The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0265-671X.htm
IJQRM
35,8
1490
Received 9 May 2017
Revised 10 July 2017
16 August 2017
Accepted 30 August 2017
International Journal of Quality &
Reliability Management
Vol. 35 No. 8, 2018
pp. 1490-1507
© Emerald Publishing Limited
0265-671X
DOI 10.1108/IJQRM-05-2017-0091
QUALITY PAPER
Assessing relationship
between quality management
systems and business
performance and its mediators
SEM approach
Manjot Singh Bhatia
Indian Institute of Management Lucknow, Lucknow, India, and
Anjali Awasthi
Concordia University, Montreal, Canada
Abstract
Purpose – The purpose of this paper is to examine the relationship between implementation of quality
management systems (QMS) and business performance, through mediating factors (operating performance,
information quality, product quality, design performance, environmental performance and competitive priorities).
Most of the published literature examines the direct impact of implementation of QMS on business performance,
and on some of the above stated factors. However, the impact of implementation of QMS on business performance,
through these mediating factors has not received much attention. Accordingly, the authors develop a theoretical
framework depicting impact of implementation of QMS on business performance through the above stated factors.
Design/methodology/approach – The paper proposes several hypotheses linking implementation of QMS,
mediating factors and business performance. The hypothesized model is empirically tested using data
collected from 120 professionals working in quality engineering/management in India and North America.
The collected data are analyzed with the aid of structural equation modeling (SEM) technique.
Findings – Information quality and design performance have emerged as the important factors in the
research. Information quality directly effects design performance, operating performance and environmental
performance. The model indicates that besides a well-designed product, managers need to focus on the
operating performance to improve overall product quality. Empirical evidence is found regarding direct and
indirect effect of implementation of QMS on above stated mediating factors and on business performance.
Originality/value – The research fills a gap in the literature by considering several mediating factors that
aid in improving business performance with implementation of QMS.
Keywords SEM, Business performance, Information quality, ISO, QMS
Paper type Research paper
1. Introduction
During the last couple of decades, organizations around the globe have implemented several
quality management systems (QMS) as a strategic tool to improve processes, enhance
competitiveness and improve business performance. These QMS include several quality
management (QM) practices and standards, such as standards set by “International
Organization for Standardization (ISO),” total quality management (TQM) tools, technical
specification (TS) standards and aerospace standards (AS). The QMS helps organizations
control costs as well as quality of products, thus increasing their competitive advantage
(Radovilsky and Hegde, 2011). Hence, implementation of QMS is necessary to survive in
today’s competitive world.
In recent years, many researchers have studied the effect of implementation of QM
practices and standards on firm performance. For example, Abdullah and Tarí (2012) found
that soft QM practices (supplier relationship, management commitment, employee
involvement, reward and recognition, customer focus, training and education) affect firm QMS and
performance directly, while hard QM practices (process control, feedback, new product business
quality, process management, inter-functional design) affect indirectly. Lin et al. (2005) found performance
that QM practices affect organizational performance only indirectly through supplier
participation. In a research based on 152 Indian manufacturing companies, Parvadavardini
et al. (2016) found that QM practices (strategic quality planning, supplier quality and process
monitoring and control) affect quality performance, which in turn is positively related to 1491
financial performance of firms. In Dubai police departments, Al-Dhaafri and Al-Swidi (2016)
found positive effect of implementation of TQM on organizational performance.
In Japanese manufacturing sector, QM practices were found to be positively related to
quality performance and competitiveness of firms (Phan et al., 2011; Anh and Matsui, 2006).
Similarly, in IT enabled small and medium enterprises (SMEs) in India, QM practices
(organizational management, capacity management and quality documentation and security
management) were found to positively impact quality performance (Basu and Bhola, 2016).
In a study on small Australian manufacturing firms, it was found that firms that implemented
QM practices showed better financial (O’Neill et al., 2016). In electronics industry in Malaysia,
Agus (2005) found that implementation of TQM practices directly resulted in improved
business performance, and indirectly improved product quality.
The research studies, discussed above, indicate that relationship between QM practices and
business performance has been amply examined. However, there is lack of research regarding
the role that the factors, operating performance, information quality, product quality, design
performance, environmental performance and competitive priorities play in improving business
performance after QMS implementation. Further, existing studies have considered only few of
these factors at a time in a single model. The present paper tries to fill this gap by considering all
the above stated factors that result in improved business performance in a single model. We test
the model involving direct and indirect effects of implementation of QMS on the above stated
factors and business performance, as suggested by Bhatia and Awasthi (2017) in the context of
manufacturing industry. We did not consider the factors, service quality, supplier relationships
and customer relationship in this research due to the context of manufacturing industry. The
model is empirically tested using data collected from 120 professionals working in quality
engineering/management in manufacturing industries and applying Structural Equation
Modeling (SEM) technique. Further, we also found that most of the research studies, when
studying the impact of QMS on performance factors do not consider the usage of QMS in daily
practice by organizations. In case, QMS are implemented and not used daily, it is not worthwhile
to examine the impact of implementation of QMS on performance. Hence, we explicitly
considered this by asking the respondents whether QMS in their organization are being actually
used in daily practice, whether the system is well coordinated and tailored to the needs of the
organization. In nutshell, this research paper tries to answer the following questions:
(1) How does implementation of QMS impact business performance through mediating
factors (operating performance, information quality, product quality, design
performance, environmental performance and competitive priorities)?
(2) What is the direct and indirect effect of implementation of QMS on mediating factors
(operating performance, information quality, product quality, design performance,
environmental performance and competitive priorities) and on business performance
of organizations?
(3) How do above stated mediating factors impact each other and ultimately business
performance?
The remainder of the paper is structured as follows. In Section 2, we briefly discuss
the relevant literature, followed by theoretical framework and research hypotheses in
IJQRM Section 3. Methodology of research is explained in Section 4 and results are presented in
35,8 Section 5. In Section 6, we discuss the results and conclusions, limitations and future
directions in Section 7.

2. Literature review
2.1 Reasons for implementation of quality standards
1492 ISO 9000 certification is seen as a good starting point to improve quality. Many
organizations consider ISO 9000 standards as a primary step in TQM implementation
(Brown et al., 1998). In recent two decades, a large number of firms have implemented ISO
standards and TQM practices. Some firms have implemented these practices due to external
reasons (to meet customer requirement, to gain marketing benefits, to stay in business, etc.)
and some have implemented due to internal reasons (to improve customer satisfaction, to
improve efficiency, to improve product quality, etc.).
In a research on ISO 9000 certified firms in Europe, the most frequent reason for getting
ISO 9000 certification was customer requirements. However, some firms also reported
improving product quality as the top reason for achieving ISO certification (Withers and
Ebrahimpour, 2000). Customer requirements was also a major reason for getting ISO 9000
certification in Swedish industry (Poksinska, 2010). In UK manufacturing industry, firms
seek ISO certification to improve customer service and to be considered for tenders that
otherwise may not be possible (Douglas et al., 2003). Similarly, in Western Australian SMEs,
Brown et al. (1998) found that firms seek ISO 9000 certification primarily due to external
reasons than internal reasons.
A number of researchers have found that firms that implement ISO standards due to
internal reasons report higher improvements in quality than the firms that implement these
standards due to external reasons (Gotzamani and Tsiotras, 2002; Withers and Ebrahimpour,
2000; Poksinska, 2010; Douglas et al., 1999).

2.2 TQM practices and performance outcomes

A number of researchers have studied the impact of TQM practices on performance
factors. Kaynak (2003) found direct positive relationship between implementation of
TQM practices and operating performance (inventory management and quality
performance) and indirect relationship with financial and market performance, through
improved operating performance. In an extension of this research, customer focus and
supplier QM were added to the existing model and similar results were reported (Kaynak
and Hartley, 2008). Mann and Kehoe (1994) found positive impact of TQM practices on
business performance.
Samson and Terziovski (1999) found positive impact of implementation of TQM
practices (leadership, customer focus and human resource management) on performance
factors (customer satisfaction, productivity, percentage defects, cost of quality, etc.).
In construction companies, in Hanoi, Nguyen et al. (2016) found that TQM
practices (leadership, customer focus, continuous improvement, etc.) do play an
important role in enhancing organizational performance (profitability, customer
satisfaction, process efficiency, etc.). Cetindere et al. (2015) reported very strong
correlation between TQM criteria (leadership and education) and performance. Duh et al.
(2012) found positive effect of TQM practices on non-financial performance measures
whereas only indirect effect of TQM practices on financial performance measures was
found through improvement in non-financial performance measures. In Spanish service
organizations, TQM dimensions (employees, top management and customers) were found
to significantly impact performance dimensions (operational performance, financial
performance and customer satisfaction) (Psomas and Jaca, 2016). However, in
Indian pharmaceutical industry, Modgil and Sharma (2016) found that TQM practices
(quality data and reporting, technology management, and product innovation) with the QMS and
support of total predictive maintenance practices, help to achieve significant improvement business
in operational performance. performance
In Western Australian SMEs, Rahman (2001) found no significant differences between
impact of TQM practices on organizational performance, except process control, for firms
with and without ISO 9000 certification. Martínez-Costa et al. (2008) found that
implementation of TQM practices resulted in improvement in both external and internal 1493
performance factors. Furthermore, the authors also found that ISO certified organizations
performed superior than non-ISO certified organizations on internal performance factors but
no difference was found in external performance factors.

2.3 ISO standards and performance outcomes

Many studies point out that the implementation of ISO standards results in number of
benefits. In total, 75 percent of the firms considered ISO certification to be value for money
(Douglas et al., 2003). Most firms in Europe reported positive impact of ISO implementation
on quality (Withers and Ebrahimpour, 2000). In Western Australian enterprises, Brown et al.
(1998) observed that post ISO implementation, there was increased awareness of problems
in the organization, enhanced quality awareness and improved product quality. In ISO 9000
certified firms in Spain, Tarí et al. (2007) found that TQM practices directly impact quality
outcomes (quality performance, customer results, society results, etc.) and indirectly,
through process management, learning and continuous improvement. To tackle global
competition, Tan et al. (1999) recommended that organizations should not only focus on
quality but suppliers, manufacturers and customers need to collaborate together to achieve
growth and financial objectives. The authors also found that implementation of TQM tools
and practices positively affect performance.
Magd and Nabulsi (2012) found that implementation of ISO 9000 standards resulted in
increased market share, improved internal efficiency, reduced operating costs and
increased customer satisfaction. In Slovenian ISO 9000 certified organizations,
implementation of ISO 9000 standards was found to better satisfy customer needs but
no direct effect on business performance was found (Piskar, 2007). Lo et al. (2009) found
positive effect of ISO 9000 standards on operating performance (lower inventory days,
operating cycle and account receivable days). Surprisingly, in New Zealand
manufacturing sector, Adams (1999) found no relationship between ISO accreditation
and profitability of firms. Douglas et al. (2003) reported that managers were content with
the contribution of ISO 9000 standards to quality improvement. In Spanish manufacturing
industry, Casadesús and Gimenez (2000) found positive effect of implementation of
ISO 9000 standards on internal benefits (errors and defects, order processing, reliability,
costs, etc.) and external benefits (customer satisfaction, market share, return on sales etc.).
Terlaak and King (2006) found that ISO 9000 certification helped organizations to gain
significant competitive advantage but no direct support for improvement in operating
performance with ISO 9000 certification was found.
In automotive industry in Thailand, Zakuan et al. (2012) found that ISO/TS16949
certification does not moderate the relationship between TQM practices and firm
performance. In ISO 9000 certified firms in Australia, Terziovski et al. (2003) found that
organizations with intrinsic quality culture have better business performance. Further,
customer focus contributed most to improved business performance. Quazi and Jacobs
(2004) identified improvements in human resource development activities and training in
firms with implementation of ISO 9000 standards. Some other benefits of ISO standards
were improved competitiveness, management of training records, quality of products, etc.
The following section discusses the theoretical framework and proposes hypotheses of our
research study.
IJQRM 3. Research model and proposed hypotheses
35,8 As discussed in Section 2, implementation of TQM practices and ISO standards can affect
and improve business performance. Several authors have reported that implementation of
TQM practices and achieving ISO certification results in improved business performance.
However, published literature has not examined the role that the mediating constructs
(operating performance, information quality, product quality, design performance,
1494 environmental performance and competitive priorities) play in improving business
performance, in a single model. Hence, we propose a model that includes the effect of
implementation of QMS on business performance, through mediating factors (operating
performance, information quality, product quality, design performance, environmental
performance and competitive priorities). Based on literature review, the following section
proposes a research model and hypotheses that aim to study direct and indirect effect of
implementation of QMS on mediating factors and on business performance.

3.1 Implementation of QMS

Implementation of QMS obligates an organization to pay obedience to standard processes
such as record keeping, documenting relevant information, maintaining records relevant to
quality of products, etc. When documents are maintained, people can easily obtain relevant
information when they need. In addition, information can be communicated easily to
employees of the organization. Rao et al. (1997) found that ISO 9000 certified organizations
resulted in improved performance on information and analysis. Sound communication
system helps in bringing steady processes that ensure that products are of quality as
required, which ultimately satisfies the customer and improves business performance
(Singh, 2008). The above discussion leads to the following hypothesis:
H1. Implementation of QMS positively influences information quality.

3.2 Information quality

When documents are updated regularly, employees have the knowledge and information on
latest data, standards and procedures. Design management tools, such as quality function
deployment, design for manufacturability, design of experiments, etc., can be implemented
effectively only if relevant data is made available (Ho et al., 1999; Easton and Jarrell, 1998).
Kaynak (2003) found direct positive impact of quality data and reporting on process
management (reduce process variation, build quality into product, etc.). It was also found to
impact product design (designing manufacturable products) directly. Kim et al. (2012) reported
similar results. Positive correlation has also been observed between relevant information sharing
and product design (Kannan and Tan, 2005; Kim et al., 2012). In addition, when latest information
on waste, injured personnel and other environmental indices becomes available and the culture
of QM already exists, employees strive to bring improvement on these indices that in turn helps
to improve work environment. The above discussion leads to the following hypotheses:
H2. Information quality positively influences design performance.
H3. Information quality positively influences operating performance
H4. Information quality positively influences environmental performance.

3.3 Design performance, operating performance, environmental performance and

product quality
The level of success that an organization can achieve depends a lot on quality of products
that it offers to its customers. Delivering high quality products to customers helps an
organization to increase its sales and, thus, grow its market share. Design performance QMS and
refers to improved product reliability, taking into account customer requirements in the business
design phase itself, etc. Product quality is significantly influenced by product design performance
(Kannan and Tan, 2005). Operating performance refers to performance of certain
manufacturing parameters, such as process cycle times, reduced product defect rates, higher
productivity, etc. Better performance on these parameters can certainly help an organization
improve its product quality and ultimately improve business performance (Kaynak, 2003; 1495
Lo et al., 2009). The majority of the quality-related issues occur in the manufacturing part of
the supply chain (Radovilsky and Hegde, 2011). Hence, operating performance and work
environment affects product quality. A better operating performance reduces variances in
dimensions of products and hence reduces defects. A conducive work environment
motivates workers to execute their job better, make few errors, which can have a direct
impact on product quality. Research has found strong impact of environment management
on financial performance of firms (Klassen and McLaughlin, 1996). In addition,
implementation of QM programs results in improved performance (product quality,
market position, etc.), through implementation of environmental management programs
(Mahapatra et al., 2007). The above discussion leads to the following hypotheses:
H5. Design performance positively influences product quality.
H6. Operating performance positively influences product quality.
H7. Environmental performance positively influences product quality.

3.4 Product quality, competitive priorities and Business performance

Competitive priority refers to an organization gaining competitive edge in a number of
parameters, such as customer satisfaction, unit product cost, flexibility in product variety,
etc. Good quality products helps an organization to achieve competitive advantage, by
providing products to customers as desired by them and thus, improving on various quality
dimensions (Forker et al., 1996; Kannan and Tan, 2005). Business performance is measured
organization in different ways, such as, profit, growth in market share, return on
investment, etc. Gaining competitive priorities further aids an organization to improve
overall business performance (Kaynak, 2003; Duh et al., 2012; Kaynak and Hartley, 2008).
The above discussion leads to the following hypotheses:
H8. Product quality positively influences competitive priorities.
H9. Competitive priorities positively influence business performance.
Based on the literature review and proposed hypotheses, the SEM model was developed as
depicted in Figure 1.

Design
Performance

H2 H5

Quality H1 H3 Operating H6 Product H8 Competitive H9 Business

Figure 1.
Information
Management Quality Performance Quality Priorities Performance Proposed model
Systems
between
H4 H7
implementation of
QMS and business
Environmental performance
Performance
IJQRM 4. Methodology
35,8 4.1 Survey instrument
A survey questionnaire was developed to achieve the listed objectives. The items used were
adopted from published research literature, thereby ensuring content validity (Naveh and
Marcus, 2005; Anh and Matsui, 2006; Martínez-Costa et al., 2008; Mann and Kehoe, 1994;
Molina et al., 2007; Singh, 2008; Tan et al., 1999; Terziovski et al., 2003; Christiansen et al., 2003;
1496 Samson and Terziovski, 1999; Park et al., 2001; Kaynak, 2003; Koc, 2007; Kim et al., 2012).
The draft questionnaire was pre-tested with few academicians and industrialists and modified
accordingly. Finally, 39 items were used within eight constructs (Table AI). The respondents
were asked to answer on a five-point Likert scale, ranging from “strongly disagree”
to “strongly agree.”

4.2 Data collection

The sample chosen for our research was professionals working in quality engineering/
management in manufacturing industry. Because it is difficult to collect enough data from a
specific sector, we used convenience-sampling approach to collect data for our analysis. Since
one of the authors of this research paper is located in Canada and one is located in India, we
collected data from professionals in North America (USA and Canada) and India. Some of
the professionals from Canada were contacted personally while some were identified from the
listing of firms on Government of Canada website – Innovation, Science and Economic
Development Canada (www.ic.gc.ca) and American Society for Quality section websites of
Canada and USA. These professionals were sent the link to online questionnaire via e-mail.
To improve the response rate, these professionals were sent a reminder after a week the first
e-mail was sent. The respondents from India were contacted in-person.
Finally, 120 usable responses were received. The average experience of respondents was
18 years. The respondents experience ranged from 1 year to more than 35 years. Moreover,
data were received from people having experience in all ranges, which helped us capture
experience of people with all levels of experience. The bar chart (Figure 2) shows the number
of respondents with experience in different ranges.

4.3 Data analysis techniques

The collected data were analyzed with the aid of statistical software, SPSS 19.0 and LISREL
8.72. We evaluated properties of constructs using confirmatory factor analysis over
exploratory factor analysis. This is because measurement variables were taken from
extensive literature published so far, so measurement variables are expected to converge only
to their respective construct. To evaluate the measurement properties of each construct, factor
analysis was carried out. There has been a considerable debate in the literature regarding if
analysis should be done using single step approach (both measurement model and structural
model together) or it should be done as a two-step approach. Anderson and Gerbing (1988)

Experience (Years)
35 32
29
No. of Respondents

30
25 21
20 19 18
15
Figure 2.
10
No of respondents in
sample having 5
experience in 0
0–5 5–15 15–25 25–35 35+
corresponding range
Range of Experience
recommended a two-step approach whereas Fornell and Yi (1992) recommended a single step QMS and
approach. Single step approach is recommended when the model possesses strong foundation business
(Chin, 1998). Two-step approach is recommended when theory is tentative (Anderson and performance
Gerbing, 1988). We used two-step approach in our analysis, since the SEM framework with
similar constructs has not been found in literature.

5. Results 1497
First, we evaluated the descriptive statistics of items and constructs used in our research.
Table I lists mean, standard deviation and correlation values among constructs considered
in our research. The mean value of 3.91 for the construct, implementation of QMS, shows
that QMS are used by organizations in daily practice. The correlation values between
constructs are statistically significant at 99 percent confidence level. Since all the correlation
values are less than 0.8, multicollinearity does not seem to be an issue among constructs
used in our research.
We also studied the discriminant validity of scales used in our research. The diagonal
(bold) in Table I below shows the square root of average variance extracted (AVE) of each
construct considered in our research. Each of these values is greater than correlation
value among each pair of latent construct. Hence, constructs used in our research study
are acceptable.

5.1 Measurement model

First, convergent validity of measurement variables was analyzed from factor loading
values. This is done to ensure if measurement variables load onto the respective construct.
The standardized loading value of each of the measurement variable was found to be more
than the recommended value of 0.6 (Chin, 1998) and each value was found to be statistically
significant. All the items considered in our research showed good level of statistical quality,
hence no item was discarded from the analysis.
Reliability testing is done to ensure the accuracy of responses by assessing consistency
and internal stability of constructs used in research (Hair et al., 1995). The reliability of each
construct was estimated by Cronbach’s α value in SPSS software. Since all the factor loading
values were found to be greater than 0.6, no item was removed and the original Cronbach’s α
was calculated. Each of the Cronbach’s α value was found to be greater than the threshold
value of 0.7, as suggested by Nunnally (1978). In our analysis, all the values were found to be
greater than 0.8. We also calculated the AVE for each factor of our study, and each AVE
value was found to be greater than the recommended value of 0.5 (Fornell and Larcker,
1981). Table II lists the standardized loading values, Cronbach’s α, t-values and AVE values.

Mean SD QMS INF DP OP EP PQ CP BP

a
QMS 3.91 0.82 0.831
INF 4.08 0.72 0.585* 0.801a
DP 4.21 0.61 0.435* 0.600* 0.832a
OP 4.09 0.74 0.440* 0.507* 0.662* 0.859a
EP 4.07 0.72 0.432* 0.559* 0.671* 0.725* 0.809a
PQ 4.23 0.70 0.438* 0.590* 0.706* 0.745* 0.703* 0.867a
CP 4.02 0.71 0.576* 0.658* 0.684* 0.612* 0.650* 0.698* 0.833a
BP 4.15 0.66 0.332* 0.485* 0.645* 0.435* 0.524* 0.492* 0.513* 0.868a
Table I.
Notes: aSquare root of average variance extracted. QMS, quality management systems; INF, information Descriptive statistics,
quality; DP, design performance; OP, operating performance; EP, environment performance; PQ, product correlations and
quality; CP, competitive priorities; BP, business performance. *p o0.01 (two-tailed) square root of AVE
IJQRM Standardized Cronbach’s Average extracted variance
35,8 Construct loadings t-value α (AVE)

1. Implementation of 0.848 0.6915

QMS
B1a 0.77
B2 0.87 9.38
1498 B3 0.73 7.99
B4 0.70 7.59
2. Information quality 0.859 0.6441
IQ1a 0.80
IQ2 0.71 8.01
IQ3 0.81 9.46
IQ4 0.76 8.74
IQ5 0.64 7.18
3. Design performance 0.888 0.6921
DP1a 0.78
DP2 0.79 9.17
DP3 0.83 9.75
DP4 0.79 9.14
DP5 0.75 8.57
4. Operating performance 0.911 0.7384
OP1a 0.75
OP2 0.87 9.94
OP3 0.86 9.87
OP4 0.81 9.18
OP5 0.80 9.09
5. Environmental performance 0.892 0.6546
EP1a 0.85
EP2 0.75 9.42
EP3 0.82 10.91
EP4 0.76 9.73
EP5 0.75 9.56
EP6 0.67 8.12
6. Product quality 0.889 0.7512
PQ1a 0.83
PQ2 0.91 12.48
PQ3 0.86 11.56
PQ4 0.68 8.26
7. Competitive priorities 0.853 0.6939
CP1a 0.84
CP2 0.80 10.06
CP3 0.64 7.55
CP4 0.71 8.59
8. Business performance 0.934 0.7531
BP1a 0.84
BP2 0.89 12.66
BP3 0.89 12.54
Table II. BP4 0.76 9.77
Loading values, BP5 0.82 11.01
Cronbach’s α, t-values BP6 0.83 11.22
and AVE values Note: aThe corresponding parameter has been set equal to 1 (unstandardized) to fix the measurement scale

5.2 Structural model

Table III lists the structural coefficients ( β) and t-values of the original model. All the β
coefficients were found to be significant at 99 percent confidence level. The value of
χ2/df ⩽ 2.16 o3 (Bollen, 1989; Hair et al., 1995), indicated a good fit. The values of NFI,
Hypothesis β Coefficient t-value Result
QMS and
business
QMS – IQ 0.67 6.14 Accept performance
IQ – DP 0.74 6.37 Accept
IQ – OP 0.69 6.50 Accept
IQ – EP 0.74 7.27 Accept
DP – PQ 0.29 3.56 Accept
OP – PQ 0.47 5.38 Accept 1499
EP – PQ 0.29 3.55 Accept
PQ – CP 0.82 8.37 Accept Table III.
CP – BP 0.61 6.11 Accept Structural coefficients
Notes: χ2 ¼ 1,499.14; df ¼ 693; RMSEA ¼ 0.099; p-value ¼ 0.00000; IFI ¼ 0.94; NFI ¼ 0.90; CFI ¼ 0.94; ( β) of the proposed
NNFI ¼ 0.93. All structural paths are significant at po 0.01 model

NNFI, CFI and IFI were each found to be greater than or equal to threshold value of 0.9
(Byrne, 1998; Mulaik et al., 1989), which also indicated a good fit. Some of the fit indices were
found to be unacceptable; indicating that model deviates from the empirical data. p-value
indicated poor fit. p-value is sensitive to normality assumption and sample size (Hu and
Bentler, 1995). In large samples “almost any model with positive degrees of freedom is likely
to be rejected as providing a statistically unacceptable fit” (Long, 1983). Hence, p-value is
very rarely used in management and operations literature (Narasimhan and Das, 2001; Das
et al., 2000). RMSEA value was found to be 0.099, greater than threshold value of 0.08
(Byrne, 1998; Jaccard and Wan, 1996), which also indicated poor fit with the data.
The unacceptable fit shown by RMSEA value was mainly because some of the direct
effects between factors were not considered in the model. These direct effects were suggested
by LISREL in modification indices. Some of the direct effects were necessary to achieve
overall fit, since they contribute significantly. The following paths were added to the existing
model as suggested by LISREL: design performance → operating performance, design
performance → competitive priorities and implementation of QMS → competitive priorities.
Once the above modifications were made, it significantly resulted in a better fit between
the model and data. The resulting model had a χ2 of 1,183.28 with 683 degrees of freedom
( χ2/df ¼ 1.73) and RMSEA value of 0.078, both values well within the limits. Most of the
proposed hypotheses were supported at 99 percent significance level, except between
environmental performance and product quality, which was supported at 90 percent
significance level. In addition, the hypothesis between design performance and product
quality was not supported at 90 percent confidence level. The final model, structural
coefficients ( β) and t-values are shown in Figure 3.
Table IV lists the direct, indirect and total effects between predictor and criterion
variables included in our study. This can help to gauge how each factor is affected by other
factors, both directly and indirectly through other factors. The factor with most indirect
effects is implementation of QMS and factors with most direct effects are information
quality and design performance. Implementation of QMS, environmental performance,
operating performance, information quality, product quality, design performance and
competitive priorities effect business performance either directly or indirectly.

6. Discussion
In this research, we studied how implementation of QMS affects business performance,
through improvement in several mediating factors. The research contributes substantially
to field of QM. First, this is one of the rare research study that investigates whether QMS are
used in daily practice, while studying the impact of implementation of QMS. We believed
that this is necessary since most of the organizations have implemented TQM practices or
IJQRM 0.68, t = 3.63

35,8
Design
Performance
0.26, t = 4.99
0.66
t = 6.21 0.51 0.17
t = 4.24 t =1.56

Quality
1500 Management
Systems
0.71, t = 6.58 Information
Quality
0.29, t = 2.55 Operating
Performance
0.58, t = 4.36 Product
Quality
0.31, t = 3.32 Competitive
Priorities
0.68, t = 6.92 Business
Performance

Figure 3. 0.62
Structural framework t = 6.16
0.21
t =1.64
between Environmental
Performance
implementation of
QMS and business
performance Notes: 2 =1,183.28; df = 683; RMSEA = 0.076; p-value = 0.000; IFI = 0.96; NFI = 0.92; CFI = 0.96;
NNFI = 0.95

Effect on 2 3 4 5 6 7 8

1. Effects of quality management systems Direct 0.71 0.00 0.00 0.00 0.00 0.68 0.00
Indirect 0.00 0.47 0.45 0.44 0.43 0.13 0.55
Total 0.71 0.47 0.45 0.44 0.43 0.81 0.55
2. Information quality Direct 0.66 0.29 0.62 0.00 0.00 0.00
Indirect 0.00 0.34 0.00 0.61 0.36 0.25
Total 0.66 0.63 0.62 0.61 0.36 0.25
3. Design performance Direct 0.51 0.00 0.17 0.26 0.00
Indirect 0.00 0.00 0.30 0.14 0.27
Total 0.51 0.00 0.47 0.40 0.27
4. Operating performance Direct 0.58 0.00 0.00
Indirect 0.00 0.18 0.12
Total 0.58 0.18 0.12
5. Environmental performance Direct 0.21 0.00 0.00
Indirect 0.00 0.07 0.05
Total 0.21 0.07 0.05
6. Product quality Direct 0.31 0.00
Indirect 0.00 0.21
Total 0.31 0.21
7. Competitive priorities Direct 0.68
Indirect 0.00
Total 0.68
Table IV. 8. Business performance Direct
Direct, indirect and Indirect
total effects Total

ISO standards these days, but whether they actually use these practices in daily operations
or not, is important. The effect of motivation to implement these practices on performance is
already well-established (Withers and Ebrahimpour, 2000; Douglas et al., 1999). In addition,
organizations must use QMS in daily practices to reap maximum benefits. In our research
study, the mean value of 3.91 of implementation of QMS factor (Table I) shows that
organizations of respondents of our research study do use QMS in daily operations.
The proposed structural framework was of sequential type, i.e. improvement in one
factor improves one or more factors and consequently, business performance. Although, all
the proposed hypotheses were found to be statistically significant, the proposed model did
not show a perfect fit with data on some indices such as p-value and RMSEA value. p-value
is generally not used in management and supply chain literature, so we can ignore QMS and
the same (Narasimhan and Das, 2001; Das et al., 2000). The slightly higher value of business
RMSEA was found because the proposed model was sequential. The following paths were performance
added to the existing model as suggested by LISREL: design performance → operating
performance, design performance → competitive priorities and implementation of
QMS → competitive priorities.
The results obtained from analysis are in agreement with previously published 1501
literature. Implementation of QMS positively affects information quality (Rao et al., 1997).
Further, information quality positively affects design and operating performance, which is
in agreement with literature published by Fynes et al. (2005).
In the updated structural model, the direct path coefficient from information quality to
operating performance was found to be 0.29, which supports the fact that information
quality improves operational performance (Lakhal et al., 2006). Besides, it was found that
there is a substantial indirect effect of information quality on operating performance,
through improvement in design performance ( β (DP → OP ¼ 0.51)). The total effect of
information quality on operating performance is found to be 0.63, which is substantial.
Moreover, information quality also affects design performance and environmental
performance. The effect is observed to be quite substantial (0.66 and 0.62, respectively).
Hence, managers must give a lot of importance to information quality, make sure that
information is updated and accurate, relevant and focuses on key areas. If the information
is useful and relevant for daily jobs, personnel can use it and decisions can be made
quickly. Updated information can help to make continuous improvement in key metrics.
Finally, if key policies related to quality are defined clearly, each employee will be well
aware of his responsibilities.
From the managerial perspective, our research points out that the information quality is
one of the key factor to improve performance. Managers must make every effort so that
relevant information is available when required and is useful for daily work. Policies and
expected results related to QM implementation need to be communicated to each employee,
so that they strive to bring continuous improvement in their work.
Further, design performance also affects competitive priorities, both directly and indirectly.
This shows that design performance is one of the key performance factors in any
organization. It is important for organizations to review designs to bring continuous
improvements so that there is less wastage of raw materials and products can be easily
manufactured. Simplified designs can actually reduce process cycle times and, hence, improve
productivity and reduce scrap. Organizations need to take productivity and ease of
manufacturability into account during product design process. Further, in the final model, the
direct path between design performance and product quality is not found to be significant, but
since the path has been added between design performance and operating performance,
design performance does improve product quality (Kannan and Tan, 2005), indirectly through
improvement in operating performance. This is because just a well-designed product does not
assure good quality, unless the product is manufactured free of defects and according to
proper dimensions. Hence, besides a good designed product, managers need to assure that it is
manufactured in accordance with specifications to improve overall product quality.
Finally, the modified model also shows direct impact of implementation of QMS on
competitive priorities. This is in accordance with the previous research (Koc, 2007; Phan et al.,
2011; Forker et al., 1996; Kannan and Tan, 2005; Huarng et al., 1999). The direct effect is mainly
because certain practices in QM, if applied, do bring improvement in key performance factors.
QM practices, such as training, strategic planning and process management are found to have
direct impact on quality performance (product delivery performance) (Kaynak, 2003; Phan
et al., 2011). Implementation of QMS also has indirect impact on competitive priorities. Process
control significantly affects product volume flexibility (Phan et al., 2011). A number of QM
IJQRM practices, such as cross functional product design, process control, information feedback,
35,8 supplier quality involvement, etc., are found to have direct relation with unit manufacturing
costs (Kannan and Tan, 2005; Phan et al., 2011).

7. Conclusions, limitations and future directions

The proposed research reflects the empirical results between implementation of QMS and
1502 business performance, including several other constructs in a single hypothetical model.
The analysis used survey responses from 120 professionals who are working or have
worked in area of QM/engineering. The analysis shows that organizations do use QM
practices after implementation. Empirical evidence is found regarding indirect effects of
implementation of QMS on business performance, through improvement in other factors.
The proposed model included nine hypotheses, which were tested using SEM approach.
All nine hypotheses were found to be statistically significant. Although most of the fit
indices showed good model fit with the empirical data, indices such as p-value and
RMSEA values did not showed good fit. On further analysis, some of the direct paths were
added to the final model. The strength of this work is the inclusion of several new factors,
such as design performance, operating performance, environmental performance,
information quality, etc., in a single hypothetical model, and assessing their direct and
indirect impact on business performance of organizations.
Several findings emerge from this analysis. First, information quality has emerged as
one of the important factor in our study. It directly affects design performance, operating
performance (Lakhal et al., 2006; Fynes et al., 2005) and environmental performance. Further,
it also affects operating performance indirectly through design performance. Hence,
managers must give special attention that relevant information is available when required
and is useful for daily work. Second, in the final model, design quality is not found to have
direct impact on product quality. Rather, it affects product quality through improved
operating performance. Therefore, it is not enough for firms to just work on product designs
and expect a good product quality. The product further needs to be manufactured in
accordance to specifications to bring improvement in quality.
Finally, this research also suffers from some limitations. First, sample size of this study is
limited. Using responses from higher number of professionals could help to improve the
results. Second, we have taken QMS as a generalized construct, whereas it may be possible
that certain firms concentrate only on a specific dimension, hence our results are applicable
only for generalized aspect of QMS in manufacturing industry. As a future work, impact of
different QMS such as TQM, ISO, etc., can be studied separately and their relative impact on
business performance compared. This can help organizations identify which QMS should they
implement. It is recommended that the model be tested in other sectors and countries.
Comparison of large-scale industries with small-scale industries is another future direction.

References
Abdullah, M.M.B. and Tarí, J.J. (2012), “The influence of soft and hard quality management practices on
performance”, Asia Pacific Management Review, Vol. 17 No. 2, pp. 177-193.
Adams, M. (1999), “Determinants of ISO accreditation in the New Zealand manufacturing sector”,
Omega, Vol. 27 No. 2, pp. 285-292.
Agus, A. (2005), “The structural linkages between TQM, product quality performance, and business
performance: preliminary empirical study in electronics companies”, Singapore Management
Review, Vol. 27 No. 1, pp. 87-105.
Al-Dhaafri, H.S. and Al-Swidi, A. (2016), “The impact of total quality management and entrepreneurial
orientation on organizational performance”, International Journal of Quality & Reliability
Management, Vol. 33 No. 5, pp. 597-614.
Anderson, J.C. and Gerbing, D.W. (1988), “Structural equation modeling in practice: a review and QMS and
recommended two-step approach”, Psychological Bulletin, Vol. 103 No. 3, pp. 411-423. business
Anh, P.C. and Matsui, Y. (2006), “An empirical analysis of quality management practices in Japanese performance
manufacturing companies”, Proceedings of the 11th Annual Conference of Asia Pacific Decision
Sciences Institute, Hong Kong, pp. 14-18.
Basu, R. and Bhola, P. (2016), “Impact of quality management practices on performance stimulating
growth: empirical evidence from Indian IT enabled service SMEs”, International Journal of 1503
Quality & Reliability Management, Vol. 33 No. 8, pp. 1179-1201.
Bhatia, M.S. and Awasthi, A. (2017), “Investigating the impact of quality management systems on
business performance”, International Journal of Productivity & Quality Management, Vol. 21
No. 2, pp. 143-173.
Bollen, K.A. (1989), Structural Equations with Latent Variables, Wiley, New York, NY.
Brown, A., Van Der Wiele, T. and Loughton, K. (1998), “Smaller enterprises’ experiences
with ISO 9000”, International Journal of Quality & Reliability Management, Vol. 15 No. 3,
pp. 273-285.
Byrne, B.M. (1998), Structural Equation Modeling with LISREL, PRELIS, and SIMPLIS: Basis
Concepts, Application, and Programming, Lawrence Erlbaum, Mahwah, NJ.
Casadesús, M. and Gimenez, G. (2000), “The benefits of the implementation of the ISO 9000 standard:
empirical research in 288 Spanish companies”, The TQM Magazine, Vol. 12 No. 6,
pp. 432-441.
Cetindere, A., Duran, C. and Yetisen, M.S. (2015), “The effects of total quality management on the
business performance: an application in the province of Kütahya”, Procedia Economics and
Finance, Vol. 23, pp. 1376-1382.
Chin, W.W. (1998), “Issues and opinion on structural equation modelling”, MIS Quarterly, Vol. 22 No. 1,
pp. 1-8.
Christiansen, T., Berry, W.L., Bruun, P. and Ward, P. (2003), “A mapping of competitive priorities,
manufacturing practices, and operational performance in groups of Danish manufacturing
companies”, International Journal of Operations & Production Management, Vol. 23 No. 10,
pp. 1163-1183.
Das, A., Handfield, R.B., Calantone, R.J. and Ghosh, S. (2000), “A contingent view of quality management-the
impact of international competition on quality”, Decision Sciences, Vol. 31 No. 3, pp. 649-690.
Douglas, A., Coleman, S. and Oddy, R. (2003), “The case for ISO 9000”, The TQM Magazine, Vol. 15
No. 5, pp. 316-324.
Douglas, A., Kirk, D., Brennan, C. and Ingram, A. (1999), “Maximizing the benefits of ISO 9000
implementation”, Total Quality Management, Vol. 10 Nos 4-5, pp. 507-513.
Duh, R.R., Hsu, A.W.H. and Huang, P.W. (2012), “Determinants and performance effect of TQM
practices: an integrated model approach”, Total Quality Management & Business Excellence,
Vol. 23 Nos 5-6, pp. 689-701.
Easton, G.S. and Jarrell, S.L. (1998), “The effects of total quality management on corporate
performance: an empirical investigation”, The Journal of Business, Vol. 71 No. 2, pp. 253-307.
Forker, L.B., Vickery, S.K. and Droge, C.L. (1996), “The contribution of quality to business performance”,
International Journal of Operations & Production Management, Vol. 16 No. 8, pp. 44-62.
Fornell, C. and Larcker, D.F. (1981), “Evaluating structural equation models with unobservable
variables and measurement error”, Journal of Marketing Research, Vol. 18 No. 1,
pp. 39-50.
Fornell, C. and Yi, Y. (1992), “Assumptions of the two-step approach to latent variable modeling”,
Sociological Methods & Research, Vol. 20 No. 3, pp. 291-320.
Fynes, B., Voss, C. and de Búrca, S. (2005), “The impact of supply chain relationship quality on quality
performance”, International Journal of Production Economics, Vol. 96 No. 3, pp. 339-354.
IJQRM Gotzamani, K.D. and Tsiotras, G.D. (2002), “The true motives behind ISO 9000 certification: their effect
35,8 on the overall certification benefits and long term contribution towards TQM”, International
Journal of Quality & Reliability Management, Vol. 19 No. 2, pp. 151-169.
Hair, J.F., Anderson, R.E., Tatham, R.L. and Black, W.C. (1995), Multivariate Data Analysis,
Prentice-Hall, Englewood Cliffs, NJ.
Ho, D.C., Duffy, V.G. and Shih, H.M. (1999), “An empirical analysis of effective TQM implementation in
1504 the Hong Kong electronics manufacturing industry”, Human Factors and Ergonomics in
Manufacturing & Service Industries, Vol. 9 No. 1, pp. 1-25.
Hu, L. and Bentler, P.M. (1995), “Evaluating model fit”, in Hoyle, R.H. (Ed.), Structural Equation
Modeling: Concepts, Issues, and Applications, Sage, Thousand Oaks, CA, pp. 76-99.
Huarng, F., Horng, C. and Chen, C. (1999), “A study of ISO 9000 process, motivation and performance”,
Total Quality Management, Vol. 10 No. 7, pp. 1009-1025.
Jaccard, J. and Wan, C.K. (1996), “LISREL approaches to interaction effects in multiple regression”,
Sage University Paper Series on Quantitative Applications in the Social Sciences, No. 07/114,
Sage, Thousand Oaks, CA.
Kannan, V.R. and Tan, K.C. (2005), “Just in time, total quality management, and supply chain
management: understanding their linkages and impact on business performance”, Omega,
Vol. 33 No. 2, pp. 153-162.
Kaynak, H. (2003), “The relationship between total quality management practices and their
effects on firm performance”, Journal of Operations Management, Vol. 21 No. 4, pp. 405-435.
Kaynak, H. and Hartley, J.L. (2008), “A replication and extension of quality management into the
supply chain”, Journal of Operations Management, Vol. 26 No. 4, pp. 468-489.
Kim, D.Y., Kumar, V. and Kumar, U. (2012), “Relationship between quality management practices and
innovation”, Journal of Operations Management, Vol. 30 No. 4, pp. 295-315.
Klassen, R.D. and McLaughlin, C.P. (1996), “The impact of environmental management on firm
performance”, Management Science, Vol. 42 No. 8, pp. 1199-1214.
Koc, T. (2007), “The impact of ISO 9000 quality management systems on manufacturing”, Journal of
Materials Processing Technology, Vol. 186 No. 1, pp. 207-213.
Lakhal, L., Pasin, F. and Limam, M. (2006), “Quality management practices and their impact on
performance”, International Journal of Quality & Reliability Management, Vol. 23 No. 6,
pp. 625-646.
Lin, C., Chow, W.S., Madu, C.N., Kuei, C.H. and Yu, P.P. (2005), “A structural equation model of supply
chain quality management and organizational performance”, International Journal of Production
Economics, Vol. 96 No. 3, pp. 355-365.
Lo, C.K., Yeung, A.C. and Cheng, T.C.E. (2009), “ISO 9000 and supply chain efficiency: empirical
evidence on inventory and account receivable days”, International Journal of Production
Economics, Vol. 118 No. 2, pp. 367-374.
Long, J.S. (1983), Confirmatory Factor Analysis, Sage Publications, Newbury Park, CA.
Magd, H. and Nabulsi, F. (2012), “The effectiveness of ISO 9000 in an emerging market as a business
process management tool: the case of the UAE”, Procedia Economics and Finance, Vol. 3,
pp. 158-165.
Mahapatra, S.K., Melnyk, S.A. and Calantone, R.J. (2007), “Understanding environment management
systems performance: an expanded empirical study”, International Journal of Productivity and
Quality Management, Vol. 2 No. 3, pp. 263-286.
Mann, R. and Kehoe, D. (1994), “An evaluation of the effects of quality improvement activities on
business performance”, International Journal of Quality & Reliability Management, Vol. 11 No. 4,
pp. 29-44.
Martínez-Costa, M., Martínez-Lorente, A.R. and Choi, T.Y. (2008), “Simultaneous consideration of TQM
and ISO 9000 on performance and motivation: an empirical study of Spanish companies”,
International Journal of Production Economics, Vol. 113 No. 1, pp. 23-39.
Modgil, S. and Sharma, S. (2016), “Total productive maintenance, total quality management QMS and
and operational performance: an empirical study of Indian pharmaceutical industry”, Journal of business
Quality in Maintenance Engineering, Vol. 22 No. 4, pp. 353-377.
performance
Molina, L.M., Lloréns-Montes, J. and Ruiz-Moreno, A. (2007), “Relationship between quality
management practices and knowledge transfer”, Journal of Operations Management, Vol. 25
No. 3, pp. 682-701.
Mulaik, S.A., James, L.R., Van Alstine, J., Bennett, N., Lind, S. and Stilwell, C.D. (1989), “Evaluation of 1505
goodness-of-fit indices for structural equation models”, Psychological Bulletin, Vol. 105 No. 3,
pp. 430-445.
Narasimhan, R. and Das, A. (2001), “The impact of purchasing integration and practices on
manufacturing performance”, Journal of Operations Management, Vol. 19 No. 5,
pp. 593-609.
Naveh, E. and Marcus, A. (2005), “Achieving competitive advantage through implementing a replicable
management standard: installing and using ISO 9000”, Journal of Operations Management,
Vol. 24 No. 1, pp. 1-26.
Nguyen, A.D., Pham, C.H. and Pham, L. (2016), “Total quality management and financial performance
of construction companies in Ha Noi”, International Journal of Financial Research, Vol. 7 No. 3,
pp. 41-53.
Nunnally, J. (1978), Psychometric Theory, McGraw-Hill, New York, NY.
O’Neill, P., Sohal, A. and Teng, C.W. (2016), “Quality management approaches and their impact on
firms‫ ׳‬financial performance–an Australian study”, International Journal of Production
Economics, Vol. 171 No. 3, pp. 381-393.
Park, S., Hartley, J.L. and Wilson, D. (2001), “Quality management practices and their relationship to
buyer’s supplier ratings: a study in the Korean automotive industry”, Journal of Operations
Management, Vol. 19 No. 6, pp. 695-712.
Parvadavardini, S., Vivek, N. and Devadasan, S.R. (2016), “Impact of quality management
practices on quality performance and financial performance: evidence from Indian
manufacturing companies”, Total Quality Management & Business Excellence, Vol. 27 No. 5,
pp. 507-530.
Phan, A.C., Abdallah, A.B. and Matsui, Y. (2011), “Quality management practices and competitive
performance: empirical evidence from Japanese manufacturing companies”, International
Journal of Production Economics, Vol. 133 No. 2, pp. 518-529.
Piskar, F. (2007), “The impact of the quality management system ISO 9000 on customer satisfaction of
Slovenian companies”, Managing Global Transitions, Vol. 5 No. 1, pp. 45-61.
Poksinska, B. (2010), “When does ISO 9000 lead to improvements?”, International Journal of
Productivity and Quality Management, Vol. 5 No. 2, pp. 124-136.
Psomas, E.L. and Jaca, C. (2016), “The impact of total quality management on service company
performance: evidence from Spain”, International Journal of Quality & Reliability Management,
Vol. 33 No. 3, pp. 380-398.
Quazi, H.A. and Jacobs, R.L. (2004), “Impact of ISO 9000 certification on training and development
activities: an exploratory study”, International Journal of Quality & Reliability Management,
Vol. 21 No. 5, pp. 497-517.
Radovilsky, Z. and Hegde, V. (2011), “Identifying and analyzing quality in supply chain”, California
Journal of Operations Management, Vol. 9 No. 1, pp. 58-70.
Rahman, S.U. (2001), “A comparative study of TQM practice and organisational performance of SMEs
with and without ISO 9000 certification”, International Journal of Quality & Reliability
Management, Vol. 18 No. 1, pp. 35-49.
Rao, S.S., Ragu-Nathan, T.S. and Solis, L.E. (1997), “Does ISO 9000 have an effect on quality
management practices? An international empirical study”, Total Quality Management, Vol. 8
No. 6, pp. 335-346.
IJQRM Samson, D. and Terziovski, M. (1999), “The relationship between total quality management practices and
35,8 operational performance”, Journal of Operations Management, Vol. 17 No. 4, pp. 393-409.
Singh, P.J. (2008), “Empirical assessment of ISO 9000 related management practices and performance
relationships”, International Journal of Production Economics, Vol. 113 No. 1, pp. 40-59.
Tan, K.C., Kannan, V.R., Handfield, R.B. and Ghosh, S. (1999), “Supply chain management: an empirical
study of its impact on performance”, International Journal of Operations & Production
1506 Management, Vol. 19 No. 10, pp. 1034-1052.
Tarí, J.J., Molina, J.F. and Castejon, J.L. (2007), “The relationship between quality management practices
and their effects on quality outcomes”, European Journal of Operational Research, Vol. 183 No. 2,
pp. 483-501.
Terlaak, A. and King, A.A. (2006), “The effect of certification with the ISO 9000 Quality Management
Standard: A signaling approach”, Journal of Economic Behavior & Organization, Vol. 60 No. 4,
pp. 579-602.
Terziovski, M., Power, D. and Sohal, A.S. (2003), “The longitudinal effects of the ISO 9000 certification
process on business performance”, European Journal of Operational Research, Vol. 146 No. 3,
pp. 580-595.
Withers, B. and Ebrahimpour, M. (2000), “Does ISO 9000 certification affect the dimensions of quality
used for competitive advantage?”, European Management Journal, Vol. 18 No. 4,
pp. 431-443.
Zakuan, N., Yusof, S.R.M., Saman, M.Z.M., Shaharoun, A.M. and Laosirihongthong, T. (2012),
“The moderator effects of ISO/TS16949 certification in Thailand automotive industry”,
Procedia-Social and Behavioral Sciences, Vol. 40, pp. 141-145.
Appendix QMS and
business
performance
Factor Measurement variables

1. Implementation of QMS
2. Information quality (IQ)
3. Design performance (DP)
4. Operating performance (OP)
5. Environment performance (EP) EP1: cleanliness and neatness
6. Product quality (PQ)
7. Competitive priorities (CP) CP1: reduced unit production costs
8. Business performance (BP)
B1: quality management systems are the part of regular routine
B2: system is well coordinated 1507
B3: integration with practice already in place
B4: tailored to the needs of organization
IQ1: information in records is complete and accurate
IQ2: information is useful in daily jobs
IQ3: information focuses on key business drivers
IQ4: information is relevant for decision making
IQ5: policies related to quality are defined clearly
DP1: improved product reliability
DP2: more clarity of product specifications and procedures
DP3: improved coordination among departments involved in
product design
DP4: continual improvements are made in product design
DP5: customer requirements are thoroughly analyzed in new product
design process
OP1: lower product defect rates
OP2: reduced unit production costs
OP3: reduced process cycle times
OP4: reduced cost of quality
OP5: higher productivity
EP2: continually strive for reduction in waste targets
EP3: work environment is conducive to the well-being of all employees
EP4: work environment is conducive to the development of all employees
EP5: reduced health and safety risks
EP6: environmental “green” protection issues are proactively managed
PQ1: reduced variances in manufactured products (more consistency
in outputs)
PQ2: reduced product defects
PQ3: improved product performance and reliability
PQ4: improvement in perceived product quality by customers
CP2: improved product delivery performance
CP3: improved product volume flexibility
CP4: improved product variety flexibility
BP1: increased profits
BP2: growth in market share Table AI.
BP3: growth in annual sales Factors and
BP4: increased return on investment measurement
BP5: increased throughput variables of
BP6: increased cash flow research study

Corresponding author
Manjot Singh Bhatia can be contacted at: manjotbht@gmail.com

For instructions on how to order reprints of this article, please visit our website:
www.emeraldgrouppublishing.com/licensing/reprints.htm
Or contact us for further details: permissions@emeraldinsight.com