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Process Improvement Studies Across a Variety of Industries Paper Hi, how are you doing

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Regardes The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0959-6119.htm
IJCHM
28,11
Supply chain quality
management: an empirical study
2446
Nanjing University of Science and Technology, Nanjing, China
Jianlan Zhong and Yizhong Ma
Received 10 March 2015
Revised 10 March 2015
9 July 2015
24 September 2015
5 December 2015
Accepted 13 February 2016
Yiliu Tu
Schulich School of Engineering, University of Calgary, Calgary,
Canada, and
Xia Li
Management School, Shanghai University of Engineering Science,
Shanghai, China
Abstract
Purpose – This paper aims to focus on supply chain quality (SCQ) in the hospitality industry in China,
and to stress the importance of the synergy of quality management (QM) and supply chain management
(SCM). The authors have investigated the relationship among QM practices, SCM practices, SCQ and
hotel performance, and examined the effect of contextual variables.
Design/methodology/approach – This study mainly uses a questionnaire survey to collect data
relating to the research hypotheses. Structural equation model technique is suited for our research
purposes, and the LISREL software is implemented to test the conceptual model.
Findings – The results show that QM practices and SCM practices are significantly correlated. QM
practices/SCM practices are positively related to SCQ, and consequently influence hotel performance.
SCQ has the mediating effect between QM/SCM practices and hotel performance. Contextual variables
truly play a moderator between QM/SCM practices and SCQ.
Research limitations/implications – Hotel managers should look beyond their own hotels into
supply chain to manage quality, highlight the importance of interdepartmental or external (i.e.
customers or suppliers) connectedness, such as building close and long-term relationships with
well-chosen suppliers, encouraging customer involvement and establishing an effective interface for
accumulating information regarding customers’ needs and feedback. Hotel managers are also able to
realize the influence of contextual variables (e.g. the new normal state of the Chinese economy), and
further to gain chance of hotel’s survival.
Originality/value – This study focuses on SCQ and tries to fill a gap in the exiting literature on SCQ
management in hospitality industry.
Keywords Quality management, Supply chain management, Hotel performance,
Supply chain quality
Paper type Research paper
International Journal of
Contemporary Hospitality
Management
Vol. 28 No. 11, 2016
pp. 2446-2472
© Emerald Group Publishing Limited
0959-6119
DOI 10.1108/IJCHM-03-2015-0110
1. Introduction
Along the trend of globalization, it is necessary to improve quality beyond a firm’s
boundaries to supply chain (Benaissa et al., 2010). Integrating quality management (QM)
This work was supported by the National Natural Science Foundation of China (No. 71471088),
China Postdoctoral Science Foundation (No.2014M561655) and Shanghai University of
Engineering Science’s fund project for research cultivation (NO. A 25001201194).
and supply chain management (SCM) is the effective way for supply chain partners to
improve their overall competitiveness. As important hospitality service providers, it is
essential for hotels to synergize with upstream suppliers (e.g. the suppliers of drinks,
food, culinary materials, laundering linen and so on) and downstream partners (e.g.
customers). However, it is worth noting that customers are also supplier in hospitality
supply chain (they provide themselves, e.g. customers’ mind, body, efforts or
information such as service specification), which is a critical characteristic making the
difference between hospitality supply chain and manufacturing supply chain.
In manufacturing supply chain, suppliers are upstream, and customers are
downstream. Groups of customers may contribute ideas or their feedback information to
the design of the product, but that feedback is not an essential input to the production
process for a specific customer. Both manufacturers and service providers conduct this
type of market research, and general customer feedback is not exclusive to either
domain. However, most hospitality services offer a combination of tangible (furniture of
a hotel) and intangible elements (the experience created by staying in the hotel, which is
in part created by the employees and management’s creativity and imagination.
Another is the service provided by the employees, and finally, the interaction between
customers and between customers and employees). Therefore, with the hospitality
supply chain, a customer provides significant inputs into the service processes (Sigala,
2014), which implies that service supply chains are bidirectional wherein customers are
also suppliers, but hotels typically do not pay for customer-provided inputs (Sampson
and Spring, 2012). Hotels can prepare for service independently but cannot actually
perform service process until the appropriate customers check in. What is more, the fact
that customers introduce tremendous variability (Sriram et al., 2015), which is difficult
to control, consequently, seriously affects supply chain quality (SCQ).
Quality in hotel’s supply chain can be defined as conformance to mutually
agreed-upon requirements among the partners, especially customers. Hotel’s SCQ
includes not only product/service quality produced in hotel and its supplier but also the
hotel’s supply chain reliability (e.g. accommodating customer-introduced variability)
and flexibility (e.g. meet customers’ need whenever and wherever possible). Supply
chain quality management (SCQM) in a hotel is the formal coordination and integration
of business processes involving all partners along the hotel’s supply chain to
accommodate customer-introduced variability, to analyze and continually improve
products, services and processes to create value and achieve satisfaction of intermediate
and final customers in the marketplace.
Some authors have investigated issues concerning hospitality supply chain (Smith
and Xiao, 2008; Fantazy et al., 2010; Pullman and Rodgers, 2010; Song, 2012). Stanley
and Wisner (2001) recognized a relationship between upstream integration and service
quality and contended that effectuation of cooperative purchasing boosted the service
quality for internal customers, then eventually influenced delivery service quality to
external customers. Murphy and Smith (2009) examined how chefs developed and
maintained relationships with suppliers to improve quality of local ingredients. Fantazy
et al. (2010) provided statistical evidence that the strategically purchasing has a positive
impact on a hotel’s performance (i.e. service quality) through communication and
supplier relationship. Shi and Liao (2013) examined the effect of relationship quality
between supply chain partners in hospitality services. Xu and Gursoy (2015) proposed a
conceptual framework for the hospitality supply chain.
Supply chain
quality
management
2447
IJCHM
28,11
2448
However, the discussion on the QM of a whole hospitality supply chain is rarely
found in the literature (Tsai et al., 2012; Xu and Gursoy, 2015). This study intends to
empirically investigate the integration of QM practices and SCM practices in the
hospitality industry, with a particular focus on the moderating effect of contextual
variables and the mediation effect of SCQ on the relationships of the QM/SCM practices
and hotel performance in the context of hotel supply chain.
The rest of this paper is organized as follows. In Section 2, the QM practices, SCM
practices, contextual variable, SCQ and hotel performance is briefly reviewed, and a
conceptual model are built. In Section 3, hypotheses with respect to relationships among
them are offered. In Section 4, the research methodology is described. In Section 5, the
results of testing the structural model are presented. In Section 6, the discussion,
conclusion and future extension are reflected.
2. Research model
Figure 1 describes a path diagram of theoretical model linking the QM/SCM practices with
SCQ and hotel performance. The main aim of this study is motivated by the work of Foster
(2008), Fantazy et al. (2010) and Wang et al. (2012). Fantazy et al. (2010) provided robust
support for the link among SCM practices, service quality and firm performance in
hospitality industry. Foster (2008) noted that it would be interesting to see how SCQ affect
performance. Therefore, this study extends the SCQM concept from the manufacturing
industry to the hotel industry. Customer input is a special character in hospitality supply
chain. In our study, we take fully into account customer input and the interaction of customer
and service provider, discuss the relationship between hospitality QM practices, SCM
practices, SCQ and hotel performance. For example, because of customer-introduced
variability, supply chain flexibility is viewed as an important element of SCQ. Specifically,
hospitality QM practices and SCM practices are considered as latent-independent
(exogenous) variables, SCQ is considered as a latent-mediation variable, whereas hotel
performance is considered as a latent-dependent (endogenous) variable.
2.1 Quality management practices
The QM construct is complex. Some researchers have noted that QM has many core
characteristics. It is, for instance, “characterized by a few basic principles-doing things
Figure 1.
Conceptual model
right the first time, striving for continuous improvement, and fulfilling customer needs,
as well as a number of associated practices” (Dean and Snell, 1991). Fontani et al. (2009)
highlighted the importance of employees’ sense of safety due to manual handling of
loads and repetitive movements in hotels. Chan and Lam (2013) examined the gap
between security managers’ and hotel customers’ perceptions about safety and security
facilities in hotel. Wang et al. (2012) examined the relationship among QM, market
orientation and hotel performance, and verified the moderating effect of external
environmental factors.
QM practices for hotels in this study have adopted the QM practices stated by Wang
et al. (2012), Grandzol and Gershon (1998) and Hayes et al. (1998), i.e. leadership,
benchmarking, customer focus, process management, continuous improvement,
internal/external cooperation, employee fulfillment, training and safety. Table I lists the
description of QM practices.
Supply chain
quality
management
2449
2.2 Supply chain management practices
SCM refers to coordination with upstream and downstream supply chain partners to
improve quality and ensure on-time delivery to customers (Wisner and Tan, 2000).
While several definitions of SCM have been proposed, a core characteristic is the
integration and coordination of processes along the supply chain for the purpose of
creating customer values (Kannan and Tan, 2005). Soltani and Wilkinson (2010)
QM practices
Description
Leadership
Acceptance of quality responsibility by top management. Evaluation of top
management on quality. Participation by top management in quality
improvement efforts. Specificity of quality goals. Importance attached to
quality in relation to cost and schedule. Comprehensive quality planning
Analyzing the best products (services) and processes of leading
competitors in the same industry, or leading organizations in other
industries, using similar process
Customers’ involvement in product or service design. Use of customer
satisfaction surveys. Focus on achieving greater customer satisfaction
Set of methodological and behavioral practices emphasizing the
management of process, or means of actions, rather than results. Less
reliance on inspection. Preventive maintenance. Employee self-inspection.
Accommodation of customer-introduced variability
Propensity of the organization to pursue incremental and innovative
improvements of its processes, products and services
Propensity of the organization to engage in noncompetitive activities
internally among employees and externally with respect to suppliers and
customers. This is exemplified by hotel-supplier partnership, hotelcustomer partnership, collaborative organization, teamwork, systems view
of the organization, trust
Degree to which employees of an organization feel that the organization
continually satisfies their need. This is exemplified by job satisfaction, job
commitment and pride of workmanship
Provision of quality-related training for all employees
Considering commitment to quality and continuous improvement, and
process management in supplier selection
Benchmarking
Customer focus
Process
management
Continuous
improvement
Internal/external
cooperation
Employee
fulfillment
Training
Supplier
capability
Table I.
The description of
QM practices
IJCHM
28,11
2450
discussed labor flexibility practice of hotel housekeeping departments and their partner
agencies. Fantazy et al. (2010) identified components related to the hospitality supply
chain are strategic purchasing, communication, supplier’s relationship and service
quality. Shi and Liao (2013) investigated the antecedents and consequences of
inter-organizational relationship on the background of hotel and restaurant supply
chain operations.
The realization of customer value depends not only on the integration of internal
functions but also on effective synergy with external members along the supply chain.
In this study, based on consulting hotel experts and making some changes to adapt to
hotel environment, supply chain integration, supply chain coordination, supply chain
development and information sharing adapted from Kannan and Tan (2005) have been
used to explore the relationship.
2.3 Supply chain quality
SCQ is different from product quality. If product quality evaluation is applied to
evaluation of SCQ, there will be some new problems. For example, product quality is
very good, but partnership along the supply chain is not good, which will lead to
customer dissatisfaction. Therefore, motivated by literature (Gunasekaran et al., 2008;
Supply Chain Council, 2010) and expert interviews (Appendix 2), SCQ includes product/
service quality produced in hotel and its supplier, supply chain reliability and flexibility
and time.
In accordance with the Supply Chain Operations Reference model, reliability is the
ability to perform tasks as expected (Supply Chain Council, 2010). The strategy metric is
perfect order fulfillment. Supply chain reliability is also directly related to its
responsiveness and strategic alliance (Gunasekaran et al., 2008). Flexibility refers to a
system’s ability to accommodate any variability along the supply chain (e.g.
customer-introduced variability).
In this study, supply chain reliability is characterized by perfect order fulfillment and
reliability of strategic alliance (e.g. conducting business operations abiding by the
contract, and the goal among supply chain members being consistent). Supply chain
flexibility is characterized by the degree to accommodate any variability along the
supply chain. The time construct is measured by two scales, including inventory
turnover ratio and on-time delivery.
2.4 Hotel performance
Performance measurement helps an organization to assess the current operation
situation, distinguish strengths and weaknesses for future initiatives. Customer
satisfaction is a key performance indicator in service industry, which indicates the
extent how the products (services) to meet or surpass customers’ expectation. Many
researchers have paid attention to customer satisfaction in the hospitality industry, but
measuring customer satisfaction along the supply chain is limited (Fantazy et al., 2010).
Employee satisfaction is priceless (Nelson, 2006). Several authors have investigated the
relationship between employee satisfaction and customer satisfaction, business
performance (Terziovski and Hermel, 2011; Huang and Rundle-Thiele, 2014).
In our study, hotel performance is given as the “dependent” variable. Based on a
review of literature (Fantazy et al., 2010; Wang et al., 2012) and discussions with
practitioners, our measures include financial and non-financial performance. The
financial performance involves net profit, return on investment, sale (growth), market
share and productivity; the non-financial performance involves customer satisfaction
and employee morale.
2.5 Contextual variables
The term moderator refers to a variable that influences direction or strength of the
relationship between independent variables and dependent variables. In this study,
contextual variables are viewed as moderator that affect the relationship between QM/
SCM practices and SCQ. These contextual variables can be divided into internal factors
and external factors.
Internal factors include management education and knowledge, corporate support
for quality and the past performance (Benson et al., 1991). To achieve superior quality
performance, top management must be solidly behind the organization’s quality efforts
and integration and coordination among supply chain partners. Clearly, management
education and knowledge are essential. In addition, the present level of SCQ is a function
of the past performance (i.e. the relationship quality among supply chain partners).
External factors, which are uncertain and complex(Phillips, 1999). This study adapts
external factors form Wang et al. (2012), including market turbulence, technological
turbulence and competitive intensity. Market turbulence refers to “the rate of change in
customers composition their and preferences” (Kohli and Jaworski, 1990, p. 57).
Competition has long been considered as a major contributor to external environment in
hospitality industry (Chan et al., 2012). In China, hotel industry becomes increasingly
competitive due to oversupply and slowdown in the domestic economy. It is important
for hotel manages to understand the strengths, weaknesses, opportunities and threats,
when exploring customers’ information and accordingly changing their offerings
(Wang et al., 2012). Technological turbulence depicts “the rate of technological change”
(Kohli and Jaworski, 1990, p. 57). Changes in technology (e.g. Office Anywhere software)
can contribute to communication among different entities, process management and
product innovation.
3. Research hypotheses
Each path in Figure 1 is labeled with its associated hypothesis, and all paths are
presented in this sections.
H1. QM practices and SCM practices are significantly correlated in the hospitality
industry.
Kaynak and Hartley (2008) contended that supplier QM and customer focus are two QM
practices that are also doubtlessly SCM practices. Customers are the drivers of QM, just
as they are the drivers of SCM. Once quality problems emerge, customers may blame the
final producer, but these problems may stem from upstream partners. QM practices,
which reduces process variance, have a significant effect on performance of integrated
supply chain (Terziovski and Hermel, 2011). Foster (2008) emphasized the impact of
SCM on QM practices. Lo et al. (2007) revealed SCM practices have an impact on both
supply quality and organizational quality performance. In a word, there is a direct
relationship between QM practices and SCM practices.
H2. QM practices are positively related to SCQ.
H3. SCM practices are positively related to SCQ.
Supply chain
quality
management
2451
IJCHM
28,11
2452
From the view of supply chain, SCQ is an important performance measure (Kaynak and
Hartley, 2008). Some studies contended that the relationship between the buyer and the
supplier can improve delivery quality to customers (Lai et al., 2005; Fynes et al., 2005).
Kaynak and Hartley (2008) confirmed that SCM-related quality practices have a
significant effect on quality performance. Kannan et al. (1998) emphasized on supplier
evaluation, supplier involvement and the decentralizatio…
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