(An Empirical Investigation of Relationship between Automotive Quality Management System Practices and Firm Performance)

Abstract

Purpose – IATF 16949 Automotive Quality Management System-QMS (known as ISO/TS 16949 standard) is a worldwide standard developed by the International Automotive Task Force (IATF), a group of the world’s leading manufacturers and trade organizations. It defines the quality management system (QMS) requirements for the design, development, production, and when relevant, installation and service of automotive-related products. The purpose of this study is to examine the relation between the Automotive QMS practices and the firm performance (financial and process performance). Desing/methodology/approach – A research model and hypotheses were tested by using survey data collected from suppliers of a main manufacturing firm in the automotive industry. Findings – A significant and positive relationship was found between the automotive QMS applications and the process performance of the enterprises. However, a significant and positive relationship was not found between Automotive QMS applications and financial performance. Discussion – The high level of application of the Automotive Quality Management System of the enterprises affects the process performance positively. The fulfillment of the requirements of the system plays an important role in the proper and efficient execution of the processes. In general, it is known that quality applications are primarily beneficial in improving processes, and that the financial performance benefit occurs in the following years. It can be stated that 53% of the surveyed enterprises have this system for less than one year and the results are meaningful.