International Journal of Pharmaceutical and Healthcare Marketing

Emerald Article: Total quality management in developing countries: A case of pharmaceutical wholesale distribution in Pakistan Muhammad Usman Awan, Abdul Raouf, Niaz Ahmad, Leigh Sparks

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To cite this document: Muhammad Usman Awan, Abdul Raouf, Niaz Ahmad, Leigh Sparks, (2009),"Total quality management in developing countries: A case of pharmaceutical wholesale distribution in Pakistan", International Journal of Pharmaceutical and Healthcare Marketing, Vol. 3 Iss: 4 pp. 363 - 380 Permanent link to this document: http://dx.doi.org/10.1108/17506120911006056 Downloaded on: 22-04-2012 References: This document contains references to 53 other documents To copy this document: permissions@emeraldinsight.com This document has been downloaded 1100 times.

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Total quality management in developing countries

A case of pharmaceutical wholesale distribution in Pakistan
Muhammad Usman Awan and Abdul Raouf
Institute of Quality & Technology Management, University of the Punjab, Lahore, Pakistan

TQM in developing countries 363

Niaz Ahmad
National Textile University, Faisalabad, Pakistan, and

Leigh Sparks
Marketing Department, University of Stirling, Stirling, UK
Abstract
Purpose The purpose of this paper is to identify the critical success factors of total quality management (TQM) in pharmaceutical wholesale distribution companies in Pakistan. The paper also seeks to contribute to reduce the existing lack of TQM studies in developing countries. Design/methodology/approach A 29-item survey questionnaire is sent to 90 pharmaceutical distributors. Response rate is 56.7 per cent. Conrmatory factor analysis deletes one item in the scale purication process. Findings Data analysis reveal that process design (PD) is critical TQM success factor in pharmaceutical wholesale distribution companies in Pakistan. Like other studies in developing countries, top management in pharmaceutical wholesale distribution companies in Pakistan does not adequately support the TQM implementation. Research limitations/implications The research is based in Pakistan only. Convenience sampling is done. The response size of the study is small (n 51) though the response rate and signicance are high. Small response size prevents more complex analysis such as structural equation modelling. Practical implications Pharmaceutical wholesale distribution companies are more focused on PD. Increased top management support is required for proper TQM implementation. Originality/value This research provides framework to researchers to build up more TQM critical success factor studies in similar sector and situations so that more concrete generalizations can be made. Keywords Pakistan, Pharmaceuticals industry, Wholesaling, Distribution operations, Critical success factors, Total quality management, Developing countries Paper type Research paper

Introduction The pharmaceutical marketplace is facing major pressures from a broad range of dynamic and powerful forces (Holdford, 2005). The global pharmaceutical industry stands at the centre of the health of nations rich and poor alike. The innovation of new drugs and their rapid diffusion at affordable prices have been major drivers source of the phenomenal increase in longevity of the human race over the past 100 years

International Journal of Pharmaceutical and Healthcare Marketing Vol. 3 No. 4, 2009 pp. 363-380 q Emerald Group Publishing Limited 1750-6123 DOI 10.1108/17506120911006056

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(Rao, 2008). Government agencies and third party payers expect the provision of pharmaceutical products to be cost effective, keeping costs to a minimum so strategic planning has become imperative for all organizations in the pharmaceutical distribution system (Birdwell, 1994). Distribution is conceptualized as bundle of connected ows (Rosenbloom, 1995). An esteemed thought in the marketing literature has been that of marketing ows with in a channel of distribution. Vaile et al. (1952) have identied eight basic ows as being essential to marketing channel performance (Figure 1) although there is no common understanding of what should be the relevant number of ows (Flygansvaer et al., 2008). The central concept of these marketing ows suggests that various marketing activities or functions should be arranged in a manner that results in customer satisfaction (Bowersox and Morash, 1989). Total quality management (TQM) is an integrative management philosophy aimed at continuously improving quality and process to achieve customer satisfaction (Karuppusami and Gandhinathan, 2006) therefore TQM implementation enhances effectiveness of different marketing ows in different distribution channels. Factors that have contributed to the successful implementation of TQM have been well researched (Warwood and Roberts, 2004). According to Claver et al. (2003), these studies have been carried out in three different ways: contributions from quality leaders (e.g. Crosby, Deming, Ishikawa, Juran and Feigenbaum), formal evaluation models, e.g. European Quality Award (EQA), Malcolm Baldrige National Quality Award (MBNQA), the Deming Award and empirical research. However, according to Rao et al. (1997) and Al-Khalifa and Aspinwall (2000), most TQM studies have focused on developed countries. There is thus a lack of information about the nature and stage of TQM implementation in regions of the world such as Asia, South America, Africa and the Middle East (Sila and Ebrahimpour, 2003). Thiagarajan et al. (2001) state and argue that knowledge of TQM in developing economies is almost totally lacking, and the scant attention given to research in the developed nations, complicated by the acknowledged limitations of transferring research ndings across national boundaries, has made efforts to learn and transfer empirically sound knowledge to developing economies all the more difcult. It is important, therefore, to create specic TQM knowledge focused on the particular requirements of developing countries.
Physical exchange Title transfer Promotion Manufacturers and producers Negotiation Financing Risking Ordering Wholesalers and retailers Physical exchange Title transfer Promotion Negotiation Financing Risking Ordering Payment Consumers (business and individual)

Figure 1. Marketing ows in channels of distribution

Payment Source: Vaile et al. (1952)

This study is an attempt to remedy a small part of this lack of information about TQM implementation in developing countries. It seeks to identify the factors contributing successfully to the implementation of TQM in pharmaceutical wholesale distribution companies in Pakistan. Chen et al. (2004) has concluded that TQM methods and tools can be utilized to implement TQM successfully in pharmaceutical logistics and TQM implementation in pharmaceutical logistics organization has increased sales and reduced employee turnover. However, most of the developing countries have unique characteristics like lack of education and democracy, instability, corruption, shortage of skilled labour force and raw materials, under utilization of available production capacity, the inferiority and lack of quality standards, high scrap, low purchasing power of customers, inadequate consumers know how, lack of balance between import and export, foreign exchange constraints, incomplete infrastructure, etc. (Curry and Kadasah, 2002). Understanding these characteristics, by denition, justies the reasons why a healthy wholesaling distribution sector is so important. Wholesaling could and should play a special role in the development of these markets. Samli and El-Ansary (2007) argue that wholesaling accelerates economic growth. Table I illustrates six key characteristics of underdeveloped country markets and the role of wholesaling in performing functions necessary to bridge demand and supply gaps in these markets (Rosenbloom, 1987). Lorentz et al. (2007) also propose that distribution system evolution in emerging markets inuences the supply chain decisions (distribution channel selection and prioritization, middle-man selection, role evaluation and allowing for more direct distribution) of the companies. Pharmaceutical wholesale distribution may not be an exception to above-mentioned features in developing countries. Therefore, in this paper, rst a literature review is presented focusing on identication of critical success factors of TQM. From the literature review, research objectives for the study are stated, i.e. to identify the critical success factors of TQM in pharmaceutical wholesale distribution companies in Pakistan and to reduce the existing lack of TQM studies in developing countries. Then methodology of the study is discussed. Data analysis is followed by discussion and conclusions, including limitations and directions for future research.
Developing country market features 1. Small markets with limited income Role of the wholesaler

TQM in developing countries 365

Wholesalers can make money by selling products to retailers at low prices 2. Scattered markets throughout the countryside By selling multiple products wholesaler justies reaching out to these markets 3. Consumers can buy very limited volume of Wholesalers by denition handle larger variety of many different products products than manufacturers 4. Because of the scattered populations, retailing Wholesalers, again, can reach out whereas is also scattered manufacturers cannot 5. Manufacturers prefer to concentrate on Wholesalers develop marketing skills and support production manufacturers 6. Scattered small-scale manufacturing Wholesalers can bring together the critical product combinations for retailers Source: Samli and El-Ansary (2007)

Table I. The role of wholesalers in bridging market gaps in developing countries

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Literature review Previous studies in TQM can be categorized along several main research objectives. These include identifying critical TQM factors, examining issues and/or barriers in the implementation of TQM and investigating the link between TQM factors and performance (Sebastianelli and Tamimi, 2003). One research objective of this study is related to the identication of TQM critical success factors, so the literature related to TQM critical success factors identication is reviewed in this section. Various studies have been carried out attempting to identify critical success factors of TQM. They tend to emphasize three different areas (Tari, 2005; Claver et al., 2003), i.e. contribution from quality leaders, formal evaluation models and empirical research. Dale (1999) identies management leadership, training, employees participation, process management, planning and quality measures for continuous improvement as consistent ndings in the work of quality leaders such as Crosby, Deming, Juran, Ishikawa and Feigenbaum. The MBNQA, EQA and Deming Application Prize are common formal TQM evaluation models used in the USA, Europe and Japan, respectively. The main components of these awards are summarized in Table II. Leadership is the top component of two of these awards. According to Karuppusami and Gandhinathan (2006), Sila and Ebrahimpour (2005) and Sebastianelli and Tamimi (2003), the study by Saraph et al. (1989) was the rst empirical study which focused on the operationalization of TQM through the identication of critical success factors. Since then the factors that determine success and/or failure in TQM have attracted the attention of many researchers (Najeh and Kara-Zaitri, 2007). Among these studies, those by Sila and Ebrahimpour (2002, 2003), and Karuppusami and Gandhinathan (2006) are signicant because they summarized previous research in a systematic manner. Sila and Ebrahimpour (2002) reviewed 347 survey based TQM studies published between 1989 and 2000 and determined that during this period 76 studies in 23 countries focused on the identication of TQM critical success factors.

MBNQA Leadership Strategic planning Human resources orientation Process management Information and analysis Customer and market focus Business results Table II. Components of various TQM evaluation models

EQA Leadership Employee management Policy and strategy Alliances and resources Process management People results Customer results Society results Key results

Deming application prize Policies Organization Information Standardization Development and usage of human resources Activities ensuring quality Activities for maintenance and control Activities for improvement, result and future plans

Source: Tari (2005)

Sila and Ebrahimpour (2002) used factor analysis to identify the 25 most commonly extracted TQM critical success factors from these 76 studies. These factors are given in Table III. Sila and Ebrahimpour (2003) extended their 2002 research and analyzed and compared these 25 factors across studies in 23 countries. They found that top management commitment was the only critical success factor covered in each country included in the study. Karuppusami and Gandhinathan (2006) used 37 TQM scale development studies published between 1989 and 2003 to identify 56 critical success factors of TQM. They selected these studies because the reliability and validity of the critical success factors were statistically tested during these studies. On the basis of Pareto analysis, Karuppusami and Gandhinathan (2006) sorted these 56 critical success factors in descending order and divided them into two groups entitled vital few and useful many. In the vital few group, 14 factors accounted for 80 per cent of the critical success factors of TQM while the remaining 42 useful many factors accounted for 20 per cent of occurrences frequency only. The 14 factors identied as the vital few are given in Table IV. Karuppusami and Gandhinathan (2006) also conrmed the nding of Sila and Ebrahimpour (2003) that top management commitment is the most critical success factor for TQM.

TQM in developing countries 367

S. No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Source: Sila and Ebrahimpour (2002)

Factors Top management commitment Social responsibility Strategic planning Customer focus and satisfaction Quality information and performance Bench marking Human resources management Training Employee involvement Employee empowerment Employee satisfaction Team work Employee appraisal-rewards and recognition Process management Process control Product/service design Supplier management Continuous improvement Quality assurance Zero defects Quality culture Communication Quality systems Just-in-time Flexibility

Table III. Twenty-ve TQM critical success factors extracted from survey-based research

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S. No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Source: Karuppusami and Gandhinathan (2006)

Factors Top management commitment Supplier management Process management Customer focus Training Employee relations Product/service design Quality data Role of quality department Human resource management and development Design and conformance Cross functional quality teams Bench marking Information and analysis

368

Table IV. Fourteen vital few TQM factors

This brief review of literature related to critical success factors of TQM therefore suggests that top management/leadership support is overall the most common, important and critical success factor in the implementation of TQM. However, most of the previous research in TQM cited in the review papers above is based on research in developed countries. Quality gurus presented their ideas on the basis of their individual experiences in developed countries. Formal evaluation models of TQM are developed for companies operating primarily in the USA, Europe and Japan. The demand for TQM can no longer be the prerogative of the developed world only however. Some of the developing countries are breaking through traditional trade barriers and opening their markets to international competitors (Temtime and Solomon, 2002). TQM is thus becoming more signicant in developing countries also. There is still lack of information however about the nature and stage of implementation of TQM in countries in some regions of the world including Asia, South America, Africa and the Middle East (Sila and Ebrahimpour, 2003). This study is also an attempt to reduce this lack of information about TQM in developing countries. The developing country selected for this study is Pakistan. The authors could nd no studies on the identication of critical success factors of TQM in companies in Pakistan. The pharmaceutical wholesale distribution sector was chosen as the successful impact of TQM implementation to nancial growth and reduced employee turnover in this sector has been previously studied (Chen et al., 2004). However, no previous studies either in developed or developing countries appear to have focused on the identication of critical success factors of TQM in pharmaceutical wholesale distribution sector. It has also been concluded in the literature that the channels of distribution in existence in a specic national market are a result of specic culture and tradition (Jain, 1996) so each country may be unique in this regard. The research objective for this study is therefore twofold: One is to identify which factor(s) is the critical success factor in the implementation of TQM in pharmaceutical wholesale distribution companies in Pakistan (a previously ignored sector in TQM critical success factor studies). Second objective is to reduce the current deciency of TQM studies in developing countries.

Methodology This research is novel in its situation. There is no readily available sample. It is not a replicate study in that sense and aspects of the methodology have had to be developed from rst principles. Because pharmaceutical wholesale distribution companies are distributed all over Pakistan a postal survey was chosen as the appropriate research strategy. Various questionnaires have been previously used in TQM studies. Basic information about seven previous TQM measurement questionnaires is summarized in Table V. The questionnaire used for this study (available from the contact author) is a rened version of the Rao et al. (1999) questionnaire. The questionnaire proposed by Rao et al. (1999) was selected for this study as it had been used before in both developed and developing countries including a developing country (India), which neighbours Pakistan. A second reason for the selection of the Rao et al. (1999) questionnaire was that this has the highest number of constructs as compared to other questionnaires. One view is that the higher the number of constructs in the questionnaire, the easier it is to rene the constructs using focus group discussions. Given this research was on a new population, focus group renement was a component of the methodology (Morgan, 1993). The Rao et al. (1999) questionnaire was thus rened after a focus group discussion with ten representatives of pharmaceutical wholesale distribution companies. The contact author acted as the moderator for the focus group discussion. As a result of the focus group discussion and then subsequent evaluation of the initial drafts of rened questionnaire by statisticians, linguistic experts and the authors, a rened questionnaire with ten constructs and 35 items was nalized. The number of constructs in the rened questionnaire was reduced to ten as compared to 13 in the Rao et al. (1999) questionnaire. The construct quality citizenship was dropped because all of the participants in the focus group discussion were of the view that this construct is an unnecessary extension of the construct top management support (TMS). The construct product/process design (PD) was re-named as PD because the sector selected for this research study is a service sector and the term product design is more associated with the manufacturing sector. The constructs quality information availability and quality information usage were merged into a new construct quality information availability and usage (QIAU) because of the argument by the majority of the participants that quality information availability and quality information usage are highly integrated activities and separation of these two constructs may confuse respondents. A similar argument was the reason behind merger of the constructs internal quality results and external quality results into the new construct entitled results of implementing quality management (RIQM). The number of items in the questionnaire was reduced to 35 as compared to 62 in the Rao et al. (1999) questionnaire. Items were dropped or modied mainly because of lack of relevance of items in the pharmaceutical wholesale distribution companies of Pakistan, inability to conceive the content of items by the practitioners and replication of items. The scale used in the rened questionnaire was a ve-point scale (1, very low; 2, low; 3, medium; 4, high; 5, very high; and U, unable to respond). For survey research, probability sampling is preferred over non-probability sampling (Saunders et al., 2000), but according to Trochim (2006) there may be circumstances where it is not feasible, practical or theoretically sensible to undertake probability sampling. This study is the rst known research study related to pharmaceutical wholesale distribution companies in Pakistan. There are believed to be almost 350 national and small

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Features Ahire et al. (1996) 07 Chief executive ofcers Suppliers to USA Navys and aviation supply ofce USA USA, India, China, Mexico, and Taiwan India Across industry 13 Chief executive ofcers, quality managers 10 Chief executive ofcers, general managers, chief quality managers Across industry Grandzol and Gershon (1998) Rao et al. (1999) Joseph et al. (1999)

Authors

Number of constructs 8 Respondents Divisional quality managers Motor vehicle parts and accessories USA

Industry focus

Country

Table V. Comparison of various TQM measurement instruments Instruments Claver et al. (2003) 11 Quality managers Across industry in ISO certied companies Spain

Saraph et al. Flynn et al. (1994) (1989)

11 12 Multiple respondents Plant managers

Across industry

USA

Machinery, electronics, and transportation companies USA

pharmaceutical wholesale distribution centres working in different cities of Pakistan (Qassim, 2005) but there is no existing reliable sampling frame. As the respondents were distributed all over Pakistan, it was also not possible to build the sampling frame from the ground-up by the researchers themselves, so non-probability purposive-convenience sampling was done. A multinational pharmaceutical company based at Lahore (Pakistan) and distributing its medicines throughout Pakistan, using a broad network of large wholesale distributors, supported this research by providing a list of its distributors. There were 46 wholesale distribution centres for wholesale distributors of this pharmaceutical company. Three other pharmaceutical wholesale distributors were also included in the sample because these wholesale distributors were operating all over Pakistan and had contracts of exclusive wholesale distribution with leading pharmaceutical companies. One of these wholesale distributors had 22 branches and the others had 12 and ten branches, respectively, across Pakistan. The questionnaire was therefore sent to 90 pharmaceutical wholesale distribution centres based all over Pakistan via registered post. The covering letter for the research was written to the chief executives of the pharmaceutical wholesale distribution centres. The pharmaceutical company, which provided the list of its wholesale distributors wrote letters to its distributors encouraging them to participate in this research study. The other three wholesale distributors also issued circulars to its branches encouraging them to participate in the study. Out of 90 despatched questionnaires, 51 responses were obtained. The response rate was 56.7 per cent, which is an acceptable response rate. Data analysis The research for this paper is a part of larger scale study whose objective is to understand the impact of implementation of TQM on customer satisfaction in pharmaceutical wholesale distribution companies in Pakistan. However, the objective of this particular paper is to identify the critical success factors contributing signicantly in the implementation of TQM. So, the portion of the larger scale study related to relation of implementation of TQM to customer satisfaction in pharmaceutical wholesale distribution companies are beyond the scope of this paper. Responses related to the construct customer orientation were therefore not included in the data analysis. Thus, nine constructs with 29 items were selected for data analysis. The constructs selected for data analysis were: (1) top management support (TMS); (2) strategic planning process in quality management (SPPQM); (3) quality information availability and usage (QIAU); (4) employee training (ET); (5) employee involvement (EI); (6) process design (PD); (7) supplier quality (SQ); (8) bench marking (BM); and (9) results of implementing quality management (RIQM). In the above-mentioned constructs RIQM was the dependent variable and all other constructs were independent variables.

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The primary approach for scale purication when a theoretical foundation drives survey development is to rely on conrmatory factor analysis (CFA) to ensure scale unidimensionality, followed by scale reliability and construct validity assessments (Anderson and Gerbing, 1982). CFA using LISREL 8.8 was conducted for each of the nine constructs to determine unidimensionality of the constructs. All the constructs except EI emerged as constructs for which no item deletion was required to obtain the required values of assessing criteria. One item was deleted from the construct EI and thus the number of items for nal analysis was reduced to 28 after CFA. According to Sila and Ebrahimpour (2005), empirical evidence in CFA is generally assessed using criteria such as the comparative t index (CFI), the root mean square error of approximation (RMSEA), the signicance of parameter estimates, and the amount of explained variance. Goodness of t index (GFI) is another measure of overall t (Mahour, 2006). Table VI summarizes the results of CFA: . CFI. This index compares the proposed model with a null model assuming that there are no relationships between the measures. A CFI value greater then 0.90 indicates an acceptable t to the data (Bentler, 1992). Table VI indicates that all the CFI values are 1.00, which suggests very good model t. . GFI. This index indicates the relative amount of variance and covariance jointly explained by the model. GFI values range from zero to one, with higher values indicating better t. According to Chau (1997), scores in the 0.8-0.89 range are interpreted as reasonable t whereas scores of 0.9 and above represent good t. All values of GFI in Table VI range from 0.87 to 1.00, which suggests very good model t. . RMSEA. This is an index used to assess residuals and adjusts parsimony in the model. Its value must be equal to or less than 0.08 for an adequate model t (Hu and Bentler, 1999). Table VI indicates that all RMSEA values are less then 0.08 indicating adequate model t. . Parameter estimates. Table VI shows that all the parameter estimates, i.e. factor loadings are statistically signicant. . Amount of explained variance. The amount of explained variance for all constructs in Table VI range from 0.09 to 0.97 thus indicating acceptable squared factor loadings. Once the unidimensionality of the constructs was demonstrated using CFA, the reliability of the each construct and the overall questionnaire with the remaining items was evaluated by the determination of Cronbachs coefcient alpha. In general, reliability coefcients of 0.70 or more are considered adequate (Cronbach, 1951; Nunnally, 1978; Murphy and Balzer, 1989). Only the values of constructs PD and SQ are less then 0.70. These values (0.61 and 0.44, respectively) are still acceptable as van de Ven and Ferry (1980) suggest 0.35 as the limit of acceptable value of Cronbachs coefcient alpha. The overall value of Cronbachs coefcient alpha for the 28 items remained in the questionnaire after CFA was 0.85. This value is acceptable. According to Mentzer et al. (1999), Cronbachs coefcient alpha is a meaningless calculation with a two or less item scale, since its purpose is to compare each item to the remaining items in the scale as a group. So, item to total correlation (ITC) were evaluated for the constructs SPPQM, SQ and BM as these constructs had only two items. All these values are above 0.70 so all ITC values are acceptable.

Construct 5.28 5 0.38257 1.00 0.87 0.034

No. of items

x 2-test
Degree of freedom p-value CFI GFI RMSEA Factor loading

R2

TMS

05

SPPQM 1.05 2 0.59152 1.00 0.97 0.000

02

5.50

0.48154

1.00

0.93

0.000

QIAU

04

ET The model is saturated. The t is perfect 0.73 5.50 5.50 0.23 2 0.89310 1.00 1.00 0.000 6 0.48154 1.00 0.93 0.000 6 0.48154 1.00 0.93 0.000 1 0.39129 1.00 0.97 0.000

03

0.42

0.51832

1.00

0.98

0.000

EI

03

PD

03

SQ

02

BM

02

RIQM

04

1.15 2.86 1.22 1.32 1.27 8.82 12.67 0.47 0.46 1.07 0.62 0.73 0.91 0.60 0.29 0.86 0.91 0.92 1.92 0.28 3.30 3.81 8.71 8.17 0.69 2.74 1.30 2.09

0.55 0.61 0.88 0.72 0.68 0.73 0.73 0.26 0.55 0.80 0.57 0.68 0.94 0.42 0.23 0.61 0.76 0.41 0.97 0.094 0.27 0.34 0.69 0.69 0.28 0.71 0.72 0.41

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Table VI. Summary of goodness of t statistics for CFA

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After assessing unidimensionality and reliability, the next issue was to assess content, convergent and discriminant validity of the questionnaire. According to Nunnally (1978), content validity depends on how well the researchers created measurement items using the relevant literature to cover the content domain of the variable being measured. The evaluation of content validity is therefore a judgmental process not open to numerical evaluation (Mahour, 2006). As mentioned previously the selection of construct items in this study was based on extensive review of the literature and then subsequent renement by focus group discussion with representatives of pharmaceutical wholesale distribution companies in Pakistan. The instrument thus had strong content validity. The convergent validity of each scale was checked with Bentler-Bonett normed t index obtained during CFA. According to Ahire et al. (1996) this index measures the extent to which different approaches to measuring a construct produces the same results. A value of 0.90 and above demonstrates strong convergent validity (Hartwick and Barki, 1994). The Bentler-Bonett coefcient for all the constructs rened after CFA was greater then 0.90, indicating high convergent validity. Discriminant validity measures the degree to which a construct and its indicators are different from another construct and its indicators (Bagozzi et al., 1991). Evidence of discriminant validity can be assessed in multiple ways (Mentzer et al., 1999). One of the ways is by comparing the Cronbachs alpha of a construct to its correlations with other model variables (Sila and Ebrahimpour, 2005). According to Ghiselli et al. (1981), if the value of alpha is sufciently larger than the average of its correlations with other variables, this is an evidence of discriminant validity. The difference between the alpha value of each construct and the average correlation of each construct with the other constructs was adequately large (0.32-0.67), providing evidence of discriminant validity. After assessing scale unidimensionality, scale reliability and construct validity, correlation, regression and stepwise regression analysis was done using SPSS 15.0. Results Table VII presents the correlation among all variables. Kendalls tau coefcient was used as Field (2005) recommends its use in the case of a small non-parametric data set. Hypothetically, the higher the value of correlation between two variables, the more related to each other these variables are. Table VI indicates that there are in total 15 signicant correlations. However, the dependent variable RIQM has only two signicant correlations, one with construct PD (r 0.377 signicant at the 0.01 level) and other with construct ET (r 0.267 signicant at the 0.05 level). PD has no signicant correlation with any of the other independent variables. ET has signicant correlation with only one independent variable, i.e. TMS (r 0.250 signicant at the 0.05 level). Therefore, on the basis of correlation analysis it may be concluded that only the constructs PD and ET are signicantly correlated with the dependent variable. The next step in the analysis was regression analysis because regression analysis determines which independent variable(s) explain variability in the outcome, how much variability in the dependent variable is explained by the independent variable(s) and which variable(s) is signicant over other variables in explaining the variability of the dependent variable (Mahour, 2006). All independent variables were entered in the

Construct

TMS

SPPQM

QIAU

ET

EI

PD

SQ

BM

RIQM

TMS

1.000

51 51 51 48 47 47 51

SPPQM

0.517 * 0.000 51 1.000

QIAU

0.230 * * 0.028 51 0.232 0.033 51 1.000

ET

0.250 * * 0.021 48 0.235 * * 0.036 48 0.497 * 0.000 48 1.000

EI

0.230 * * 0.036 47 0.363 * 0.001 47 0.128 0.251 47 0.165 0.141 47 1.000 0.087 0.437 47 20.099 0.396 47 0.176 0.122 47 0.166 0.145 47 0.124 * * 0.285 46 1.000

PD

SQ

0.131 0.218 51 0.507 * 0.000 51 0.064 0.554 51 20.019 0.862 48 0.259 * * 0.022 47 20.048 0.680 47 1.000

BM

0.234 0.028 51 0.340 * 0.002 51 0.013 0.901 51 0.036 0.749 48 0.263 0.020 47 0.055 0.633 47 0.209 0.055 51 1.000 51

RIQM

r p n r p n r p n r p n r p n r p n r p n r p n r p n 50

0.042 0.695 50 2 0.109 0.326 50 0.194 0.072 50 0.267 * * 0.017 47 0.101 0.374 46 0.377 * 0.001 47 2 0.111 0.313 50 0.027 0.803 50 1.000

Note: Correlations are signicant at the *0.01 and * *0.05 levels (two-tailed)

375

Table VII. Correlation among variables

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regression model. Only the construct PD emerged as a statistically signicant predictor of dependent variable. The regression model explained 48.6 per cent of the variability of dependent variable with standard error 2.39. Analysis of variance (ANOVA) showed that the model was statistically signicant ( p-value 0.001). This analysis suggested the conclusion that there is a linear relationship between the independent variable PD and the dependent variable. Stepwise regression makes it possible to identify predictors that are considered useful at an early stage but lose their usefulness when additional predictors are brought into the model (Mahour, 2006). All independent variables were therefore entered in the stepwise regression model and PD emerged as statistically signicant predictor of dependent variable. The stepwise regression model explained 36.3 per cent of the variability of the dependent variable with standard error 2.42. ANOVA showed that the model was statistically signicant ( p-value 0.000). Stepwise regression therefore conrmed the nding of the standard regression that PD is the only factor contributing signicantly in the implementation of TQM in pharmaceutical wholesale distribution companies in Pakistan. Discussion and conclusion The results show that only construct PD has a vital role in shaping TQM in pharmaceutical wholesale distribution companies in Pakistan. Though the literature (Karuppusami and Gandhinathan, 2006; Flynn et al., 1994; Sila and Ebrahimpour, 2002) provides strong support for PD in effective implementation of TQM in organizations, it is note worthy that TMS (the most critical success factor identied in the literature review) did not emerge as a signicant factor in regression or stepwise regression analysis. TMS was even not correlated signicantly to the dependent variable. It may be argued that the dependent variable is signicantly correlated with ET, which is signicantly correlated with TMS so indirectly TMS is correlated with dependent variable. However, this is not enough reason to conclude that TMS has an indirect effect on dependent variable (RIQM) because ET did not emerge as a signicant factor in regression or stepwise regression analysis. Previous studies related to issues and/or barriers in TQM implementation issues in developing countries (Djerdjour and Patel, 2000; Temtime and Solomon, 2002; AL-Khalifah and Aspinwall, 2000; Mersha, 1997) have concluded that top management in developing countries is not committed to TQM. Pakistan is also a developing country, so it may be suggested that as far as the commitment of top management for implementing TQM is concerned, the pharmaceutical wholesale distribution companies of Pakistan are not an exception from studies on TQM implementation barriers previously undertaken in other developing countries. This may be the reason that TMS did not emerge as critical success factor in this study. As only one construct emerged as the signicant factor in this study, it may also be concluded that TQM has not been yet incorporated in the strategic and long-term plans of pharmaceutical wholesale distribution companies in Pakistan. In pharmaceutical wholesale distribution companies in Pakistan TQM may not yet be an operational and business level strategy. Like all other studies, this research has limitations. The data was obtained through a postal survey and relied on the perceptions of the respondents. The response size of the study was also small (n 51) though the response rate and signicance were high.

Small response size prevents more complex analysis such as structural equation modelling. Such analysis may need to be conducted with larger response sizes in the future. Nonetheless, this study may be a good foundation for future research in several ways. This study identied that PD is the critical success factor in implementation of TQM in pharmaceutical wholesale distribution companies in Pakistan. In investigating the perception of chief executives in pharmaceutical wholesale distribution companies regarding PD, qualitative studies are recommended so that the reasons for emergence of PD as the only critical success factor may be identied. It is possible that because of high regulatory requirements in the pharmaceutical wholesale distribution sector, the companies may have to focus more on PD. Studies should also be conducted in pharmaceutical wholesale distribution companies in other countries to see if PD is as signicant elsewhere for this sector. Pharmaceutical wholesale distribution is an integral part of pharmaceutical supply chains so future research can also examine critical success factors of TQM in pharmaceutical manufacturing and retailing companies, so that pharmaceutical supply chain specic critical success factors of TQM may be identied. Because this study is the rst known study on the identication of critical success factors of TQM in Pakistan, future research should be undertaken as well in other business sectors in Pakistan so that generalizations can be made about critical success factors of TQM in companies in Pakistan specically and perhaps for developing countries generally. Though being based in a previously neglected country and sector this study provides a signicant contribution to the literature about TQM in developing countries. It also identies considerable scope for TQM critical success factor studies in Pakistan and other developing countries to provide better conceptualization and understanding of practice of TQM.

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Thiagarajan, T., Zairi, M. and Dale, B.G. (2001), A proposed model of TQM implementation based on an empirical study of Malaysia industry, International Journal of Quality & Reliability Management, Vol. 18 No. 3, pp. 289-306. Trochim, W. (2006), Non probability sampling, available at: www.socialresearchmethods.net/ kb/sampnon.htm (accessed 5 July 2007). Vaile, R.S., Grether, E.T. and Cox, R. (1952), Marketing in the American Economy, The Ronald Press, New York, NY. van de Ven, A. and Ferry, D. (1980), Measuring and Assessing Organizations, Wiley, New York, NY. Warwood, J.S. and Roberts, B.P. (2004), A survey of TQM success factors in UK, Total Quality Management, Vol. 15 No. 8, pp. 1109-17. About the authors Muhammad Usman Awan is an Assistant Professor in the Institute of Quality and Technology Management, University of the Punjab, Lahore, Pakistan. This paper is a part of his PhD thesis entitled Development of pharmaceutical distribution model for customer satisfaction. He was a visiting Researcher at Institute for Retail Studies, University of Stirling, UK from January to December 2007. He has more than seven years of industry and teaching experience. His research interests are TQM, customer satisfaction and service quality. Muhammad Usman Awan is the corresponding author and can be contacted at: usman@iqtm.pu.edu.pk Abdul Raouf is a Professor and patron in the Institute of Quality and Technology Management, University of the Punjab, Lahore, Pakistan. He has more than 40 years of research and teaching experience. He has published extensively in the areas of quality, safety and maintenance of production systems. Recognizing his scholarly pursuits, he was bestowed upon the coveted title of Sitara-e-Imtiaz by the Government of Pakistan. The Higher Education Commission of Pakistan conferred upon him the title of Distinguished National Professor. He is or has been on the editorial board of refereed international journals like Journal of Quality in Maintenance Engineering, International Journal of Industrial Engineering, International Journal of Operations & Production Management, International Journal of Quality & Reliability Management, International Journal of Health Care Quality Assurance, Journal of Human Ergology, Arabian Journal of Science and Engineering, International Journal of Production Research, Journal of Engineering Sciences, and Supply Chain Management: An International Journal. Niaz Ahmad is a Rector of National Textile University, Faisalabad, Pakistan. He has more than 20 years of industry and teaching experience. His research interests are TQM and environmental engineering. He is a Chief Editor of International Journal on Quality and Innovation and Journal of Quality and Technology Management. Leigh Sparks is a Professor of Retail Studies and chair of division of Marketing at Stirling Business School, University of Stirling, Scotland, UK. He was an undergraduate at the University of Cambridge, and completed his PhD at St Davids University College, Lampeter. He has been a Professor at Stirling since 1992. He has also been the Director of the Institute for Retail Studies and the Dean of the Faculty of Management. He was a Visiting Professor at Florida State University, Tallahassee from July 2000 to July 2001, and Visiting Professor at the University of Tennessee, Knoxville from June to December 2006. He is Co-Editor of the leading European retail journal, The International Review of Retail, Distribution and Consumer Research, published by Taylor & Francis. He has edited a number of books and has published over 100 refereed journal articles as well as many practitioner, trade and newspaper pieces.

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