Philippine Management Review, Vol 15 (2008)

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ISO 9000 CERTIFICATION AND BUSINESS PERFORMANCE OF SELECTED PHILIPPINE COMPANIES

Erik Paolo S. Capistrano

Abstract


This exploratory study aims to determine whether acquiring an ISO 9000 certification has a significant effect on Philippine business organizations’ respective financial measures linked to performance. Based on a conceptual framework directly linking ISO 9000 certification to enhanced business performance, this study hypothesizes that if a business organization gets
certified, then there will be a significant improvement in its operating efficiency and asset use efficiency, and a significant decrease in its dependence on external financing. The results of the study showed that there are improvements
in some performance measures after certification, although not statistically significant. There are also some firms that showed declining performance. Majority of the firms displayed a decrease in the variance of their performance measures, indicating a more stable environment after certification. At this point, it can only be speculated that ISO 9000 certification – or even quality management in general – is not fully understood, appreciated, and implemented here as much as in other countries and as much as the literature suggests. This
is something that needs to be considered, given the amount of resources devoted to preparing the firm for certification, acquiring of the certification itself, and the periodic audit checking needed to maintain the certification.

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