Small business and high performance management practices

by Stephens, Paul Raymond.

Small Business and High Performance Management Practices Paul R. Stephens In the 1980’s, the U.S. government along with important commercial organizations realized the significance of improving the quality of products and services in order to enhance the international competitiveness of companies and the national economy. (Anonymous, 1999) This realization led to the development of the Malcolm Baldrige National Quality Award for Performance Excellence criteria that has now spread across all sections of the business community. Research has determined that implementing the Baldrige criteria can result in positive impacts on firms, allowing them to achieve performance excellence and improve competitiveness in their markets. (Barclay (1993), Hendricks and Singhal (1996), Mendham et al, (1994)) Small organizations with their limited resources can apply the Baldrige principles with measurable success, and without undue expense. (Ghobadian and Gallear, 1996) Yet, others find the frameworks themselves lacking. According to Wilkes and Dale (1998) the development of the EFQM model (European model based on Baldrige) to suit the characteristics of small firms is needed and more needs to be done to simplify the language, the format of the model, and the application process. Familiarity with a particular theoretical framework and understanding the underlying principles found in a framework are two different conditions. It is our argument that it seems logical (discussed by McTeer and Dale, 1994 and Van der Wiele and Brown, 1998 for TQM) that small firms may not be specifically familiar with Baldrige but may practice its principles every day without placing such a label on it. Threfore, there may be a lack of specific knowledge concerning Baldrige but not the underlying management principles. The goal of this research is to identify the importance of the Baldrige criteria to small firms by examining the specific management practices elucidated throughout the criteria. Additionally, the research will determine how endemic these practices are throughout the small company population. Insights stem from previous research that attempts to describe the characteristics of small firm operations. The task at hand is to link these characteristics to how small firms perceive the importance of the Baldrige criteria and to what extent these small businesses are able to implement the criteria.