Total Quality Management & Business Excellence

ISSN: 1478-3363 (Print) 1478-3371 (Online) Journal homepage: http://www.tandfonline.com/loi/ctqm20

A Systemic and Contingent View of the Basic

Elements of Quality Management
Vicente Roca-Puig , Ana B. Escrig-Tena , Juan C. Bou-Llusar & Inmaculada
Beltrn-Martn
To cite this article: Vicente Roca-Puig , Ana B. Escrig-Tena , Juan C. Bou-Llusar & Inmaculada
Beltrn-Martn (2006) A Systemic and Contingent View of the Basic Elements of Quality
Management, Total Quality Management & Business Excellence, 17:9, 1111-1127, DOI:
10.1080/14783360600750402
To link to this article: http://dx.doi.org/10.1080/14783360600750402

Published online: 24 Jan 2007.

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Date: 16 December 2016, At: 08:17

Total Quality Management

Vol. 17, No. 9, 1111 1127, November 2006

A Systemic and Contingent View of the

Basic Elements of Quality Management
VICENTE ROCA-PUIG, ANA B. ESCRIG-TENA, JUAN C. BOU-LLUSAR
N-MARTIN
& INMACULADA BELTRA
Universitat Jaume I, Castellon, Spain

ABSTRACT This paper presents a structural model that considers the interrelationships between
the social and technical components of a Quality Management (QM) initiative. In this model,
leadership appears as the starting point of any initiative intended to implement QM. Using this
model, the influence of each of these two subsystems (social and technical) on customer results is
evaluated. At the same time, the external and internal effects of QM elements on business results
are estimated. Finally, we analyse the existence of significant differences in the degree of QM
introduction as well as the intensity of the causal effects considered by the model depending on
two contingent factors: sector and size.
KEY WORDS :

Quality management, causal relationships, simultaneous equations, contingent view

Introduction
There is widespread agreement that the concept of Quality Management (QM) as a management strategy will lead to enhanced customer satisfaction and, ultimately, greater
company effectiveness (Porter & Parker, 1993). In line with contributions by Dotchin &
Oakland (1992), Dean & Bowen (1994) or Wilkinson et al. (1998), it is possible to
define this approach in terms of some basic elements.1 Earlier works commonly showed
that the dimensions of QM were identified as follows:
(a) viewing the customer as the reference point when setting up objectives or designing
the firms products and processes;
(b) fostering continuous improvement of all processes and activities; this requires setting
up a system that will provide the necessary information regarding relevant data and
facts;
(c) fostering the development and involvement of people by viewing them as the
organisations most important assets;

Correspondence Address: Vicente Roca-Puig, Dpto. Administracion de Empresas y Marketing, Facultad de

Ciencias Jurdicas y Economicas, Universitat Jaume I, 12071 Castellon, Spain. Email: roca@emp.uji.es
1478-3363 Print=1478-3371 Online=06=09111117 # 2006 Taylor & Francis
DOI: 10.1080=14783360600750402

1112

V. Roca-Puig et al.

(d) considering the total involvement of all organisational areas and processes in quality
improvement, which requires management leadership and quality planning in all areas.
Among these elements and according to Dotchin & Oakland (1992), Boaden (1997) and
Wilkinson et al. (1998), we can distinguish two different aspects in the content and practices of the QM framework. One of these refers to technical aspects that capture a more
operational focus, emphasising systems and data obtention and measurement and the
other deals with cultural or social aspects which refer to the human and social side
of QM and focus on human resources management and a cultural change.2 Both aspects
are interrelated and they simultaneously affect the customers perception of the value of
products and services offered by the organisation. Hence, we can put forward a causal
model to explain business results. In this model, customer satisfaction is a basic intermediate goal that is attained by process management and people management. Moreover, these
latter elements are encouraged by the leadership of management. In short, these five
elements, referring to both QM implementation enablers (leadership, people management
and process management) and its expected results (customer satisfaction and economic
results) make up the theoretical model of Quality Management.
On the other hand, most researchers (e.g. McGee, 1993; Sjoblom, 1995; Dale, 1997)
claim that the previous elements should be jointly and systemically considered since
they might have an effect on business results. Thus, quality management is an integrated
approach (Flynn et al., 1994; Fuentes-Fuentes et al., 2004). In short, it is essential to treat
QM as a total management model, as all the previously mentioned elements must be taken
into account, and a holistic construct, since the multiple relationships between these
elements must be considered simultaneously.
However, considering QM as an integrated model does not prevent it from adopting
different configurations according to the prevailing environmental conditions and the
organisational context in which the QM implementation takes place. As suggested by
Dean & Bowen (1994) or Watson & Korukonda (1995), it is advisable to adopt a contingency-based approach during the introduction and development of QM. In other words, it
is pointed out that QM design and effectiveness depend on certain contextual variables and
it may be risky to accept a standardised conceptualisation of this model. Hence, the degree
of implementation of the various QM elements, and even the postulated interrelationships
between them, may present significant differences according to certain contingency-based
variables.
To sum up, for a successful QM implementation, a systemic and contingent approach to
the model is necessary. Accordingly, this study has two objectives. The first consists of
building a representative QM model where its basic elements and respective interrelationships are considered. The second objective consists of examining how diverse contextual
factors may affect the QM model. Specifically, we set out to analyse any significant differences, both at the implementation level of the basic QM elements and in the relationships
that the model establishes, according to two contextual factors mentioned in the literature,
namely, activity sector and company size.
In order to meet these objectives, the paper is structured as follows. First, the QM model
is justified and the hypotheses deriving from it are developed. Then, the contingent arguments are set forth; these arguments explain why the contextual variables may influence
the QM model. The subsequent section explains the methodology used in our study.
Finally, the results obtained are presented and interpreted.

The Basic Elements of Quality Management

1113

The Systemic View of Quality Management

In any quality management initiative, the overall responsibility is on the management
team. The board of directors should act as a reference point and actively promote
pro-quality policies by making the necessary investments (Saraph et al., 1989; Porter
& Parker, 1993; Flynn et al., 1994).
Management efforts will enable the solid grounding of QM subsystems, that is, the
social and technical aspects (Wilkinson, 1992; Dale et al., 1997). Social aspects focus
on the human resource management within the organisation and emphasise teamwork,
training and employees self-control. Technical aspects emphasise standardisation in
production methods and operations. They seek to establish a work method based on
well-defined and normalised processes and procedures aimed at the continuous improvement of products and services. Management efforts should be simultaneously focused on
these two basic subsystems (Mandal et al., 1998). Furthermore, works by Winn &
Cameron (1998) or Pannirselvam & Ferguson (2001) reveal that the main leadership
influence is on organisational systems, which in turn improves business results. We can
put forward these arguments in the following hypotheses:
Hypothesis 1. Quality-oriented leadership positively affects people management.
Hypothesis 2. Quality-oriented leadership positively affects process management.
Furthermore, managers cannot treat these two subsystems separately. On the contrary,
they must be jointly managed (Snell & Dean, 1992). McGee (1993) states that successful
QM initiatives have balanced the needs of human systems with those of technical work processes. Dale (1997) observed that the lack of integration between soft and hard components of quality management is partly responsible for the failure of these initiatives.
Consequently, there is a basic interdependence between these two subsystems (Stahr, 2001).
Even though there is no precise definition of the nature of this fit (Dow et al., 1999), it is
generally accepted that the normalisation of processes will be more successful if the organisation has previously developed aptitudes and attitudes in people that ensure their active
participation in the design of the operative processes (Rahman & Bullock, 2005). The
most effective way of attaining continuous improvement in the organisation is through
the knowledge and skills of the employees responsible for identifying and implementing
the process schema (Hill & Wilkinson, 1995). Training and self-control enable people to
take part efficiently in the continuous improvement of products and processes (Dean &
Bowen, 1994). People are the source of ideas and innovation (Wilkinson et al., 1998).
Their skills, experience, knowledge and cooperation are basic if these ideas are to
become a reality in the form of successfully implemented work methods and procedures.
In short, adequate process management needs appropriate people management, which
supports the existence of a causal link between these variables. We therefore propose
the following hypothesis:
Hypothesis 3. Quality-oriented people management positively affects process
management (fit).
Likewise, as McAdam & Bannister (2001) point out, companies that are committed
towards a QM initiative, emphasise the attainment of customer satisfaction. This leads

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V. Roca-Puig et al.

to better customer-based results and financial performance. Customer satisfaction is an

intrinsic goal of QM (Porter & Parker, 1993; Agus et al., 2000), which depends on both
the social and technical components.
On the one hand, the sociocultural component stimulates keeping the employees
informed and motivated so that they meet or exceed customer needs. This people management policy generates a social climate, value sharing, and certain attitudes among employees that affect customers perceptions of the organisations products and services (Oakland
& Oakland, 1998; Rogg et al., 2001). In fact, works such as Pannirselvam & Ferguson
(2001), which look at the relationships between the categories of the Malcolm Baldrige
Model, concluded that people management has a significant effect on customer satisfaction. Apart from this direct effect, these authors proposed that people management also
has an indirect effect on the organisations business results through its influence on
process management.
On the other hand, Wilson & Collier (2000) and Reiner (2002) upheld that the technical
component harvests the benefits that adequate product design and absence of defects will
have on customer satisfaction. This objective quality of the product delivered to the
customer is a direct consequence of the process system used by the organisation. Winn
& Cameron (1998) empirically confirmed the existence of a direct effect of process
management on customer satisfaction.
In this sense, it is possible to distinguish two types of effects of QM on customers: one
derived from social initiatives (soft effect) and the other derived from technical aspects
(hard effect). The distinction between soft and hard has been acknowledged by several
authors. Gronroos (1990) distinguishes between functional quality and technical quality.
Functional quality refers to the way in which relationships with customers are established
and includes the interpersonal characteristics present when giving the customer a product or
service. Technical quality defines the intrinsic characteristics of the product or service
offered to the customer. Similarly, Dervitsiotis (2001) distinguishes between subjective
and objective aspects in employee-customer interactions: the first refer to the social
climate and the trust that is established when dealing with customers, while the second
type refers to the exchange of information and products. Likewise, in the construction of
the model based on the European Consumer Satisfaction Index (1998) a distinction is
made between technical and human aspects as precursor elements of the degree of customer
satisfaction. In short, this rationale allows us to propose the following two hypotheses:
Hypothesis 4. People management positively affects customer results (soft effect).
Hypothesis 5. Process management positively affects customer results (hard effect).
Finally, various authors (e.g. Garvin, 1984; Deming, 1986; Rust et al., 1995) explain how
QM influences business results through two complementary paths: (a) the internal effect
through processes, including cost-savings by reduction of defects and reprocessing due to
the normalisation of processes; (b) the external effect through the market, reflecting the consequences of customer satisfaction in business results due to an increase in purchase intention
and sales margins. All of this finally translates into an improvement in company profitability.
Consequently, these arguments enable us propose the following two hypotheses:
Hypothesis 6. Customer results positively affect business results (external effect).
Hypothesis 7. Process management positively affects business results (internal effect).

The Basic Elements of Quality Management

1115

The consideration of these arguments has enabled us to set up a theoretical framework

that captures all the causal relationships between the five basic elements of QM (Figure 1).
The Contingent View of Quality Management
The first studies on QM (e.g. Deming, 1986) looked upon this management approach as
being universally applicable to all firms and all organisational activities. These early
works did not question whether their rationale could be interpreted in a specific manner
according to certain organisational variables. More recent works have developed a
contingency-based approach to QM. Thus, Dean & Bowen (1994) sustain that QM must
be based on a contingency-based approach rather than assuming it is universally applicable. Furthermore, The International Quality Study (Ernst & Young/American
Quality Foundation, 1992), or the work by Benson et al. (1991), has shown that it is
not possible to support the hypothesis that QM practices are universally beneficial.
Hence, QM can be contingent, with different orientations and results in different sectors
and in organisations with different sizes (Hill & Wilkinson, 1995; Powell, 1995; Taylor,
1996; Terziovski & Samson, 1999). According to this contingent approach, it is possible to
distinguish two kinds of arguments: (a) those that explain how the degree of implementation of QM policies and practices may be different for different types of firms; and
(b) those that sustain that the intensity of the influence of QM policies and practices on
results changes according to the organisational setting.
Activity Sector
Even though QM has its origins in industry, it has been progressively implemented in the
service sector since the 1980s. The greater tangibility of products fostered the emergence
and development of QM in industrial firms. In this regard, the question is to what extent
QM can be transferred to services and whether there are differences in its implementation,
and in the results obtained, with respect to industrial sectors.

Figure 1. QM theoretical model

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V. Roca-Puig et al.

Various studies (e.g. Powell, 1995; Taylor, 1996; Beaumont et al., 1997) showed how
manufacturing sectors are more active in the implementation of QM activities. According
to these authors, the reason for the difference between industrial and service sectors can be
explained by the fact that the effective adaptation and assimilation of a QM system
requires a longer history of dealing with this kind of initiative. The unequal nature of
implementation between industrial firms and services may be due to the differences in
the periods of time these kinds of initiatives have been implemented, given that a
certain amount of time is necessary for a management initiative to be adapted and assimilated. Consequently, we can propose the following hypothesis:
Hypothesis 8. In comparison with service industries, industrial firms show higher
mean values in leadership, people management and process management.
With regard to the effect of QM on results, Powell (1995) upholds that, thanks to their
greater experience, industrial companies take better advantage of quality management
efforts than service companies. In this regard, Rust et al. (1995) and Singh & Deshmukh
(1999) stated that cost reduction (internal effect) normally appears with greater intensity in
industrial firms. This effect is more difficult to achieve in service industries since personalisation tends to impede the development of economies of scale. Some service companies
are increasingly offering more standardised and formal procedures that reduce contact
between the employee and the customer, and they are tending to introduce service-providing technologies. Nevertheless, it must be pointed out that in service firms the need for
interpersonal contact is still fundamental and it is greater than in industrial firms
(Lemak & Reed, 2000). Consequently, we posit the following hypothesis:
Hypothesis 9. In comparison with industrial firms, service firms present an internal
effect with a lower intensity.
Finally, following Rees (1995) and Wilkinson et al. (1998), QM emphasises employee
commitment towards customer satisfaction in service sectors due to the greater
employee customer interaction in this kind of firm. Consequently, in service firms, any
improvement in people management will have a greater impact on customers perceived
quality. According to these authors, in service industries the social subsystem of QM is
essential in reinforcing customer satisfaction. Hence, we can put forward the following
hypothesis:
Hypothesis 10. In comparison with industrial firms, service firms present a soft effect
with a higher intensity.
Size
Studies by Price & Chen (1993), Ghobadian & Gallear (1996, 1997) and Yusof & Aspinwall
(1999) point out that some characteristics of QM are compatible with smaller firms,
whereas other actions are more in line with large firms. More specifically, it is expected
that, in small firms, the social subsystem (people management) presents greater values
compared with large firms. On the other hand, the strength of large firms rests on the technical subsystem (process management) (Price & Chen, 1993; Lee & Oakes, 1995). This is

The Basic Elements of Quality Management

1117

due to the features of small firms: flatter hierarchical structure, fewer pressure groups or
greater communication between members. Such characteristics facilitate the implementation of social aspects of QM (Yusof & Aspinwall, 1999). Since large firms are usually
more bureaucratic, however, they are likely to use formal structural coordination mechanisms. Consequently, they are more oriented towards systems and processes rather than
towards persons (Ghobadian & Gallear, 1996). Likewise, in small firms the normalisation
of processes is hindered by lower financial resources and a more limited knowledge of
management (Ghobadian & Gallear, 1997; Quazi & Padibjo, 1998). Based on these arguments, we propose the following two hypotheses:
Hypothesis 11(a). In comparison with large firms, small firms show higher mean
values for people management.
Hypothesis 11(b). In comparison with large firms, small firms show lower mean
values for process management.
In general terms, Terziovski & Samson (1999) pointed out the unequal influence that
size has on the relationship between QM practices and organisational performance. This
study offers empirical evidence that size raises the positive effect of QM implementation on the expected results. Nevertheless, Lee & Oakes (1995), in line with later
arguments put forward by Ghobadian & Gallear (1996) and Yusof & Aspinwall
(1999), postulated that if customer satisfaction depended on the social aspect and
good communication between employees it would be reasonable to assume that, in comparison with large firms, the effect of people management on results would be greater in
small firms. Without standardised behaviours, small companies depend mainly on
employees ideas to improve results (Price & Chen, 1993). Furthermore, employees
in small firms usually have a closer and more direct rapport with customers, and this
tends to augment sociability as well as enhance the interpersonal relationships
between employee and customer (Yusof & Aspinwall, 1999). According to these last
arguments, it would appear that size can influence the intensity of the effects. Hence,
we can propose the following hypothesis:
Hypothesis 12. In comparison with large companies, small companies present a soft
effect with a higher intensity.
Accordingly, we can expect that with increased systematisation of processes, any effort
made in process management will greatly improve the technical quality of products made
by large companies (Ahire & Golhar, 1996). Likewise, we could put forward the notion
that the existence of greater normalisation of processes in large companies will be
reflected in greater productive efficiency based on: (a) fewer defects and a lower need
for reprocessing; (b) the emergence of economies of scale caused by greater production
rates and greater fixed costs. Hence, it can be put forward that:
Hypothesis 13(a). In comparison with large companies, small companies present a
hard effect with a lower intensity.
Hypothesis 13(b). In comparison with large companies, small companies present an
internal effect with a lower intensity.

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V. Roca-Puig et al.

To sum up, Hypotheses 8, 11(a) and 11(b) refer to the degree of QM implementation,
while hypotheses 9, 10, 12, 13(a) and 13(b) refer to the intensity of the effects of QM
on business results, depending on the contextual factors considered.
Methodology
Sample
The selection of companies for the sample was made with information provided by the
N directory of Spanish companies, using a stratified random procedure
1999 ARDA
with its representativeness fixed proportionally to the universe by sector3 and size.4 The
population was 2695 companies from all over the country and 446 companies formed
the final sample. The confidence level was set at 95% and for the most unfavourable
case ( p q 50%), the sampling error was+3.283%. The mean number of employees
for the sample was 86.524, with a standard deviation of 122.372. The fieldwork was
carried out during the months of October and December 2000, in a series of personal interviews with quality managers and top management executives for each organisation; a
structured questionnaire was filled in.
In order to study the firm size factor, a distinction was made between small companies
(238 companies) and medium-size/large companies5 (204 companies). The number of
employees was obtained from the questionnaire. As can be appreciated, the total
number of companies in both subgroups does not coincide with the final sample as this
question was left unanswered in some cases. Lastly, the distinction between service
companies (233 firms) and industrial companies (213 firms) was carried out according to
the activity sector to which the companies belonged.
Measurements
The elaboration of the questionnaire was based on the contents of the EFQM Excellence
Model, which is quite specific in terms of criteria, subcriteria and guidance points. Its
specific nature therefore makes it useful when drawing up questionnaires (Eskildsen &
Kanji, 1998).6 Hence, the content of the questionnaire was designed to cater for the five
elements considered in our model. The total number of indicators was 44 (see the Appendix). The questions were evaluated by the interviewed persons by using a 7-point Likert
scale, where a value of 1 denoted total disagreement and a value of 7 denoted total
agreement.
For each of the five measurement scales, the reliability level was checked using Cronbachs alpha test. The results for this test show adequate values of internal consistency (see
Table 1), which shows that the indicators making up the scales are interrelated and the
possibility of random errors are considerably reduced in the measurements (Shepherd &
Helms, 1995). Finally, the value reached for each element was calculated as the arithmetic
mean of their respective indicators.
Analytical Procedure
In order to check our hypotheses, we used a structural equation model within the EQS
statistical programme (Bentler, 1995). This technique enabled us to test all

The Basic Elements of Quality Management

1119

Table 1. Descriptive statistics for the total samplea (N 446)

Bivariate Correlations
QM elements

Mean

s.d.

1. Leadership
2. People management
3. Process management
4. Customer results
5. Business results

5.799
5.054
5.339
5.819
5.434

0.755
1.184
0.956
0.817
1.153

(0.713)
0.636


0.580


0.446


0.337

(0.907)
0.644


0.535


0.341

(0.866)
0.554


0.479

(0.832)
0.491

(0.933)

a
Cronbachs alpha coefficients are presented in brackets over the diagonal.
Note: () p , 0.1; (
) p , 0.05; (

) p , 0.01

the interrelationships proposed in the previous theoretical model. In particular, given that
the measurement of elements was carried out by taking the arithmetical means of the corresponding indicators, we have specified a simultaneous equation model or path analysis.
The estimation method was maximum likelihood (ML). The statistical x 2 test associated
with this model enabled us to check that the proposed model is an adequate representation
of the whole set of causal relationships.
With regard to the study of the potential existence of contingent factors, two complementary analyses were carried out. The first was an ANOVA, to test for the existence
of significant differences in the mean value for each of the five elements among the
various subgroups.
The second was a multigroup analysis to test whether the causal relationships of the proposed theoretical model were statistically different among the various subgroups. Following indications by Bentler (1995) on the use of multigroup analysis, we first established the
restriction that the seven causal relationships proposed in the structural model should be
the same for the various subgroups. Furthermore, when we analysed the sector, we established that the proposed structural model was to be identical for service companies and
industrial companies. Likewise, when we analysed organisational size, we specified that
the structural model should be identical for small and medium-size/large firms. Then
we analysed the statistical x 2 test associated with each of the seven restrictions, using
the Lagrange Multiplier Test (LM test). When the significance level associated with the
value of this test was less than 5%, the equality restriction should be removed and
the model should be tested once again. The final result for each contingent variable was
the identification of two structural models where we can see: (a) which structural coefficients
are similar and, conversely, which are different; and (b) whether the causal relationships
put forward are statistically significant for each of the subsamples.
Results
Table 1 shows the descriptive statistics means and standard deviations for the five
elements comprising the theoretical model. It also shows the matrix of Pearson Correlations between them. These are all positive and statistically significant, showing that
there is a strong interrelation between those elements.
With regard to the overall fit for the structural model proposed for the total sample,
the value of x 2 (5.233, g.l. 3; p 0.155), the adjusted goodness fit index

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V. Roca-Puig et al.

(AGFI 0.976) and the root mean square error of approximation (RMSEA 0.041)
prove that it is a satisfactory representation of the complete set of causal relationships
under consideration. Moreover, regarding the individual estimate of each of the models
parameters, it may be verified that all of the causal relationships proposed present structural coefficients that are positive and statistically significant (see Table 2 and Figure 2).
The first seven hypotheses put forward in this research are therefore confirmed at a 1%
significance level.
With regard to the study of contingent factors, Table 2 also shows the structural coefficient of the proposed relationships in the theoretical model for each of the subgroups of
companies. Subgroups that are statistically different are marked in bold. As can be
seen, the theoretical arguments derived from QM (hypotheses 1 7) are also confirmed
in each of these four company subgroups at a 1% significance level. In each of them
the structural coefficients are positive and statistically significant.
Moreover, the results obtained in Table 2 show that there is no significant difference in
the intensity of causal relationships put forward in the theoretical model according to the
sector of activity. The effects of implementing quality in business results are the same in
service companies and industrial companies. This could be an indication that service companies are not so different from industrial companies. As a result, there is no confirmation
that the internal effect is greater in industrial companies than in service companies
(Hypothesis 9), nor that the soft effect is greater in service companies compared to industrial ones (Hypothesis 10).
On the other hand, when analysing the variable of company size, only two causal
relationships appear between the two company subgroups that are statistically different:
the hard effect (small: 0.299; medium-size/large: 0.346) and the soft effect (small:
0.144; medium-size/large: 0.295). In this sense, it is clearly shown that an equivalent
effort in improving people and process management produces a greater positive effect
on customer results in the case of medium-size and large companies. Consequently,
there is empirical evidence proving that the hard effect is greater in large companies
(Hypothesis 13(a)), but it is not verified that small companies present a larger soft
effect (Hypothesis 12) nor a lower internal effect (Hypothesis 13(b)) compared with
large companies.

Table 2. Analysis of the interrelationships proposed in the QM theoretical model

Sector
QM relationships
H1:
H2:
H3:
H4:
H5:
H6:
H7:

V2.V1
V3.V1
V3.V2 (fit)
V4.V2 (soft effect)
V4.V3 (hard effect)
V5.V4 (external effect)
V5.V3 (internal effect)
Global fit

Total sample
1.010
0.376
0.362
0.210
0.303
0.453
0.363

Industry

Services

0.943


0.943


0.368


0.368





0.404
0.404


0.167


0.167





0.327
0.327


0.490


0.490


0.346


0.346


x 2: 14.028 g.l. 13
p. 0.371

Note: non-standardised coefficients; () p , 0.1; (
) p , 0.05; (

) p , 0.01

Size
,50 em.

50 em.

1.017


1.017


0.329


0.329





0.381
0.381


0.144


0.295





0.299
0.346


0.459


0.459


0.353


0.353


x 2: 10.393 g.l. 11
p. 0.495

The Basic Elements of Quality Management

1121

Figure 2. Causal relationships in the total sample

Finally, and regarding the contingent approach, Table 3 shows the mean values obtained
for each of the elements considered in this model. It can be seen that, with the exception of
business results, service companies obtain higher mean values than industrial companies.
There is therefore insufficient empirical validation to confirm that industrial companies
may have higher mean values in these elements (Hypothesis 8). Furthermore, since the
mean differences are statistically significant in enabler elements leadership, people
management and process management the results of previous studies are not confirmed
(for example, Powell, 1995 or Beaumont et al., 1997).
With regard to organisational size, except for customer results and people management, it is confirmed that medium-size and large companies obtain significantly
greater values compared to small companies. As a result, we may conclude that there
is sufficient empirical validation to sustain that small companies, compared with large
ones, obtain lower mean values in process management (Hypothesis 11(b)). In large
companies, the greater implementation of process management is a clearly salient
feature. Nevertheless, compared to large companies, there is no evidence to suggest
that small companies reveal significantly higher values in people management (Hypothesis 11(a)).

Table 3. Contingent analysis of the mean value of QM elements

Sector
QM elements
Leadership
Persons
Processes
Customer results
Business results

Industry
5.672
4.620
5.233
5.605
5.479

Size
Services
5.917
5.460
5.438
6.020
5.391

Note: () p , 0.1; (
) p , 0.05; (

) p , 0.01

,50 em.

50 em.

5.747
5.079
5.155
5.797
5.265

5.869
5.039
5.560


5.856
5.647

1122

V. Roca-Puig et al.

Conclusions
One of the main contributions of this study is the simultaneous analysis of multiple causal
relationships supported by QM literature. An independent analysis of these relationships
using partial models that only bring together certain relationships considered among the
QM elements may offer results that differ from those found in the model proposed in our
study. The perspective adopted in our paper enables the systemic view to be fully included
when studying the implementation and effects of QM in organisations.
In this sense, empirical validation is given to the accuracy of the hypotheses supported
by this theoretical framework. The importance of involving managers in improving the
management of social and technical aspects of QM is therefore verified. At the same
time, it is shown that the implementation of QM demands a powerful interrelationship
(fit) between its social and technical practices. People management is a basic requirement
for the appropriate management of processes. Excellence in activities of a social and technical nature also influences customer satisfaction. Customers value both technical quality
(hard effect) as well as functional quality (soft effect), and both aspects reveal a significant
impact on customer satisfaction. Finally, it can be seen how business results are gradually
improved via processes (internal effect) as well as through the market (external effect).
Another contribution refers to the adoption of a contingent perspective, since we have
developed and differentiated two types of analyses that provide complementary information.
On the one hand, when we study the mean value of QM elements according to contingent
factors, we particularly focus on elements referring to implementation efforts leadership,
people management and process management. This provides an evaluation of the degree of
implementation of QM practices in different types of companies. On the other hand, when we
examine the causal relationships among the elements, we try to determine: (a) if the theoretical propositions are confirmed in the four different types of firms, i.e. whether they are valid
for any type of company; and (b) if there are significant differences in the intensity of causal
relationships depending on sector and size. We believe that these distinctions help to clarify
and specify contingent arguments put forward in previous research.
In particular, if we focus on the mean values of enabler elements of QM, we see that this
initiative is more frequently followed by service companies rather than by industrial
companies, and by medium-size/large companies rather than small ones. Consequently, it
may be stated that the degree of QM implementation is contingent and depends on sector
and size.
On the other hand, if we look at the causal relationships, we should first conclude that
the theoretical relationships or hypotheses of QM are fulfilled in any type of company
regardless of sector and size. Since the structural coefficients are positive and statistically
significant in the four company subgroups, it may be deduced that the relationships supported by QM are universal. Nevertheless, it can also be seen that QM can be contingent,
since significant differences are found in the intensity of the causal relationships depending on size. Evidence suggests that, compared with small companies, medium-size and
large companies make better use of people and process management because they have
a greater effect on customer results. With regard to sector, this variable is not defined
as a contingent factor that modifies the degree of intensity of the causal relationships.
It is worth stressing that if we study the degree of QM implementation in different types
of companies the contingent view contradicts the universalist propositions. On the basis of
results taken from the ANOVA, we can determine whether a significant difference exists

The Basic Elements of Quality Management

1123

between different types of companies. However, if we study causal relationships,

the contingent and universalistic views are not antagonistic. As we have shown in this
research, both views may actually be compatible and exist at the same time.
The main limitation of this study is its cross-sectional nature, which prevents us from
conducting a more exhaustive and accurate study of the causal relationships put
forward. In addition, this research has made an independent study of each of the two contingent factors. Consequently, future research will be aimed at longitudinal-type studies in
which these two contingent factors are blended in a way that enables us to examine and
contrast the results obtained from this study in far more detail. Likewise, the model
we propose in this paper partly correspond to the elements considered in the EFQM
Excellence Model. It would be interesting to address this study by extending the analysis
to consider all the Model criteria and perform a more comprehensive study.
Notes
1. We should point out that, on a descriptive level, other studies (e.g. Saraph et al., 1989; EFQM, 1999)
have identified more elements to develop a theoretical framework. Nevertheless, we have adopted a
normative approach aimed at establishing a model based on the previous theoretical framework.
Summarising Porter (1991), models define and formalise frameworks; by the same token, frameworks
enrich models by increasing the number of variables and describing the diversity of situations given
in the real world. Both types of research are complementary to each other.
2. This distinction between technical and social aspects corresponds to QM definitions based on
the differentiation between hard and soft elements put forward by the British Quality Association
(BQA).
3. Six activity sectors were selected: three from the service sector hotels (SIC 7011), dealers (SIC 5511)
and transport (SIC 4213) and three from the industrial sectors associated with the industrial ceramics
business floor tiles and glazed ceramic tiles (SIC 3253), paints and glazes (SIC 2851) and machinery
(SIC 3559).
4. Three company segments were identified following the European Union criteria (European Commission,
1996): those employing between 1049 workers (small companies), between 50249 workers (mediumsize companies) and those with 250 or more workers (large firms).
5. The small number of large firms in the sample prevented us from undertaking a specific study for this
segment; consequently, we decided to group medium and large companies together. The maximum
likelihood estimation method in the structural models requires a minimum sample size of between 100
to 150 cases (Hair et al., 1998). The same argument encouraged us to gather together in one group the
companies of the three industrial sectors and in another group the remaining service companies.
6. In spite of the fact that the contents of the EFQM Excellence Model were updated in 2003, with the introduction of some small changes in some of its criteria, we have used the 1999 EFQM Excellence Model in
the present study. The main changes have to do with the updating of the description of the key concepts
of the model and the explicit statement of the relationship between these key concepts and the Model
criteria. Furthermore, some subcriteria such as Leadership and Policy and Strategy have been restructured and there has been an extension and clarification of the areas to be dealt with, as well as the explanation and rationale behind the use of RADAR. Nonetheless, these changes do not affect the essence of
the Model and the study we present in this paper could have been carried out with the updated version of
the Model.

Acknowledgements
This work was carried out as a part of a research project (ref. GVOS/125) funded by the
Generalitat Valenciana. It was also supported by a grant from the Bancaixa Foundation
(ref. P1 1A2005-11)

1124

V. Roca-Puig et al.

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Appendix
Leadership
1. Managers delegate authority and responsibility to employees.
2. The management team participates in and promotes efforts aimed at improvement.
3. Top management participates in quality training through leadership and instructing the
following level of the organisation.
4. The involvement of workers is only attained if managers are the first to set an example.
5. The managements style of action encourages employees to voluntarily accept the
changes proposed.
6. The managements behaviour enables the integration and mobilisation of team
members.
7. Top management must get involved with the total and continuous improvement process
even though this process may not affect activities specific to management.
8. There is ample room to discuss ideas, and diverse opinions are accepted in all areas.
People Management
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.

Procedures have been set up to gauge the opinion and satisfaction of our employees.
Persons receive specific training on quality management.
Teamwork systems are fostered.
Special efforts have been made to get experienced and well-trained people into the firm.
Employees at all levels follow up new developments in their respective fields.
Employees learn skills and acquire new knowledge on-the-job because resources have
been allocated for this.
Supervisors allow employees to have a high degree of autonomy and self-control.
There is a high participation of the personnel in objective definition and
implementation.
The willingness of my firm to offer greater training and the participation of employees
is high.
Whenever there is a problem, the workers have the delegated responsibility to solve it
by themselves.
Each of the areas of the company is given summarised information about complaints
and satisfaction from its customers, both internal and external.
There is a defined system dealing with the distribution of information to personnel,
customers and suppliers, according to their needs.
Information on quality results is available to all employees.
Management reports on and formally recognises the achievements of its collaborators.

Process Management
1. Work methods and processes are identified, defined and documented.
2. There is extensive documentation of processes and work instructions.

The Basic Elements of Quality Management

1127

3. Quality manuals and procedures are revised periodically.

4. A system of indicators is used to check on changes introduced into processes.
5. Work processes have been designed in such a way as to develop efficient standards of
conduct.
6. There is an emphasis on the development and innovation of production processes.
7. We know the type of products and services required by the customer.
8. We are capable of beating competitors at the development of a new product or in the
incorporation of a new service.
9. The positive characteristics of my products are superior to those of my competitors.
10. I consider that the orientation of my company towards the satisfaction of the
expectations and needs of the customers is high.
11. The better design of my products affords greater usefulness to my customers.
12. A standardised system is used to deal with complaints and claims made by customers.
13. My company has fostered the development of marketing techniques and methods.
Customer Results
1.
2.
3.
4.
5.

Improvement in customer satisfaction.

Consolidation of customers.
Improvement in communication with customers.
Reduction in complaints or claims made by customers.
The quality of the service delivered by my company to the customer is better than that
of my competitors.

Business Results
1.
2.
3.
4.

Improvement in the market share.

Increase in sales per employee.
Improvement in earnings as a percentage of sales.
There is a noticeable improvement in the financial results.