The relationship between TQM, learning orientation and market performance in service organisations: an empirical analysis

Abstract

The purpose of this paper is to investigate the tridimensional relationship between total quality management (TQM), learning orientation and market performance of Malaysian service firms, in which TQM is hypothesised as a platform to enhance both learning orientation and market performance of a company. Furthermore, this empirical paper also investigates whether effective learning orientation can bring about improved market performance. The sample data are collected from 146 service firms in Malaysia. To examine the relationship between TQM, learning orientation and market performance of the service organisations in Malaysia, the structural equation modelling analysis was employed. The survey evidence identified that the adoption of TQM practices in service organisations is positively and significantly related to both learning orientation and market performance. However, learning orientation did not show any significant correlation with market performance of the firm, implying that learning orientation does not provide extensive opportunities for a service organisation to attain a higher market performance. The managers of the service firms who intend to achieve organisational success through the implementation of TQM practices that support their firm's learning orientation and enhance their market performance will be able to benefit from this research paper.

Keywords:

• total quality management
• learning orientation
• market performance
• structural equation modelling
• factor analysis

Acknowledgement

The authors gratefully acknowledge the assistance from Sim J. J. in data collection.