Investigating the effects of innovation and employee performance on the relationship between total quality management practices and firm performance: An empirical study of Turkish firms

The results from studies of the relationship between total quality management (TQM) practices and firm performance and from those on the effects of TQM practices on various types of performance measures are mixed. There is no extensive empirical evidence about the effect of TQM practices on employee performance and innovation performance, and few empirical studies have investigated the mediating effect (indirect relationship) of one type of performance measure on the relationship between TQM practices and another type of performance measure. The objective of this study was to investigate the relationships between TQM practices and multiple performance measures and to examine the mediating effects of employee performance and innovation performance on the relationship between TQM practices and firm performance. The study used a cross-sectional survey methodology-we sent questionnaires to 500 randomly selected ISO 9001:2000 certified firms in different industries in the Marmara region in Turkey in 2005 and 2006 and obtained 373 usable questionnaires. After confirming the validity and reliability of the latent variables with confirmatory and exploratory factor analyses, we tested the model and hypotheses using structural equation modeling. Results of the study support the proposed hypotheses that employee performance and innovation performance partially mediate the relationship between TQM practices and firm performance. The study also provides managerial and research implications, research limitations, and suggestions for future studies. (C) 2010 Elsevier B.V. All rights reserved.