Quality-Driven Change and its Effects on Financial Performance

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Abstract
Instituting continuous improvement within organizations has been recognized as a pervasive part of business thinking, and has even been recently recognized as a type of intangible resource by researchers. In this paper, a model that maps the quality transformation process, and the associated impact on financial performance, is developed. The model is tested using structural equations, employing a survey of ASQ managers in 307 North American manufacturing organizations. The results support the proposition that increased globalization has an impact on customer demand for quality, and acts as an agent for change within the organization. In assessing the quality transformation, the model assesses dimensions of organizational leadership, human resource development, and customer focus. The results provide support for the relationship between a company's quality-driven strategies and improved financial performance.