Quality management has had considerable success in terms of its acceptance in organizations worldwide. Quality management is one of the most talked about areas for research and teaching. Due to its short history, however, there is still much confusion surrounding the effects of ISO 9000 registration efforts on the Total Quality Management (TQM) practices and business performance. A priori model is constructed on the basis of established beliefs, propositions, and findings of previous empirical studies in quality management, and several hypotheses are proposed and tested. In this study, Structural Equation Modeling (SEM) is applied to assist in explaining and predicting the relationships which have not been examined before in the operations management literature, between and among ISO 9000 registration efforts, TQM practices, organizational competitiveness, customer satisfaction, and business performance. Data is collected from 441 ISO 9000 registered manufacturing companies in the United States.
This study is developed from a theoretical foundation and provides a deeper insight into fundamental theories in quality management. The results of this study raise as many questions as they answer. One important result is the strong evidence that the ISO 9000 registration efforts enhance organizational competitiveness, which in turn enhances customer satisfaction as well as business performance. Also, ISO 9000 registration efforts and TQM practices have a significant, positive relationship when the model is tested based on all 441 responses. However, TQM practices do not have a significant, positive relationship with customer satisfaction as the literature suggests. As ISO 9000 registration efforts, TQM practices enhance competitiveness, which in turn enhances customer satisfaction as well as business performance.
Multiple group analyses are performed by splitting the data set by industry type, U.S. owned and foreign owned firms, firm size in terms of the number of employees, as well as by firm's quality orientation to test exactly what effects these groupings have on the relationships among different constructs.
