Quality practices and customer/supplier management in Australian service organisations: untapped potential

This paper reports on a cross-sectional study in which the extent of implementation of quality management practices with customers and suppliers, and the links between specific practices and performance outcomes are considered. The sample for the study (N=141) is drawn from small to medium sized Australian service organisations. Key findings are that quality management practices are not widely implemented with customers and suppliers, and that organisations perceive only a moderate effect from such implementation on performance outcomes. When the relationship between specific quality practices with customers and suppliers, and performance outcomes are explored by regression analysis, the most significant predictor of improved systems, improved responsiveness, increased quality of service, and improved competitive advantage is the involvement of suppliers in system change and improvement. Other significant factors include the use of customer satisfaction surveys, and the existence of strategic alliances. These findings give a clear message to about the potential of quality practices to managers in service organisations who are seeking more value from their customer/supplier interface.