The role of organisational culture in total quality management adoption and cost of quality

Abstract

Organisational Culture (OC) is related to the implementation of TQM, while both are associated with the economic aspect of TQM meaning the Cost of Quality (CoQ). The present study aims to investigate the impact of different types of OC, namely group, developmental, rational and hierarchical culture on TQM and CoQ. Moreover, the study aims at determining the impact of TQM on CoC and CoNC. Greek manufacturing and service companies were approached through a structured questionnaire and 292 participated in the study. Confirmatory Factor Analysis was applied to examine the reliability and validity of latent constructs, the relationships of which were determined through Multiple Linear Regression analyses. According to the findings, all the cultural types have a positive impact on TQM. TQM has a significant and positive impact on CoC and a negative influence on CoNC. Finally, CoC is significantly influenced by two types of OC (developmental culture and hierarchical culture), while CoNC is directly affected only by rational culture. This study offers clear implications for managers who want to fully adopt TQM and improve CoQ by reinforcing specific OC types. To the best of the authors’ knowledge, no previous research has discussed these relationships in the Greek business environment.