Key success factors of total quality management an empirical study in vietnamese paint and coating industry

MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY  NGUYEN DUC DUY ANH KEY SUCCESS FACTORS OF TOTAL QUALITY MANAGEMENT – AN EMPIRICAL STUDY IN VIETNAMESE PAINT AND COATING INDUSTRY MASTER THESIS OF BUSINESS ADMINISTRATOR HO CHI MINH CITY – 2012 MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY  NGUYEN DUC DUY ANH KEY SUCCESS FACTORS OF TOTAL QUALITY MANAGEMENT – AN EMPIRICAL STUDY IN VIETNAMESE PAINT AND COATING INDUSTRY Subject: Master of Business Administrator Code: 60.34.01.02 MASTER THESIS OF BUSINESS ADMINISTRATOR SUPERVISOR: Dr NGUYEN THI NGUYET QUE i Acknowledgement This research would have not been completed without the incredible amount of help and support from my supervisor, teachers, colleagues, customers, family members and friends I would like to express my profound thanks to all of you Foremost, my greatest gratitude is extended to my supervisor Dr Nguyen Thi Nguyet Que, who has given valuable guidance, advices and comments throughout the whole period of this research Needless to say, without her support, this dissertation would not be either inspired or finished I also would like to give special words to all professors of the Economic University in HCM city has teaching and support during study Many thanks as well for the generous support of my student colleagues who helped me in any respect during the completion of the research My deep thank is also sent to my friends who are working in the paint and coating industry for helping and supporting me collect information as well as investigate and learn the practical experiences during the process of conducting this dissertation Last but not least, I would like to take this opportunity to extend my great gratitude to my beloved parents, family members and close friends for their support and encouragement not only during the period of this research but also for my whole life Nguyen Duc Duy Anh Ho Chi Minh, Dec 2012 ii Commitment I would like to commit that the thesis, “Key success factors of total quality management – An empirical study in Vietnamese paint and coating industry”, hereby declare that this research thesis is my own original work and that all sources have been accurately reported and acknowledged, and that this document has not been previously, the data was collected in reality and it has clear origins Nguyen Duc Duy Anh iii Abstract This study is an empirical examines key success factors of total quality management (TQM) to the result of quality implementation in paint & coating industry in Vietnam TQM system helps the enterprise to identify the relationships between TQM factors and the enterprise performances (Sebastianelli, 2003) The quantitative data were obtained through a survey from 260 quality managers, top management managers, factory managers and purchasing managers of Paint & coating manufacturing industry in Vietnam The objectives of the research are to provide the key success factors (KSF) and measure their relationship to the quality implementation as Top management responsibility, Process design, Employee training, Employee involvement, Benchmarking, and customer focus Then, the key findings will be provided and recommendations to enhance the level of TQM in paint and coating enterprises iv Table of Contents Acknowledgement i Commitment ii Abstract iii List of table vii List of figure vii Chapter 1: Introduction 1.1.Introduction 1.2.Backgrounds to the research 1.3 Research issues, objectives and questions 1.3.1 Research issues 1.3.2 Research objectives 1.3.3 Research questions 1.4.Research methodology and scope 1.5 Thesis structure 1.6 Conclusion Chapter 2: Literature Reviews 2.1 Introduction 2.2 Total quality management 2.2.1 Definitions total quality management 2.2.2 Key success factors of TQM 10 2.3 Development of research model and hypothesis 14 2.3.1 Top management responsibility 14 2.3.2 Process design 14 2.3.3 Employee training 15 2.3.4 Employee involvement 16 2.3.5 Benchmarking 17 2.3.6 Customer focus 18 2.3.7 Result of implementing quality management 18 v 2.4 Proposed research hypotheses and research model 20 2.4.1 Research Hypotheses 20 2.4.2 Research Model 20 2.5 Conclusions 21 Chapter 3: Research Methodology 23 3.1 Introduction 23 3.2 Research design 23 3.3 Questionnaire development 24 3.3.1 Operationalization of measurement scales 24 3.3.2 Preparation of draft questionnaire 26 3.3.3 Questionnaire design 27 3.4 Pilot study 28 3.5 Main survey 28 3.5.1 Population and sampling 28 3.5.2 Questionnaires administration 30 3.5 Data analysis techniques 30 3.5.1 Data cleaning 30 3.5.2 The reliability of the survey’s results 31 3.5.3 Exploratory factor analysis (EFA) 31 3.5.4 Correlation analysis 33 3.5.5 Multiple linear regression (MLR) analyses 33 3.6 Conclusion 34 Chapter 4: Data analysis and result 35 4.1 Introduction 35 4.2 Data cleaning, Data filer and Sample description 35 4.1.1 Data cleaning and data filter 35 4.2.2 Sample description 36 4.3 Reliability test of measurement 38 4.4 Exploratory factor analysis (EFA) 41 vi 4.5 Testing the research model and the hypothesis 45 4.5.1 Testing the correlations of the constructs 45 4.5.2 Testing assumptions of Linear Regression 46 4.6 Multiple Linear Regression Analysis 47 4.7 Conclusion 51 Chapter 5: Conclusions and implications 52 5.1 Introduction 52 5.2 Discussion of findings 52 5.3 Implications 54 5.3.1 Theoretical implications 54 5.3.2 Practical implications 55 5.4 Limitation of the research 56 5.5 Conclusion 57 Bibliography 58 Appendix 1: Survey of Questionnaires – English version 61 Appendix 2: Bảng khảo sát – Phiên tiếng Việt 64 Appendix 3: Descriptive statistics of variables 67 Appendix 4: Measurement scales reliability of variables 67 Appendix 5: Exploratory Factor Analysis (EFA) 71 Appendix 6: Correlations 74 Appendix 7: Graphic analysis of regression assumptions 75 Appendix 8: Regression 77 Appendix 9: Responders interview list 78 vii List of table Table 1: Key success factors of TQM 10 Table 2: Key success factors of TQM in some previous studies 12 Table 3: Research hypotheses 20 Table 4: Measurement scale of variables 25 Table 5: Descriptive statistics on all factors 36 Table 6: The responder’s information 38 Table 7: Cronchbach's alpha values 39 Table 8: KMO and Barlett's Test 41 Table 9: Total variance explained 43 Table 10: Rotated Component Matrix 44 Table 11: Pearson Correlations 46 Table 12: Regression when RIQ (Y) is dependent variable 48 Table 13: Results of testing hypothesis 50 List of figure Figure 1: The market share in Vietnamese paint and coating industry Figure 2: Research Model 21 Figure 3: Research process 23 Figure 4: The updated research model 51 Figure 5: The process of benchmarking 55 Chapter 1: Introduction 1.1 Introduction This chapter explains the reason of choosing the title, and briefly explains the problem and objectives of the research The scope and data collection methods of the research are also presented in this part It is necessary to overview about the Vietnamese paint and coating industry in order to illustrate to the readers about the weaknesses in the quality management of local companies in comparison with foreign companies that have the competitive advantages in higher service quality and technology The author also addresses the fact that there were not so many previous researches were written about the total quality management (TQM) and finding key factor success to result of implementing quality management in paint and coating industry in term of Vietnamese market characteristics 1.2 Backgrounds to the research Scott Detiveaux and Allen Tsaur (2011) reported that the global paint and coating industry has been affected by the global economic downturn since 2008 They provided the growth rate before and after the global economic downturn which are 30% and 3% respectively, showing the negative impacts of the global economy to the paint and coating industry However, Scott Detiveaux and Allen Tsaur (2011) also said that Asia Pacific was only one bright spot in the gray picture of global paint and coating industry From 2004 to 2009, the growth rate of this industry in Asia Pacific was amazing, 60%, outperforming the global economic downturn From 2010 to 2011, the growth rate of paint and coating industry has not remained at high speed and reduced to 30% but still higher than the growth rates of any other areas in the world market During the economic downturn, the production volume of this area took 41% of the 27 billion liter of the global coating volume (Scott Detiveaux and Allen Tsaur, 2011) ... implementing total quality H3 management in Vietnamese paint & coating industry Employee involvement affects to the results of implementing total quality H4 management in Vietnamese paint & coating industry. .. Vietnamese paint and coating industry has been increasing during the time The highest achievement of Vietnam paint and coating development is to join the Asian Paint Industry Council (APIC) in. .. coating industry? How these key success factors of TQM impact the result of implementing total quality management in Vietnamese paint and coating industry? 1.4 Research methodology and scope In