The influence of ISO 9001 quality management system implementation on financial performance among companies listed in the Nairobi securities exchange

Abstract

This study intended to probe the influence of ISO 9001 quality management system implementation on the financial performance of companies listed in the Nairobi Securities Exchange (NSE). Based on a population of companies listed by August 2019 and using, correlation, regression, and ANOVA analysis models, the research sought to find out if implementing Quality Management Systems influences financial performance. The researcher provided a historical and theoretical foundation for the study of ISO 9001 quality management system implementation and its relationship with the financial performance for certified firms. One main research objective and six specific objectives were tested. The significance of the study to existing Kenyan firms, regulators, policymakers, and scholars was explained. The Signaling theory and Institutional theory and their relevance to the survey were also revealed. Over ten previous studies on the subject and their conclusions were discussed. Seven total variables of interest were presented in the form of a conceptual framework. The target population was 177 management staff stratified into the top, middle, and low-level management staff from which a sample size of 122 respondents was selected. The data was collected using structured questionnaires which were administered using the drop-off/pick up strategy. One hundred and twenty-two questionnaires were applied with a response rate of 68%. The study concluded that top management leadership influenced financial performance for listed companies. Customer orientation, quality system processes, human resource applications, supplier relationships and process control & improvement did not affect financial performance for companies listed on the NSE. A t-test revealed a statistically significant difference between the financial performance of ISO 9001 certified companies compared to non-ISO 9001 certified firms with ISO 9001 accredited companies having better financial performance.