the
significance of “quality”. This also allowed for the criticism by Wilkinson and
Wilmott (1955) who mentioned “that the quality gurus have enjoyed a virtual
monopoly over the definition and discussions of this field” (p. 2).
A similar track was followed to define the meaning of the potential social
variables that could be perceived to be affected by implementing a quality policy.

A major source of information is again the literature related to the subject.

Quality-related research has so far focused on a broad range of single social
effects. An exhaustive list of these variables, and how they are affected by QPI,
would certainly require a separate volume. However, without listing all the
possible social variables that have so far been related to quality management,
some recent examples in random order will suffice here to delineate the potential
span of social constructs involved: motivation (e.g. Judge, Hanisch, &
Drankoski, 1995; Wilkinson & Wilmott, 1995); satisfaction (e.g. Judge et al.,
1995; McArdle, Rowlinson, Proctor, Hassard, & Forrester, 1995); training (e.g.
Miner & Crane, 1995; Wilkinson Marchington, & Goodman, 1992); morale (e.g.
Crosby, 1995); control (e.g. Hill, 1995; Van der Loo & Giljam, 1995); empower-
ment (e.g. Liden & Tewksbury, 1995; McArdle et al., 1995); teamwork (e.g.
Landen, Bluestone, & Lawler III, 1995); culture (e.g. Hill, 1995; Tosi, Rizzo,
R. Carroll, 1994); organizational commitment (e.g. Van der Loo & Giljam 1995;
Wilkinson et al., 1992); communication (e.g. Hill, 1995; Wilkinson et al., 1992);
employee involvement (e.g. Landen et al., 1995; Wilkinson et al., 1992); social
relations (e.g. Hill, 1995); industrial relations (e.g. Liden & Tewksbury, 1995;
Wilkinson, Allen, & Snape, 1991); creativity (e.g. Bernardin, Kane, Ross, Spina,
& Johnson, 1995; Wilkinson et al., 1992); appraising performance (e.g.
Bernardin et al., 1995; Ghorpade & Chen, 1995); hierarchy/bureaucracy (e.g.
Kaufman, Lewin, & Adams, 1995; Van der Loo & Giljam, 1995); job security
(e.g. Hill, 1995; Nicholson et al., 1995); work schedules (e.g. Johns, 1996;
Kaufman et al., 1995); part-time work (e.g. Miner & Crane, 1995).
The elements in this broad selection of social variables have so far been
researched in a number of ways, although never combined into one single
research project: “there are so many books that champion the cause of ‘quality
management’ ... yet so few studies that address its actual meaning, or reflect upon
its practical implementation or social significance” (Wilkinson & Wilmott, 1995,
p.1). Therefore, this paper will primarily deal with an investigation in which the
majority of these potential social effects will be integrated in an attempt to find
out which of them make up the specific social variables that relate to quality
management, and how they are related to the basic, company-specific philosophy
behind the quality policy that was introduced.
As a second objective, this paper will deal with some more specific
hypotheses that arose from the literature review. First of all, some sources
indicate that for many organizations, external pressures (i.e. competition), urge
them to accelerate on the quality track (e.g. Ackers, Marchington, Wilkinson, &
Goodman, 1992). Under these circumstances attention to the social impact of
quality implementation is often neglected, since for these companies social issues
are considered inferior to the vast economic issues at stake (Wilkinson et al.,
1992). Therefore, it can be hypothesized that in the majority of the organizations,
changes in the social texture may not be impacted, or even be negatively

influenced. This can lead, for example, to a negative impact on union/

management relationships, as feared by Wilkinson et al. (1991), or to a new
control-enhancing management device being installed (Tuckman, 1995).
On the other hand, it may be deduced from the previous argument that in
companies driven by more internal pressures when starting to “work on quality”,
a more pervasive quality culture may become apparent characterized by more
empowerment of the employees and a positive impact on issues such as employee
commitment and communication (McArdle et al., 1995; Robbins, 1997). This
assumes that the quality approach is not limited to a rather formal process
orientation, as exemplified by an ISO-9000 approach (Clement, 1996) where
human resource activities may be set up with the sole goal of obtaining the
quality certificate.

The project1 comprised three research phases:

Exploratory phase
This first phase aimed at providing the basic foundation for the project. Its
objective was to acquire an understanding of the meaning of “quality” (as given
by organizations), of the social variables that were seen to be affected, and of the
relationship that would have to be included in the study.
Focus groups had been organized at the national level in nine countries (UK,
Germany, France, Spain, Portugal, Denmark, Sweden, The Netherlands and
Belgium) with representatives of social partners, quality organizations,
government bodies and companies implementing quality policies. Each focus
group consisted of four to ten participants. Additionally, a supra-national focus
group was organized in Brussels with representatives from European
A total of 76 organizations participated in the focus groups. They represented
the four intended groups as follows: quality organizations (46%); companies
implementing a quality policy (28%); social partners (18%); and government
bodies (8%). Two major observations were made from this phase:

1. As could be expected from the literature, a wide range of social areas was
observed to be affected by the introduction of a quality policy: organizational
culture (empowerment, process orientation, proactive posture, pressure);
organizational control (de-layering, bureaucracy); nature of work and workforce
(job requirements, job involvement, health and safety, de-staffing, flexibility);

This project was set up thanks to financial support provided by the European Commission—
DG III (Industry) and partially relied on the administrative support of the Inter-university Institute
for Training and Development as well as field support by the SGS-Group.

training and development (pervasiveness, individualization, appraisal

procedures, social surveys); and communication (team work, communication
flows, union/management dialogue).
2. Several differentiating elements were perceived to moderate the social
impact of QPI: the nature of the quality policy (objectives); the country of origin;
and the type of company (scale, industrial activity, market, affiliation and

Descriptive phase
The second phase concerned an in-depth elaboration of the findings of the
exploratory phase, including a preliminary investigation of the potential social
impact of QPI as well as collecting descriptive indicators for the effects of QPI on
a firm’s social structure. Structured interviews were undertaken with key-
respondents in six to eight companies in the nine countries that were involved in
the first phase. A heterogeneous sample of companies had been selected, based
on three factors: industrial activity (services vs. manufacturing); production
process (technology intensive vs. labour intensive); and company size (small vs.
Fifty-nine semi-structured interviews were conducted, covering the specific
issues that came up in the previous phase. Since this research phase built on the
results from the first phase while at the same time preparing for the third phase,
two major outcomes could be identified:

1. The different social areas impacted by QPI (as found in the previous phase)
could be further operationalized through a total number of 35 descriptive
indicators (items) to be used in the next research phase (see results section).
2. In order to investigate a company’s specific definition of “quality”, it
became clear that the major objectives that organizations said they were trying to
reach through their implementation of a quality policy could be used as a fruitful
way around the various definitions of “quality”. Hence, a set of 15 possible
objectives were collected to be used in the third research phase (see results

Conclusive phase
In this phase, potential effects emanating from the previous qualitative phases
were investigated in detail. Here, the research objective was one of representa-
tiveness, not one of heterogeneity. Towards that end, a postal survey was set up
to obtain data from a large sample of companies in all 15 countries of the
European Union. This survey used a questionnaire which included the various
sets of indicative items coming from the previous phase. Next to a set of company
identification variables, a first question asked for the relevancy of different
objectives when aiming at the implementation of a quality policy. As a result, a

set of 15 possible objectives resulting from the previous phases, were identified.
Respondents were asked to mark on a five-point scale (from 1 = not at all at
stake, to 5 = absolutely at stake), how much each objective was at stake at the
time when the organization decided to implement a quality policy.
Another part of the questionnaire was intended to measure a series of 35
variables (potential effects) that could be observed as a result of QPI. It included
items about: commitment (e.g. employees’ satisfaction); organization (e.g.
number of layers in the organization); communication (e.g. upward communica-
tion); training (e.g. management development activities); personnel performance
(e.g. frequency of performance appraisals); work schedule (e.g. part-time
contracts); and workforce data (e.g. rate of absenteeism). Each of the items had to
be rated on a nine-point scale (from –4 = highly decreased, to +4 = highly
increased), answering the question “Assuming the situation before QPI could be
quantified as zero (0), how would you assess today’s organizational situation on
the following issues?”. Furthermore, a general measure was included to tap the
perceived general assessment of the social impact (GASI) of QPI (7-point scale,
from –3 = major negative impact, to +3 major positive impact).
As can be observed, a variety of different response type formats were used
with the intention of reducing potential response format biases. The order of the
15 quality objectives as well as of the 35 social effects was also altered using
three different presentations of the items, thus reducing order effects which can
be especially prevalent in this type of extended questioning.
Finally, a set of potentially related business issues were introduced.
Respondents were asked to rate the perceived impact of seven business trends
(internationalization, production automation, introduction of information
technology, decreasing monopolies and protection, product shifts, change in
important markets, environmental awareness) on the companies’ operations (5-
point scale, from 1 = no influence, to 5 = major influence). This set of items was
introduced in order to look for covariates that might “trouble” the unique effect of
the implementation of a quality policy.
The questionnaire was conceived in English and translated into the other 10
languages of the European Union, in order to increase response rates. It was
addressed to the human resource manager (or to be further forwarded to the
quality manager) of each company in the sample. Since the nature of the
questioning points to the company being the underlying reference, the
perceptions by these key respondents were assumed to represent the company’s
actual situation.
The objective was to have a sampling list of 250 companies in each country,
randomly chosen from lists provided by quality certification bodies. These
included companies already far ahead on the quality track, as well as companies
that had just started a quality certification process. However, in four countries it

was not possible to construct a sample of 250 organizations since the census of
companies was smaller than the targeted sample size. In these countries the
sampling frame equalled the census list: Luxembourg (n = 11); Greece (n = 80);
Ireland (n = 130); and Austria (n = 242). Thus, a total of 3213 questionnaires
were administered during September and October 1995. Of these, 765 were
returned (total response rate: 23.8%), and this was considered a high number
given the complex nature of the questioning and the absence of any incentives to
the respondents scattered around Europe. Specific response rates in the countries
where 250 organizations were addressed varied from 32% for Sweden to 18% for
Germany and France. In the four remaining countries response rates went from
18.6% for Austria to 72.7% for Luxembourg.
Although the actual representativeness of this European sample could not be
tested, it will become clear from the following sample specifics that a broad
diversity of companies participated in the study. The size of the responding
organizations went from 2 to 220,000 employees (mean = 1866; sd = 13,694;
median = 155). 30.5% of the companies were a subsidiary of a foreign company,
22.1% of a national company and 47.4% were not a subsidiary. The majority of
the companies (52.0%) constituted privately-owned businesses, 42.2% were
publicly owned and the remainder were a mixed form (due to this low percentage
of 5.8%, the latter category was deleted from further analyses related to this
variable). Of all companies, 49.7% served business markets, and 14.6% end
customers, with the remainder being a mixed form. The number of customers
adhering to company was established using a four-point ordinal scale, indicating
73.4% of the companies had more than 100 customers. The responding
organizations covered a wide variety of activities, of which 78.6% were treated
as manufacturing companies (e.g. electrotechnical industry, chemical industry)
and 21.4% as belonging to the service industry (e.g. transport and
communication, services to companies).
The average number of years a company reported being involved in the
implementation of a (general) quality policy was five the modus being four years
(i.e. started in 1991). The average number of years since starting the quality
certification process was three, the modus being two years (i.e. started in 1993).
Analysis of response distributions suggested that certification had reached its
maximum diffusion rate. Yet it should be noted that some of the companies that
obtained their certification only recently may not have gained an entry in the
quality directories of their country at that time. This may—at least partly—
explain an observed decline in the certification of organizations during 1994 and
1995. Further analyses showed that 61% of the companies started the
implementation of a quality policy before going for certification, 7% started with
a quality certification process first, and the remaining 32% started both at the
same time.

Quality objectives
The set of 15 possible objectives that came out of the second research phase were
included in the questionnaire and were submitted to principal components
analyses and subsequent Cronbach alpha tests. After having deleted two items in
order to get a more robust structure, three factors emerged after varimax rotation,
presented here with all variables having a factor loading of more than .40
(explained variance: 52.8%):

· Factor 1, product and service excellence (a = .718) including the objectives:

“trying to deliver the best possible products”; “satisfying customers”; “going for
the permanent improvement of processes”; “improving the service standards of
the company”; “having world-class products”; and “heading for excellence”.
· Factor 2, efficiency improvement (a = .721) covering the objectives:
“operating in the most cost-effective way”; “defining and solving
malfunctioning; “improving financial results”; and “bringing the personnel cost
· Factor, organization quality (a = .612) including: “aiming at the best
quality of working life”; “achieving the team organization”; “and focusing on the
core competencies of the firm”.

In addition to these basic factors representing overall objectives for starting QPI,
the two objectives that were omitted from the second principal components
analysis were treated as separate objectives with a unique variance. These were
“beating the competitors” and “ISO-certification, i.e. following the ISO-9000
standards as specified in a quality handbook”.
For further analyses, average summative scores were computed for each
factor, while the separate objectives were included using their raw scores. Using
the score averages for the total of five objectives, these were rank-ordered
according to indicated importance when starting QPI. This showed that “product
and service excellence” was the most dominant objective in the European
organizations surveyed (mean = 4.17), closely followed by the “ISO-9000
certification” (mean = 4.10), and further followed by “Beating the competitors”
(mean = 3.67), “efficiency improvement” (mean = 3.44) and finally,
“organization quality” (mean = 3.32).2
Although not central to our analyses in this paper, it may be worth mentioning
that a separate question was asked concerning the perceived overall success of
QPI, related to the company’s objectives as measured on a scale from 1 (very

All differences significant at the .001 level, except the difference between the two most
dominant objectives that had statistical significance of .055.

unsuccessful) to 5 (very successful). In the total sample the average was 3.64
(significantly higher than the midpoint 3, p < .01), indicating a general positive
experience with QPI. Correlating this perceived success rating with each of the
five remaining objectives indicated that “beating the competitors” and “ISO-
certification” did not lead to a significant relationship (p > .01), while the three
others showed a highly significant correlation coefficient. For these three
objectives, (mentioned as factors above: product and service excellence,
efficiency improvement, organizational quality) the correlations were,
respectively: .14 (p < .001); .19 (p < .001); and .11 (p < .01). This can be seen as
an indication of the fact that when aiming for the latter three objectives, perceived
success in implementing QPI is more obvious.

Social impact of quality policy implementation

Principal components analyses were also used to determine a factor structure
underlying the 35 items covering the perceived social impact that was
experienced. Again, Cronbach alpha’s helped to determine reliable factors. After
nine items were deleted in order to arrive at a robust factor structure, the analysis
with varimax rotation resulted in six factors with an eigenvalue > 1.00 and
explaining 59.2% of the variance (all the items attributed to each of the six factors
are presented in the following list):

· Factor 1, commitment (a = .894): employees’ satisfaction, work motiva-

tion, job involvement, organization involvement, individual creativity.
· Factor 2, training (a = .745): management development activities, white
collar training activities, blue-collar training activities, behavioural
training, technical training.
· Factor 3, career attention (a = .745): frequency of performance appraisals,
quality of performance appraisals, educational prerequisites, promotion
opportunities, social surveys.
· Factor 4, work problems (a = .680): rate of absenteeism, occupational
accidents, social conflicts.
· Factor 5, variable work schedules (a = .631): part-time contracts, number
of temporary employees, fixed-term contracts, flexible work schedules,
· Factor 6, teamwork (a = .705): cross-functional linkages, frequency of
team work, measurement of processes.

These factors can be considered the major social areas on which companies
perceive the implementation of a quality programme to have an impact.
The nine items that were deleted from the final principal components analysis
were treated separately in view of their rather unique variance: number of layers
in the organization; bureaucracy; job security; personnel turnover; upward

communication; downward communication; verbal communication; written

communication; and quality of union/management dialogue. 3
For further analyses, respondents were represented by their average scores for
the six social impact factors, whereas the nine separately-treated items were
included using the raw scores. Inspecting the average score frequencies for this
set of 15 “new’ variables (see Table 1), one notices “written communication” has
the highest perceived increase reported after QPI, followed by “upward
communication”. At the bottom end, two decreases were reported, being the
“number of layers in the organization” and “work problems”. Given the
perceptual nature of the data, without any absolute anchors, one should not focus
on the absolute numbers that were reported. More relevant are the relative
differences in reported changes in the variables, which indicate a less or more
important perceived impact after QPI.
Using the GASI-measure, the average perceived overall assessment of the
social impact of QPI was significantly positive; 1.25 (sd = 0.88) on a scale from
–3 (major negative impact) to +3 (major positive impact). In order to investigate

Average Response Frequencies Representing the
Perceived Social Impact as a Result of a Quality Policy
Implementatio n (scale range ±4/+4)

Social variables Mean Stand Dev.

Written communication +1.78 1.34

Upward communication +1.54 1.14
Training +1.46 0.90
Downward communication +1.45 1.35
Teamwork +1.44 0.99
Commitment +1.39 0.98
Career attention +1.00 0.82
Verbal communication +0.77 1.55
Job security +0.65 1.36
Quality of union/management dialogue +0.60 1.13
Bureaucracy +0.50 1.62
Variable work schedules +0.36 0.75
Personnel turnover +0.12 1.30
Number of layers in the organization –0.38 1.33
Work problems –0.47 0.86

Items on upward, downward and verbal communication came out of the first principal
components analysis as one factor’s a-coefficient (0.531) was too low, which made us decide to
treat them as separate items.

in more detail which specific social effects were seen to be related to this positive
social impact, a stepwise regression analysis was carried out using GASI as the
dependent variable (see Table 2). The highly significant result with R 2adj = 0.368
(F = 65,810, p < 0.001), showed that European companies view the positive
social impact of QPI as related to a perceived improvement in commitment,
communication, personnel development and job security.

Differences in social impact according to company

First of all, the effects of three company features on the overall social impact
measure (GASI) were tested: company size (number of employees in the
organization); activity profile (manufacturing vs. service industry); and
ownership profile (privately vs. publicly owned). This produced only one
significant relationship, for ownership profile (t(659) = –3,84, p < 0.001).4 This
shows that publicly owned companies report a significantly more positive overall
social impact than privately owned companies.
The detailed 15 specific social effects were also tested for differences
according to the same company variables, with the following results.

Company size
Pearson correlations were calculated for the relationships between the scores
on each of the variables and company size. Also, partial correlations were
calculated, allowing to control for the business processes that were earlier

Significant Social Variables Explaining the
Overall Perceived Social Impact of
Quality Policy Implementatio n, after Regression Analysis

Social variables b* t-value p

Commitment .3367 8.667 .000

Upward communication .1301 3.655 .001
Job security .1059 3.278 .001
Career attention .1050 2.798 .005
Quality of union/management dialogue .0840 2.501 .013
Training .1008 2.441 .015

*standardised regression coefficients

In view of the sample size, small effects are easily becoming significant. Therefore a
significance level of p < 0.01 will further be discussed.

specified. Only one significant relationship was found, with “written

communication” (r = –13, p < 0.001), with the partial correlation showing exactly
the same result. This showed that, independent of other business influences that
are perceived, the larger the company, the less written communication is seen to
increase after the implementation of a quality policy. This may be due to the fact
that large companies already made extensive use of written communication.

Activity profile
Analysis of covariance (ANCOVA) was applied to test for differences in
social effects according to whether an organisation was active in the
manufacturing or the service industry. The seven business trends (see method
section) were included as covariates. However, none of the effects showed
significant differences, at the 0.01 level, between manufacturing and service
companies. Still, the covariates “environmental awareness”. “production
automation”, “introduction of information technology” and “change in important
markets” explained significant portions of the residual variances in the
differences in social effects, on top of the activity profile.

Ownership profile
Using ANCOVA, differences in social effects were computed according to
the company being privately or publicly owned, with the same seven business
trends as covariates. Significant differences were found for four of the effects, as
represented in Table 3. This shows that, in general, only four significant
differences were found between the two types of company ownership.
Furthermore, “environmental awareness” was found to be the most important
covarate overall, while “production automation” came second in this respect.
This shows that business trends influence social effects at the same time as QPI.
Nevertheless, if the influence of business trends is removed, significant
differences on a number of social effects according to the ownership profile can
still be observed and have to be attributed to the implementation of a quality

Social effects related to the original quality implementation

A canonical analysis was performed in order to investigate the relationship
between the set of 15 social effects and the set of five objectives that were said to
be pursued when implementing a quality policy. The outcomes for the resulting
variates are presented in Table 4.
Only two variates were significant at p < 0.05, and a third variate at p < 0.10.
In order to interpret these results one ought to focus on the canonical loadings
instead of on the canonical weights, the latter being influenced by
Ownership Profile and Social of Quality Policy
Implementatio n, after Analysis of Covariance

Social variables Privately Publicly

owned owned

Written communication 1.86 1.76

Upward communication 1.51 1.66
Training 1.36 1.62
Downward communication* 1.28 1.69
Teamwork 1.36 1.60
Commitment 1.32 1.53
Career attention .92 1.09
Verbal communication .69 .82
Job security .69 .62
Quality of union/management dialogue* .45 .84
Bureaucracy .63 .47
Variable work schedules .36 .37
Personnel turnover .12 .06
Number of layers in the organization* –.16 –.54
Work problems* –.39 –.66

*p < 0.01

Results of the Canonical Correlation Analysis between
Social Variables and Quality Objectives

Canonical Eigen- Canonical R Chi2 df Significance

variates values

1 .2031 .4507 207.17 75 .000

2 .0402 .2006 74.58 56 .048
3 .0358 .1892 50.72 39 ‘099
4 .0341 .1848 29.44 24 .204
5 .0156 .1249 9.17 11 .606

“multicollinearity” (Kuylen & Verhallen, 1981). For the first three variates the
loadings are presented in Table 5.
Looking at these results, the first variate shows that going for organization
quality, but at the same time paying attention to overall excellence and efficiency,
relates to the most extensive reported social impact. A number of social variables
are reported to be affected in a positive way when those three objectives are
pursued while implementing a quality policy.
The two other variates all include ISO-9000 as the major objective, but
each time this is combined with one or more of the other objectives. The

Canonical Variates relating Social Variables and
Quality Objectives*

Variate 1 Variate 2 Variate 3

Social variables
Written communication .001 .324 .624
Upward communication .581 .243 .103
Training .741 .124 .460
Downward communication .489 –.194 .152
Teamwork .526 –.303 .234
Commitment .667 .131 .078
Career attention .654 .240 .130
Verbal communication .427 .389 .029
Job security .344 .426 .121
Quality of union/management dialogue .254 .004 –.263
Bureaucracy –.310 .353 –.044
Variable work schedules .154 –.224 .121
Personnel turnover .027 .139 –.031
Number of layers in the organization –.489 .089 .533
Work problems –.495 –.117 .007

Quality objectives
Product and service excellence .697 –.173 .330
Efficiency improvement .672 –.285 .480
Organization quality .919 .364 –.059
Beating the competitors .166 –.290 –.320
ISO-certification –.022 .594 .639

*Loadings shown in bold type (� .300) were used for interpretation.

second variate, going for ISQ-9000 certification, links to an increase in

bureaucracy and written communication, but also in job security. The latter
may partially be explained by the fact that this variate points to an emphasis
not only on ISO-9000, but also on engaging for quality in view of a better
organization. Since this variate also indicates a reduction in teamwork and verbal
communication, it seems that this approach to quality emphasizes a more formal
quality culture (in addition, reducing the variability of work schedules is in line
with this).
The third variate again shows that a unique concentration on ISO-9000 is
probably not that common. As opposed to the second variate, one notices here, a
stress on efficiency and on excellence. This goes together with an increase in the
number of layers in the organization, but also with more written communication
and training. Furthermore, on the one hand, one should note that the quality
objective “beating the competitors” does not positively link to the social

variables in this study; while on the other hand, some social variables are
relatively unrelated to the quality objectives, i.e. quality of union/management
dialogue, variable work schedules and personnel turnover.

As might be expected (Hill, 1995, Wilkinson et al. 199l), the companies in this
study claim an overall favourable perceived social balance of QPI in their
organizations represented by our significantly positive GASI. The more detailed
social variables that have been tapped in this project can also be seen as providing
us with a positive picture of the social impact of QPI. In relative terms, major
effects are reported in the communication area, training, teamwork and attitudes
to work. Lesser effects are those perceived in the organizational and employment
areas. But, as could be expected, the social impact of QPI is considerable, since
all reported effects are significantly different from a zero effect (although the
latter may somewhat be influenced by the large sample size). As has been
reported elsewhere (Hill, 1995), increased employee involvement, increased
teamwork and more open and effective communication channels sustained by
improved training are not just results of the implementation of a quality policy,
but also a necessary condition to build up quality in an organization (Voehl,
However, the previously discussed overall findings build on the effects that
were included in the survey based on the results of the qualitative research
phases. When looking at the organizations’ point of view related to social impact,
it was shown through our regression analysis that companies mainly associate a
positive social impact with a substantive improvement in employee commitment,
upward communication, job security, career attention, quality of the union/
management dialogue, and training. In other words, organizations report their
quality policy to induce the basis of empowerment which is a requirement for the
successful total-quality organization, (McArdle et al., 1995, Robbins, 1997).
Indeed, such organizations observe higher employee commitment, an increase in
training opportunities, and an increase in upward communication, thus preparing
employees for the self-sustained actions required to move towards continuous
improvement. The hypothesis suggesting TQM as a control-enhancing manage-
ment device (Tuckman, 1995) can therefore not be supported. The greater
attention on people’s careers, originally defined as being related to more frequent
performance appraisals, and more social surveys, originally also related to a
higher quality of appraisals and more promotion opportunities, which may also
explain the observed higher job security, at least for those employees responding
to the increased educational requirements.
QPI also has a positive perceived relationship to the quality of the union/
management dialogue. Although our third research phase did not include
observations on the nature of union involvement in QPI, fears for the

marginalization of unions (Wilkinson et al., 1991) were not confirmed by our

data. Moreover, our initial qualitative study pointed to the required involvement
of unions in the quality process. This conclusion is further supported by a
perceived reduction in work problems (absenteeism, accidents, and social
conflicts), which may be seen as emphasizing the beneficial effect of good
industrial relations in implementing a quality policy.
However, a note of caution seems appropriate here. The positive outcomes
that were found could in some way be related to our methodological approach.
Since we asked people in the organizations (as previously stated it was mainly
human resource managers or quality managers who filled in the questionnaires)
to report on their perceptions of the social impact, it may well be true that they
reported positively in order to avoid cognitive dissonance. Members of
organizations that have invested time and effort in the implementation of a
quality policy may well be less likely to report negatively on the effects of their
investments. On the other hand, had that seriously biased our results than we
would have expected a less differentiated picture of the social impact. Indeed, if
the intention was to present a positive picture, then the different factors that
constitute our social impact would show more similar positive patterns.
Furthermore, one should not forget that perceived effects commonly regarded as
being more negative (e.g. increased bureaucracy and increased personnel
turnover) have indeed been reported as being negatively impacted, which one
would not expect had the avoidance of cognitive dissonance distorted our data
The investigated differentiating variables between organizations were not
found to produce important differences in the observed social variables. This
points to the rather universal nature of the reported quality policy influences.
Only the ownership profile (privately/publicly owned) resulted in some
significant differences, even after having accounted for other business trends that
may affect the company’s mode of organization. All in all, it seems that there is a
tendency for the implementation of a quality policy to produce a somewhat more
communicative culture in publicly owned companies than in privately owned
organisations. But the fact that publicly owned organisations perceive more
downward communication and a better quality of union/management dialogue
may at least partially be explained by the fact that on average, public
organizations are bigger and therefore have a less communicative culture which
makes a perceivable increase in these variables more plausible. It may further be
argued that the greater reduction in the number of layers in a publicly owned
organization and a more important reduction in perceived work problems,
supports our conclusion in this respect.
The results related to the business trends point to their covariance with the
implementation of a quality policy, in several cases with an increased
environmental awareness of the companies. The latter supported a finding that
was already observed in some companies during our qualitative research phases,

where even a causal relationship between them had been suggested. However,
our research cannot be conclusive in this matter, because our measurements of
these business trends were not sophisticated enough. On the other hand, this
finding stresses the relatedness of various managerial policies which ought to be
differentiated more clearly from the impact of a quality policy in further research.
Parts of the previous discussion, although in line with the overall findings,
need some substantial refinement when taking account of the researched
relationship with the various objectives that were pursued when implementing
the quality policy.
First of all, and contrary to what Ackers et al. (1992) proclaim, our results do
not indicate that organizations exclusively start on the quality track because of
competitive reasons. Although the most dominant objective—product and
service excellence—certainly links to external pressures, the most significant
canonical variate points to an internal trigger as well as to an external one.
Furthermore, it is observed in this study that the quality objective does not really
exist, since companies pursue more than just one objective at the same time.
Related to social impact it became clear that a quality orientation towards
excellence, at the same time as towards efficiency improvement and going for a
higher organization quality is the most effective combination of initial objectives
in view of the perceived positive social impact. From the dominant variables that
organizations consider to be at the basis of their view of social impact, five out of
six are positively related to this kind of quality approach in our canonical
analysis. Moreover, teamwork, downward, and verbal communication are
perceived as outcomes of this kind of quality policy, which is further seen to
reduce bureaucracy and work problems, and to promote a “flatter” organization.
All in all, our previous conclusion on the empowerment-stimulating role of a
quality policy needs to be reformulated and appears to be mainly linked to quality
objectives concentrating on efficiency, effectiveness, and organization quality.
Although, strictly speaking, a canonical analysis does not allow for causal
interpretation, we suggest that under these circumstances, where external as well
as internal forces stimulate the implementation of a quality policy, a quality
culture will become apparent, including more open communication, greater
commitment, and greater involvement (Hill, 1995).
Moreover, if an organization is oriented towards an ISO-9000 certification
approach as the basis for their quality policy, formalization through written
communication becomes more clear. Compared to the relationship between
social effects and quality objectives, as discussed in the previous section, ISO-
9000 can be considered as having a less profound social impact, and seems to
increase a formal process orientation (Clement, l996). But, once again, one will
notice that the ISO-9000 objective does not stand alone. Again, extending the
relational interpretation of our canonical analysis on to a causal one, we suggest
that combining an ISO-9000 objective with an orientation towards organization
quality may well produce a more bureaucratic environment. But it can also be

combined with efficiency and excellence objectives, producing a more

structured organization. Especially for this third relationship, the lack of
focusing on the quality of the organization may indicate that the implementation
of a quality policy ignores required changes in the organization process, which
may result in a looser quality approach, though organization layers are created in
a formal way in order to make sure that procedures can be followed. Under this
assumption, training becomes merely a tool used to pass on skills and knowledge
in order to attain the certification, without having the more fundamental goal of
standardisation and cooperation of skills, nor widening and deepening skills,
which may explain the resulting lack of increase in employee commitment
(Bessant, 1993).
On the other hand, our data does not allow us to significantly link the objective
“beating the competitors” to any of the social variables studied. It seems that
mainly going for an external objective when implementing a quality policy is not
beneficial in social terms. This comes close to the argument made by Wilkinson
et al. (1992) who stated that under a predominantly competitive quality
orientation, involvement of the employees is often considered largely
unproblematic. In fact it is assumed there that organizations do not worry about
the employees. Our data underline that under a dominant belief in a purely
competition-oriented purpose of the quality policy, significant changes in the
social texture of the organization are not observed. This may be because, in these
instances, if “consideration is given to the human side of TQM it is simply
assumed that changes in the management of the labour process are determined by
changes in the production processes and management systems” (McArdle et al.,
1995 p. 158) and is probably not because “social changes” are accepted as a
necessary condition for a quality organization. As a result, the likelihood of the
required social support being provided for a successful quality implementation
may become very doubtful.
All in all, this study causes us to suggest that a combined emphasis on
organization quality as well as on quality objectives not just related to the final
beating of competitors, but on the intermediate objectives, i.e. the utilized means
that allow organizations to respond to the external competition (excellence and
efficiency), produce a more pervasive social impact than any other initial quality-
related objective. Hence, a firmer basis for building the “house of total quality” is
laid, and at the same time a more competitive result may be arrived at. If
however, one is trying too hard to get the ISO-9000 certificate with insufficient
focus on a combination of efficiency, excellence and organization quality, or an
over-emphasis on trying to beat the competition, not only less of a social impact
can be expected, but at the same time the necessary social and organizational
requirements for success in attaining and continuing the quality organization are
ignored (Pepermans & Mertens, 1995).
One final remark still seems appropriate: one should not forget that this paper
reports results that relate to perceived effects as indicated by members of

organizations highly involved in the implementation of a quality policy. It may

well be that the actual employees in these companies may have a different
opinion: the scale of the study did not allow for more in-depth investigations of
the views of employees in the various organizations. However, it goes without
saying that such research—perhaps via case studies on a smaller scale—is
certainly required in order to supplement the results reported here, and to get a
full picture of the social impact of quality investments.

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