Senior leadership, customer orientation, and service firm performance: the mediator role of process management

Abstract

Taking a social-technical dimensions view of total quality management (TQM) practice, this study examines the impact of social and technical TQM factors on the performance of service firms in China. We choose senior leadership and customer orientation as social factors, and process management as a technical factor. A mediation model is developed to postulate the mediating role of process management between senior leadership, customer orientation, and service firm performance. Data were collected through questionnaires from 182 Chinese service firms, and a technique of structural equation modelling was used to test the mediation model. The results indicate different paths to service firm performance from different factors of TQM practice. Process management affects service firm performance directly and positively. However, senior leadership and customer orientation indirectly influence service firm through the role of process management. It means that service firm performance depends directly on process management which can be promoted by senior leadership and customer orientation. In light of findings in this research, limitations and future research directions are subsequently addressed.