Quality management, environmental management and firm performance: a review of empirical studies and issues of integration
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| June 2009 © 2008 The Authors 203 Journal compilation © 2008 Blackwell Publishing Ltd and British Academy of Management affected departments in design reviews, clarity of specifications and emphasis on quality). Along with these eight dimensions, other dimensions have also been mentioned in some studies open organization, zero-defects mentality, flexible manufacturing, quality resource, quality awareness, quality department and quality product, among others. These dimensions were not included in Table 2 because they appeared in only one or two studies. Regarding the effects of QM on firm performance, QM can positively affect the firm’s competitive position in terms of costs and differentiation (Porter 1980). In this sense, quality can be applied at all firm levels, often showing that costs can be reduced and levels of differentiation increased (Belohlav 1993; Grant 2002). Deming (1982) pointed out that higher quality implies lower costs and increased productivity, which in turn gives the firm a greater market share and increased competitiveness. Therefore, QM pursues customer satisfaction and process improvement in order to reduce costs and prevent defects and waste. This orientation towards the customer maybe associated with a strategy for differentiating products, and the drive towards reducing costs will eventually be linked to a strategy for cost leadership. Thus, although strategies for improving quality have traditionally been related to the development of differentiated products, the current approach to quality considers that quality is free because reducing costs can help the firm to obtain a greater market share (Crosby 1979; Juran 1988). This idea suggests that QM may have positive effects on firm performance. Considering the definitions provided previously, Table 3 shows those empirical works that seek to answer the question Does QM affect performance This table includes studies which measured QM as a multidimensional construct (the studies included in Table 2) and some studies which used other QM measures. In addition, this table shows QP and FP measures used in these studies. Table 3 shows that avast majority of works found positive results and therefore, arguably, implementing effective QM programmes can improve performance. In regard to the analysis of QM variables, studies tend to focus on TQM and the ISO 9001 certification. A distinction must be made within the first group between those measuring TQM as a single construct and the rest, where a different set of dimensions was used. Total quality management is most commonly seen as a set of dimensions (e.g. leadership, people management, customer focus, supplier management, planning and process management), and authors often use perceptual measures for these elements. In this sense, 15 studies measured TQM as a multidimensional construct, and five as a unidimensional construct. Furthermore, three studies used winning an award as the quality variable, and seven as being certified with the ISO standard. With respect to measuring firm performance, Table 3 reveals alack of agreement, as this variable is considered from several points of view QP only, FP only, and both QP and FP. The factors that are most often used to measure QP are customer satisfaction, percentage of defects, cost of quality, product quality, on-time delivery, productivity and people results (e.g. employee morale. Some measures such as ROA, ROE, ROI, market share and stock price were used to measure FP. EM and its Effects on Firm Performance Research on EM has been mostly theoretical and anecdotal, and more work needs to be done on the quantitative empirical side. Taking as its starting point the definitions offered previously, Table 4 contains information about quantitative empirical studies that analysed the impact of EM on firm performance. This review helps to identify EM, EP and FP variables. Table 4 shows that most of the empirical studies found a positive relationship. The EM variables related to the environment are diverse. Examples are the integration of environmental issues into the strategic planning |