Customer Satisfaction in TQM Organizations

Top management leadership, employee empowerment, job
satisfaction, and customer satisfaction in TQM
organizations: an empirical study
Isaiah O. Ugboro*, Kofi Obeng
School of Business and Economics, North Carolina A&T State University, Greensboro, NC 27411, USA
Received 1 June 1996; received in revised form 1 December 1999; accepted 1 April 2000
Abstract
Top management leadership and employee empowerment are considered two of the most important
principles of total quality management (TQM) because of their assumed relationship with customer
satisfaction. As a result, many top management leadership and employee empowerment strategies and
practices have been suggested in the management literature. However, few studies have been done to
test this assumed relationship and determine which of these strategies and practices may be most
effective in bringing about the intended results. This study surveyed organizations that have adopted
TQM to determine the relationship between top management leadership, employees' empowerment,
job satisfaction, and customers' satisfaction. The results reveal positive correlation between top
management leadership, employee empowerment, job satisfaction, and customer satisfaction.
Employee empowerment and improved levels of job satisfaction are facilitated by top management
leadership and commitment to the TQM goal of customer satisfaction by creating an organizational
climate that emphasizes total quality and customer satisfaction. Effective strategies for achieving
employee empowerment and job satisfaction, together with top management leadership roles in a
TQM environment, are identified and discussed. D 2001 Elsevier Science Inc. All rights reserved.
Keywords: Top management leadership; Employee employment; Customer satisfaction
1084-8568/00/$ ± see front matter D 2001 Elsevier Science Inc. All rights reserved.
PII: S1084- 8568( 01) 00023- 2
* Corresponding author. Tel.: +1-336-334-7656 ext. 4028; fax: +1-336-334-7093.
E-mail address: [email protected] (I.O. Ugboro).
www.journalofqualitymanagement.com
Journal of Quality Management
5 (2000) 247±272
1. Introduction
Today, more than ever, the long-term survival of many manufacturing and service
organizations is considered to be inextricably linked to the ability of these organizations to
produce goods and services that meet or exceed customers' quality expectations. Therefore,
organizations are searching for approaches to managing people and production systems in
ways that assure the transformation of inputs into quality outputs that meet or exceed
customers' expectations. Total quality management (TQM), because of its focus on customer
satisfaction, arguably is the most widely discussed approach to directing organizational
efforts toward the goal of customer satisfaction. Its tenets are continuous improvement, top
management leadership commitment to the goal of customer satisfaction, employee empow-
erment, and customer focus. Advocates of TQM hold that the goal of customer satisfaction is
achieved through top management commitment to creating an organizational climate that
empowers employees and focuses all efforts on the goal of customer satisfaction. A positive
relationship between leadership and commitment, and employee empowerment (leading to
job satisfaction) with customer satisfaction is assumed.
Both the trade and academic literatures on TQM suggest many different top leadership
strategies and practices for empowering or involving employees in quality-related decision-
making processes. However, few empirical studies, outside of the Malcolm Baldridge Award
program, have been done to sufficiently document these relationships and to determine which
of the many suggested strategies and practices are effective in bringing about the intended
results (employee empowerment, job satisfaction, and superior customer satisfaction).
This study surveyed organizations that formally introduced TQM as a means for
identifying the management strategies and practices that are effective in bringing about
employee empowerment, employee job satisfaction, and, ultimately, customer satisfaction.
The objective of this study is to provide empirical assessment of the assumed relationship
between top management leadership and commitment, employee empowerment, job satisfac-
tion, and customer satisfaction. Such assessment should provide guidance to organizations in
the design of empowerment and job satisfaction components of their TQM programs.
Another objective is to provide empirical assessment for the TQM-based literature.
2. Literature review
In almost all of the TQM literature, employee involvement, empowerment, and top
management leadership and commitment are identified as crucial elements of a successful
TQM program (Bowen, Siehl, & Schneider, 1989; Brower, 1994; Camp, 1989; Deming,
1982; Mendelowitz, 1991; Roberts, 1994; Senge, 1994). Lawler (1994) referred to employee
empowerment as one of the most important tenets of TQM. Thomas and Velthouse (1990)
define empowerment ``as intrinsic task motivation that manifests itself in four cognitions
reflecting an individual's orientation to his or her work roles.'' By intrinsic task motivation,
they mean ``positively valued experiences that an individual derives directly from a task that
produce motivation and satisfaction.'' The four cognitions they identified are meaningfulness,
competence, impact, and choice. Meaningfulness is the value of the task goal or purpose in
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 248
relation to the individual's own ideals or standards, and competence is the degree to which a
person can perform task activities skillfully. Impact, on the other hand, is the degree to which
behavior is seen as making a difference in terms of accomplishing the purpose of the task,
while choice is the causal responsibility for a person's actions. A more operational-level and
process-oriented definition of empowerment was offered by Bowen and Lawler (1992). They
define empowerment ``as sharing with front-line employees information about an organiza-
tion's performance, information about rewards based on the organization's performance,
knowledge that enables employees to understand and contribute to organizational perfor-
mance, and giving employees the power to make decisions that influence organizational
direction and performance.'' In Zemke and Schaaf (1989), employee empowerment means
turning the ``front line'' loose, and encouraging and rewarding employees to exercise
initiative and imagination.
One of the most frequently referenced definitions and constructs of empowerment has been
offered by Conger and Kanungo (1988) who define empowerment as ``a process of enhancing
feelings of self-efficacy among organizational members through the identification of condi-
tions that foster powerlessness, and through their removal by both formal organizational
practices and informal techniques of providing efficacy information.'' This definition implies
strengthening the effort-to-performance expectancy or increasing employee feeling of self-
efficacy. According to Conger and Kanungo, the effect of empowerment is ``initiation and
persistence of behavior by empowered employees to accomplish task objectives.'' These
definitions are derived from the management theory of power and authority delegation that
gives an employee the right to control and use organizational resources to bring desired
organizational outcomes.
In practice, employee empowerment centers on strategies or interventions that strengthen
employees' self-efficacy or confidence in accomplishing task objectives. The management
literature on employee empowerment identifies contextual factors and strategies that promote
and support empowerment. For example, Burke (1986) suggests that a way to empower
employees is to express confidence in them together with establishing realistic high-
performance expectations for them. Block (1987) adds the creation of opportunities for
employees to participate in decision-making and giving employees autonomy from bureau-
cratic constraints as empowerment strategies. Comparatively, Benis and Nanus (1985) suggest
the strategy of setting performance objectives for employees that are challenging and inspiring.
Also, Hackman, Oldham, Janson, & Purdy (1975), Kanter (1979), Oldham (1976), and Strauss
(1977) suggest performance-based reward systems and enriched jobs that provide autonomy
and control, task identity, opportunities for career advancement, and task meaningfulness as
ways to empower employees. At the organizational level, however, House (1988) and
McClelland (1975) suggest that empowerment could be achieved through employee selection
and training programs designed to provide required technical skills together with a culture that
encourages self-determination and collaboration instead of competition.
Thus, in TQM organizations, employee empowerment is operationalized by encouraging
employees to respond to quality-related problems and giving them the resources and authority
to do so. Also, employees are delegated authority and allocated resources to make quality
improvement decisions in their jobs. In manufacturing environments, employees are
empowered to accept or reject the quality of work-in-process and finished work (Rubinstein,
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 249
1993). To Colzon (1987), the empowerment strategy is to free employees from the rigorous
control imposed by instruction, policies, and orders and in their place give employees the
freedom to take responsibility for their ideas, decisions, and actions.
Obviously, from the preceding discussion, a primary objective of employee empowerment
is to create a workforce that is energized by an enhanced ability to produce products or
services that meet or exceed internal and external customers' expectations. In the context of
TQM, it is generally held that organizations best meet this objective when top management is
committed to the goal of customer satisfaction and by creating an organizational climate that
emphasizes customer satisfaction. It is generally held also that empowered employees have
higher levels of job satisfaction and performance primarily because of their involvement in
goal setting and in making decisions that affect their work. Blackburn and Rosen (1993)
reported some preliminary evidence of these outcomes in their study of Baldridge Award-
Winning Companies. However, other researches have failed to show unconditional relation-
ships between involvement and participation in decision-making and improved performance
(Cotton, Vollrath, Froggatt, Lengnick-Hall, & Jennings, 1988). Additionally, Bowen and
Lawler (1992) and Lawler (1988) show that the effectiveness of empowerment and
involvement in causing improved organizational performance is contingent upon other
organizational factors such as a firm's competitive strategies, technology, and the nature of
the firm's relationship with its customers.
Similarly, studies on the relationship between job satisfaction and performance have failed
to show a strong and unconditional link. For example, Iaffaldano and Mucinsky (1985)
concluded from their analysis of results from several studies that at best, the relationship
between job satisfaction and performance is very weak. Though this finding supports most
previous studies, Petty, McGee, and Cavender (1984) found a higher and consistent positive
correlation between individual job satisfaction and individual job performance. Also, Bhagat
(1982) reported a positive relationship between employee job satisfaction and job perfor-
mance. However, this relationship is moderated by time and organizational pressures to
perform. A stronger relationship between job satisfaction and performance exists only when
job satisfaction results in employee organizational commitments that in turn produce
desirable organizational citizenship behavior (Williams & Anderson, 1991). This behavior
is the willingness of an individual to engage in extra role behavior that is not generally
considered a part of an individual's job description.
2.1. Employee empowerment, organizational culture, and customer satisfaction
TQM's primary focus of customer satisfaction, measured by an organization's ability to
meet and exceed its customers' expectations, often requires TQM organizations to maintain
close contact with customers through postpurchase surveys, sales people, marketing, and
customer relations departments (Hauser & Clausing, 1988). Additionally, the customer
satisfaction focus requires the interactions between front-line employees and customers to
be pleasant experiences especially for the customer. This latter requirement is facilitated by
empowered and highly motivated employees who are satisfied with their jobs as a result of
their empowerment, involvement, and perception of the emphasis that the organizational
culture places on quality. Schlesinger and Heskett (1991) and Schlesinger and Zomitsky
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 250
(1991) found that employees' perception of service quality positively relates to both job
satisfaction and employee self-perceived service capability. Also, Fulford and Enz (1995)
found employee perception of empowerment to have an impact on employee loyalty, concern
for others (including customers), and satisfaction. The implication of this finding is that
enhancing employee service capability through empowerment contributes to employee job
satisfaction, job commitment, pride of workmanship, and what Anderson, Rungtusanatham,
and Schroeder (1994) called employee fulfillment or the degree to which employees feel that
the organization continually satisfies their needs.
Related findings reported by Tornow and Wiley (1991) are that employee attitudes Ð
measured by feelings about reward for performance, work itself, management practices,
satisfaction with the company, work group climate, and a culture for success Ð are related to
customer satisfaction. Here, customer satisfaction is in terms of customer service, product
quality, customer orientation, product functionality, and training. These measures of
employee attitudes are similar to those of employee job satisfaction. Thus, employee
perception of organizational climate and work content (job satisfaction) is related to customer
satisfaction. These findings support and extend earlier works of Parkington and Schneider
(1979), Schneider and Bowen (1985), and Schneider, Parkington, and Buxton (1980) that
showed relationships between customer satisfaction and employee perception of an organiza-
tional culture or climate that emphasizes quality.
3. Hypotheses
The premise of this study is that the adoption of TQM as a competitive strategy by an
organization is a strategic decision. Therefore, it requires top management leadership and
commitment to create an organizational climate/culture that promotes employee empower-
ment and focuses on total quality and customer satisfaction. As Choi and Behling (1997)
note, top management leadership is the basis of TQM. It is also one of the criteria in the
Baldridge Award. These authors also note that many US companies, including Allied Signal
and Xerox, stress the ``importance of continuous leadership in the successful implementation
of TQM.''
There is no question, too, that top management leadership roles are essential to employee
empowerment. In fact, one cannot empower employees without active top management
involvement since empowerment involves power or role sharing. If employees are suffi-
ciently empowered, it could translate into better employee behaviors, which subsequently
could lead to increased customer satisfaction. Therefore, we formulate the following
hypotheses to express the relationship between the concepts of top management leadership
and commitment, and employee empowerment.
Hypothesis 1: Top management leadership and commitment to total quality principles of
participative management are positively associated with employee empowerment.
An underlying feature of this hypothesis is the effect of top management leadership styles
and commitment on empowerment. A leadership style can be classified as authoritarian if
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 251
decisions are centralized, and there is little or no participation of employees in activities such
as defining the organization's quality mission, establishing performance goals, determining
how work is to be done, or identifying how they are to be evaluated. With this type of
leadership style, the potential for TQM's success is quite slim indeed since employee
involvement and empowerment cannot be achieved. Comparatively, a democratic leadership
style that encourages employee participation is more suitable to employee empowerment and
involvement and to the achievement of TQM objectives.
Empowered employees have some control over their work, how the work is done, and the
quality of the output. They have a great degree of task autonomy and identity. Because both
task autonomy and identity are desirable job characteristics, we expect a positive relationship
between employee empowerment and job satisfaction. This relationship is expressed in the
following hypothesis:
Hypothesis 2: Employee empowerment is positively associated with job satisfaction.
It must be noted that by this hypothesis, we do not imply that job satisfaction is fully
explained by employee empowerment to the exclusion of other factors such as promotion
and career development opportunities, equitable reward, and recognition system, working
conditions, supportive coworkers, and a challenging job. Employee empowerment is only
a partial explanation of job satisfaction. However, if empowered employees are satisfied
with their jobs, it may translate into improved product and customer service, which
together increase customer satisfaction. A feeling of empowerment, too, may lead to a
better job performance that may translate into better customer satisfaction. Therefore, we
hypothesize that:
Hypothesis 3a: Employee empowerment is positively associated with customer
satisfaction.
Hypothesis 3b: Employee job satisfaction is positively associated with customer
satisfaction.
4. Methods
4.1. Data
Testing the above hypotheses requires data on empowerment, job satisfaction, and top
management leadership and commitment. The data were obtained from organizations that
were chosen on the basis of their commitment to and implementation of the key elements of
TQM espoused by Crosby (1979, 1984), Deming (1982), Juran (1964, 1986), and Taguchi
and Clausing (1990). These elements include a definition of quality covering the full range of
the production or service delivery system, top management leadership and commitment to
total quality vision, values and customer satisfaction, employee empowerment and involve-
ment, continuous improvement, involvement of suppliers and customers in the organization's
TQM efforts, and equitable reward systems. We chose members of the Association for
Quality and Participation who are responsible for TQM in their respective organizations as an
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 252
ideal population for the study. Consequently, a questionnaire was designed and sent with
prepaid return postage to approximately 800 members, randomly selected from the associa-
tion's membership. A criterion for being selected was that the individual holds a management
position and has responsibility for TQM. Also, copies of the questionnaire were sent to
employees who were responsible for TQM in each of the companies that had won the
Malcolm Baldridge Award for quality achievement since its inception.
5. Measures and scales
The questionnaire required respondents to indicate the extent of their agreement or
disagreement, and satisfaction or dissatisfaction (in the case of job satisfaction questions)
with statements using a five-point Likert scale. These responses were to be based upon the
experiences of the respondents with their respective TQM programs. The statements dealt
with top management leadership and commitment to TQM, employee empowerment, TQM
implementation strategies, employee job satisfaction, and customer satisfaction.
5.1. Employee empowerment
In developing measures of employee empowerment, we relied upon the definition of the
concept of empowerment offered by Conger and Kanungo (1988). This definition sees
employee empowerment ``as the removal of conditions that contribute to feelings of
powerlessness and the creation of a work environment that strengthens an employee
feeling of self-efficacy.'' We identified three measures of empowerment and developed
item statements for each measure. These measures are delegation of decision-making
authority, participation or involvement in the decision-making process, and access to
information and other organizational resources. With regard to the delegation of authority,
there were four item statements that dealt with the authority to resolve customers' quality-
related problems, authority to accept or reject the quality of own work, or the work of
others, and the authority to make quality-related decisions. Participation and involvement
included four item statements that dealt with the existence of processes that bring multiple
perspectives to bear on quality issues, employee involvement in the definition of the
quality mission, the ease with which employees express quality improvement ideas, and
employee participation in the quality improvement process. One statement dealt with the
availability of job performance requirement information to employees. Respondents were
to indicate the level of their agreement or disagreement to these statements using the
following five-point Likert scale: strongly disagree = 1, disagree = 2, undecided = 3,
agree = 4, and strongly agree =5.
5.2. Job satisfaction (employee fulfillment)
Our conceptualization of the concept of job satisfaction was derived from the definition
offered by Locke (1976), Wanous and Lawler (1972), and Reilly, Chatman, and Caldwell
(1991). They defined job satisfaction as ``a favorable attitude or pleasurable emotional state
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 253
that results from a person's job experience or a fit between a person and an organization.''
Also, the experiences of organizations with successful TQM programs, especially those that
have won the Malcolm Baldridge Quality Award, show that employee job satisfaction is
influenced by improvements in work environment (location, space, and amenities). Other
factors that influence job satisfaction are health and safety provisions, and the availability and
quality of training programs, involvement in setting performance targets, process planning,
opportunity for promotion, and career development. Additionally, employee job satisfaction
is affected by the availability of information about the organization's mission, values and
management strategies, recognition schemes, and involvement in the total quality process.
Therefore, we designed statements to assess the presence of factors that are associated with
job satisfaction.
Broadly, the satisfaction items were grouped under the following measures of job
satisfaction: promotion and career advancement opportunity, equitable reward system, work
environments that support productivity, enriched job, and participation. There were two
statements for each of the other three measures except participation, which was measured
with items, and enriched jobs, which was measured with one statement. Overall, there
were 10 statements on job satisfaction for which we asked respondents to express their
degree of satisfaction or dissatisfaction. The item statements of employee job satisfaction
used are similar to those of the Minnesota Satisfaction Questionnaire (Dunnette, Campbell,
& Hakel, 1967).
5.3. Customer satisfaction
With TQM's focus on quality products and services that meet or exceed customer
expectation, organizational effectiveness has become synonymous with customer satisfac-
tion. Berry, Parasuraman, and Zeithaml (1988), Berry, Zeithaml, and Parasuraman (1990),
Bowen et al. (1989), and Garvin (1984, 1987) provide the most widely referenced definitions
and measures of customer satisfaction. Berry et al. (1988) identified five principal measures
used by customers to judge the quality of the services they receive. First, there are the
tangibles that deal with the appearances of the physical facilities, equipment, personnel, and
communication materials. Next is reliability, which is the ability to perform the promised
service dependably and accurately. This is followed by responsiveness or the willingness to
help customers and to provide prompt service. The fourth measure is assurance or the
knowledge and courtesy of employees and their ability to convey trust and confidence to
customers. Lastly, there is empathy, or the provision of caring, and individualized attention
to customers.
Garvin (1984), on the other hand, identified eight measures for evaluating product quality,
which are performance, features, reliability, conformance, durability, serviceability, aes-
thetics, and perceived quality in terms of the product's reputation or how it compares to
similar brands. These measures are the bases for assessing customers' perceptions of product
and service quality in this paper and are consistent with the customers' satisfaction measures
used by the General Accounting Office (1991).
In manufacturing firms, we used product performance (which is a combination of
features, reliability, and perceived quality), postpurchase serviceability, durability, con-
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 254
formance, responsiveness, and empathy to customer complaints as measures of customer
satisfaction. The same measures, with the exception of durability, were used to measure
customer satisfaction in service firms. Thus, separate sets of customer satisfaction ratings
were used for service and manufacturing firms. Respondents were asked to respond only
to those that applied to their respective organizations and to rate their organizations from
poor to excellent using the following Likert scale: poor = 1, below average = 2, average =3,
very good = 4, and excellent = 5. However, respondents from firms that considered
themselves to be both manufacturing and service providers were asked to respond to
both sets of questions.
Specific statements were included in the survey that required respondents to rate their
companies with respect to different measures of customer satisfaction. For conformance, the
ratings regarded the ability of the organization's product to meet design specifications, and
the ability of the organization to provide service that meets customer expectations. For
reliability, the ratings were with respect to defects, errors, and the rejection rate of the
organization's product, customer perception of product quality, and customer perception of
service reliability. Durability ratings were to be made by respondents from manufacturing
firms only and related to customer perception of product durability, quantity of customer
returns, and cost of warranty payments. Serviceability ratings were in terms of on-time
resolution of customers' problems and the ability of the organization to provide accurate
solutions to customer problems. Comparatively, responsiveness ratings were with respect to
the existence of customer complaint handling procedures, customer accessibility to key
personnel and staff, awareness of customer problems, and willingness of employees to
provide prompt service to customers. Finally, empathy was rated according to an organiza-
tion's ability to provide individualized attention to customers, and courteous response to
customer problems and inquiries.
5.4. Top management commitment and leadership
Leadership and commitment were measured by designing questions to determine the
extent to which top management is responsible for creating and sustaining an organizational
climate or culture that supports the tenets of TQM. These principles include participative
management, empowerment of all organization's members to focus on and achieve total
quality objectives, commitment to organizational systems that are designed to ensure total
quality, and providing access to resources needed to achieve total quality goals as prescribed
by Deming (1982). From these principles, three broad measures are used to describe top
management leadership and commitment. They are leadership, commitment and involvement,
and resource allocation. For each measure, a set of statements was developed to assess the
levels to which respondents agreed or disagreed using the following five-point Likert scale:
very dissatisfied = 1, dissatisfied =2, somewhat satisfied =3, satisfied = 4, and very satisi-
fied =5.
Five statements were developed to assess leadership roles. These statements referred to
top management assumption of responsibility for initiating and maintaining quality goals
and culture, continuous communication of top management vision and commitment to TQM
to employees, the presence of policies and strategies based upon total quality concepts,
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 255
credible reward systems that recognize employees for quality-related achievements, and
policies to encourage employees to participate in the TQM process. Commitment and
involvement were assessed with two statements that addressed top management involvement
in reviewing progress on total quality efforts, and the amount of time top management
spends on total quality issues. The resource allocation facet was assessed with two
statements that focused on the provision of sufficient funds for equipment and training
employees on essential TQM techniques.
5.5. Statistical method
We used correlations to test the three hypotheses. Before doing so, we made some
modifications to the data. If a measure had multiple items, their ratings were added to obtain a
score for that measure. Also, we summed the scores for the measures to obtain composite
scores for empowerment, customer satisfaction, job satisfaction, and top management
leadership and commitment. Both scores are used in correlation analysis to relate empower-
ment, customer satisfaction, job satisfaction, and top management leadership and commit-
ment to each other. Thus, we obtain separate correlations for the composite scores and the
measures. This allows us to test the effects of the measures on each other. Furthermore, we
tested the reliability of the scales in two ways. First, we computed alpha coefficients for all
item statements for empowerment, job satisfaction, customer service, and top leadership role
and commitment separately. These coefficients allow us to determine if repeated samples will
yield the same results. Second, we estimated the correlations among the items in each scale,
and also among the items that fall under each measure. If the item statements measure the
same things, then we should expect positive correlations between them.
6. Results
Of the 800 mailed questionnaires, 300 responses were obtained. Out of this, 250 were
usable; the rest were not because respondents either failed to answer all questions or
declined to participate. A profile of the organizations to whom the questionnaires were sent
is in Table 1. This table shows that our population was drawn from employees of different
industries. Tables A.1±A.5 show the alpha values for each scale. Here, the alpha values are
not for the separate measures but for all items used in each scale. The alpha values are
more than .7 and fall into the acceptable range suggested in the literature. For example,
Malhotra (1996) suggests alpha values of .6 or better for new scales and .7 or better for
well-established scales. Also, Tables A.1±A.5 show that the correlations between the items
are positive, which is what should be found.
Tables A.1±A.5 show that while in general the respondents were more than somewhat
satisfied with their jobs, there are three areas of concern. Most respondents were dissatisfied
with target setting and career planning processes in their organizations, as well as with
reward and recognition schemes. Also, most respondents were dissatisfied with career
development opportunities and promotion in their organizations. In employee empowerment,
the tables show two areas of concern. First, most employees did not feel that they had been
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 256
given sufficient authority to accept the quality of their own work. Second, most employees
did not agree that they were actively involved in the definition of the quality missions and
objectives of their organizations. These concerns undercut some of the objectives of TQM,
which are to facilitate employee involvement, and change reward systems to include group
and individual contributions.
Table 2 shows the relationship between the measures of top management leadership and
commitment and those of employee empowerment. Also shown is the correlation between
the composite scores of top management leadership roles and empowerment. Irrespective
Table 1
Profile of firms surveyed
Business type Total number in survey Percent
Electronics 6 0.75
Transportation 30 3.76
Manufacturing 197 24.66
Health 72 9.01
Computers 3 0.38
Heating and air conditioning 1 0.13
Technology 41 5.13
Government 26 3.25
Food 19 2.38
Communication 43 5.26
Consultancy 47 5.88
Insurance 19 2.38
Education 24 3.00
Utility 44 5.51
Petroleum 5 0.63
Employment agency 1 0.13
Retail 1 0.13
Parcel 2 0.25
Environmental 4 0.50
Others 215 26.91
Total 800 100.00
Table 2
Correlation coefficients: top management leadership and employee empowerment
Top management
leadership
Empowerment:
composite
score
Empowerment:
delegation of
decision-
making
authority
Empowerment:
participation/involvement
in decision-making
process
Access to job
requirements
information
Leadership role ± .6207 (.0001) .7560 (.0001) .5499 (.0001)
Commitment ± .4749 (.0001) .6324 (.0001) .4722 (.0001)
Resource allocation ± .4150 (.0001) .5876 (.0001) .4418 (.0001)
Composite score: top
management role
.7702 (.0000)
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 257
of whether we use the composite or the individual scores of the measures, the
correlations are significant and positive and support Hypothesis 1. For example, the
correlations show that the roles and commitments of top leadership have very strong
positive and significant associations with employee empowerment. The sizes of the
coefficients suggest that the top management leadership role has a stronger association
with employee empowerment than top management commitment or involvement in
resource allocation. Likewise, the sizes of the correlation coefficients show a very strong
association between top management leadership and empowerment in terms of employee
participation and involvement in the organizational decision-making process. In terms of
the sizes of the coefficients, top management commitment, involvement, and resource
allocation are not strongly associated with empowerment in terms of delegation of
decision-making authority and access to information.
Hypothesis 2 is also supported by the correlations between the composite scores in Table 3.
These correlations are statistically significant and show that employee empowerment is
positively associated with job satisfaction. The correlations between the measures of
employee empowerment and job satisfaction are also statistically significant. As in the
previous discussion, the sizes of the correlation coefficients between the measures show
strong associations between empowerment and job satisfaction. For example, empowering
employees to participate and be involved in an organization is strongly associated with job
satisfaction in terms of equitable reward. This empowerment is effective by being associated
with employee satisfaction in terms of employee participation in the organization. Also,
empowering employees by providing them access to job requirement information is
associated with improvements in employee participation. Additionally, Table 3 shows that
top management leadership and commitment has a strong positive relationship to employee
satisfaction. Most notably, this leadership and commitment role has a positive and significant
correlation with employee satisfaction in terms of equitable reward and participation.
If employees are satisfied with their jobs from being empowered, and from top manage-
ment leadership and commitment, we have argued that it could translate into increased
customer satisfaction, which is the basis of most TQM programs. Table 4 shows the
relationship between customer satisfaction, job satisfaction, and top management while
Table 5 shows the relationship between employee empowerment and customer satisfaction.
Again, we have provided both the correlation results for the composite scores and the
measures. Consistent with Hypotheses 3a and 3b, the correlation between the composite
scores for job satisfaction and customer satisfaction is positive and statistically significant.
Similarly, there are positive and statistically significant relationships between customer
satisfaction and top management leadership, and between customer satisfaction and
employee empowerment. In no case is the relationship negative. Similarly, in no case is
the direction of the relationship different in service and manufacturing firms. However, the
sizes of the correlations in Table 4 show that in service firms, there appears to be a stronger
relationship between both employee satisfaction with the availability of job requirement
information (job content) and participation in the organization with customer satisfaction
than in manufacturing firms. Similarly, the pattern that emerges from the sizes of the
correlations indicates a stronger relationship between empowerment and customer satisfac-
tion in service firms compared to manufacturing firms except in terms of reliability. These
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 258
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I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 261
differences in service and manufacturing firms in terms of the relationships between
empowerment, top leadership, and commitment, and customer satisfaction are worthy of
further discussion.
7. Discussion and conclusion
The overall results of this study support the findings of earlier studies that suggest the
existence of relationships between top management leadership, employee empowerment (i.e.,
delegation of decision-making authority), and employee job satisfaction. This finding
Table 5
Correlation coefficients: employee empowerment and customer satisfaction
Employee
empowerment
Empowerment:
composite score
Delegation of
decision-making
authority
Participation/
involvement in
decision-making
Access to
information
Customer satisfaction in
manufacturing firms
Á
Conformance ± .2718
(.0011)
.3722
(.0001)
.2056
(.0141)
Á
Reliability ± .3919
(.0069)
.5103
(.0001)
.4114
(.0001)
Á
Durability ± .2413
(.0001)
.3767
(.0001)
.3424
(.0001)
Á
Serviceability ± .4492
(.0001)
.4322
(.0001)
.3339
(.0001)
Customer satisfaction in
manufacturing firms:
summated
.4969
(.0001)
± ± ±
Customer satisfaction in
service firms
Á
Conformance ± .5251
(.0001)
.4659
(.0001)
.4469
(.0001)
Á
Reliability ± .3633
(.0001)
.3627
(.0001)
.3314
(.0001)
Á
Serviceability ± .5003
(.0001)
.4436
(.0001)
.4716
(.0001)
Á
Responsiveness ± .5644
(.0001)
.5101
(.0001)
.4523
(.0001)
Á
Empathy ± .5397
(.0001)
.4901
(.0001)
.4835
(.0001)
Customer satisfaction in
service firms: summated
.6460
(.0001)
± ± ±
The levels of significance are in parentheses.
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 262
supports Fulford and Enz (1995) who found the perception of empowerment to impact
employee loyalty, concern for others, and job satisfaction. Also, employee job satisfaction
induced by job-related factors could in turn lead to improved customer satisfaction (Bhagat,
1982; Caldwell, 1984; Chacko, 1982; Ford, 1973; Hackman, 1977; Herzberg, 1968;
Herzberg, Mausner, & Synderman, 1959; Kim, 1984; Latham & Steele, 1983; Lawler,
Mohrman, & Ledford, 1992; MacGregor, 1960; Petty et al., 1984; Thomas & Velthouse,
1990; Vroom, 1964).
Successful TQM programs involve and empower employees, according to our study, by
putting in place processes that bring multiple perspectives to bear on quality decisions, and
delegating sufficient authority to employees to make both individual and collective decisions.
Additionally, we found that these TQM organizations have communication systems that
facilitate lateral and vertical flows of information critical to total quality objectives and
actively involve employees in the definition of the organization's quality mission and
objectives. Furthermore, these programs empower employees to resolve customers' com-
plaints quickly and effectively, and continuously train employees on teamwork, problem
recognition, and problem-solving skills.
Another finding is that employees' involvement or participation in TQM is facilitated by
employee satisfaction with communication at lower organizational levels, availability of job
requirement information, enhanced promotion, and development opportunities, and avail-
ability of information about the organization's values, vision, and strategies. Employee
satisfaction with the organization's reward and recognition systems, organizational adjust-
ment to a total quality culture, training and retraining programs that facilitate continuous
improvement, and health and safety provisions in the job environment also facilitate
employee involvement and participation in TQM programs. These findings are consistent
with the assertions of Caldwell (1984), Gufreda, Maynard, and Lytle (1990), Lawler et al.
(1992), and Tannenbaum, Weschler, and Massarik (1961) that effective participative manage-
ment requires an organizational culture that supports employee involvement (an element of
employee empowerment). The resulting improvement in employee job satisfaction then leads
to improved customer satisfaction. The findings also suggest a strong and active role for top
management in creating an organizational culture that promotes total quality. These top
management roles should include initiating and maintaining a total quality culture by being
actively involved in reviewing progress of critical quality programs; making available
sufficient resources to implement total quality initiatives; and devising credible reward
systems that recognize employees' and managers' contributions to total quality objectives
throughout the organization. Finally, we found a strong relationship between employee
empowerment and job satisfaction, and between job satisfaction and customer satisfaction.
Besides these findings, our study shows that employees are generally receptive to the idea
of empowerment. However, they are not enthusiastic about being empowered to judge and
either accept or reject the quality of the work of peers. This, perhaps, is due to employees'
desires to avoid interpersonal conflicts (that may result from the exercise of such authority)
and to maintain group cohesiveness that contributes to effective teamwork and group
performance (Idstein, 1993; Whitney & Smith, 1983).
The value of this study is the empirical basis it provides for some frequently suggested
management practices and strategies for achieving employee empowerment and participation
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 263
in TQM organizations. The findings provide a prescriptive outline for the design and
implementation of employee empowerment, top management leadership and commitment
roles, and job satisfaction components of a TQM program. Additionally, the findings support
previous studies that suggest a strong association between employee empowerment and
customer satisfaction (e.g., Miller & Monge, 1986; Wooldridge & Floyd, 1990). However,
they disagree with those that found only a modest association between employee empower-
ment and customer satisfaction (Adam, 1991; Locke & Schweiger, 1979). The findings can
provide managers with a framework for formulating employee empowerment strategies, top
management leadership roles based on what has worked in many organizations that have
successful TQM programs.
In service organizations, especially, a perception of satisfaction by customers, to a great
extent, depends on the quality of the interaction between employees and the customer. As
noted in the Literature Review (Schlesinger & Heskett, 1991; Schlesinger & Zomitsky, 1991),
this interaction needs to be a pleasant experience for the customer. Obviously, employees who
find their jobs unpleasant cannot convey pleasantness to customers during this interaction.
This, according to our findings, underscores the importance of employees who are satisfied
with their jobs as a result of their empowerment and perception of the emphasis that
organizational culture places on quality. This, again, is facilitated by top management
leadership and commitment to the creation of a total quality culture that emphasizes, among
other things, employee empowerment in terms of their participation and involvement in the
organizational decision-making processes and their access to job requirement information.
Finally, there is an ongoing debate about the merits of TQM because not every
organization has realized the associated benefits. This may not be due to the failure of
TQM as a management philosophy but to its half-hearted implementation. As shown in this
study, some organizations are willing to implement only those aspects of TQM supported by
the existing organizational culture, and are not willing to undertake the total cultural
transformation that TQM requires. For example, as we noted earlier, most employees did
not feel that they had been given sufficient authority to reject or accept the quality of their
own work. Second, most did not agree that they were actively involved in the definition of the
organization's total quality missions and objectives. These views, if widely held, can
undermine the effectiveness of TQM efforts in these organizations. The fact that an
organization claims to have a TQM program does not necessarily mean that TQM is fully
and well implemented.
7.1. Implication for management
A successful adoption of TQM as a competitive strategy requires both structural and
cultural transformation. For example, our finding that associates the success of TQM
programs with lateral and vertical flows of information has implication for the design of
organizational communication and management information systems. Also, our finding,
which associates employees' commitment and participation with employee satisfaction with
an organization's adjustment process to a TQM culture, emphasizes the need for employee
involvement in the cultural change or adjustment process. Finally, the strong relationships
between top management leadership and commitment and employee empowerment and
I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 264
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I.O. Ugboro, K. Obeng / Journal of Quality Management 5 (2000) 247±272 269
customer satisfaction suggest a visible role for top management especially in creating and
sustaining an organizational culture that focuses on customer satisfaction.
7.2. Limitations
A limitation of this paper is the treatment of top management leadership role and
empowerment conceptually as separate issues. Often, they are treated as conceptually the
same. While we recognize this as a problem, future research devoted to making this
distinction clear is needed.
Acknowledgments
We thank the Urban Transit Institute at North Carolina A&T for the funding, which made
this project possible. We would like to thank also the anonymous reviewers whose comments
and suggestions were very helpful in revising the paper.
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