The business value of quality management systems certification. Evidence from Australia and New Zealand

TLDR

ISO 9000 certification is one of the world’s most popular quality assurance systems, yet its role and business value remain unclear and widely debated. This study tests the strength of the relationship between ISO 9000 certification and organisational performance, both with and without a total quality management (TQM) environment. The analysis uses a large random sample of manufacturing firms in Australia and New Zealand. A literature review revealed a major research gap, and the study finds that ISO 9000 certification has little or no explanatory power for organisational performance, regardless of a TQM environment.

Abstract

Abstract ISO 9000 certification is one of the most popular quality assurance systems in the world. Despite its overwhelming popularity, there is considerable confusion and frustration surrounding the role and business value of ISO 9000 certification. A review of the literature revealed a major gap in research in this area of quality/operations management. The purpose of this study is to test the strength of the relationship between ISO 9000 certification and organisational performance in the presence and absence of a total quality management (TQM) environment. Our analysis is primarily of a large random sample of manufacturing companies in Australia and New Zealand. The central finding is that ISO 9000 certification is not shown to have a significantly positive effect on organisational performance in the presence or absence of a TQM environment. This supports the view that on average ISO 9000 certification has little or no explanatory power of organisational performance.