The relationship between supply chain quality management practices and organizational performance

Abstract

This study tests middle managers’ perceptions on the association between supply chain quality management practices and organizational performance. Two instruments were used for the study: a revised version of Saraph et al.’s quality management instrument and Madu et al.’s organizational performance instrument. The data were classified into three groups based on the level of supply chain quality practices. It is observed that high quality‐tendency systems tend to perform better than low quality‐tendency systems on cost savings. High quality‐tendency organizations can be differentiated from medium quality‐tendency organizations in areas such as productivity, sales growth, and earning growth. Medium quality‐tendency systems seem to be differentiated from low quality‐tendency systems on indicators like employee satisfaction, productivity, and sales growth. Our results suggest that organizational performance could be enhanced through improved supply chain quality management.