The effect of internal quality integration on financial performance: the mediating role of product innovation
Journal of Manufacturing Technology Management
ISSN: 1741-038X
Article publication date: 7 August 2023
Issue publication date: 24 October 2023
Abstract
Purpose
This study aims to examine the joint effect of internal quality integration and product innovation on financial performance by considering the mediating roles of incremental and radical product innovation.
Design/methodology/approach
A theoretical framework was developed using the organizational capability view. Based on empirical survey data collected from 209 Chinese manufacturing firms, this research uses structural equation modeling and the bootstrapping method to test hypotheses.
Findings
The results show that internal quality integration positively impacts incremental and radical product innovation and financial performance. Further, incremental product innovation can promote radical product innovation. Both incremental and radical product innovation partially mediate the relationship between internal quality integration and financial performance.
Practical implications
The findings provide practical guidance for manufacturing companies to engage in quality integration and product innovation. Managers should encourage the internal functional departments to coordinate quality integration while promoting incremental and radical product innovation to occupy a larger market and achieve higher performance.
Originality/value
This research contributes to the literature in two ways. First, this study expands the theoretical research framework of the joint effects of quality integration and product innovation on financial performance. Second, through testing the mediating role of product innovation, this study provides empirical evidence for the intermediate role of internal quality integration for improving financial performance.
Keywords
Acknowledgements
This research was supported by Zhejiang Provincial Philosophy and Social Sciences Planning Project (Grant/Award Number: 23NDJC245YB), Major Humanities and Social Sciences Research Project in Zhejiang Higher Education Institutions (Grant/Award Number: 2023GH072), Zhejiang Provincial Soft Sciences Research Project (Grant/Award Number: 2022C35087), Youth Project of Humanities and Social Science Foundation of the Ministry of Education (Grant/Award Number: 18YJC790185), and General Project of National Social Science Foundation of China (Grant/Award Number: 20BJL018).
Citation
Yu, Y., Li, H., Xu, J., Zhang, M., Zhang, X., Zhang, J.Z. and Wu, Y. (2023), "The effect of internal quality integration on financial performance: the mediating role of product innovation", Journal of Manufacturing Technology Management, Vol. 34 No. 7, pp. 1235-1255. https://doi.org/10.1108/JMTM-01-2023-0005
Publisher
:Emerald Publishing Limited
Copyright © 2023, Emerald Publishing Limited