Bin Srinidhi and K.R. Balachandran
The traditional view of quality treats it as an economic good which can be developed by incurring costs. Proponents of total quality management have rejected the traditional view…
Abstract
The traditional view of quality treats it as an economic good which can be developed by incurring costs. Proponents of total quality management have rejected the traditional view and stress the complementary nature of cost and quality. Reconciles these two views as different manifestations of the same underlying phenomenon within the same strategic framework. This requires precise definitions of quality concepts such as conformance and performance quality. The organization first examines its current position within this framework. The definitions of quality help sharpen the formulation of strategic objectives and the framework helps in mapping out a policy for moving the firm from the current position to the desired position. In addition, also determines the operating systems of quality management by how quality is defined in the organization. In conjunction with the strategic direction, the operational management procedures facilitate the process of cost management.
Details
Keywords
Notes that to be effectively implemented, quality management has to be aligned with strategy and properly co‐ordinated. Develops a systems framework entitled congruence management…
Abstract
Notes that to be effectively implemented, quality management has to be aligned with strategy and properly co‐ordinated. Develops a systems framework entitled congruence management business architecture. Notes that under this architecture an activity is the core entity for change and that every quality or related initiative will change, eliminate or create activities. Considers various quality management mechanisms under this architecture and considers various barriers. Suggests that the congruence management framework can help make quality management more effective.
Bin Srinidhi and Giri Kumar Tayi
There is extensive literature on the benefits of manufacturing control arising from minimal inventory policies of just in time (JIT). Operations management literature has focused…
Abstract
There is extensive literature on the benefits of manufacturing control arising from minimal inventory policies of just in time (JIT). Operations management literature has focused on controlling set‐up, lead and changeover times to streamline the operations and achieve low optimal inventory levels. Our paper first expands these models to include information and incentive effects. We then develop a model in which JIT focuses attention on process imbalances and derive the compensation contract that induces managers to be more creative in managing the process. We show that the loss of controllability decreases the benefits of JIT and increase the benefits of traditional buffer inventory. If, as on 11 September 2001, the loss or gain of controllability occurs quickly and unexpectedly, organizations need to develop the agility to switch between minimal inventory and buffer inventory systems.
Details
Keywords
Roslina Ab Wahid and James Corner
The purpose of this paper is to try to identify the critical success factors and problems in ISO 9000 maintenance during the post‐certification period. Much of the published work…
Abstract
Purpose
The purpose of this paper is to try to identify the critical success factors and problems in ISO 9000 maintenance during the post‐certification period. Much of the published work on issues associated with ISO 9000 certification in the quality management journals focuses on how to obtain certification and the impact of certification on ISO‐certified organisations. Thus, studies do not generally address what happens after the organisations have obtained their certification.
Design/methodology/approach
In total, 14 face‐to‐face interviews were conducted over a period of seven weeks with top management, middle management, lower management in charge of operations and quality, and the management representative responsible for the implementation of ISO 9000 in the case study organisation (XYZ). Each interview lasted between 1.5 and 2 hours. ISO documents were also reviewed as part of the data gathering process.
Findings
The results showed that people who comprise top management, other employees, the reward system, teamwork, continuous improvement, understanding of ISO itself, measurement of performance and communication are all critical success factors for ISO 9000 maintenance of XYZ. Apart from continuous improvement, other factors also seemed to be consistent with the findings from other studies. In contrast to the other studies, the current study found continuous improvement of process, people, and system as several of the critical success factors for the sustainable quality management system at XYZ.
Originality/value
This paper makes a contribution to the body of knowledge in the field of quality management systems during the post‐certification period where such work is limited, especially in the service sector.
Details
Keywords
Camilla Ciappei, Giovanni Liberatore and Giacomo Manetti
This study aims to holistically explore the academic literature on female leaders to identify the key topics and dynamics of the field.
Abstract
Purpose
This study aims to holistically explore the academic literature on female leaders to identify the key topics and dynamics of the field.
Design/methodology/approach
The authors systematically review 532 papers to explore the research on female leaders; based on objective and replicable criteria, the authors identify relevant papers and thus ensure the quality of the analysis. The bibliometric analysis and visualization support us in recognizing trends in this topic.
Findings
This study outlines the state of the art over the past decade by synthesizing theoretical contexts and critically discussing the main streams of research on sustainability, firm outcomes and barriers preventing women from reaching the upper echelons. The authors also explore empirical issues and highlight areas that entail new paths for future scholars.
Practical implications
The research provides novel evidence of the attempt internationally to increase female participation at the top of the firm hierarchy by analyzing firm outcomes, sustainability and the constraints faced by women in achieving these careers.
Social implications
The results show that the participation of women in leadership roles is not (only) a matter of compliance with current regulations. Through their ability to monitor key social and environmental issues from a long-term perspective and their attention to the internal control systems, companies more effectively pursue their financial and nonfinancial aims.
Originality/value
Using bibliographic and narrative analyses, this study reviews the literature on women at the top of the firm hierarchy with a focus on business research. The authors extend prior studies by investigating a larger pool of firm roles to provide a comprehensive understanding of this widely discussed topic.
Details
Keywords
Dennis Caplan and Saurav K. Dutta
Recent public policy initiatives seek greater transparency in financial reporting through an honest, balanced and thorough management discussion of company performance in the…
Abstract
Recent public policy initiatives seek greater transparency in financial reporting through an honest, balanced and thorough management discussion of company performance in the annual report. Management’s discussion invariably includes key performance indicators, such as financial ratios, relevant to external stakeholders. We model the impact of accounting estimates, assumptions, choices and errors on the risk of misleading financial ratios. This framework is illustrated through good and bad examples of financial reporting practices and by simulation of financial data of public companies. We provide a structured approach to inform policymakers, auditors and other stakeholders of the incremental financial reporting risk that accompanies current regulatory efforts.
Details
Keywords
Rajeev R. Bhattacharya and Mahendra R. Gupta
The authors provide a general framework of behavior under asymmetric information and develop indices of diligence, objectivity and quality by an analyst and analyst firm about a…
Abstract
Purpose
The authors provide a general framework of behavior under asymmetric information and develop indices of diligence, objectivity and quality by an analyst and analyst firm about a studied firm, and relate them to the accuracy of its forecasts. The authors test the associations of these indices with time.
Design/methodology/approach
The test of Public Information versus Non-Public Information Models provides the index of diligence, which equals one minus the p-value of the Hausman Specification Test of Ordinary Least Squares (OLS) versus Two Stage Least Squares (2SLS). The test of Objectivity versus Non-Objectivity Models provides the index of objectivity, which equals the p-value of the Wald Test of zero coefficients versus non-zero coefficients in 2SLS regression of the earnings forecast residual. The exponent of the negative of the standard deviation of the residuals of the analyst forecast regression equation provides the index of analytical quality. Each index asymptotically equals the Bayesian ex post probability, by the analyst and analyst firm about the studied firm, of the relevant behavior.
Findings
The authors find that ex post accuracy is a statistically and economically significant increasing function of the product of the indices of diligence, objectivity and quality by the analyst and analyst firm about the studied firm, which asymptotically equals the Bayesian ex post joint probability of diligence, objectivity and quality. The authors find that diligence, objectivity, quality and accuracy did not improve with time.
Originality/value
There has been no previous work done on the systematic and objective characterization and joint analysis of diligence, objectivity and quality of analyst forecasts by an analyst and analyst firm for a studied firm, and their relation with accuracy. This paper puts together the frontiers of various disciplines.
Details
Keywords
Marziana Madah Marzuki, Effiezal Aswadi Abdul Wahab and Hasnah Haron
This paper aims to investigate whether the revised Malaysian Code on Corporate Governance in 2007 enhances earnings conservatism. In addition, the authors examine the relationship…
Abstract
Purpose
This paper aims to investigate whether the revised Malaysian Code on Corporate Governance in 2007 enhances earnings conservatism. In addition, the authors examine the relationship between board of directors’ expertise and conservatism. The third objective is to investigate the relationship between audit committee characteristics and earnings conservatism.
Design/methodology/approach
The sample of this study is based on 3,183 firm-year observations for a period of 2004-2009. The authors hand collected the corporate governance variables, whereas the remaining data were extracted from Compustat Global. The authors used two measures of conservatism. The first is the market-based model by Basu’s (1997), and the second measure is the accrual-based measure by Ball and Shivakumar (2005).
Findings
The authors find that the revision of Malaysian Code on Corporate Governance 2007 results in improving earnings conservatism. The authors find two audit committee characteristics, namely, audit committee financial expertise and independence increase earnings conservatism, after 2007. However, the authors could not find support whether board financial expertise mix affect conservatism.
Research limitations/implications
This study did not consider other possible corporate governance variables that could influence earnings conservatism, as it would be a difficult task to gather them.
Originality/value
The authors provide evidence on the role of corporate governance and earnings conservatism in Malaysia.
Details
Keywords
Abstract
Purpose
For most companies, growth measures such as asset growth are positively correlated with accrual measures. Just like investment in fixed assets, current accrual represents one form of investment and is an integral part of a firm’s business growth. This makes it difficult to distinguish between the growth-based and earnings quality-based interpretations of the accrual effects, because high accruals can represent both high growth and inflated earnings. The purpose of this paper is to add to the literature by examining an issue that has not received much attention: the correlation between asset growth and accruals and its implication on stock return predictability. The authors address the issue using Fama and Macbeth’s (1973) cross-sectional regressions that are conditional on the correlations between the two variables.
Design/methodology/approach
The authors partition firms based on whether the correlation between current accrual and asset growth in the past five years is positive (ρ+) or negative (ρ−). The authors refer to these two types of firms such as “positive correlation” and “negative correlation” groups. For both groups, the authors examine whether firms with higher asset growth and higher accruals are associated with lower future stock returns. The authors implement Fama and MacBeth’s cross-sectional regressions incorporating the effect of correlations between growth and accrual measures. In addition, the authors regress hedge portfolio returns on Fama and French (1993) three-factor and Fama and French (2015) five-factor models to see if the intercepts (a’s) from these regressions are significantly different from 0.
Findings
For each year, the authors partition firms based on whether the correlation between asset growth and current accrual is positive or negative. For both the “positive correlation” and “negative correlation” firms, the authors examine the association between accruals and future stock returns. The authors find that accruals remain strong in predicting future stock returns for both groups. The accrual effects from the “negative correlation” group cannot be attributed to the growth-based hypothesis because for these firms, when accruals are high, growth measures tend to be relatively low and vice versa. The effects are most likely driven by the alternative hypothesis that investors overvalue the accrual part of earnings.
Research limitations/implications
There exist a few issues when investors actually implement these strategies. These include liquidity costs, institutional holdings and short sale constraints. Lesmond (2008) concludes that the bulk of the trading profits is derived from the short side of the trade, but that this position suffers from high liquidity costs that reduces institutional holdings with consequent short sale constraints. The net gains after taking into account these issues remain an open question be addressed in the future.
Practical implications
The empirical results indicate that investors can do an implementable portfolio strategy of going long for a year on an initially equally weighted lowest asset growth (accrual) decile portfolio and going short for a year on an initially equally weighted highest asset growth (accrual) decile portfolio, which produces significant abnormal returns. The results further show that these abnormal returns can be improved if investors classify stocks into “the positive correlation” and “negative correlation” groups and implement trading similar trading strategies.
Originality/value
The empirical evidence finds that firm-year observations that exhibit a negative correlation between growth and accrual measures represents a significant 30 percent of the total firm-year observations during the sample period from July 1974 to June 2017. This highlights the necessity to undertake a detailed analysis on the issue. The authors continue to find accrual effects among these groups of firms. Therefore, the accrual effect cannot be attributed to the diminishing marginal return hypothesis. This is the main contribution of the paper.