Contingency relationships of firm size, TQM duration, unionization, and industry context on TQM implementation—A focus on total effects Jayanth Jayaram a, *, Sanjay L. Ahire a,1 , Paul Dreyfus b,2 a Management Science Department, Moore School of Business, University of South Carolina, 1705 College Street, Columbia, SC 29208, United States b Department of Management, Athens State University, Athens, AL 35611, United States 1. Introduction Total quality management (TQM) has been widely adopted by firms in the last 50 years and yet firms report less than optimal results (Sousa and Voss, 2008; Sila, 2007; Powell, 1995). In a study of 225 electronics manufacturing firms in Hong Kong, Yeung et al. (2006) reported that advanced TQM firms and non-TQM firms do not differ in their organizational performance. Our study contributes to the contingency perspective research stream which argues that the success of TQM depends on contextual factors (e.g., Sousa and Voss, 2008; Sila, 2007; Shah and Ward, 2003; Powell, 1995; Benson et al., 1991). Specifically, our research objectives are: (1) To study the effects of culture and quality system design on outcomes; and (2) To examine direct and total effect relationships among culture, quality system design and outcomes that are attributable to contextual factors. We propose a culture-quality system design-outcomes model that link key TQM constructs in a network of relationships. As relationships similar to this model have been established previously (see Section 2), we only provide a brief summary of this model and then move on to our main research intent of examining contingency relationships. 2. Baseline model Our baseline model is based on the premise that firms pursuing TQM address cultural issues first, followed by designing the quality system (Fig. 1). The joint consideration of culture and quality system design issues is expected to lead to positive outcomes. Past TQM literature has pointed out that systemic actions cause outcomes through an establishment of a culture or through deliberate design of the quality system (e.g., Sousa and Voss, 2008; Flynn et al., 1994). Firms invest in structural resources that we call culture, to set an appropriate climate for TQM. We operationalized the Culture-Quality System Design-Outcomes model by proposing thirteen culture, quality system design, and outcome constructs that are frequently discussed in the literature (Sila, 2007; Samson and Terziovski, 1999; Anderson et al., 1995; Flynn et al., 1994). The culture constructs are top management commitment, customer focus, and employee trust. The Quality System Design constructs are design management, employee training, empowerment, supplier quality management, quality information usage, and process quality management. The outcome constructs are design Journal of Operations Management 28 (2010) 345–356 ARTICLE INFO Article history: Received 3 February 2009 Received in revised form 10 November 2009 Accepted 16 November 2009 Available online 14 December 2009 Keywords: Total effects Total quality management Contingency theory Structural equation modeling ABSTRACT Past TQM literature has been inconclusive in resolving the validity of the universalistic approach versus the contingency approach of TQM implementation. In this paper we contribute to the resolution of this debate by using a total effects approach within the contingency perspective. We propose a culture- quality system design-outcomes framework for TQM implementation. We then use this framework to study the differences in total effects relationships among TQM constructs across four contingencies, firm size, TQM duration, unionization, and industry type. Data from a sample of 394 plants (SIC codes 20 through 39) are used to test the validity of our contingency model. Our results revealed that firm size, TQM duration, and industry type moderate the influence of total effects of culture (top management commitment, customer focus, and trust) on final outcomes (process quality, product quality, and customer satisfaction). These contingencies also moderate the influence of total effects of quality system design (design management, training, empowerment, quality information usage, supplier quality management, and process quality management) on final outcomes. The strongest contributor to variation in total effects across groups was industry type, followed by size and then TQM duration. To a lesser extent, unionization was a moderator in total effects relationships. These findings uniquely contribute to the emerging contingency theory of TQM implementation. ß 2009 Elsevier B.V. All rights reserved. * Corresponding author. Tel.: +1 803 777 5976; fax: +1 803 777 3064. E-mail addresses: jayaram@moore.sc.edu (J. Jayaram), ahire@moore.sc.edu (S.L. Ahire), pdreyfus@athens.edu (P. Dreyfus). 1 Tel.: +1 803 873 3376; fax: +1 937 777 3064. 2 Tel.: +1 256 233 8120; fax: +1 256 233 8164. Contents lists available at ScienceDirect Journal of Operations Management journal homepage: www.elsevier.com/locate/jom 0272-6963/$ – see front matter ß 2009 Elsevier B.V. All rights reserved. doi:10.1016/j.jom.2009.11.009