We now summarize 41 published articles on SCM, 13 on logistics, and 48 on QM, in the context of China. Although we do not claim that this set of articles is exhaustive, it contains a good cross-section of the important literature on these topics. This is generally true for SCM, logistics, and QM. In reviewing the literature, two tables were developed for each topic. The first lists the primary methodological approaches employed in the research, by topic. The second shows how the methodological approaches have evolved over the years covered in this article. We also classified these studies according to the scale development approaches employed in Table 7.
Research on SCM in China
China plays an increasingly important role in the global SC. In the following subsections, we briefly review SCM articles and categorize them according to the topical issues addressed and data collection methodology (Table 1). Many of the articles that we evaluated pertained to impact of culture on SCM. Supplier selection, evaluation and management, and SC collaboration and relationship management were also dominant topics. Surveys, followed by case studies, were the most prevalent methods.
Table 1. Supply chain management (SCM) topics and research methodology.
|Supplier selection, evaluation, and management|| 3|| 1||2|| 6|
|Supply chain (SC) collaboration and relationship management|| 2|| 4|| || 6|
|Impact of culture on SCM|| 1||11|| ||12|
|SC quality management|| 1|| 4|| || 5|
|SC practices|| || 2|| || 2|
|Green SC|| || 2|| || 2|
|SC design and coordination|| 1|| || 1|
|Other issues|| 2|| 2||3|| 7|
Supplier selection, evaluation, and management
The SCM literature suggests that supplier selection, evaluation, and management play vital roles in building a competitive SC. Proper selection, evaluation, and management of supplier relationships can help to reduce conflict, opportunistic behavior, and transaction and inventory costs, while enhancing quality, delivery, flexibility, customer service, and innovative capabilities. These, in turn, help Chinese firms gain competitive advantage in the marketplace and improve financial performance.
Humphreys, Shiu, and Chan (2001) used an adapted scale to report the percent usage of supplier selection criteria among 72 large Hong Kong companies. They found that problem solving capability, capacity, and logistics were the three most important criteria. They found no significant differences in the use of the criteria between Hong Kong and UK firms.
Several studies used case study methodology to study supplier selection, evaluation, and management. Zhang and Goffin (2001) investigated supplier management in Chinese international joint venture manufacturing. They confirmed that the primary challenge is simultaneously reducing costs by purchasing materials and components locally, while maintaining high quality levels. Choy and Lee (2003) presented a generic supplier management tool to use in outsourcing. In a later article, Choy, Lee, and Lo (2004) discussed application of an intelligent supplier relationship management system for new product development, including customer relationship management, supplier rating systems, and product coding systems. They found that outsourcing cycle time and delivery delays were greatly reduced when this system was used by Honeywell Consumer Products.
Handfield and McCormack (2005) described challenges of sourcing from China, based on their discussions with Chinese executives and a translated survey of SC maturity levels using the Supply Chain Council's SC operations reference model. They pointed out that Chinese companies are stronger in the elements that are within their control, such as in-house make-and-delivery processes, but weaker in processes that require external collaboration, such as planning, sourcing, and designing. Although the article is highly descriptive and subjective, it provides many practical insights for sourcing in China and raises interesting new researchable issues.
In a study of the ownership of potential suppliers, Millington, Eberhardt, and Wilkinson (2006) investigated the performance of suppliers with different ownership types, based on interviews with senior managers of 75 UK and U.S. manufacturing firms. They used decontextualization for the ownership construct and adaptation for the other constructs. They found that, while state-owned enterprises (SOEs) had significantly worse performance than international joint ventures (IJVs) or wholly owned foreign enterprises (WOFEs), Chinese private enterprises performed comparably to the IJVs and WOFEs, especially in terms of relationships. Although this study only examined differences between mean scores by ownership and the overall mean, the results indicate that ownership significantly influences performance. Further investigation of how ownership influences the role of the firm within the SC is warranted.
SC collaboration and relationship management
SC collaboration and relationship management is another important theme in SCM. Humphreys, Li, and Chan (2004) examined the role of supplier development in buyer–supplier performance, using an adapted survey and data collected from 142 electronics manufacturers in Hong Kong. Important to supplier development infrastructure were strategic goals, effective communications, long-term commitment, top management support, supplier evaluation, supplier strategic objectives, and buyer trust. Transaction-specific supplier development, trust, supplier strategic objectives, and effective communication were also shown to improve buyer–supplier performance. In a related article, Li, Humphreys, Yeung, and Cheng (2007) studied the relationship between supplier development and buyers' competitive advantage. They found that joint actions and trust were the two most critical elements for enhancing operational efficiency, while asset specificity improved market responsiveness. As one of the most methodologically sophisticated China-based articles, the researchers applied confirmatory factor analysis to assess the exogenous and endogenous measurement models and the convergent and discriminant validity of the constructs. Hypotheses were tested using structural equations modeling (SEM).
Wong, Tjosvold, and Zhang (2005) performed a survey of 96 supplier relationships and 71 marketing partnerships in SOEs in Xian, using the adaptation approach. They proposed and tested a model of the relationship among interdependence, goal interdependence, trust, continuous improvement, and customer satisfaction. The results showed that interdependence between firms and their partners fosters cooperative goals. Cooperative goals help to improve trust, which leads to continuous improvement, and continuous improvement positively influences customer satisfaction. Therefore, cooperative goals form the basis for developing effective SC partnerships in China. This study was strong in terms of research methodology. The research models and hypotheses were theoretically justified, and SEM was used to test the relationships. However, a small convenience sample of participants in an executive training class was used; thus, the findings have limited generalizability. Furthermore, the validity of the measurement scales was not well assessed. In an earlier article, Wong, Tjosvold, Wong, and Liu (1999) investigated how relationships with suppliers contribute to improving the quality of products in Hong Kong–China SCs, using the theory of cooperation and competition through an adapted survey of Hong Kong managers. They also found that manufacturers and suppliers that shared cooperative goals and discussed quality issues open-mindedly and constructively had developed trusting, long-term relationships.
Sheu, Yen, and Chae (2006) performed in-depth case analysis of five pairs of suppliers and retailers in Taiwan. They found that (i) interdependence, intensity, and trust influenced long-term orientation; (ii) supplier–retailer relationship and long-term orientation affected SC architecture, which affected the level of supplier–retailer collaboration; and (iii) supplier–retailer collaboration enhanced supplier–retailer performance. Using data collected through interviews, direct observation, and archival data, the authors proposed a model and research propositions. This study was well designed and executed; however, all supplier–retailer pairs were from a single supplier. Future studies with more diversified samples are needed to replicate their work. In a case study of four companies, Wang and Kess (2006) investigated the motives for partnership. They found that partner selection included both task- and partner-related dimensions.
Impact of national culture on SCM
Twelve studies were found that explicitly examined the role of China's unique national culture in managing the relationship between suppliers and buyers (Table 1). China's national culture is characterized as collective, high in power distance, and long-term focused (Hofstede, 1980). Several interesting and well-executed studies examined how these cultural characteristics affect management of buyer–supplier relationships. They employ a variety of methodologies, including surveys, experiments, interviews, and cases studies.
In an example of a well-executed case study, Batonda and Perry (2003) examined the impact of national culture on interfirm network development in China and Australia. Their in-depth interviews were guided by detailed case study protocols, and interview data were analyzed using matrix displays and tables. They concluded that each group should be better prepared to adjust to its partner's business culture. Chow, Deng, and Ho (2000) used an experiment to assess the interaction between national culture and contextual factors and the openness of knowledge sharing. Participants from China and the United States. were presented with two scenarios, and their responses were analyzed using content analysis. Openness of knowledge sharing was related to collectivism, with in-group membership moderating this relationship; Chinese respondents shared significantly less with potential respondents who were not members of their in-group. Kim, Pan, and Park (1998) examined the role of cultural context in decisions about marketing relationships, surveying respondents in China, Korea, and the United States. While the Chinese and Korean respondents exhibited tendencies that were consistent with a high-context culture, U.S. respondents' tendencies were consistent with a low-context national culture.
Lin and Miller (2003) studied the effect of national culture on negotiation behaviors of managers in 74 American–Chinese joint ventures. Negotiation approaches were conditioned by relational contextual variables. National culture had an indirect effect on choice of negotiating approaches, while interacting with relational context. Mavondo and Rodrigo (2001) examined the interaction between relationship dimensions and their impact on interpersonal and interorganizational commitment among Chinese and Australian business partners. Using a path modeling approach, they developed a hierarchy of importance among relationship dimensions. Wong, Tjosvold, and Yu (2005) studied the roles of self interest, goal interdependence, and opportunism in 103 customer–supplier pairs in Shanghai, using SEM. Shared vision helped partners develop cooperative goals, which reduced opportunistic behavior.
Some of the research on SC relationship management deals with guanxi, which is the obligation for reciprocal exchange that is unique to China (Zhao et al., 2006). These studies all use a contextualization approach in developing scales to measure the guanxi construct. Lee and Dawes (2005) examined the determinants of trust in a salesperson, specifically examining the guanxi construct. Using unstructured interviews, pilot testing, and factor analysis, they found three factors that constitute guanxi: reciprocal favor, face preservation, and emotion. Leung, Lai, Chan, and Wong (2005) studied the relationship among guanxi, personal trust (xinyong), and other relational variables, including supplier competence, commitment, conflict handling, and satisfaction among senior purchasing managers in clothing manufacturing firms in Guangzhou. Their SEM results revealed that guanxi had a stronger influence on xinyong than on satisfaction, and xinyong was extremely important in establishing a partnership relationship with a Chinese buyer. Wu, Hom, Tetrick, Shore, Jia, Li, and Song (2006) developed and validated a measure of three types of reciprocity: generalized, balanced, and negative. After generating a pool of items, they conducted three studies to assess the measurement properties of the scales, using over 1,600 respondents. Their analysis upheld the reciprocity types that had been predicted by the literature. Rao, Pearce, and Xin (2005) explored the role of government support and structure in the development of trust, using archival data and structured interviews of 399 managers in China, the United States, Hong Kong, and Thailand. There was greater trust among business associates with facilitative versus nonfacilitative governments, whereas nonfacilitative governments had greater reciprocal exchange relationships. However, the reciprocal exchange relationships were insufficient to overcome the strong effect of facilitative governments on managers' trust. Zhuang and Zhou (2004) studied the relationship between dependence and power in SC relationships, focusing on department stores in Xian and their suppliers. Power was not derived from the dependence of the other member of the SC dyad, counter to the expectations of the Western literature on SC behavior. Using SEM, the results indicated that it was more desirable to associate with a powerful partner, rather than a dependent partner, because association with a powerful partner provided the ability to transfer the partner's guanxi network. Rameseshan, Yip, and Pae (2006) studied power and channel exchange relationships in 302 Shanghai and Guangzhou tenants in department stores. The use of coercive power had no effect on the tenant's economic or social satisfaction. Interestingly, coercive power was perceived as legitimate by the tenants, which was described as typical of members of a collectivist national culture.
SC design and coordination
Design and coordination of the SC have a great deal of impact on SC efficiency and responsiveness. Lau and Yam (2005) investigated the relationship between product modularization and SC design and coordination, based on a case study of an audio consumer electronics manufacturer in Hong Kong and China. They found that product modularization affected SC design and that product innovation impacted SC coordination. While they developed some interesting propositions, their research was based on a single company. Because generalizability is a major concern, future studies are needed in this area.
Several studies examined SC practices in a Chinese context. Pyke, Robb, and Farley (2000) investigated SCM among 100 companies in Shanghai, comparing their findings with those obtained in Beijing by Robb and Xie (1998). Differences among ownership types were generally insignificant, and the firms all used advanced manufacturing strategies. However, the Chinese companies were not as advanced in SCM as many Western firms. Chinese manufacturers communicated more with customers than suppliers, indicating that their downstream relationships are closer than their upstream relationships. Chin, Tummala, Leung, and Tang (2004) investigated SCM practices in a survey of 184 manufacturers in Hong Kong. They examined the importance of strategic success factors, such as building customer–supplier relationships, employing information and communication technologies, reengineering material flows, changing corporate culture, and identifying performance measures. They concluded that Hong Kong companies were making little progress toward SCM implementation. These studies only report descriptive statistics, such as means and percentages. There is little conceptualization and no testing of research hypotheses. Furthermore, the scales are direct translations of Western scales, without much effort to test and validate them in a Chinese context.
Green SCM (GrSCM)
There has been an increasing emphasis on GrSCM research in China, because many multinationals require certification of sustainability and disposal practices (Zhu, Sarkis, & Geng, 2005), and the Chinese government encourages enterprises to develop in a sustainable way (ke chi xu fa zhan strategy). Two influential articles in this area are Zhu et al. (2005) and Zhu and Sarkis (2004). Zhu et al. (2005) investigated GrSCM drivers, practices, and performance, using data collected from 314 Chinese manufacturing firms. Sources of pressure included SC partners, costs, marketing, and government regulations. Practices included internal environmental management, external GrSCM, eco-design, and investment recovery. They evaluated the measurement instruments and reported descriptive statistics on these constructs, but did not statistically test any relationships. Zhu and Sarkis (2004) examined the relationship between GrSCM practices and performance, based on survey data from 186 firms. GrSCM practices had a positive impact on environmental and economic performance. QM and just-in-time (JIT) had a moderating effect; while QM can help GrSCM, JIT may hurt the environmental performance associated with internal environmental management. These two articles represent the best efforts to date for developing and testing measurement instruments for GrSCM. Measurement items were either adapted from previous instruments or contextualized for GrSCM practices in China. The second article also did a very good job with developing and testing the research hypotheses, and the quality of this article is the best among all published articles on SCM in China. However, the data were gathered from a convenience sample of participants in executive development and MBA programs, and participants were from only three cities; thus, the results may not be generalizable to other cities or provinces in China.
SCM and QM
With the increasing importance of QM and SCM, researchers have investigated their interaction. Kanji and Wong (1999) examined the relationship between total quality management (TQM) and SCM, enriching an existing SCM model using TQM concepts. The model was verified using data from 139 companies in Hong Kong. Wong (2003) found further evidence to support the model by his content analysis of the comments made by SC managers of 59 companies concerning their relationship with their major supplier and its contributions and problems. Lin, Chao, Madu, Kuei, and Yu (2005) identified factors that influence SCM, based on data collected from 109 firms in Hong Kong and 103 firms in Taiwan. QM practices were correlated with supplier participation and selection strategies. These studies used the literature and interviews with executives to develop instruments, which were not designed specifically for the Chinese context. Thus, they illustrate Farh et al.'s (2006) decontextualization approach.
Lo and Yeung (2004) examined how total quality philosophies (TQP) influence strategic alliance practices (SAP) in the Pearl River Delta (PRD). They identified three phases of strategic alliance and proposed a practical framework for PRD manufacturers to use in developing partnerships with their critical suppliers. In an effort to develop good contextualized measures for supplier quality management (SQM) in the PRD, they conducted an extensive literature review and interviewed practitioners. They proposed a framework that portrays the relationship between TQP and SAP and developed an instrument for measuring the key constructs. The measurement instrument was reviewed by ten practitioners, and it was pilot-tested in 30 leading PRD manufacturers. Lo and Yeung offered qualitative managerial insights, rather than statistically testing relationships. In another article, Lo and Yeung (2006) used in-depth interviews and an extensive literature review to identify critical items for evaluating SQM practices, employing a contextualization approach. They developed and validated the instrument with 90 manufacturers in Hong Kong, extracting ten critical factors for describing a SQM system. These factors were clustered into three groups: supplier selection, supplier development, and supplier integration. These two articles represent the best efforts for developing instruments to measure specific constructs in the context of the PRD, providing a good example of contextualization. Among the studies in this area, only Kanji and Wong (1999) and Lin et al. (2005) proposed and empirically validated relationships between key constructs, while the other studies were limited to descriptive statistics only.
Other issues in SCM
Other issues that have been investigated include SC efficiency (Jiang & Hansen, 2003), SC cost advantage (Wu, Yue, & Sim, 2006), manufacturing support infrastructure (Lee, Tummala, & Yam, 2000), SC subcontracting (Liu & Brookfield, 2006), SC operation difficulties (Jiang, 2002), SC talent gap (MacEachern, Melius, Roberts, & Tan, 2005), and integration of SCM and management information systems (Koh, Saad, & Arunachalam, 2006).
Overall, our review of the literature indicates that there has been increasing research interest in SCM in China in recent years, and many of the studies have raised interesting research questions. Table 2 shows the evolution of the research methodology over time, revealing that, while many of the studies have been descriptive, the maturity of the research has been increasing over the past 5 years. About 70% of the studies tested relationships among constructs. However, less than half of the studies explicitly tested the validity and reliability of the survey instruments, and only nine applied SEM/path analysis. Most of the articles did not do a good job designing and implementing the research, and only a few studies were methodologically sound (Batonda & Perry, 2003; Zhu & Sarkis, 2004; Lin et al., 2005; Wong, Tjosvold, & Yu, 2005; Wong, Tjosvold, & Zhang, 2005; Sheu et al., 2006; Li et al., 2007).
Table 2. Evolution of supply chain management research methodology.
|2007|| || 1|| 1|| 1|| 1|
|2006|| 3|| 3|| 5|| 1|| 9|
|2005|| 2|| 7|| 8|| 3||10|
|2004|| 2|| 3|| 3|| 1|| 6|
|2003|| 2|| 1|| 3|| || 5|
|2002|| 1|| || 1|
|2001|| || 1|| 3|| 1|| 3|
|2000|| 1|| 1|| 2|| || 3|
|1999|| || 2|| 2|| 2|| 2|
|1998|| || 1|| || 1|
Research on Logistics in China
The logistics infrastructure and how companies manage logistics activities greatly influences operational efficiency and competitiveness. As a result, there has been a great deal of attention paid to China's logistics infrastructure and systems, how they influence operations in China, and how companies deal with logistics barriers and challenges. Yet, relative to SCM, there is much less empirical research. In the following paragraphs, we review and summarize the major studies by topic area (Table 3).
Table 3. Logistics topics and research methodology.
|Evolution of logistics infrastructure and systems|| ||4|| 4|
|Logistics barriers and challenges|| ||3|| || 3|
|Logistics strategy|| ||1|| || 1|
|3PLs||1||4|| || 5|
Evolution of logistics infrastructure and systems
Logistics infrastructure and systems have been evolving rapidly since 1978, as China undertakes major economic reform. Luk (1998) described distribution reform programs and emerging trends. He also discussed unresolved marketing and administrative issues, providing guidelines for effective channel management in China. Jiang and Prater (2002) described China's traditional distribution system, recent developments, and reform efforts. They indicated that the main problems with China's distribution system include underdeveloped infrastructure, government regulation, and regional protectionism. However, China's booming economy, its accession to the World Trade Organization (WTO), and e-commerce are major driving forces for improving China's logistics systems and infrastructure. Goh and Ling (2003) analyzed transportation networks, telecommunications systems, warehousing facilities, customs procedures, and laws and regulations, using secondary data. They found that the logistics infrastructure curtails the ability of multinational companies to leverage China's full potential. Bookbinder and Tan (2003) compared logistics systems in Asian and European countries and clustered them into three groups, using secondary data from Garelli (1999). Clustering criteria included infrastructure, performance, information systems, human resources, business environment, and political environment. Denmark and Singapore had the top-ranked logistics systems, with China classified in the second tier. This study represents the best example of the use of secondary data to evaluate the logistics performance of different countries.
Logistics barriers and challenges
The underdeveloped logistics infrastructure has created barriers and challenges for companies in developing their businesses in China. Several studies investigated logistics barriers and actions for overcoming them. Carter, Pearson, and Peng (1997) evaluated the severity of barriers to managing operations in China in a survey of 204 U.S. companies operating in China. In a related article, Pearson, Carter, and Peng (1998) reported on strategic alliances between U.S. and Chinese companies, using survey data from 282 U.S. firms. Each of these articles assessed strategic actions to overcome barriers used in multiple regression analyses. Because the data was derived from only U.S. firms, however, it is difficult to generalize the findings to Chinese firms. Ta, Choo, and Sum (2000) investigated 63 Singapore-based manufacturing companies with plants in China. Satisfaction with transportation in China was influenced by both the type of transport mode and ownership. They identified transportation problems faced by foreign companies operating in China and proposed actions for overcoming them.
Compared with the numerous studies about business strategy and operations strategy in China, logistics strategy research has been virtually ignored by scholars. Chan's (2005) study provides an exception. Chan examined the relationship between positioning strategy, competitive strategy, manufacturing planning and control, and manufacturing logistics systems performance, based on a survey of 125 senior managers in light manufacturing industries in Hong Kong. Manufacturing logistics performance was dependent on the fit of logistics systems with competitive strategy.
Third-party logistics service providers (3PLs)
Several studies have examined 3PLs in China.Gunasekaran and Ngai (2003) explored how a small 3PL company in Hong Kong achieved high performance. The company's strategic alliances with customers, operations strategy, and technology were critical success factors. Lai, Zhao, and Wang (2006, forthcoming) studied the impact of information technology (IT) on competitive advantage and financial performance among 3PLs. Using data collected from 105 3PLs in China, they found that IT strategy significantly influenced financial performance in a nonlinear fashion. Yeung, Selen, Sum, and Huo (2006) investigated strategies adopted by 159 3PLs in Hong Kong. The cost and differentiation strategy outperformed a pure low-cost or differentiation strategy. Using a similar method, Wang, Zantow, Lai, and Wang (2006) investigated the strategic posture of 3PLs in China. They found that a differentiation strategy outperformed a cost leadership strategy and that companies pursuing cost leadership were shifting toward differentiation, to cope with intense competition. These articles had explicit research hypotheses, which were tested using sophisticated statistical techniques. They represent a major improvement in research methodology over earlier descriptive studies.
As stated by Zhao et al. (2006), most logistics research in China focuses on describing the status and evolution of China's logistics infrastructure and reporting challenges faced by companies operating in China. Interestingly, Table 4 does not show a clear trend of increasing empirical work in China-based logistics research, which is much less mature than the SCM research. Some articles used brief surveys, while others used case studies, direct observation, or secondary data. Out of the 13 important articles reviewed, only two explicitly proposed and tested research hypotheses using statistical analysis and data. Five reported descriptive results only, and eight articles tested relationships between constructs. None tested relationships among variables using path analysis or SEM. Furthermore, most studies were based on relatively small samples and did not properly assess the validity and reliability of the instruments.
Table 4. Evolution of logistics research methodology.
|2006|| ||1||4|| || 4|
|2005|| ||1|| || 1|
|2003||3|| || 3|
|2002||1|| || 1|
|2000|| ||1|| || 1|
|1998||1|| ||1|| || 2|
|1997|| ||1|| || 1|
Research on QM in China
There has been a substantial amount of empirical research on QM in China. Typical of an emerging area of study, many of the articles have dealt with the status of QM in China and development of frameworks that articulate its antecedents and consequents. The topics and research methods used for China-based QM research are summarized in Table 5.
Table 5. Quality management (QM) topics and research methods.
|Status of QM|| ||14|| ||14|
|QM implementation|| ||12|| ||12|
|Customer perceptions of quality||3|| 6|| || 9|
|Relationship between QM and performance|| || 5|| || 5|
|Relationship between national culture and quality|| ||10||2||12|
|Measurement of QM constructs|| || 3|| || 3|
Status of QM in China
Because QM in China has lagged its implementation in Western countries, research on its status helps establish and document various aspects. Lee and Leung (1999) sampled engineering management students and respondents from ISO 9000 registered companies. Although respondents were aware of customer satisfaction and quality concerns, they were not ready for a comprehensive TQM approach. Lee and Zhou (2000) classified 243 manufacturers in China as TQM or traditional. The TQM firms had more foreign sales and tended to focus on high-precision products. They ranked product quality as their highest priority, compared with traditional firms, which focused on cost priorities. Lau, Zhao, and Xiao (2004) classified 452 organizations in China according to their stage of QM system development. Using factor analysis, they found that firms at the TQM stage had superior performance, but that most Chinese firms lacked a complete understanding of strategic QM. This study was very strong methodologically and sampled firms across China in 29 provinces and autonomous regions. Li, Anderson, and Harrison (2003) collected data from 428 firms in northern China. They found that joint ventures scored the highest in quality practices, while SOEs scored the lowest. Privately owned companies scored well in some aspects of QM implementation, especially quality leadership. Zeng, Tian, and Tam (2005) found that the major motivation for implementing ISO 9001 in China was to improve organizational culture.
Several studies compared the status of QM in China to other countries. In an early study, Zhao, Maheshwari, and Zhang (1995) compared QM efforts in India, China, and Mexico. The majority of manufacturers in all three countries were aware of modern QM concepts and philosophies, believing they were doing a good job providing high-quality products. While this study used a random sample in India and Mexico, it used a convenience sample of executives in a management development class in China. Raghunathan, Rao, and Solis (1997) compared QM practices in India, the United States, and China. There were no differences in human resources (HR) practices among the United States, India, and China, and India and China were similar in their perceptions of QM practices. Sun (2000) compared QM in China and Norway. Although Chinese companies had been using QM longer than Norwegian companies, they focused more on quality control and statistical methods, neglecting customer satisfaction and quality assurance. However, the Chinese respondents were members of the Shanghai Association for Quality Control, which may have accounted for the bias toward quality control in their responses.
Ahmed, Aoieong, Tang, and Zheng (2005) compared the status of QM systems in the construction industry in the United States and Hong Kong. Quality tools were mainly used for monitoring and recording purposes in both countries. This study had a very low response rate, with only 8% of the U.S. sample responding. Chin, Sun, Xu, and Hua (2002) compared QM practices in Hong Kong and Shanghai. Although the use of QM practices led to improvement in business results in both locations, Shanghai companies paid greater attention to environmental impact, while Hong Kong companies focused more on market and customer feedback. Hopkins, Nie, and Hopkins (2004) compared perceptions of QM among managers of electronics firms in Taiwan and China. There were differences in beliefs about the definition of quality, the relationship between QM and organizational performance, the extent to which QM is practiced and how the quality of their firms' products compares with the global competition. Taiwan managers held stronger beliefs about QM and used QM practices to a greater extent. In his survey of 500 small Chinese manufacturers and visits to ten small manufacturers, Lee (2004a,b) found that TQM was new to most small manufacturers in China. He reported that TQM is commonly viewed as a tool for saving money through inventory reduction.
QM implementation issues and factors
Although most research on QM has been conducted in a Western setting, QM in China may have different key drivers and implementation issues. Pun and Ho (2001) identified critical factors and recommended improvement strategies for a Hong Kong restaurant; however, the study had limited generalizability beyond the immediate case. Likewise, Guarnani (1999) looked at TQM implementation problems in a case study of a single Hong Kong division of a multinational company. He found that there were implementation difficulties when time and labor were limited. Lo and Cheng (1997), in their survey of top managers in engineering-related industries, found that Hong Kong employees were motivated by QM's technical aspects, compared with its systematic and philosophical aspects. Chin, Tummala, and Chan (2003) sampled 400 companies in the electronics and toy industries in Hong Kong. Customer focus was perceived to be the most important core element, followed by leadership and employee participation. Rao, Raghunathan, and Solis (1999) assessed QM practices in the HR division of companies in India, China, and Mexico. The best practices in all three countries were related to training in specific skills and building quality awareness, while the weakest included training in statistical tools, employee involvement, and participation. This study could have been improved by analyzing actual scores, rather than artificially dichotomizing them into high and low, and reporting the results across the entire sample, rather than simply reporting high and low within countries. Chow and Lui (2001) evaluated adoption of TQM in the information systems (IS) function of Hong Kong firms. They found that the key factors were user focus, top IS management support, and IS product and service design.
In a well-executed study, Zhao, Yeung, and Lee (2004) developed an empirical taxonomy of QM systems in service industries in China. Nonhierarchical cluster analysis revealed four patterns of service QM: undeveloped, accommodating, strategic, and soft. The type of QM system adopted was associated with organizational contextual factors. Although the perceived importance of quality induced further development of the QM system to a strategic quality system, they found that small service firms that competed locally could achieve very good performance using a soft quality system.
Customer perceptions of quality
As China has become a major player in the global economy, particularly since its accession to the WTO, customer focus has become more of an issue. Particularly because manufacturing has historically been controlled centrally, customer focus remains a challenge. Ellis, Williams, and Zuo (2003) studied the extent to which cross-cultural expectations and perceptions influence perceived service quality. Their sample included managers of European and Chinese supermarkets in Nanjing, Suzhou, and Shanghai, as well as their Chinese customers. While there was no difference in perceived service quality between local and international service providers, there were significant differences in perceptions of personal interaction, reliability, and policy. Heung, Wong, and Qu (2000) studied Chinese casual, full-service, and quick-service restaurants, finding that customer expectations varied by type of restaurant. Bennett and Zhu (2004) used a combination of semistructured interviews and questionnaires to study the relationship between brand and country of origin to customer impressions about product quality in China and the United Kingdom. Their sample included Chinese machine tool manufacturers that were the partners of UK machine tool manufacturers, as well as Chinese companies in various industries. All three groups believed that foreign technology-based machines that were made in China were superior to machines based on local technology. Cui, Lewis, and Dong (2004) used rigorous, structured content analysis of interview data from retail bank customers and employees in five banks in Guangzhou to examine factors influencing bank service quality, as well as a questionnaire in China and the United Kingdom. They found 16 factors that were perceived as determinants of service quality. While some service quality determinants functioned as satisfiers, some were dissatisfiers and others were dual determinants of service quality. Schniederjans, Cao, and Olson (2004) studied the perception of Chinese goods in the eyes of randomly selected respondents in all 50 U.S. states. The average rating of Chinese products was “poor,” and non-Chinese products were viewed as having greater net product value. However, because this study relied on U.S. consumers' memory of having purchased Chinese-made products, there are issues with its validity.
Relationship between QM and performance
Several studies have sought to articulate key practices that contribute to improvements in performance. Lam (1995) studied 220 frontline supervisors in Hong Kong organizations, finding that they felt that QM did not make their jobs more interesting or more important, only more demanding. Lee, Adam, and Tuan (1999) found that quality performance was strongly related to the improvement approach employed. Operating and financial performance were weakly related to the type of improvement approach. Li, Zhao, and Lee (2001) compared the performance of Hong Kong and UK banks. Hong Kong banks focused more on meeting service standards and providing prompt service, while UK banks focused more on customer needs and wants. Wang, Lo, and Hui (2003) studied bank branches in northern China, using SEM. Both service and product quality influenced bank reputation, but there was no evidence that reliability or empathy had an impact on service quality. Ng's (2005) study of the satisfaction of government and quasi-government organizations with the quality performance of engineering consultants found that actual benefits tended to be lower than clients' expectations. Wang, Lo, and Yang (2004) studied customers of two competing cell phone service providers in China. Customer value mediated the relationship between service quality and customer satisfaction. Xu, Jayaram, and Xu (2006) used hierarchical regression to study the effect of service enablers on conformance quality and productivity. They isolated resource management and human resource management (HRM) practices that affected both conformance quality and productivity, finding that the level of customer contact had a contingency effect. Although they found no significant differences between them, the same data was gathered in two different ways—through mail surveys and through face-to-face interactions in field visits.
Yeung, Cheng, and Lai (2005) studied key constructs in achieving business results in 225 firms in the electronics industry in Hong Kong and the PRD. In a study that was very strong methodologically, they found that process control and improvement were the key drivers of operational performance and customer satisfaction. There was a chain of effects that impacted operational performance: top management leadership, cultural elements, operational support systems, process control, and improvement.
Relationship between national culture and QM
Noronha (2002, 2003) studied the influence of Chinese cultural values on QM in 385 companies in China, Hong Kong, and Taiwan. Using SEM, he found that the underlying Chinese values of abasement, adaptiveness, harmony with people, harmony with the universe, interdependence, and respect for authority influenced the dimensions of quality. He concluded that quality climate is an important intermediary for bridging cultural values into quality practice and results. In contrast, Pun (2001) found no evidence that Chinese cultural values influenced employee involvement or QM adoption. Management in both Hong Kong and China was in harmony with Confucian ethics and the traditional Chinese values of paternalism, hierarchy, and personal obligation. In their study of middle managers in the United States, Japan, Taiwan, and Hong Kong, Yavas and Rezayat (2003) found that individualism/collectivism, uncertainty avoidance, and power distance were all important in differentiating the way that managers perceive quality processes. Walumba, Lawler, Avolio, Wang, and Shi (2005) studied the moderating effect of collective- and self-efficacy on the influence of transformational leadership on followers' work-related attitudes. Surveying 644 respondents in 37 branch banks in China, India, and the United States, they found that transformational leadership and efficacy beliefs were positively related to followers' work-related attitudes in all three countries. Aggregated collective- and self-efficacy moderated the relationship between transformational leadership and followers' work-related attitudes.
Chow, Lindquist, and Wu (2001) used an experiment to study the relationship of national culture to the implementation of high-stretch performance goals. Chinese nationals more readily accepted imposed high-stretch performance standards than the U.S. respondents. Hui, Au, and Fock (2004) examined cross-cultural effects on empowerment, focusing on the moderating role of power distance in the relationship between job autonomy and job satisfaction. The authors combined analysis of secondary data, a survey, and an experiment to reveal that power distance consistently moderates the effect of empowerment on job satisfaction. Essential conditions for implementing empowerment included willingness to exercise discretionary power and the desire to satisfy customer needs. Lindholm (2000) examined the extent to which HRM practices could be transferred between countries. Surveying 1,849 host-country employees from European multinational corporations (MNCs) in China, Thailand, India, the United Kingdom, and the United States, he found that evaluation and feedback practices were likely to be adapted to the host culture. Wang and Clegg (2002) studied the relationship between trust and participation in 328 managers in Australia and China. While trust in employee psychological maturity had a positive impact on willingness to encourage employee participation, Chinese managers had a lower level of trust in the psychological maturity of their employees. This led them to invite less employee participation. Lau, Tse, and Zhou (2002) examined readiness for change in Chinese firms with different types of ownership. A major research company conducted interviews with 3,960 managers and workers in 20 firms. Employees in IJVs and reformed enterprises were more open to change than employees in SOEs. In addition, employees in more developed regions of China were more open to change. There were sharp contrasts in openness to change between top managers, middle managers, and workers.
Measurement of QM constructs in China
Several articles dealt exclusively with the development or adaptation of measurement instruments. Zhang, Waszink, and Wijngaard (2000) contextually developed and validated an instrument for measuring QM in China. Although the instrument was developed specifically for use in China, it was initially developed in English, then translated into Chinese. Zhou (2004) found that his adaptation of SERVPERF was an appropriate predictor of customer satisfaction in China. The primary driver of customer satisfaction was reliability/assurance, and there was a lack of trust in local banking services. Lam (1997) adapted SERVQUAL (Parasuraman, Zeithaml, & Berry, 1988) for studying health care quality in Hong Kong. He found that it was consistent and reliable for measuring health care service quality; however, the dimensions that he found did not confirm SERVQUAL's five dimensions.
These studies reflect that, although progress is being made, China is still early in its QM journey. The studies on national culture and QM tend to be methodologically stronger than those in other areas, which are anecdotal or descriptive. Table 6 indicates that some more recent studies have used SEM/path analysis, but that there continues to be numerous descriptive studies. In terms of content, although there are numerous studies on the status of QM, there are relatively fewer that deal with relationships between theoretical constructs. In addition, virtually all of these studies used respondents from regions of China that were relatively advanced in their economic development, suggesting that QM in most parts of China is likely to lag the rest of the world even more.
Table 6. Evolution of quality management research methodology.
|2006|| || 1|| || 1|
|2005|| 2||1|| 1||1|| 5|
|2004|| 4|| || 4||2||10|
|2003|| 3|| || 1||2|| 6|
|2002|| 1|| ||1|| 2|
|2001|| 1||2|| 1|| || 4|
|2000|| 1||2|| || 3|
|1999|| 2|| || 1|| || 3|
|1998|| 2|| || 2|
|1997|| 2|| || 3|| || 5|
|1995|| 2|| || 2|