A Structural Equation of McKinsey’s 7-s Framework and Total Quality Management to Firm Performance in the Luangprabang-Indochina-Mawlamyine Economic Corridor
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Published:
Oct 27, 2020
Keywords:
McKinsey’s 7-s Framework, Total Quality Management, Firm Performance
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Abstract
The purposes of this research were to study the operational level in accordance with the McKinsey 7-s framework and total quality management of businesses in the Luangprabang-Indochina-Mawlamyine economic corridor, and to study structural equation of the McKinsey’s 7-s framework and total quality management to firm performance in the Luangprabang-Indochina-Mawlamyine economic corridor. The samples used in this study were 540 entrepreneurs in the Luangprabang-Indochina-Mawlamyine economic corridor. The tool for data collecting was questionnaires. The statistics used in this research were percentage, mean, standard deviation, pearson correlation coefficient and Structural Equation Modeling (SEM). The results showed that total quality management components have statistically significant positive impact on the firm performance of the Luangprabang-Indochina-Mawlamyine economic corridor (DE = 0.57). Followed by the McKinsey’s 7-s framework have statistically significant positive impact on the firm performance of the Luangprabang-Indochina-Mawlamyine economic corridor (DE = 0.29). In addition the McKinsey’s 7-s framework have statistically significant positive impact on the total quality management (DE = 0.80). The operation of business based McKinsey’s 7-s framework coupled with total quality management can be used as an important guideline for businesses to plan their business development to be competitive and achieve good operational results.
Article Details
How to Cite
Moonsri, K. (2020). A Structural Equation of McKinsey’s 7-s Framework and Total Quality Management to Firm Performance in the Luangprabang-Indochina-Mawlamyine Economic Corridor. WMS Journal of Management, 9(4), 63–79. Retrieved from https://so06.tci-thaijo.org/index.php/wms/article/view/245372
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Research Articles-Academic Articles
References
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Lazaridi, K. (2014). Total Quality Management: West and East. Journal of Business, 3(1), 41 – 46.
Leklersindhu, S. (2017). Management of Local Administrative Organizations in Central Province. Rajapruk University.
Milovanovic, V. (2014). Total Quality Management as a Profitability Factor in the Hotel Industry. Industrija, 42(3), 115-127.
Nekoueizadh, S., & Esmaeili, S. (2013). A study of the impact of TQM on organizational performance of the Telecommunication Industry in Iran. European Online Journal of Natural and Social Sciences, 2(3), 968-978.
Neyestani, B., & Juanzon, J. B. P. (2016). Developing an Appropriate Performance Measurement Framework for Total Quality Management in Construction, and other Industries. IRA-International Journal of Technology & Engineering, 5(2), 32-44.
Nguyen, A. D., Pham, C. H., & Pham, L. (2016). Total Quality Management and Financial Performance of Construction Companies in Ha Noi. International Journal of Financial Research, 7(3), 41-53.
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Parul, K., & Rubal, KM. (2016). Total Quality Management is an Important Factor in Today’s Business World. IOSR Journal of Business and Management (IOSR-JBM), 18(6), 84-88.
Patiar, A., Davidson, M. & Ying, W. (2012). Competition, total quality management practices, and performance: Evidence from upscale hotels.Tourism Analysis.17, 195-211.
Pokorna, J., & Castek, O. (2013). How to measure organizational performance in search for factors of competitiveness. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis,LXI (2), 451–461.
Pothiyadath, R., & Wesley, J. R. (2014). Developing a Measurement Scale for 7-S Framework. IOSR Journal of Business and Management, 16(1), 14-16.
Ravanfar, M. M. (2015). Analyzing Organizational Structure based on 7s model of McKinsey. Global Journal of Management and Research: A Administration and Management, 15(10), 6-12.
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Sila, I. (2007). Examining the effects of contextual factors on TQM and performance through the lens of organizational theories: An empirical study. Journal of Operations Management, 25, 83 – 109.
Sila, I., & Ebrahimpour, M. (2005). Critical linkages among TQM factors and business results. International Journal of Operations & Production Management, 25(11), 1123-1155.
Silpcharu, T. (2017). Research and statistical analysis with SPSS and AMOS. (17 th ed). Bangkok: S R Printing Mass Product.
Talib, F., & Rahman, Z. (2010). Critical Success Factors of TQM in Service Organizations: A Proposed Model. Services Marketing Quarterly. 31(3), 363- 380.
Talib, F., Rahman, Z., & Qureshi, M.N. (2010). The relationship between total quality management and quality performance in the service industry: a theoretical model. International Journal of Business, Management and Social Sciences. 1(1), 113-128.
Tari, J. J., Molina, J. F., & Castejon, J. L. (2007). The relationship between quality management practices and their effects on quality outcomes. European Journal of Operations Research, 183, 483-501.
The Office of the National Economic and Social Development Council. (2019). Gross Regional and Provincial Product Chain Volume Measures 2017 edition. Retrieved from https://www.nesdb.go.th/ewt_dl_link.php?nid=5628&filename=gross_regional
Wanarat, S. (2018). A Structural Equation Model of Total Quality Management, Innovation and Supply Chain Performance. Business Administration and Economics Review, 14(1), 105-127.
Yeandle, J., Fawkes, L., Carter, C., Gordon, C., & Challis, E. (2015). Organisational effectiveness and personality disorder. Mental Health Review Journal, 20(2), 84-91.
Yusuf, Y., Gunasekaran, A., & Dan, G. (2007). Implementation of TQM in China and organizational performance: An empirical investigation. Total Quality Management,18, 509–530.
Akhtar, S., Zameer, H., & Saeed, R. (2014). Impact of Total Quality Management on the Performance of Service Organizations in Pakistan. International Journal of Academic Research in Economics and Management Sciences, 3(6), 109-117.
AI-Damen, R. A. (2017). The impact of Total Quality Management on organizational performance Case of Jordan Oil Petroleum Company. International Journal of Business and Social Science, 8(1), 192-202.
Benavides-Velasco, C. A., Quintana-Garcia, C., & Marchante-Lara, M. (2014). Total Quality Management, corporate social responsibility and performance in the hotel industry. International Journal of Hospitality Management, 4, 77-87.
Cooper, D. R., Schindler, P. S., & Sun, J. (2006). Business Research Methods. (9th ed.). New York: McGraw-hill.
Demirbag, M., Tatoglu, E., Tekinkus, M., & Zaim, S. (2006). An analysis of the relationship between TQM implementation and organizational performance: evidence from Turkish SMEs. Journal of Manufacturing Technology Managemen, 17(6), 829-847.
Department of Business Development, 2018). Business information. Retrieved From http://www.dbd.go.th/news_view.php?nid=469407675
Fongprae, P. (2016). Factors Affecting the Development of Organizations to Become High Performance Organizations case study: United Overseas Bank (Thai) Public Company Limited. (Masters of Business Administration; MBA, Global Business Management. Burapha University, Thailand).
Gharakhani, D., Rahmati, H., Farrokhi, M. R., & Farahmandian, A. (2013). Total Quality Management and Organizational Performance. American Journal of Industrial Engineering, 1(3), 46-50.
Gokdeniz, I., Kartal, C., & Komurcu, K. (2017). Strategic Assessment based on 7S McKinsey Model for a Business by Using Analytic Network Process (ANP). International Journal of Academic Research in Business and Social Sciences, 7(6), 342-353.
Government Public Relations Department. (2018). Link 3 countries to support Thai SMEs. Expand opportunities for investment opportunities. Retrieved from http://www.aseanthai.net/ewt_news.php?nid=8 443&filename=index
Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2010). Multivariate data analysis: A global perspective (7th ed.). London: Prentice-Hall.
Hanafizadeh, P., & Ravasan, A. Z. (2011). A McKinsey 7S model-based framework for ERP readiness assessment. International Journal of Enterprise Information Systems (IJEIS), 7(4), 23-63.
Jabeen, R., Shehu, A. M., Mahmood, R., & Mata, B. A. K. (2014). TQM AND KNOWLEDGE MANAGEMENT IMPACTS ON SME PERFORMANCE. International Postgraduate Business Journal (IPBJ), 6(2), 23-43.
Jadesadalug, V. (2009). Building Innovative Creation Efficiency of Furniture Business in Thailand: An Empirical Research of Its Antecedents and Consequences. (Ph.D. Dessertation), Mahasarakham University. Mahasarkham.
Jayakrishnan, M., Mohamad, A. K. B., & Yusof, M. B. M. (2018). The Holistic View Of Business Intelligence (BI) And Big Data Analytics (BDA) Towards Designing Strategic Performance Management Framework: A Case Study. Journal of Theoretical and Applied Information Technology, 96(7), 2025 - 2040.
Jung, J. Y., Wang, Y. J., & Wu, S. (2009). Competitive strategy, TQM practice, and continuous improvement of international project management: A contingency study. International Journal of Quality & Reliability Management, 26(2), 164-183.
Kaplan, R. S. (2005). How the balanced scorecard complements the McKinsey 7-S model. Strategy & Leadership, 33(3), 41-46.
Kaur, P., & Sharma, S.K. (2014). Evaluating the Relationship and Influence of Critical Success Factors of TQM on Business Performance: Evidence from SMEs of Manufacturing Sector. IUP Journal of Operations Management. 13(4), 17–30.
Kaynak, H. (2003). The relationship between total quality management practices and their effects on firm performance. Journal of Operations Management, 21(4), 405-435.
Khurshid, M. A., Amin, M., AL-AALI, L. & AL-AALI, G. (2018). A Conceptual Framework of the Impact of Total Quality Management and Corporate Social Responsibility on Business Performance in the Context of developing Economy. Proceedings of ISER 99th International Conference, New York, USA. 30-38.
Kline, R. B. (2005). Principles and practice of structural equation modeling. NY: Guildwood.
Kunst, P., & Lemmink, J. (2000). Quality management and business performance in hospitals: A search for success perameters. Total Quality Management, 11(8), 1123-1133.
Koyalkar, K. R., & Gankar, S. (2018). A case study of application of Mc-Kinsey 7-S framework to investigate the effectiveness of new product development and launch strategies. IJARIIE, 4(3), 313-317.
Kwamega, M., Li, D., & Ntiamoah, E.B. (2015). Role of Total Quality Management (TQM) as a Tool for Performance Measurement in Small and Medium Sized Enterprise (SME’S) in Ghana. British Journal of Economics, Management & Trade, 10(3), 1-10.
Lazaridi, K. (2014). Total Quality Management: West and East. Journal of Business, 3(1), 41 – 46.
Leklersindhu, S. (2017). Management of Local Administrative Organizations in Central Province. Rajapruk University.
Milovanovic, V. (2014). Total Quality Management as a Profitability Factor in the Hotel Industry. Industrija, 42(3), 115-127.
Nekoueizadh, S., & Esmaeili, S. (2013). A study of the impact of TQM on organizational performance of the Telecommunication Industry in Iran. European Online Journal of Natural and Social Sciences, 2(3), 968-978.
Neyestani, B., & Juanzon, J. B. P. (2016). Developing an Appropriate Performance Measurement Framework for Total Quality Management in Construction, and other Industries. IRA-International Journal of Technology & Engineering, 5(2), 32-44.
Nguyen, A. D., Pham, C. H., & Pham, L. (2016). Total Quality Management and Financial Performance of Construction Companies in Ha Noi. International Journal of Financial Research, 7(3), 41-53.
Njeru, W. G., Awino, Z. B., & Adwet, K. (2017). Strategy Implementation: Mckinsey’s 7s Framework Configuration And Performance of Large Supermarkets In Nairobi, Kenya. Archives of Business Researc, 5(6), 1-17.
Pathomsirikul, Y. (2011). bǣpčhamlō̜ng patčhai khwāmsamret kānčhatkān thurakit bō̜rikān sukkhaphāp khō̜ng rōngphayābān ʻēkkachon nai prathēt Thai [Model of successful health care service business management
model of private hospitals in Thailand]. Journal of Business Administration, 34(130), 14-35.
Parul, K., & Rubal, KM. (2016). Total Quality Management is an Important Factor in Today’s Business World. IOSR Journal of Business and Management (IOSR-JBM), 18(6), 84-88.
Patiar, A., Davidson, M. & Ying, W. (2012). Competition, total quality management practices, and performance: Evidence from upscale hotels.Tourism Analysis.17, 195-211.
Pokorna, J., & Castek, O. (2013). How to measure organizational performance in search for factors of competitiveness. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis,LXI (2), 451–461.
Pothiyadath, R., & Wesley, J. R. (2014). Developing a Measurement Scale for 7-S Framework. IOSR Journal of Business and Management, 16(1), 14-16.
Ravanfar, M. M. (2015). Analyzing Organizational Structure based on 7s model of McKinsey. Global Journal of Management and Research: A Administration and Management, 15(10), 6-12.
Sanguanwongwan, W. (2017). Strategic management. Bangkok: Top.
Sila, I. (2007). Examining the effects of contextual factors on TQM and performance through the lens of organizational theories: An empirical study. Journal of Operations Management, 25, 83 – 109.
Sila, I., & Ebrahimpour, M. (2005). Critical linkages among TQM factors and business results. International Journal of Operations & Production Management, 25(11), 1123-1155.
Silpcharu, T. (2017). Research and statistical analysis with SPSS and AMOS. (17 th ed). Bangkok: S R Printing Mass Product.
Talib, F., & Rahman, Z. (2010). Critical Success Factors of TQM in Service Organizations: A Proposed Model. Services Marketing Quarterly. 31(3), 363- 380.
Talib, F., Rahman, Z., & Qureshi, M.N. (2010). The relationship between total quality management and quality performance in the service industry: a theoretical model. International Journal of Business, Management and Social Sciences. 1(1), 113-128.
Tari, J. J., Molina, J. F., & Castejon, J. L. (2007). The relationship between quality management practices and their effects on quality outcomes. European Journal of Operations Research, 183, 483-501.
The Office of the National Economic and Social Development Council. (2019). Gross Regional and Provincial Product Chain Volume Measures 2017 edition. Retrieved from https://www.nesdb.go.th/ewt_dl_link.php?nid=5628&filename=gross_regional
Wanarat, S. (2018). A Structural Equation Model of Total Quality Management, Innovation and Supply Chain Performance. Business Administration and Economics Review, 14(1), 105-127.
Yeandle, J., Fawkes, L., Carter, C., Gordon, C., & Challis, E. (2015). Organisational effectiveness and personality disorder. Mental Health Review Journal, 20(2), 84-91.
Yusuf, Y., Gunasekaran, A., & Dan, G. (2007). Implementation of TQM in China and organizational performance: An empirical investigation. Total Quality Management,18, 509–530.