The evolving scope and impact of total quality management in leading South African companies

Abstract

The objective of the study was to quantify the evolving scope of quality management as practiced in a sample of companies in South Afiica, and to correlate this with corporate profitability. The empirical data in this study suggests that a more extensive scope of application and practice of quality management and related management practices is related to better organisational profitability. The significant correlations which were demonstrated are: • A focus on results by companies is inversely correlated with Operating Profit Margin. • Quality training, employee communications and internal coordination correlates positively with Net Profit Margin. • The rigorous use of quality standards correlates positively with Net Profit Margin. • Quality control and monitoring correlates positively with Return on Equity. Recommendations flowing from this study include that a broader paradigm of quality management is required, expressed as an integrated model for innovation and change which is holistic rather than fragmented.