The impact of organizational context on hard and soft quality management and innovation performance

There are conflicting arguments about the relationship between quality management (QM) and innovation. Few studies have considered the role of organization context in influencing QM for innovation achievement. Taking a multi-dimensional view of QM, this study develops a research framework that examines relationships among organization contextual factors (centralization of authority and integration between functions), two dimensions of QM (hard QM and soft QM), and innovation performance (speed of new product introduction and product innovativeness). Survey data were collected from 238 plants in three industries across eight countries, and structural equation modeling was used to test the framework. Our results indicate that two QM dimensions respectively mediate the effect of contextual factors on innovation performance. Hard QM directly influences speed of new product introduction, while soft QM directly influences product innovativeness. Centralization of authority facilitates hard QM but impedes soft QM, while a high level of integration between functions is favorable to both hard QM and soft QM. A decentralized structure combined with strong integration between functions is beneficial for fostering product innovativeness through soft QM. Some other managerial implications are discussed in this study as well.