LINKING QUALITY STRATEGY WITH MANAGEMENT CONTROL-SYSTEMS - EMPIRICAL-EVIDENCE FROM JAPANESE INDUSTRY

Normative theory suggests that management control systems should be designed to complement management's objectives and strategies. Few empirical studies, however, have focused on how management control systems have been modified to complement new manufacturing techniques, such as total quality control and zero defect strategies. This study relates quality strategies with the management control information provided for quality in 26 Japanese automotive and consumer electronics firms. Quality strategy was measured by a set of eight attitude questions addressing whether the managers adhered to a traditional economic conference level (ECL) quality management strategy or a "zero defect" quality management strategy. The relationship of quality strategy to the type and frequency of quality goal and feedback information was then measured. The results indicate that the management control systems supporting a zero defect quality strategy are more likely to include regular goal-setting and more frequent feedback relating to quality than those supporting an ECL quality strategy. Widespread use of quality cost targets and feedback is also related to a zero defect strategy. The results provide empirical evidence to support the normative argument that Japanese companies following a zero defect quality strategy have modified their management control systems to encourage the continuous quality improvements that are key to this strategy. © 1991.