The Effect of Quality Management Implementation on Organizational Productivity: Case Study of Kenyan Engineering Firms

A Research Project Report Submitted to the Chandaria School of Business in Partial Fulfillment of the Requirement for the Degree of Master of Science in Organizational Development (MOD)The general objective of the study is to investigate the effect of QM on the productivity. The study sought to realize three objectives, namely; to investigate the effect of QM on staff performance of Kenyan engineering firms, to determine the influence of QM on customer satisfaction of Kenyan engineering firms, and to examine the effect of QM on organizational processes of Kenyan engineering firms. The study employed the use of an explanatory research design. The population for the current study comprised of 60 engineering firms operating in Nairobi of which 53 were sampled for the study. The researcher used simple random sampling technique to collect data from the target population. The data collection method was the use of structured questionnaires and each questionnaire comprised of 38 questions. The quantitative method of data analysis used was both descriptive and inferential analyses. Further associations between the variable were conducted by the use of Statistical Package for Social Sciences (SPSS) program, through which Correlations, ANOVA and regression were conducted among relevant variables to permit further interpretation of the data. The study found that virtually all the sampled firms had implemented QM with 95% of the respondents indicating their organization had QMS. It established that the QMS were used in almost all the operational areas with 71.4% indicating that the systems were used in all areas and 23.8% indicating that QMS was used in “Design and Project Management”. The study established that Employee Motivation” was the most highly ranked aspect of organizational performance affected by QMS with 73.8%, followed by “Employee Participation in Management” with 71.4%. while “Employee Satisfaction” was ranked last with 59.5%. The study found that the majority of the respondents 66.7% thought the effect of QMS on their overall participation was positive and 61.9% considered QMS to have a positive impact on their morale towards task performance. It established that 64.3% of the respondents thought QMS had a high impact on customer loyalty. It found that 83.3% and 4.8% of the respondents thought the effect of QMS on customer satisfaction with the firm was high and low respectively. The study made the following findings concerning the effect of QMS on organizational processes. The study found that 71.4% and 4.8% of the respondents considered effect of QMS on communication within the firm to be high and low respectively. It found that 59.5% and 2.4% of the respondent viewed QMS to have a high and low impact respectively on Firm’s communication with customers. It further established that while 9.5% of respondents perceived effect of QMS on organizational learning to be low, 81% considered it high. A correlation analysis was carried out between QMS and staff performance, customer satisfaction and organizational processes to determine the nature of the relations between QMS and each of the three dependent variables. The study found that Pearson correlation co-efficient values for QMS and staff performance, customer satisfaction and organizational processes were; r = .274, p < 0.01, r = .599, p <.05 and r = .304, p < 0.01, indicating that each of the variables was positively correlated with QMS and that customer satisfaction had the strongest positive association with QMS of the three variables. A regression analysis was also done to assess the effect of QMS on organizational productivity. It was found that the R Square value for the model was .391 indicating that 39.1% of the variance or change in the model is accounted for by staff performance, customer satisfaction and organizational processes. The study established that QMS (the independent variable) predicts the dependent variables (Staff Performance, Customer Satisfaction and Organizational Processes), F (3, 38) = .000. This means that the model has explanatory power that is QMS help account for organizational productivity. The study concludes that, QMS accords modern firms a means of enhancing staff performance. It also concludes that QMS provides a vital means of achieving customer satisfaction and loyalty. It further concludes that QMS augments and enhances organizational processes leading to smooth running of the firm resulting in enhanced levels of productivity and performance. The study recommends that, human resource managers and the leadership in the engineering consultancy firms need to embrace and implement QMS as it enhances staff performance. It also recommends that te management and leadership of the engineering consultancy firms in Kenya need to acknowledge and embrace QMS for its potential positive effects on customer satisfaction. That future researchers should examine the effect that QMS has on other aspects of organizational performance such as competitive advantage, product and service quality as well financial performance