THE IMPLEMENTATION OF STATISTICAL PROCESS CONTROL CAN IMPROVE THE QUALITY OF HALAL COSMETICS PRODUCT AND GIVE A BENEFIT TO THE COMPANY: PARTIAL LEAST SQUARE STRUCTURAL EQUATION MODELING APPROACH Rosita Husain 1 , Astri Yulia 2, Mohd Fuad Mohd Salleh 3 1 Faculty of Business, University Selangor, Shah Alam E-mail: rosita@unisel.edu.my Abstract The demand for halal cosmetics products is rapidly increasing due to the high quality of the products. Hance, it is not surprising that halal cosmetics industry can be the next emerging sector for the Halal Industries in Malaysia. The halal cosmetic products in Malaysia are certified and control under JAKIM (Department of Islamic Development Malaysia) and follow the Malaysian Standard MS 2200:2008 requirement. According to the Standard MS2200: 2008, Halal Cosmetics products must be safe and not hazardous to be used by customers. It means the products should have high quality in the manufacturing process. Thus, the implementation of Quality Control method intended to improve the quality of the halal products has become a business strategy for organizations. Statistical Process Control (SPC) is known as a powerful technique which organizations can use in improving the quality of products or services and lead to the many benefit for companies. Therefore, the purpose of this study is to examine the influence of management commitment on SPC implementation and the impact of SPC implementation on company benefit. The study was conducted for 10 cosmetics companies in Selangor, and use self-administered questionnaires as data collection method. This study applies modelling methodology of Partial Least Squares (PLS) using SmartPLS software to study the relationships in the theoretical model. The results of the PLS analysis support the proposed model with all regression coefficients are significant at 0.05 (t-value > 1.97), i.e. the relationships among the constructs are statistically significant. As a result, the model is statistically valid and give a clear indicators of SPC implementation in Halal cosmetics companies. Keywords: Halal Cosmetics, Statistical Process Control, Management Commitment 1 INTRODUCTION Nowadays, ‘Halal’ concept is becoming more spiritually conscious in the Middle East and some Asian countries. Muslim consumer awareness toward halal has widened from being concerned with meat-based products to a wide range of products. Muslim consumers are seeking Halal integrity and reliability of the products, and services. This also extend to a cosmetics and personal care products. In the scope of halal cosmetics, the halal concept covers all aspects of management system of halal quality. It is not only focusing on the aspect of production including sourcing of halal ingredients but all elements must be accounted, such as manufactured procedure, storing packaging and logistics (Tieman, 2011). In Malaysia, Halal standard was established in 2003, and it was utilized by the appointed halal certification body, the Department of Islamic Development Malaysia (JAKIM) and their Halal Certification scheme (Department of Standard Malaysia, 2008). Under JAKIM, there are three types of Malaysian Halal Standards; 1- MS 1900:2005, Quality Management System-Islamic Perspectives;2- MS 2200- 1:2008, Islamic Consumer Goods-Part1: Cosmetics and Personal Care –General Guidelines; 3- MS 1500:2004, Halal Food-Production, Preparation, Handling and Storage-General Guidelines. JAKIM is also responsible for issuing the certification halal products for export and import, while the Islamic state government (JAIN) only issues halal certifications for local consumptions. Halal certification refers to the examination of the processes in its preparation, slaughtering, cleaning processing, handling, disinfecting, storing, and transportation and management practices. To comply with all conditions set by halal standard requirements, manufacturers must act responsibly to maintain the halal status of their products that they produce. For halal cosmetics and personal care products, the products must comply with the standard MS Malaysia 2200: 2008 requirements. According to MS 2200:2008, cosmetic products must be safe and non-hazardous to users and consumers. In brief, the halal cosmetics are products that must not have humans part of ingredient derived from thereof; not contain any animal parts forbidden to Muslims or, any animal not slaughtered according to syariah law; no genetic modified organism (GMO) which are decreed as najs; no alcohol from alcoholic drinks (khamar); no contamination from najs during preparation, processing, manufacturing and storage; and safe for consumers . The certification also requires that the products should have certain quality Proceedings of UNISEL Bestari Research Projects 2016, Ed(s): Setyawan Widyarto, et.al., Shah Alam: FIIT-UNISEL Publisher, ISBN: 978-983-3757-29-9 180