Business Performance Assignment: Impact of ISO 9000 Certification

Question

Task: Write a research report on business performance assignment on the impact of ISO 9000 certification on business performance of Sydney.

Answer

1 Background of The Research
1.1 Problem Statement for Business Performance Assignment
ISO certification has been promoted to help and promote the businesses worldwide by considering the quality of the products and services. The ISO certification helps in implementing quality management and offering quality assurance to the consumers ISO has introduced number of standard series on quality management and quality assurance. Moreover, it is stated that the certificate helps in ensuring that the certification helps the business in providing quality goods and services that is acceptable across all international standards (Kar et al., 2016). Thus, the impact of ISO 9000 certification on business performance has always been a question and it has become highly important for the businesses to know whether this certificate is important for them to take. The problem statement that the research will answer is that whether businesses do achieve profit from ISO 9000 certification and the extent of effect it has on the business. It will find whether businesses are the benchmark for the quality they are offering to the customers (Javorcik& Sawada, 2018). Moreover, the research will help investigate that whether this certification matters in the global competitive world of business and help the business to attain competitive advantage over others.

1.2 Research Objective
The purpose of the study is to investigate the relation of ISO 9000 certification with the extent of profit that business earns. The research project will meet the aim of the paper with the help of various objectives:

RQ 1: To examine the relationship between profit and ISO 9000 certificate. RQ 2: To explore the perception of the population towards ISO 9000 certification and the extent of effect it has on the business.
RQ 3: To examine whether ISO 9000 certification is considered important by the managers for meeting the benchmark of quality in their business.

1.3 Research Questions
The research question will be in line with the research objectives and will help in solving the research problem. The research question will align with the overall research purpose that is whether businesses thinks that certifying their products and services with ISO 9000 will help increase their overall quality standards and profits. The questions of the research are thus formulated as follow:

• Does ISO 9000 certification held by the businesses helps in changing their sales or service quality positively or negatively?
• What is the relation between the certification held by business and the overall quality of products or services over time?
• Should the leader be worried about choosing the things to be certified in their business or is it just their misconception regarding ISO 9000 certification?

2 Literature Review
2.1 INTRODUCTION
This chapter analyzes the past works of literature in relation to ISO 9000 certification processes and the way it is impacting businesses. This section makes use of recent articles that has worked on analyzing the role of ISO 9000 certification in businesses and the areas it is being used recently. The article chosen are all recent ones that is less than ten years old so that a close and recent knowledge is gathered in this study area. This will start by identifying and introducing ISO 9000 certification and the reason it has been introduced. This is then followed by examining the impact of the certificate on various aspects of business performance and analyzing the motive behind acquiring this certificate for quality management.

2.2 ISO 9000 CERTIFICATION
ISO 9000 certification is an International Organization for Standardization has been introduced as one of the most authentic quality management system that has gained its popularity in the past two decades. There are various kinds of certificate that has been introduced under this. The number of certificates has increased by 20 times from 46,571 in 1993 to 1,109,905 by 2010 (Kar et al., 2016). Javorcik& Sawada(2018) has stated that the aim of the certification is to improve the performance of firms that are certified under this standard and help manager to follow various principles. Some of the most evident principles are customer focus, process approach, leadership, system approach, factual approach to decision making and mutual supplier relationships.

Siougle, Dimelis&Economidou (2019) has stated that the certificate is a formalised quality assurance process that has been formed in response to the needs of the defence industry to come up with standards and slowly this spread to various national standards. The ISO standard has been introduced from time to time since 1987. ISO 9000 certification was introduced in 1994 and was then revised in 2000 as ISO 9001. This was done to improve the effectiveness of the management system and measure of the performance. The key idea behind the introduction of this certification was to develop a formal quality policy, fulfilling customer needs and making effective marketing plan. Thus, ISO 9000 is a quality management certificate that is taken as an assurance that the quality of product supplied by the company is high in quality standard. It is an international standard given on quality and developed to help company document their quality system effectively and applies to all firms, either small or large.

2.3 ISO 9000 CERTIFICATION AND BUSINESS PERFORMANCE
Siougle, Dimelis&Economidou(2019) has examined the effect of ISO 9000 certificate on aspects of business performance by analysing the way the certification effects the quality of the firm. ISO certification is one of the best routes for management and helps in managing the internal quality of the business through quality management system. This is because the ISO 9000 offers formal quality policy that the business needs to abide by to be able to obtain the certificate and work through its measurable objectives. Under this certification the quality is analysed regularly for compliance and effectiveness. Further, it is seen that ISO also examine the areas from where the raw materials are processed and recorded to keep a trace of the source. This means that ISO 9000 is formalized systems by which the businesses can share basic information of their products with the customers such as inquiries, contracts, orders, product information, complaints and others. The ISO 9000 certification is only obtained by a firm that has an established quality management system (Chatzoglou, Chatzoudes&Kipraios, 2015). Thus, the certification gives the customers an assurance that quality is one of the most important factors for the firm and creates a notion among the customers that the company sells genuine and certified products.

Moreover, Heras-Saizarbitoria&Boiral (2015) has stated that ISO 9000 standards play an integral role in helping in building an effective interaction between the products and processes supplied. Thus, it will help in creating productivity benefits by enhancing productivity knowledge that is stated in the standards. There are also firms that invest in ISO certification to improve their chances of tenders and enhance satisfaction of the customers and increase profitability. This is because ISO 9000 has three types of effect on business such as a reputational effect, an improvement to performance and improvements to performance. This means that ISO help in building a positive reputation of the business and making it compliant to effect quality standards. Further, () has pointed out that ISO certified products perform better in several areas such as reduction in bad products from the stocks, reduction in customer complaints and in turn help in increasing productivity and profit.

However, Kakouris&Sfakianaki (2019). argued that ISO 9000 does not impact the performance of the organization directly. This is because the level of performance for quality management in the organization highly depends on the type of motivation they have. Thus, it does not really mean that the suppliers that make use of ISO certification perform really better than the ones that does not use such certification. Moreover, certification that is gained out of external pressure actually result in hollow achievement. Similarly, Siougle, Dimelis&Economidou (2019) has stated that there are no differences in financial performance between the firms that has ISO certification and the ones that are non-certified firms. It also points out that the positive impact that grows from the use of ISO 9000 certification also faded out fast over time. Some of the firms also state that the certificate has caused negative impact on them by reducing their earnings in the first three years after the certification is gained. This is because ISO certified firms has to keep close check on quality and this increases their overall production costs. Many firms have also stated that there is no extra benefit that they received on their performance from the ISO certification. Likewise, it is stated that the ISO 9000 certification helps in creating significant improvements in the operating performance of the business within five year of the attainment of the certificate, however, it is not the case in business performance improvements.

2.4 Motives For Acquiring Iso 9000 Certified Quality Management Process Between Small And Large Companies
According to Kakouris&Sfakianaki (2019) it is seen that small and medium sized enterprises has preferred the use of ISO 9000 certification. This is an initiative to improve the quality of the product and services on a global scale. The process of gaining the certificate is highly costly for the small and medium size enterprise, however, such enterprise still adopts the certification for several reasons. One of the reasons behind the small and medium enterprises is to increase the confidence of the customers and become competitively strong over large firms. This is because it helps in forming a formal and systematic processes to manage quality. However, the inconsistencies between the practice and the rhetoric remain underexplored at a large scale. The major motive behind attaining the certificate by the SMEs are to drive better quality control in the internal atmosphere, pressure from competition, improvement in the competitiveness and quality of services, pressure from market, quality management, management customer pressure and maintain image of the organization. However, the motive behind gaining ISO 9000 certificate by the large organization is earn profit and increase sale. Unlike small companies the large companies are not motivated to get a certification for pressure of competition or market pressure. Likewise, Kar et al., (2016) has pointed out that the motive of the smaller companies for the ISO 9000 certification is passive and external than the large companies. However, sometimes size of the companies proves to be irrelevant in relation to the motive behind obtaining certificates. This is because all companies irrespective of their size think of improving quality of their products and services and create a better image in the market with the ISO certification.

2.5 Conclusion
Therefore, from the section it is seen that ISO certification does have close relation with the overall sale improvement and profit of the organization by improving their product and service quality. Moreover, it is seen that the impact and role of ISO 9000 certification in case of small and medium size organisation and in the large firms is still not clear and leaves a gap in the literature and need to be explored further. It has not stated whether the certification is a pain or a gain for organizations based on sizes.

3 Research Design
3.1 Research philosophy
Research philosophy is the process or logic that the researcher uses to move forward with the research work and the way they can gather the information related to research. There are four kinds of philosophies used by a researcher such as positivism, interpretive, pragmatist and realistic (Ahlskog, 2020). This research paper will make use of positivist philosophy where the researcher can interfere in the reality and it is considered objective.

3.2 Research choices, approach and strategy
Researcher consider particular method to approach the investigation process and there are two ways by which a researcher approaches a research such as deductive and inductive method. Deductive method focusses at deducing data and information in relation to the topic from the past or existing research (Ahlskog, 2020). This is done based on narrow hypothesis to search materials that are direct to the topic. The past researches are investigated using keywords such as ISO 9000 certification, small and medium companies, large companies, profit, performance and others. Inductive approach will also be used to collect data directly from the source that is small and medium and large enterprise that make use of ISO 9000 certification (Ahlskog, 2020).

In addition to the mixed deductive and inductive research approach, the researcher will also have to make use of a research choice. There are various kinds of research choice available for a researcher such as exploratory, descriptive and explanatory (McDaniel Jr & Gates, 2018). The paper will make use of descriptive research choice to give an in-depth knowledge on the effect of ISO 9000 certification on the performance of both small and large companies. Moreover, most of the past researches on this topic has made use of exploratory research design and a descriptive research choice will help to add more information to the existing information on ISO 9000 certification.

Finally, in relation to research choice the researcher will also make use of research strategy to plan, execute and monitoring the over study process. It tells the researchers to collect and analyse data in relation to the study area (McDaniel Jr& Gates, 2018). The research will make use of interview as well as survey research strategy for different people of the small and large businesses. Interview will be conducted with the managers of chosen companies regarding their views for ISO 9000 with the help of questionnaires. Moreover, survey will be collected from the employees of these companies to learn their views on quality and ISO certification. Further, these two strategies will be used along with qualitative and quantitative research strategy to reach the accurate outcome.

3.3 Type of the research
A mixed type of research will be followed for this research by making use of mixture of research processes and strategy to collect and analyse the data. This will help give a better and accurate outcome with effective and in-depth research.

4 Data
4.1 Population,
The target population of the research will be all small and large companies of Sydney that comes under various industries that exists in that region. The entire lot of different industries or sector that is a part of Sydney region will be considered for data collection for both interview and survey.

4.2 Sample and sampling technique
Sampling is the way to reduce the size of the population short and chosen in a way that represent the entire population. There are two type of sampling that is probability sampling and non-probability sampling. Sample size needs to be selected for both interview and survey method because the population size is huge and covers all industries and companies in Sydney. A stratified sampling will be used for the survey method where each strata will be each industry. the attributes of all companies in an industry will be assumed to be same. Moreover, a purposive sampling will be used for qualitative data that is interview method where sample will be selected based on purpose such as to know the impact of ISO certification in small companies and in large companies (Leather & Watt,2005). Thus, sample will be selected based on small and large companies in each industry.

The sample size for interview method will be five managers from five different industries in Sydney. The sample size for the survey will be 50 employees from large organizations in Sydney and 50 employees from small organizations. The expected respondent for the interview will be from five managers from five industries out of 10 industries. This means a response rate of 50% of the total population. The expected responses from interview is 100 employees per 1000 population of employees that is a response rate of 10%. Thus, the questionnaire will be shared with 10 managers of 10 industries and 1000 employees of Sydney.

4.3 Data collection tool
The method to be used for collecting primary data will be both interview and survey to get a detailed and in-depth analysis of the study. Survey will make use of closed ended questions to deduce result fast and less complex manner (Flick, 2020). The questionnaire will consist of 20 closed ended question that aligns with the research questions and objectives. Further, interview method will make use of 10 common questions open ended questions for both large and small companies. The sample questionnaire for survey and interview showed in the appendix shows that the questions will be linked with all the three research questions. The structure of the questionnaire for both the interview and survey is given below. Moreover, the open and closed ended questions were designs using adaptive instrument that is from the literature.

5 Analytic approach
The researcher will make use of descriptive analysis that will help analyse quantitative data using charts, graphs and other mathematical tools. Moreover, an inferential method will be used to show relationship between variables in the research questions such as ISO 9000 certification and business performance. This will be done with the help of software such as excel or SPSS. Further, a content analysis method will be used to analyse the qualitative data collected from the interview based on themes (McDaniel et al., (2013). Themes will be the three research questions:

Theme 1- ISO 9000 certification and business sales and profit.
Theme 2- ISO 9000 certification and product quality.
Theme 3- ISO 9000 certification motive of small and large firms.

6 Ethical considerations
The research will consider all ethics and morals while collecting data such as informed consent, minimise risk, anonymity, confidentiality, avoiding deceptive practices and preserving rights of customers. Further the research is been checked for no further issues or ethical problem (see appendix 3).

7 Strength and Weaknesses of The Research
Strengths of the research:

• Highly in-depth analysis.
• Use of mixed data collection and analysis methods.
• Ethics of all human participants are maintained in the research.
• Aligning with past works of research in this area.

Weaknesses of research:

• Complex process.
• Lack of willingness of the respondents.
• Time consuming.
• Prove to be costly.

8 Validity and Reliability
The research will be high on reliability and validity because the research will make use of multiple research technique and will help in gaining an accurate result (McGregor, 2017). The appendix 3 also show the areas that has been checked carefully and increases the validity and reliability of research.

9 Conclusion
Therefore, it can be stated that the research proposal has considered every aspect of the research carefully and will help in completing an accurate research to know the relation between ISO 9000 certification and business performance of both small and large companies.

10 References
Ahlskog, J. (2020). The Primacy of Method in Historical Research: Philosophy of History and the Perspective of Meaning (Vol. 40). Routledge.

McDaniel Jr, C., & Gates, R. (2018). Marketing research. John Wiley & Sons. McDaniel, C., Gates, R., Sivaramakrishnan, S., & Main, K. (2013). Marketing research essentials. Washington, DC: Wiley.

Flick, U. (2020). Introducing Research Methodology: Thinking Your Way Through Your Research Project. SAGE Publications Limited.

McGregor, S. L. (2017). Understanding and evaluating research: A critical guide. SAGE Publications.

Leather, S. R., & Watt, A. D. (2005). Sampling theory and practice. Insect sampling in forest ecosystems. Oxford: Blackwell Publishing, 1-15.

Kar, F., Bin, M., Sorooshian, S., & Bin, S. (2016). Implementation Of Total Quality Management And ISO 9000 Certification. International Journal of Engineering Applied Sciences and Technology, 1(6), 33-6.

Javorcik, B., & Sawada, N. (2018). The ISO 9000 certification: Little pain, big gain?. European Economic Review, 105, 103-114.

Siougle, E., Dimelis, S., &Economidou, C. (2019). Does ISO 9000 certification matter for firm performance? A group analysis of Greek listed companies. International Journal of Production Economics, 209, 2-11.

Chatzoglou, P., Chatzoudes, D., &Kipraios, N. (2015). The impact of ISO 9000 certification on firms’ financial performance. International Journal of Operations & Production Management.

Heras-Saizarbitoria, I., &Boiral, O. (2015). Symbolic adoption of ISO 9000 in small and medium-sized enterprises: The role of internal contingencies. International Small Business Journal, 33(3), 299-320.

Kakouris, A., &Sfakianaki, E. (2019). Motives for implementing ISO 9000–does enterprise size matter?. International Journal of Productivity and Performance Management.

11 Appendix
Appendix 1: Brief Overview of Survey Questions
RQ 1:
1. Is your company ISO 9000 certified?
a) Yes b) No

2. Has your company received increased profit after the adoption of ISO 9000 certification?
a) Yes b) No

RQ 2:
3. Has the ISO 9000 certification helped in adding extra quality improvement to your product and services?
a) Yes b) No

4. Did the sale of your company increase with ISO 9000 certification?
a) Yes b) No

RQ 3:
5. Are you as a leader plan for the adoption of the certificate?
a) Yes b) No

6. Do you think consideration for the ISO 9000 certification is different for small or large companies?
a) Yes b) No

Appendix 2: Brief Overview of Interview Questions
RQ 1:
1. Share the changes in quality you attained from ISO 9000 certification?

RQ 2:
2. How do you think is the certificate linked with the overall performance of the business?

RQ 3:
3. What are your motives behind choosing ISO 9000 certification?

Appendix 3: Validity and Reliability Checklist