Manager Roles and Total Quality Management: a Comparison Between U
Abstract Number 003-0181
Influence of Leadership Style on Quality Management Practices
Sixteenth Annual Conferemce of POMS, Chicago, IL, April 29 – May 2, 2005
Tipparat Laohavichien
Department of Operations Management
Faculty of Business Administration
KasetsartUniversity
Bangkok, Thailand 10900
Phone: 662 379-1595
Fax: 662 942-8101
Lawrence D. Fredendall
Management Department
ClemsonUniversity
Clemson, SC29634-1305
Phone: 864 656-2016
Fax: 864 656-2015
Caron St. John
Management Department
ClemsonUniversity
Clemson, SC29634-1305
Phone: 864 656-5963
Fax: 864 656-2015
Influence of Leadership Style on Quality Management Practices
Abstract
Leadership is important to quality management, but existing leadership theory has not been integrated into existing quality management theory. This paper tests the effects of leadership on the infrastructure quality management practices, the core quality management practices and the quality performance of the firm. A survey of quality managers in the U.S. provided data that was tested using multiple regression analysis. The results show that leadership has a significant effect on the level of infrastructure quality management practices.
Influence of Leadership Style on Quality Management Practices
1.0 Introduction
Leadership research categorizes leadership as being either transformational or transactional (e.g., Bass and Avolio, 1990). Transformational leadership is typically viewed as appropriate for QM, while some QM researchers suggest that transactional leadership is not relevant for QM (Dean & Bowen, 1994). For example, Waldman (1994) states that transactional leadership may encourage short-term thinking, which would be detrimental to continuous improvement, while transformational leadership stimulates team-work and continuous improvement. However, we could not locate an empirical study investigating whether either transformational or transactional leadership influences a QM program.
This paper makes twomajor contributions to the quality management literature. First, it integrates existing leadership theory into QM theory, which is one step towards implementing Sousa and Voss’s (2002) suggestion to integrate existing management theory into QM theory.Leadership theory is integrated with QM theory by investigating whether higher levels of transformational leadership and/or transactional leadership lead to higher levels of either infrastructure or core QM practices and quality performance. Second, this study further tests and expands the existing quality modelproposed by Sousa and Voss (2002) and Flynn et al. (1995). This model classifies QM practices into infrastructure and core QM practices and stipulates that the core QM practices mediate the affect of infrastructure QM practices on quality performance. This paper then further tests the relationship between the infrastructure QM practices, the core QM practices and the firm’s quality performance as suggested by Sousa and Voss (2002)
2.0 Literature Review
2. 1 Transformational and Transactional Leadership
Bass (1985) and Bass and Avolio (1990) divide leadership into two types – transformational and transactional leadership. Transformational leaders identify the higher needs and motivations of their followers (Burns, 1978). Transformational leaders attempt to increase their followers’ awareness of the importance of achieving certain outcomes and encourage their followers to transcend their own self-interest for the sake of the larger group. Transformational leaders also engage their followers in developing their own capabilities and pursuing goals and objectives based on their own intrinsic motivation (Bass, 1985; Bass & Avolio, 1990). Bass and Avolio (1990) state that transactional leaders view leadership as the exchange of one thing for another (i.e., transactional leadership is based on the exchange of rewards for effort). Transactional leadership may compose the majority of the interactionsbetween leaders and followers (Burns, 1978), but leaders exhibit both transformational and transactional leadership behaviors in varying degrees (Bass & Avolio, 1997).
Scales to measure the degree to which a leader exhibitstransformational and transactional leadership behaviors were developed by Podsakoff et al. (1990). These scales measure six key dimensions of transformational leadership and two dimensions of transactional leadership. The six key dimensions of transformational leadership are: articulating a vision, providing an appropriate model, fostering the acceptance of group goals, high performance expectations, providing individualized support, and intellectual stimulation. The two key dimensions of transactional leadership are contingent reward and contingent punishment (also called “management by exception” by Bass & Avolio,1990).
Podsakoff et al.’s (1990) dimension of ‘articulating a vision’ measures leaderbehaviors that identify and express a clear vision. Their dimension of ‘providing an appropriate model’ measures the leaders’ behaviors that set an example for subordinates to follow, and whether these examples are consistent with the goals of the organization. The dimension of ‘fostering the acceptance of group goals’ measures the leader’s behaviors which encourage subordinates to cooperate and sacrifice some of their own goals to achieve the group’s goals. The dimension of ‘high performance expectation’ measures the leader’s behaviors which demonstrate that the leader has expectations of high quality performance. The ‘providing individualized support’ dimension measures the behaviors of the leader that demonstrate the leader’s concern for individual subordinates. Finally, the ‘intellectual stimulation’ dimension measures the leader behaviors that encourage the subordinates to find ways to improve their performance. The ‘contingent reward’ dimension of transactional leadership measures the behaviors of the leader that promises rewards for subordinates, when the subordinates satisfactorily complete the assigned job. The ‘contingent punishment’ dimension of transactional leadership measures the forms of negative feedback from the supervisor. This is the leadership behavior that takes corrective actions when the subordinates fail to meet the standards.
2.2 Leadership and Top Management Commitment/Support
Deming and other quality practitioners considered visionary leadership to be an essential requirement for an effective QM program (e.g., Anderson et al., 1995; Curkovic et al., 2000). Several theoretical articles have suggested that transformational leadership is the type of leadership which Deming and others would consider to be visionary leadership that they felt was necessary for an effective QM program (e.g., Dean & Bowen, 1994; Waldman, 1994).
This review of the literature could not identify any empirical examination of the relative importance of transformational and transactional leadership to the success of the QM program.Prior QM research measures a variety of variables to represent leadership but does not measure transformational or transactional leadership. Even studies that specifically discuss the importance of visionary leadership to the success of the QM program (e.g., Anderson et al., 1995) do not measure either transformational or transactional leadership. Leadership constructs that have been measured in prior QM researchare shown in Table 1. These constructs measure commitment, communication and involvement or support and are referred to collectively as top management commitment/support in the remainder of this paper.Visual examination of the items used in these studies to measure theirtop management support/commitment constructs suggests that these items do notcorrespond to the items used to measure any of the dimensions of eithertransformational or transactional leadership discussed earlier.
INSERT Table 1 About Here
While the top management commitment/support construct currently in the QM research literature differs from both the transformational and the transactional leadership constructs, all the empirical studies to datehave found that itis significantin explaining differences in quality practices (e.g., Anderson et al., 1995; Flynn et al., 1995). So, while this construct may not be a measure of either transformational or transactional leadership, top management commitment/support seems to be an important infrastructure QM practice. One reason thatthe top management commitment/support construct may be important to QM theory even after including transformational and transactional leadership in the model is suggested by Beer (2003). Beerfound that implementing continuous improvement using lower-level cross functional teams requires shifting power to those with the most immediate knowledge and information about the problem. However, unless senior management is committed to the change, the organization’s policies and practices will not be realigned to support continuous improvement.
2.3 Quality Management Practices
In their recent review of the quality management (QM) research, Sousa and Voss (2002) categorized the QM practices, which were examined in ten empircial studies, as either infrastructure or core QM practices. They used this categorization, which was first proposed by Flynn et al., (1995) and supported by Ho et al., (2001) and Rahman and Bullock (2002)to evaluate the current theory of QM in the context of management theory. In their review, Sousa and Voss (2002) concluded that QM is a maturing field of study, and that future research should standardize the vocabulary and use precise definitions. They specifically suggested distinguishing between principles, practices and techniques to improve the measurement constructs. For example, customer focus is a QM principle, but summarizing customer complaints into a regular report for managers is a practice (Ahire et al., 1996). Sousa and Voss (2002) also suggested that future research investigate the interplay of infrastructure QM practices and core QM practices and the interactions between them. In addition, they pointed out the need to incorporate more management theory into QM research by linking QM studies to other more theoretically developed fields.
Research by Flynn et al.(1995), Ho et al. (1999, 2001), and Rahman and Bullock (2002) shows that there are significant positive relationships between the infrastructure QM practices and the core QM practices. The core QM practices completely act as a mediator in the relationship between infrastructure QM practices and quality performance. Flynn et al. (1995) found that the infrastructure QM practices do not directly impact quality performance, rather they support the use of the core QM practices. But, the core QM practices do directly affect quality performance. Further, Flynn et al. (1995) found that it is difficult to discern any direct effect of either core or infrastructure QM practices on business performance.
Researchers differ about how to classifyQM practices in terms of infrastructure and core practices. For example, Flynn et al. (1995) include supplier relationships as an infrastructure QM practice, but Ho et al. (1999) include supplier relationships as a core QM practice. Flynn et al. (1995) found that top management support (an infrastructure QM practice) has a positive relationship with the core QM practices. But, Ho et al. (1999) found no evidence of a relationship between top management support and the core QM practices. Also, Kaynak (2003) does not classify QM practices into infrastructure and core QM practices in her work, but she did find that management leadershipwas directly related to three variables that Sousa and Voss (2002) classified as infrastructure QM practices (i.e., quality training, employee relations and supplier quality management) and to a fourth variable (i.e., product/service design) that Sousa and Voss classified as a core QM practice.
3.0Research Model
The research model shown in Figure 1 proposes that both transformational and transactional leadership affect the level of infrastructure and core QM practices, and quality performance. It also proposes that the level of infrastructure QM practices affects the level of core QM practices and the level of quality performance. It also proposes that the core QM practices directly affect the quality performance level. Figure 1 shows all of the dimensions of the transformational and transactional leadership constructs and the infrastructure QM practices and core QM constructs, as well as four measures of quality performance. The reasons for selecting only these construct measures is discussed later after the support for the hypotheses shown in Figure 1 is provided.
INSERT Figure 1 About Here
As explained earlier, transactional and transformational leadership are two distinct types of leadership which are conceptually independent of one another (Bass, 1985). Transformational leadership behavior should inspire subordinates to perform beyond the minimum levels specified by the organization. Transformational leadership is viewed by practitioners (e.g., Deming, 1996) and QM theoreticians (e.g., Waldman, 1994) as critical to QM success. Given that infrastructure quality practices support the implementation of core practices, it is probable that transformational leadership directly affects the level of infrastructure QM practices. So, the following hypothesis is proposed:
H1:The level of transformational leadership behaviors is positively associated with the level of infrastructure quality management practices.
As stated earlier, some leadership theory suggests that transactional leadership may encourage behaviors detrimental to continuous improvement (Waldman, 1994). Transactional leadership behaviors maybe detrimental to QM because they may remind subordinates that their performance is being monitored, and specifically, that their future rewards and punishments depend on their level of performance. This short term thinking could inhibit the implementation of infrastructure QM practices, so the following hypothesis is proposed
H2:The level of transactional leadership behaviors is negativelyassociated with the level of infrastructure quality management practices.
As discussed earlier, Flynn et al., (1995), Ho et al. (2001), Rahman and Bullock (2002) as well as Sousa and Voss’s (2002) literature review found that the level of infrastructure QM practices positively affect the level of core QM practices. So, it is hypothesizedthat:
H3:The level of infrastructure quality management practices is positivelyassociated with the level of core quality management practices.
Flynn et al. (1995) and Ho et al.(2001) found that the core QM practices completely mediate the relationship between the infrastructure QM practices and quality performance and that the core QM practices directly influence quality performance. Recent research by Kaynak (2003) supports the concept that some QM practices completely mediate the influence of other QM practices on quality performance. While Sousa and Voss (2002) also support the mediating role of the core QM practices, they suggest the need to confirm this relationship. So, it is hypothesized that:
H4:Core quality management practices doimprove quality performance.
It is not clear from prior research how leadership affects quality performance.Powell (1995) concludes that there is limited value in implementing the core QM practices and that leadership is the primary determinant of quality performance. But, Kaynak (2003) found that top management support/commitment directly affected a core QM practice, which influenced quality performance. Based on their review of the QM literature,Sousa and Voss (2002) recommended further investigation of the relationships between the variables in the infrastructurecorequality performance model to confirm the proposed relationships. To investigate the relationship of leadership to quality performance, itis proposed that both transformational and transactional leadership directly affect quality performance. The hypotheses are:
H5:The level of transformational leadership is positively associated with quality
performance.
H6:The level of transactional leadership is positively associated with quality performance.
As discussed earlier, Kaynak (2003) found that top management support/commitmentdirectly influenced both infrastructure and core QM practices. This suggests that both transformational and transactional leadership may directly affect the level of core QM practices. This could occur if top management in a plant has direct contact with the line workers and/or the design engineers. This would allow top management to then directly influence the implementationof the core QM practices. So, it is proposed that both transformational and transactional leadership affect the core QM practices. The hypotheses are:
H7:The level of transformational leadership is positively associated with the level of core QM practices.
H8:The level of transactional leadership is positively associated with the level of core QM practices.
While the assumption of the basic infrastructurecorequality performance model is that the core QM practices completely mediate the affect of infrastructure QM practices on quality performance, Sousa and Voss (2002) suggest that the relationships between the variables in thismodel should be investigated further to confirm the relationships. To investigate this relationship, it is proposed that infrastructure QM practices directly affect quality performance. So the hypothesis is:
H9:The level of infrastructure quality management practices is positively associated with the level of quality performance.
3.1 Measurement Scales
Heberlein and Baumgartner (1978) and Dillman (1978) argue that longer questionnaires have a lower response rate than shorter questionnaires. To obtain as high of a response rate as possible, both the number of QM practices examined and the number of items used to measure each practicewere limited.Those QM practices included in this study were used in at least three of the five major empirical studies reviewed by Sousa and Voss (2002) as shown at the top of Table 2. To clarify the construct selection procedure for the reader, the infrastructure and core QM practices examined in the prior studies,are arranged so that the corresponding construct from each study is in the same row of Table 2. The six infrastructure QM practices and the three core QM practices that were included in this study are shown in the far right column of Table 2 in the row that corresponds to the relevant QM practices of the prior studies.
Once the constructs are selected, the number of items used to measure each construct was determined by selecting the most appropriate items used in one of the five surveys listed in Table 2. As suggested by Sousa and Voss (2002), item selection was done to avoid incorporating principles, practices and techniques into the same construct.
INSERT Table 2 About Here
After selecting appropriate items from prior studies, the constructs in this study were named (see the last column in Table 2) and defined. The top management support constructin this study measures those behaviors of top management thatsupport quality management. In this study, customer focus measures the internal effort of management to ensure that all staff strive to satisfy the customer. Supplier management measures the quality of the supplied material and the relationship between the company and supplier. Workforce management measuresthe use of quality-based incentives, the breadth of skill-based compensation, and the employees’ ability to exchange opinions and ideas. Training measures the frequency of quality training, management’s involvement in training and the depth of training. Organizational cooperation measures the internal cooperation of the employees, departments and the management team. Process management measures the cleanliness and organization of the workplace, and the effectiveness of production scheduling and facility layout. Statistical process control (SPC)measures how extensively SPC is used and the level of employee knowledge of SPC. Design quality measures the use of cross functional teams during the design process, the cooperation of team members and the formality of the design process.
The supplier management and organizational cooperation constructs need some additional explanation. Anderson et al. (1995) measured supplier management and organizational cooperation as one item, whereas this study follows the precedent of the Flynnet al. (1995) and Powell (1995) studies and measures supplier management and organizational cooperation as separate constructs.