شیوه های ایزو 9000 و عملکرد مالی: دیدگاه انسجام تکنولوژی
|کد مقاله||سال انتشار||مقاله انگلیسی||ترجمه فارسی||تعداد کلمات|
|5958||2008||19 صفحه PDF||سفارش دهید||12080 کلمه|
Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)
Journal : Journal of Operations Management, Volume 26, Issue 5, September 2008, Pages 611–629
Attention to processes has increased, as thousands of organizations have adopted process-focused programs such as TQM and ISO 9000. Proponents of such programs stress the promise of improved efficiency and profitability. But research has not consistently borne out these prospects. Moreover, the expectation of universal benefits is not consistent with research highlighting the important role of firm-specific capabilities in sustaining competitive advantage. In this paper, we use longitudinal panel data on ISO 9000 practices for firms in the auto supplier industry to study two new issues related to the adoption of process management practices. First, we find that, as the majority of firms within an industry adopt ISO 9000, late adopters no longer gain financial benefits from these practices. Second, we explore how firms’ technological coherence moderates the performance advantages of ISO 9000 practices. We find that firms that have a very narrow or very broad technological focus have fewer opportunities for complementary interactions that arise from process management practices and thus benefit less than those with limited breadth in technologically related activities.
A central question in strategy is: How do firms achieve sustainable competitive advantage? Research is often aimed at assessing whether particular organizational practices can deliver sustainable advantages, especially given that other firms can also adopt similar practices. Practices aimed at improving operational effectiveness may benefit adopting firms for a time, but if a firm's competitors can all adopt the same practice, the benefits will be competed away (Porter, 1996). Firms are then frustrated in their efforts to translate performance improvements into relative financial performance advantage. If a generic “best practice” can be copied and equally benefit all potential adopters, it cannot confer lasting benefits (e.g. Lieberman and Montgomery, 1988, Porter and Siggelkow, 2004 and Levinthal, 2000). However, if an organizational practice is firm-specific, valuable, and difficult to imitate, it may lead to sustainable competitive advantage (cf. Barney, 1991 and Peteraf, 1993). Research in strategy, in particular, in the Resource-Based View, has increasingly focused on the central role of firm-specific, unique, and inimitable capabilities in creating competitive advantage (e.g. Peteraf, 1993 and Barney, 1991). Organizational routines or processes have emerged as critical building blocks in these difficult-to-imitate capabilities (e.g. Teece et al., 1997; Dosi et al., 2000; Eisenhardt and Martin, 2000). At the same time, a focus on organizational routines and processes has increased in managerial practice. Thousands of firms have embraced the process-focused practices that underlie a progression of popular quality improvement programs, including Total Quality Management (TQM), Business Process Reengineering, the Malcolm Baldrige Award Criteria, and more recently, the ISO 9000 certification program and Six Sigma (e.g. Staw and Epstein, 2000, Garvin, 1991, Garvin, 1995, Cole, 1998 and ISO, 2007). While these programs differ in scope and approach, they share a core focus on systematic attention to operational processes in organizations, and involve mapping, improving, and adhering to systems of repeatable processes (Hackman and Wageman, 1995 and Benner and Tushman, 2002). Proponents of process management practices cite expectations of improved quality and efficiency, leading to increased revenue, reduced costs, and ultimately, higher profits (e.g. Winter, 1994, Garvin, 1995, Hammer and Champy, 1993 and Harry and Schroeder, 2000), and these expectations are also reflected in most empirical research on the performance implications of process management practices (e.g. Easton and Jarrell, 1998, Corbett et al., 2005 and Ittner and Larcker, 1997). However, despite the widespread assumption that organizations will benefit from process management, the findings from research have been equivocal. While some research demonstrates the anticipated financial advantages (e.g. Easton and Jarrell, 1998, Corbett et al., 2005 and Hendricks and Singhal, 1997), other research has not found better business performance associated with the actual process-focused techniques (e.g. Powell, 1995, Staw and Epstein, 2000, Terziovski et al., 1997 and Samson and Terziovski, 1999). Still other research has found that the effects dissipate over time (Wayhan et al., 2002 and Casadesus and Karapetrovic, 2005). One explanation for these contrasting results, which has not been considered in previous research, is that the financial performance advantages that may accrue to early adopters can disappear for the later ones, as more firms in an industry adopt and achieve similar generic improvements in efficiency and quality. Indeed, process management programs often have been viewed as generic improvement practices that are easily adopted by all firms (e.g. Hammer and Champy, 1993, Harry and Schroeder, 2000 and Pande et al., 2000). In that case, even as firms improve their own operational efficiency, it will be increasingly difficult to translate these improvements into sustainable relative financial performance advantages over time as firms within an industry increasingly adopt identical practices and achieve similar reductions in cost, improvements in quality, or access to new customers (cf. Porter, 1996 and Lieberman and Montgomery, 1988). However, generic organizational improvement practices may confer lasting benefits if they interact with firm-specific routines and give rise to unique capabilities that are difficult to imitate. Since process management implementation is aimed directly at organization-specific processes and capabilities, and in particular, at streamlining processes and the handoffs between processes across an organization, process management practices affect the potential for firms’ capabilities to lead to competitive advantage. Specifically, by tightening the linkages between unique organizational processes, process management practices can increase the “fit” or complementarities among organizational activities (cf. Siggelkow, 2002). Thus, the potential for process management to lead to competitive advantage will differ across firms, depending on firm-specific characteristics. In line with existing perspectives in manufacturing strategy (White, 1996 and Miller and Roth, 1994), some research looking at process management has also begun to recognize that the impact of process management practices may depend on firm characteristics (e.g. Benson et al., 1991, Das et al., 2000, Sousa, 2003 and Ettlie, 1997; see also Sousa and Voss, 2002 for a recent review of research on quality improvement). However, research has not provided consistent analyses of how the interaction with a firm's technological coherence, i.e. the narrowness or breadth of a firm's technologies, affects the financial performance benefits of process management practices. In this paper, we go beyond prior research, drawing from strategy and organization theory literature to better understand how competitive advantage arises for firms adopting process management practices. We study the ISO 9000 quality certification program, a set of process-focused practices which became increasingly popular and were widely adopted by organizations throughout the 1990s. We explore two questions that have not been addressed in previous studies. First, we ask what happens to the financial performance benefits of firms following the adoption of the process-focused practices associated with ISO 9000 as the majority of competitors in an industry undertake identical practices. We argue that as ISO 9000 is widely adopted in an industry, efficiency improvements are less likely to translate directly into higher profits, as generic process management practices can be imitated (cf. Barney, 1991 and Peteraf, 1993), and will not confer lasting advantage (e.g. Lieberman and Montgomery, 1988 and Porter, 1996). Second, we consider how the financial performance advantages of ISO 9000 are influenced by firm-specific technological characteristics. We follow prior work that explores relatedness or coherence in a firm's technological capabilities (e.g. Patel and Pavitt, 2000, Silverman, 1999, Teece et al., 1994 and Wolter et al., 2003), and analyze how technological coherence moderates the effects of ISO 9000 practices on performance. This approach also reflects research in strategy that suggests firms have opportunities to create greater advantage from related businesses (e.g. Rumelt, 1982 and Singh and Montgomery, 1987). The process management practices associated with programs like ISO 9000 may be one vehicle for creating linkages and synergies across related activities. We study these ideas using a unique, comprehensive, longitudinal dataset for firms in the auto supply industry. Studying these questions within one industry where process management adoption has become ubiquitous allows us to assess the changes in relative performance advantages over time, while better controlling for industry effects that also influence firm performance. We assess the moderating role of technological coherence with a firm-specific measure developed from a comprehensive assessment of the technologies used by each auto supply firm. We estimate models of the impact of process management on firm performance using panel data with firm fixed effects and year controls. This longitudinal approach statistically controls for firm-specific unobserved factors correlated with both performance and adopting a process management program like ISO 9000, which could lead to erroneous inference and might confound our findings. For example, firms that adopt may have systematically different performance levels for reasons unrelated to ISO 9000 adoption. Identifying our estimate from the change in performance (more specifically, from the within-firm variation) avoids attributing differences in levels of performance that are independent of adoption to the adoption itself. The paper proceeds as follows. In Section 2, we develop our hypotheses about process management's effects, and specifically, the effects of practices underlying the ISO 9000 certification program, on firms’ financial performance. In Section 3, we discuss our measures and models. Section 4 presents the results of our empirical tests. In support of our hypotheses, we find that the financial performance benefits of ISO 9000 practices disappear as the majority of competitors in an industry adopt similar practices, and further, that the performance benefits of ISO 9000 process management practices are indeed moderated by firm-specific technological coherence. This relationship exhibits an inverted U-shape: very narrowly or very broadly focused firms have fewer opportunities to take advantage of the potential for improved internal fit or complementary interactions among related firm activities, while firms with moderate breadth in technologically related activities appear to benefit the most from practices focused on operating processes. We conclude with a discussion of the implications of this work for research and practice, and possible extensions.
نتیجه گیری انگلیسی
We extend existing research studying process management by exploring two questions that have been missing in prior studies. Drawing on literature in strategic management, we first explore how the expected performance benefits of process management practices, such as ISO 9000, may be competed away as most firms in an industry adopt. Second, we explore the firm-specific conditions under which these practices might lead to sustainable performance advantages. We hypothesized and concluded that while performance advantages accrue for earlier adopters in an industry, they are competed away over time for later adopters. We further argued, however, that process management practices are not simply generic improvement practices; instead, they directly affect the linkages and fit among firms’ activities. Thus, the effects of process management practices likely depend on differences in underlying capabilities. We hypothesized that the extent of coherence or relatedness in firms’ underlying technologies would influence the performance benefits of process management utilization. Very narrow firms with only one or a few technologies will have limited opportunities for linking related activities to create unique, valuable, firm-specific combinations. Thus, we expect benefits for these firms to be less sustainable, as they are unlikely to lead to inimitable capabilities. As a firm increases the breadth of its technological capabilities, process management practices may help increase the fit among related activities, and may result in firm-specific complementarities and interactions between interdependent processes that are hard to imitate. However, as a firm's technologies become highly unrelated, the potential for complementary interactions that arises from relatedness is reduced; in addition it may be more difficult and costly to implement process management in disparate areas. Our results confirm this hypothesis. Specifically, firms with medium level of technology diversity, i.e. companies with a broad but not very diverse set of technologies systematically show gains from ISO 9000 adoption. This study contributes to both the process management and strategy literature streams. Although strategy scholars have suggested that the advantages from adoption of best practices like process management will be competed away (e.g. Porter, 1996, Levinthal, 2000 and Lieberman and Montgomery, 1988), such ideas have not been empirically tested with detailed panel data on process management practices. Similarly, work in strategic management has developed ideas about how relatedness or fit in firm capabilities affects sustainable advantage (e.g. Siggelkow, 2002), but again such research has not used widespread adoption of process management – with its focus on integrating firm activities – to test these ideas. By integrating these insights from strategy literature with data on process management adoption, our findings also help to provide plausible explanations for conflicting results in previous process management studies. We provide deeper insights into the conditions under which some firms are likely to benefit more from such practices. Our study of a longitudinal panel of firms in one industry also makes an important empirical contribution. Instead of cross-sections or broad control groups, we are able to study a comparable and competing set of firms in a sector over time during a period when ISO 9000 adoption became ubiquitous. These features of our empirical design help control for unobserved heterogeneity (and thus selection issues), often overlooked in previous studies. We use a unique dataset that includes objective third-party data on firms’ process-focused activities and performance (helping to overcome the subjectivity of self-report survey data), in addition to firm-specific detail on technological capabilities. This research also contributes to management practice. Managers often have been frustrated in their efforts to translate efficiency gains into expected financial performance advantages. Our findings suggest that although relative performance benefits from process management may become elusive as the majority of firms in an industry adopt, creating sustainable advantage from such techniques may be possible if firms use them to link related activities in unique, inimitable ways. Properly used, such practices may be a way for firms to integrate knowledge while mitigating its imitability (e.g. Coff et al., 2006). Our study has limitations. Our results strongly show that performance advantages are lower for later adopters, suggesting that the potential for benefits disappears as the majority of firms in an industry adopt these practices. The time frame available in our data limits our ability to directly test whether the advantages for earlier adopters dissipate beyond the periods included in our study. Moreover, while we demonstrate that firms with some relatedness in their portfolio of technologies benefit the most from process management adoption, we again do not have a sufficient time frame to test whether these advantages are sustainable over a longer period. Our findings provide a first step toward answering deeper questions about the conditions under which process management advantages are sustainable, but future research could consider these questions over an even longer period. Another limitation is related to the fact that the data used in our study only goes until 1998, and therefore does not account for what has happened in the past decade in this sector. Since then, anecdotal evidence suggests there has been virtually a complete adoption of the norm in the automotive sector. Moreover, in 1999, the ISO/TS 16949 was approved as the first sector specific ISO 9000 adaptation, to be used in the auto supplier industry. The overall ISO 9000 norm also changed in 2000, becoming much more focused more on process improvement than earlier versions and thus the current conditions do not mirror the context of our work. Thus, any subsequent or related work would have to consider the impact of these changes. Future work should explore equivalent questions in multiple industries. While the auto supply industry is ideal for studying the competitive effects of increasing process management use within an industry, the generality of our findings for other contexts is not clear. In industries where adoption of these practices has been slower and less widespread, it may be that firms are able to gain and sustain financial advantages from efficiency improvements. In particular, our findings may be more applicable to mature industries, characterized by a focus on incremental change and pressures for efficiency improvement. Prior research has also suggested that process management practices are most beneficial in stable or incrementally changing environments, and may be detrimental in a changing or turbulent environment (e.g. Sitkin et al., 1994, Sutcliffe et al., 2000 and Benner and Tushman, 2003). Process management's focus on incremental learning and local search may inhibit more dramatic innovation and change required to adapt in changing environments (e.g. Sitkin et al., 1994, Levinthal and March, 1993 and Benner and Tushman, 2002). A tighter fit in systems of activities, spurred by process management practices, while appropriate for performance improvements in stable environments, can also heighten inertia and maladaptive response in the face of environmental change (Levinthal, 1997; Hannan and Freeman, 1984). Thus, while managers may gain from using these practices to seamlessly coordinate related activities in mature environments, they must also exercise caution in undertaking these practices in changing environments.