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MSQ
20,5 Critical factors for effective
implementation of ISO 9001 in
SME service companies
440
Evangelos L. Psomas, Christos V. Fotopoulos and
Dimitrios P. Kafetzopoulos
Department of Business Administration of Food and Agricultural Enterprises,
University of Ioannina, Agrinio, Greece

Abstract
Purpose – The purpose of this study is to investigate the critical factors for the effective
implementation of the ISO 9001 standard in small and medium enterprises (SMEs) operating in the
services sector.
Design/methodology/approach – An empirical study is conducted with a sample of 93 ISO
9001:2000-certified Greek service companies. Data are obtained by a questionnaire survey of the
managers responsible for quality in each of the sample firms. Individual critical factors for ISO
9001:2000 implementation are assessed for importance by simple descriptive statistics. Exploratory
factor analysis is then applied to refine these individual critical factors into five latent constructs.
Findings – All of the individual critical factors examined in the study are assessed as being of some
importance with regard to their contribution to ISO 9001 effectiveness. The five latent constructs of the
underlying structure of these critical factors are (in descending order of importance): “internal
motivation of company”; “attributes of company”; “employee attributes”; “requirements of the quality
system”; and “attributes of the external environment”.
Research limitations/implications – The study is limited by the small size of the whole sample
and sub-samples of SMEs. Future research could utilise a broader sample of private SME service
companies.
Practical implications – This study provides practical guidance for SME service companies that
wish to implement the ISO 9001:2008 standard effectively.
Originality/value – Several authors have noted that more research is required into the critical
factors for effective implementation of the ISO 9001 standard, especially in SMEs. In addition to
assessing the importance of various critical factors, the present study defines their underlying
structure in terms of latent constructs, thus identifying the broad critical areas that require attention
for effective implementation of the quality standard.
Keywords Critical success factors, Quality assurance, Small to medium-sized enterprises
Paper type Research paper

Managing Service Quality
Vol. 20 No. 5, 2010
pp. 440-457
q Emerald Group Publishing Limited
0960-4529
DOI 10.1108/09604521011073731
1. Introduction
To enhance efficiency, competitiveness, and customer satisfaction, an increasing number
of companies are developing or adopting a quality management system (QMS) (Magd,
2008). In many instances, such a QMS is established in association with certification under
the ISO 9001:2000 international quality standard or the recently revised ISO 9001:2008
version of the standard (which, according to ISO, introduces no new requirements, but does
clarify the existing requirements of ISO 9001:2000) (International Organization for
Standardization, 2008). The purpose of the ISO 9001 standard is to assist companies of
various sizes in any sector to implement and operate an effective QMS by enhancing the
firm’s ability to design, produce, and deliver quality products and services (Wahid and ISO 9001
Corner, 2009; Sroufe and Curkovic, 2008). The standard provides guidelines on procedures, in SME
controls, and documentation for a QMS to help a company identify mistakes, streamline its
operations, and maintain a consistent level of quality (Kartha, 2004). companies
Although the generic features and terminology of the ISO 9001 standard enable it to
be used by all types of companies in both the manufacturing and service sectors
(Angelogiannopoulos et al., 2007; Singh and Mansour-Nahra, 2006; Lee et al., 2009), the 441
majority of certifications under the standard initially came from manufacturing firms
(Calisir, 2007). In comparison with manufacturing firms, the service sector has lagged
behind – not only in terms of implementing the standard, but also in embracing the
associated concepts of “total quality management” and “continuous improvement”
(Ghobadian et al., 1994; Heras et al., 2008). However, more recently, the success of total
quality management (TQM) in manufacturing industries has encouraged service
companies to adopt the principles and tools of quality management (Calisir, 2007). As a
consequence, the take-up of ISO 9001 certification has begun to increase rapidly in the
services sector (Dick et al., 2002).
If the ISO 9001 system is implemented effectively, its benefits exceed its costs by
improving the performance of any company and building a sustainable competitive
advantage (Augustyn and Pheby, 2000; Koc, 2007); indeed, if the ISO 9001 standard is
understood and implemented correctly, as opposed to being used merely as a
marketing and promotional tool, there are significant internal and external benefits to
be derived by any organization that adopts the standard (Sampaio et al., 2009).
However, the introduction of a QMS in a company does not always produce the desired
results; in practice, this is usually due to ineffective implementation.
A wide variety of factors that might have an adverse impact on the implementation
of a quality standard (such as ISO 9001) have been suggested by many researchers
(Jang and Lin, 2008; Magd, 2008; Feng et al., 2008; Sroufe and Curkovic, 2008; Zeng
et al., 2007; Cheng et al., 2007; Zaramdini, 2007; Terziovski and Power, 2007; Park et al.
2007; Gotzamani et al., 2007; Boiral and Roy, 2007). Even for the older versions of the
ISO quality standards (such as ISO 9000:1994), Augustyn and Pheby (2000) noted that
there was a need to determine the critical factors that influence the effective
implementation of a quality standard. This still continues to be a matter that needs to
be explored in the case of the subsequent revised versions of these quality standards
(such as the ISO 9001:2008 version). Although there are many instances of the
successful adoption of the revised versions of the standard, the problems of achieving
sustainable implementation mean that the critical success factors require ongoing
identification and exploration (Zeng et al., 2007; Sampaio et al., 2009).
Against this background, the purpose of this study is to conduct an empirical
investigation of the critical factors for effective implementation of the ISO 9001
standard among small and medium-sized enterprises (SMEs) in the services sector. In
doing so, the study not only assesses the relative importance of a variety of critical
factors, but also uses exploratory factor analysis to establish the underlying structure
(or latent constructs) of these individual factors.
The remainder of this paper is organised as follows. The next section presents a
review of the relevant literature on the implementation of quality standards (such as
the ISO 9001 standard). This is followed by a statement of the research questions
addressed in the study. The following section provides a description of the
MSQ methodology of the empirical study. The empirical results are then presented, followed
20,5 by a discussion of their significance in terms of previous studies in this area. The paper
concludes with a summary of the major findings, practical implications, limitations of
the study, and suggestions for future research.

2. Literature review
442 2.1 Critical success factors and barriers to ISO 9001 certification
In general terms, “critical success factors” can be defined as the crucial elements that
require examination and categorisation to ensure effective management and
implementation of an individual system and/or the overall mission of an
organization (Oakland, 1995). According to Augustyn and Pheby (2000), the
effectiveness of the older versions of the ISO 9001 standard (such as the ISO
9001:1994 standard) depended on the approach of the company towards certain
identified critical success factors. A review of the literature suggests that numerous
such factors have been identified as crucial to the successful implementation of ISO
9001 in any company, irrespective of the sector to which it belongs.
Most companies have encountered problems during and after the process of ISO 9001
certification (Chow-Chua et al., 2003). In particular, a lack of management and leadership
has been identified as an important barrier to the success of the implementation of ISO
9001:2000 (Singh et al., 2006). In a similar vein, Bhuiyan and Alam (2005) identified a lack
of management support and a lack of training as important barriers to successful
implementation of ISO 9001:2000, along with inadequate perception of quality on the
part of most employees, resource constraints, and employee resistance to change. Zeng
et al. (2007) concluded that the main barriers to the effective implementation of the ISO
9001:2000 standard were short-sighted motivations for seeking certification,
over-expectations of the standard, mandatory requirements to become certified (that
is, a lack of wholehearted commitment to a QMS), and simply following others in seeking
certification. Magd (2008) identified important barriers to the effective implementation of
ISO 9001:2000 as being inadequate senior-management commitment, a lack of qualified
personnel, insufficient training with respect to quality issues, a lack of financial
resources, and a failure to define responsibility and authority for personnel. In a similar
vein, Cheng et al. (2007) also identified a lack of senior-management commitment,
employee resistance to change, and inadequate training and support as barriers to the
successful implementation of ISO 9001:2000.
Park et al. (2007) grouped the barriers to implementation of the ISO 9001:2000
standard into five categories:
(1) the company policy and cultural background;
(2) ISO 9001:2000 requirements;
(3) ISO 9001:2000 QMS effects;
(4) the certification body; and
(5) customer policy.

Chow-Chua et al. (2003) emphasised a failure to exercise adequate control over

documents, a failure to define responsibility and authority for personnel, and
inadequate training. Angelogiannopoulos et al. (2007) pointed out such barriers as the
lack of training of seasonal personnel, inadequate resources (financial and human), a
lack of infrastructure, a failure to gain workforce commitment to QMS implementation, ISO 9001
and a lack of ISO 9001:2000 experience and knowledge. in SME
2.2 Motivations for ISO 9001 certification
companies
Among the many critical success factors and barriers noted above, the motivations for
certification have been identified in the literature as being of particular importance to
successful implementation. Gotzamani et al. (2007) noted that the successful 443
implementation of the ISO 9001:2000 standard depends on the degree to which a
company seeks certification for the purposes of improving quality, rather than as a
result of external pressure. Gotzamani and Tsiotras (2002) found that motivation was a
significant factor in determining both the degree to which the ISO 9001:1994 standard
was implemented and the overall benefits that companies gained from the certification.
Similarly, Feng et al. (2008) reported that companies that sought ISO 9001:2000
certification for external reasons were likely to fail (or gain fewer benefits), whereas
companies that sought certification to improve the quality of products and services
gained greater benefits from the certification.
Williams (2004) found that successful recovery of the initial investment required for
ISO 9001:2000 implementation depended on the motives that had driven a company to
seek certification – which might include customer demand, quality improvement, part
of a larger marketing strategy, pressure from competitors, and government
requirements and regulations. Terziovski and Power (2007) included continuous
improvement strategy, business performance improvement, waste reduction, reaction
to environmental factors, and reaction to pressure from customers and competitors as
motivational factors for seeking ISO 9001:2000 certification. Lundmark and Westelius
(2006) suggested that improvement in the efficiency of a quality system, achievement
of customer satisfaction, pressure from competitors/foreign partners, a desire to
increase market share, meeting government demands and external requirements as the
leading motivations for seeking ISO 9001:2000 certification.
Zaramdini (2007) found a correlation between the benefits derived from ISO
9001:2000 certification and the motivations to seek such certification. These motives
included a desire to:
.
improve processes and procedures;
.
enhance product and/or service quality;
.
improve productivity and/or efficiency;
.
reduce incidents, rejections, and complaints; and
.
enhance the public image and competitive advantage of the organization.

2.3 ISO 9001 certification in the service sector

Several studies have examined the implementation of ISO 9001 in a variety of service
industries in various countries.
The critical factors for the successful implementation of the ISO 9001:1994 standard
in the UK tourism sector were identified by Augustyn and Pheby (2000) as:
.
the commitment and support of senior management;
.
a formal system for monitoring complaints;
.
looking for opportunities for continuous improvement;
MSQ .
an internal and external customer focus;
20,5 .
a positive attitude to ISO 9001 on the part of staff;
.
a focus on error prevention, training, effective information gathering, and a
dissemination system;
.
a long tradition of commitment to quality; and
444 . presenting ISO 9001 in a clear manner to employees.

McAdam and Fulton (2002), who evaluated the state of quality management in general
(and perceptions of the ISO 9001:2000 standard in particular) in the context of the UK
small-firm software industry, found that nearly half of the companies involved did not
have any QMS in place and that many of those that had adhered to quality certification
had done so as a result of external pressure. However, there was a perception in this
industry that an effective QMS can play a key role in improving both operational and
strategic business performance. Focusing on quality improvement as part of the whole
culture of the software industry (rather than perceiving quality management solely in
marketing terms) was found to be the most important factor in building a competitive
advantage through effective implementation of ISO 9001:2000.
Wahid and Corner (2009), who investigated the post-certification period in a large
Malaysian service organization (which offered a comprehensive range of services for every
aspect of infrastructure maintenance and in particular road and highway maintenance),
found that the maintenance of ISO 9001:2000 depended on senior management, the
employees, the reward system, teamwork, continuous improvement of the processes,
understanding of ISO itself, measurement of performance, and communication.
Pina and Selles (2008) studied the utility of the ISO 9001:2000 standard for
designing an efficient QMS in a sample of Spanish companies (half from the
manufacturing sector and half from the services sector). The results indicated that the
organizations had used the ISO 9004:2000 standard as a guide for optimising their
QMSs (and thus improving organizational efficiency and efficacy), but without making
“total quality” an explicit objective of their endeavours.
Heras et al. (2008), who assessed the ISO 9001:2000 standard in the Spanish
residential aged-care sector, categorised the obstacles to successful ISO 9001:2000
certification into four groups:
(1) the characteristics of the sector (lack of resources, lack of knowledge of quality
management, and lack of pressure for certification across the whole industry);
(2) lack of motivation and leadership (among both managers and employees);
(3) problems with implementation (expense of implementation and certification,
additional bureaucracy, and externally conducted implementation); and
(4) quality of care (ISO 9001 having nothing to do with quality of care of residents
and some health professionals seeing ISO 9001 as an “industrial” quality
model).

Lee et al. (2009), who analysed survey data collected from ISO 9001:2000-certified
service organizations in China (from a variety of sectors), found that some
organizations were implementing ISO 9001:2000 to the minimal extent required for
certification, whereas others were committed to implementation levels beyond the
minimal requirements. The two clusters were not significantly different in terms of size ISO 9001
or number of years of implementing the standard, but the level of adoption of ISO in SME
9001:2000 principles was correlated with subsequent company performance.
companies
3. Research questions
It is apparent from this review of the literature that the list of possible critical success
factors for the implementation of ISO 9001:2000 is extensive; moreover, the list 445
provided here is by no means comprehensive. Because various companies behave
differently, the importance of any given factor will differ, depending on the type of
business. For these reasons, several authors have argued that further research in this
area is required to reflect the dynamic needs of various economic sectors (Augustyn
and Pheby, 2000; Cheng et al., 2007; Lin and Jang, 2008; Lee et al., 2009).
Against this background, the present study investigates these critical success
factors in the context of SMEs operating in the services sector. The following research
questions are addressed in the empirical study that follows:
(1) What are the main critical factors for the effective implementation of the ISO
9001 standard in service companies?
(2) What is the underlying structure (that is, the latent constructs of observed
variables) of these critical factors for the effective implementation of the ISO
9001 standard in service companies?

4. Methodology
4.1 Questionnaire
The present study was conducted in accordance with the methodology adopted by
most previous research studies into ISO 9001 certification, the majority of which have
utilised descriptive statistics and quantitative methodologies on survey data collected
by questionnaire (Sampaio et al., 2009; Kannan and Tan, 2007; Magd, 2008).
Based on an extensive review of the critical success factors mentioned in the literature
on ISO 9001 implementation, a structured questionnaire was developed specifically for
this study. Because most of the literature on the subject was in English, the original
questionnaire was developed in that language, before being translated into Greek by an
experienced translator in the field of quality management. To reduce any translation
bias, the Greek version of the questionnaire was then back-translated into English by
another person (a researcher who is undertaking research in quality management).
Finally, both the Greek version and the English version were incorporated in the
questionnaire to reduce the potential for confusion among respondents.
The draft questionnaire was then subjected to a face-to-face pilot test involving
interviews with three practitioners who had expertise in managing quality in service
operations and three experienced empirical researchers. Based on their responses,
minor adjustments were made to improve the clarity of the wording in the final version
of the questionnaire.
The final questionnaire consisted of two parts. The first part contained questions
regarding the companies’ profiles. The second part contained statements regarding the
importance of a range of critical factors in the effective implementation of ISO
9001:2000. Respondents were asked to indicate their degree of agreement or
disagreement with these statements (regarding importance) using a seven-point
Likert-type scale (1 ¼ “strongly disagree”; 7 ¼ “strongly agree”).
MSQ 4.2 Sample
20,5 The questionnaire was distributed by e-mail to the senior manager in charge of quality
management in each of 300 Greek service companies. The random sample of 300
companies was selected from a population of approximately a 1,000 ISO
9001:2000-certified service companies recorded in the database of ICAP (the largest
business information and consulting firm in Greece). Two follow-up reminder e-mails
446 were sent four and eight weeks after the initial e-mailing.
In total, 93 completed questionnaires were received, which represented a response
rate of 31 percent. Early and late responding companies were compared in terms of the
number of employees (cross tabulation and chi-square test) and the questionnaire items
(one-way ANOVA); no statistically significant differences were found between these
two groups. In addition, several non-responding companies stated, when contacted,
that the major reason for not participating in the research project was lack of time. It is
thus apparent that non-response bias was not likely to be an issue in the final sample.

4.3 Data analysis

The statistical package SPSS was used for data processing. Descriptive statistics were
utilised to determine the relative importance of the critical factors for the effective
implementation of ISO 9001. In accordance with previous studies (Fotopoulos et al.,
2009; Strohbehn et al., 2004; Gadene and Sarma, 2009), exploratory factor analysis
(EFA) was applied to refine the latent constructs (unobserved variables) of the critical
factors examined.

5. Results
5.1 Profile of respondents
The sample included private service companies from a variety of sectors
(wholesale/distribution, retail, banking/finance, repair/maintenance, communications,
construction, insurance, food and beverage catering).
The vast majority (88.2 percent) were small or medium-sized enterprises (SMEs). In
terms of the European Commission (European Commission, 2006) definitions of SMEs
(Recommendation 2003/361/EC), the responding service companies were categorized as
follows:
.
micro enterprises (fewer than ten employees): 38.7 percent of respondents;
.
small enterprises (more than ten and fewer than 50 employees): 28 percent;
.
medium-sized enterprises (more than 50 and fewer than 250 employees): 21.5
percent; and
. non-SMEs (more than 250 employees): 11.8 percent.

In terms of years of implementation of the ISO 9001:2000 standard, the responding

companies were categorized as follows:
.
14 percent for more than eight years;
.
32.4 percent for five-to-eight years;
.
33.3 percent for three-to-five years; and
.
20.3 percent for fewer than three years.
In terms of the persons representing the responding firms, almost half were university ISO 9001
graduates and 34 per cent possessed a Master’s degree. Regarding the experience of the in SME
respondents, 10.8 percent had been working in the services sector for more than 25
years, 16 percent for 16-25 years, 45.2 percent for 6-15 years, and 28 percent for fewer companies
than five years.

5.2 Critical factors 447

Table I presents the critical factors for the effective implementation of ISO 9001, in
descending order according to their mean value of importance on a scale of 1 to 7. It is
apparent that the respondents considered all of the suggested factors to be of some
importance (mean values ranging from 3.67 to 6.00), but that none of the factors was
considered of great importance (no mean values approximating the highest value of the
seven-point scale).
The factors that were considered to be of major importance were mainly concerned
with the internal environment of a company. These factors were:
.
“meeting customer needs and expectations”;
.
“continuous improvement of processes and product quality”;
.
“improvement of the company’s image”;
.
“equipment and infrastructure required”;
.
“calibration and adjustment of instruments and machines”;
.
“efficiency improvement”;

Measured variables Mean valuea SD

Meeting customer needs and expectations 6.00 0.98

Continuous improvement of processes and product quality 5.98 0.96
Improvement of company’s image 5.92 1.10
Equipment and infrastructure required 5.90 0.93
Calibration and adjustment of instruments and machines 5.83 1.09
Efficiency improvement 5.81 1.09
Production technology 5.81 0.99
Commitment and support of senior management 5.80 1.20
Costs of production and decreasing waste products 5.77 1.17
Appropriateness of company’s size 5.72 0.92
Increase in internal and external market share 5.44 1.21
Employee involvement and commitment 5.10 1.00
Employee training in requirements of the quality standard 5.05 1.08
Know-how of employees 4.95 1.12
Employee acceptance of required changes 4.94 1.05
Number of employees 4.76 1.25
Time of implementation 4.75 1.03
Volume of paper work 4.67 1.11
Financial resources required 4.67 1.08
Pressure from competitors 4.22 1.51
Customer pressure 4.07 1.44 Table I.
Involvement of government and authorities 3.64 1.60 Factors influencing the
effective implementation
Note: a 1 represents “strongly disagree” and 7 represents “strongly agree” of ISO 9001
MSQ .
“production technology”;
20,5 .
“commitment and support of senior management”;
.
“costs of production and decreasing waste products”;
.
“appropriateness of company size”; and
.
“increase in internal and external market share”.
448
The second-tier factors of somewhat lesser importance related to employees:
.
“employee involvement and commitment”;
.
“employee training in the requirements of the quality standard”;
.
“know-how of employees”;
.
“employee acceptance of the changes required”; and
.
“number of employees”.

The third-tier factors were concerned with system requirements:

.
“volume of paper work”; and
.
“financial resources”.

The factors that were considered least important in the effective implementation of ISO
9001:2000 were concerned with the external environment of the company:
.
“pressure from competitors”;
.
“customer pressure”; and
.
“involvement of government and authorities”.

5.3 EFA of critical factors

As shown in Table II, EFA using varimax rotation was employed to identify five latent
constructs to which the critical factors were refined (Kaiser-Meyer-Olkin ¼ 0.844;
Bartlett’s test of sphericity ¼ 1516.564; p ¼ 0:000; MSA . 0.620; eigenvalue . 1;
cumulative variance ¼ 69.06 percent). Based on the loadings of the critical factors, the
constructs were labelled as:
.
“internal motivation of company”;
.
“employee attributes”;
.
“requirements of the quality system”;
.
“attributes of company”; and
.
“attributes of the external environment”.

The reliability of these latent constructs was tested with Cronbach’s alpha coefficient.
As shown in Table II, the results were:
.
0.923 (“internal motivation of company”);
.
0.906 (“employee attributes”);
.
0.780 (“requirements of the quality system”);
.
0.839 (“attributes of company”); and
.
0.682 (“attributes of the external environment”).
 Factors
Quality system
Internal Employee requirements Company External
Measured variables motivation attributes Factor loadings attributes attributes

Efficiency improvement (0.693a) 0.833

Continuous improvement of processes and product quality (0.692) 0.825
Costs of production and decreasing waste products (0.652) 0.808
Meeting customer needs and expectations (0.628) 0.793
Improvement of company’s image (0.524) 0.724
Increase in internal and external market share (0.450) 0.671
Commitment and support of senior management (0.376) 0.614
Know-how of employees (0.748) 0.865
Employee training in requirements of the quality standard (0.717) 0.847
Number of employees (0.497) 0.705
Employee acceptance of the changes required (0.426) 0.653
Employee involvement and commitment (0.417) 0.646
Financial resources required (0.649) 0.806
Volume of paper work (0.628) 0.793
Time of implementation (0.582) 0.763
Production technology (0.488) 0.699
Equipment and infrastructure required (0.414) 0.644
Appropriateness of company’s size (0.322) 0.568
Calibration and adjustment of instruments and machines (0.259) 0.509
Pressure from competitors (0.661) 0.813
Involvement of government and authorities (0.534) 0.731
Customer pressure (0.525) 0.725
Eigenvalue 9.84 2.14 1.86 1.55 1.19
Cumulative variance % 40.99 49.91 57.66 64.11 69.06
Cronbach’s a 0.923 0.906 0.780 0.839 0.682
Mean valueb 5.82 4.96 4.70 5.81 3.98
a b
Notes: Kaiser-Meyer-Olkin ¼ 0.845; ¼ squared factor loading; 1 ¼ strongly disagree, 2 ¼ disagree, 3 ¼ neither disagree nor agree, 4 ¼ agree
and 5 ¼ strongly agree
companies

factors for effective

implementation of ISO
9001
analysis of the critical
Exploratory factor
ISO 9001

449
in SME

Table II.
MSQ All of these values indicate acceptable to good reliability, with even the lowest value of
20,5 0.682 being within the lowest acceptable limit of Cronbach’s alpha coefficient (0.6 to
0.7) (Hair et al., 2005).
Table II also shows that all but two of the factor loadings were greater than 0.60.
The squared factor loadings indicated that a satisfactory proportion of measured
variance was explained by each respective latent construct. Although factor loadings
450 of ^ 0.30 to ^ 0.40 are acceptable, values greater than ^ 0.50 are generally considered
necessary for practical significance (Hair et al., 2005). Moreover, loadings of ^ 0.55 and
^ 0.60 are considered significant for sample sizes of around 100 and 85 respectively
(Hair et al., 2005). Given that the sample size in this study was 93, it is apparent that the
factor loadings were practically and statistically significant.
The mean values of the latent constructs varied from 3.98 to 5.82, which indicate
that all of the constructs were considered to be somewhat important with regard to ISO
9001:2000 effectiveness. The constructs of “internal motivation” (5.82) and “attributes
of company” (5.81) were considered to be the most important in the effective
implementation of ISO 9001:2000. The constructs of “employee attributes” (4.96) and
“requirements of the quality system” (4.70) were less important, and “attributes of the
external environment” (3.98) was the least important.

6. Discussion
6.1 Size of companies
The results reveal that, despite their small-to-medium size, the private service
companies studied here had largely made the transition from traditional management
practices to a quality-oriented management philosophy by implementing the ISO
9001:2000 standard. Half of the respondents had done so since the revision of the ISO
9000:1994 series of standards and the publication of ISO 9001:2000, whereas the
remainder had been implementing the standard for fewer than five years. This finding
is in accordance with the rapid worldwide diffusion of the ISO 9001 standard in the
services sector.
The majority of the SMEs in the present study had entrusted the implementation
and maintenance of the standard to highly educated people with a great deal of
experience in the services sector, which indicates that they had recognised the
importance of the commitment and guidance of senior management in the successful
implementation of a QMS.
The findings of the present study with regard to SMEs have similarities and
differences with those of previous studies of quality certification in small firms. In their
study of SMEs, Lee et al. (2009) found that the experience of their sample of SMEs in
adopting the ISO 9001:2000 standard was, on average, four years, which is somewhat
less than the experience in the present study (14 percent for more than eight years; 32.4
percent for five-to-eight years; 33.3 percent for three-to-five years; and 20.3 percent for
fewer than three years). McAdam and Canning (2001) reported that only 39 percent of
the small firms in their sample had been certified according to the prevailing
quality-assurance standard at that time (ISO 9000:1994); moreover, they found that, as
the number of employees in their firms increased, the rate of certification also
increased. McAdam and Fulton (2002) found that the ISO 9001:2000 quality standard
was poorly implemented in their sample of small service companies in the software
industry.
 In contrast with these studies of SMEs, Dick et al. (2002) examined large service ISO 9001
companies using quality constructs that resembled elements of the ISO 9001:2000 in SME
standard. They concluded that accreditation to a quality standard can make a
profound difference to the way in which quality is perceived and measured in these companies
companies.

6.2 Critical factors 451

It is apparent that the critical factors for effective implementation of the ISO
9001:2000 standard in the SME service companies examined in the present study
were quite similar to the factors identified by Augustyn and Pheby (2000) with
regard to the older version (the ISO 9001:1994 standard) in their study of small
tourism enterprises. First, Augustyn and Pheby (2000) identified such factors as the
commitment and support of senior management, continuous improvement, internal
and external customer focus, and error prevention as being the most important
factors for the effective implementation of the ISO 9001:1994 standard; these factors
can be said to correspond to the latent construct of “internal motivation of a
company” identified in the present study. Second, Augustyn and Pheby (2000) noted
the importance of the positive attitude of employees to ISO 9001:1994, employee
training and commitment to quality, and the presentation of the ISO 9001:1994
elements in a clear manner to employees; these factors correspond to the latent
construct of “employee attributes” in the present study. Finally, Augustyn and
Pheby (2000) referred to the formalisation of the procedures and the dissemination
system, which has certain parallels with the third latent construct of the present
study (“requirements of the quality system”). In summary, there are clearly several
common elements in these two studies, which respectively examined ISO 9001:1994
certification among tourism SMEs (Augustyn and Pheby, 2000) and ISO 9001:2000
certification among general service SMEs (present study). Nevertheless, there are
also differences between the two studies; in particular, the present study identified
two additional latent constructs as being important in the effective implementation
of the ISO 9001 standard – “attributes of company” and “attributes of the external
enviroment”.
There are also similarities between the findings of the present study and those of
Wahid and Corner (2009), who examined a large service organization and identified
three critical factors for a sustainable QMS based on the ISO 9001:2000 standard. Of
these three factors, two of the most important had similarities to the latent constructs
of present study. These were:
(1) the human aspects (employee commitment, involvement, team working,
rewarding, etc.), which has similarities with the construct of “employee
attributes” in the present study; and
(2) the technical aspects of the ISO 9001:2000 standard, which coincides with the
construct of “requirments of the quality system” in the present study.

However, it should be noted that these constructs were not the most significant in the
present study – in contrast to their importance in the study of Wahid and Corner
(2009). The third critical factor identified by Wahid and Corner (2009) was continuous
improvement (of processes, people, and systems), which can be said to coincide in some
respects with the present study’s latent construct of “internal motivation of the
MSQ company” (identified in the present study as the most significant factor in successful
20,5 implementation). Nevertheless, there are also differences between the present study
and the study of Wahid and Corner (2009); in particular, the present study identified
two additional latent constructs as being important in the effective implementation of
the ISO 9001 standard in SME service firms – “attributes of company” and “attributes
of the external enviroment”.
452 Three of the five latent constructs of the present study were also mentioned in the
study of Williams (2004), who studied manufacturing companies (rather than service
companies). Williams (2004) noted that a successful ISO 9001:2000 certification process
depends on:
.
the internal and external motivation of a company seeking certification (which
corresponds to the present’s study “internal motivation of a company” and
“attributes of the external environment”); and
.
the way in which the standard is communicated to the workforce and how it is
perceived by the workforce (which coincides with the latent construct of
“employee attributes” in the present study).

Nevertheless, there are also differences between the findings of the present study and the
study of Williams (2004); in particular, the present study identified two additional latent
constructs as being important in the effective implementation of the ISO 9001 standard in
SME service firms – “attributes of company” and “requirements of the quality standard”.
With regard to the study of Magd (2006), who examined the effective
implementation of ISO 9001:2000 in manufacturing companies, some similarities
with the present study are again apparent. Magd (2006) recommended that
manufacturing firms should plan carefully (measuring internal and external aspects)
and perform cost-effectiveness analyses of the implementation process. These factors
coincide, at least to some extent, with the present study’s latent constructs of “internal
motivation of company”, “attributes of the external environment”, and “requirements
of the quality system”. Magd (2006) also recommended gap analysis to assess a firm’s
actual abilities against ISO requirements, which coincides, to some extent, with the
present study’s latent construct of “attributes of company”. These similarities suggest
that there are common factors affecting the effective implementation of ISO 9001:2000
in the manufacturing sector (Magd, 2006) and the services sector (the present study).
However, it would seem that the present study’s latent construct of “employee
attributes” is applicable only to service companies.
In summary, a comparison of the results of the present study with those of previous
studies suggests that there are many similarities in the critical factors for the effective
implementation of ISO 9001 in SME service companies (as studied here) and the critical
factors that are important in:
.
the implementation of ISO 9001:1994 in small tourism service companies
(Augustyn and Pheby, 2000);
.
implementation of ISO 9001:2000 in a large service organization (Wahid and
Corner, 2009); and
.
the implementation of ISO 9001:2000 in manufacturing organizations (Williams,
2004; Magd, 2006).
However, the present study has also identified certain differences between the critical ISO 9001
factors applicable to the above-mentioned contexts and those of SME service in SME
companies seeking the effective implementation of the revised ISO 9001:2008 standard.
This represents the major contribution of this study to the extant literature in this area. companies

7. Conclusions and implications

7.1 Major conclusions 453
The main conclusion to be drawn from this study is that there are five critical areas
that should be considered by SME service firms that seek to implement ISO 9001
effectively. These five critical areas were revealed as latent constructs of the numerous
individual factors examined in this study; they thus constitute the underlying structure
of the critical factors that require attention. The present study thus concludes that the
critical areas that should be considered by a small-to-medium service company are
(in descending order of importance):
.
the internal motivation of the company;
.
the attributes of the company;
.
employee attributes;
.
the requirements of the quality system; and
.
the attributes of the external environment.

Taking account of the individual critical factors represented by these latent constructs,
it is apparent that a SME service company requires:
.
the right motives for implementing the standard (especially a desire to improve
its internal environment);
.
suitable infrastructure, facilities, and equipment (in accordance with
contemporary advanced technology);
.
trained employees who are actively involved in implementing the quality
standard;
.
the right conditions for the implementation of the system in terms of financial
resources, time, and the paperwork required; and
.
awareness of the attributes of the external market to which the company belongs.

If these critical factors receive appropriate attention, the effective implementation of

the ISO 9001 standard is more likely to be attained by SME service firms.

7.2 Managerial implications

The quality manager of a small-to-medium service company that wishes to implement
a robust QMS according to the principles of ISO 9001:2008 should focus carefully on
the five critical areas identified above.
The manager should first ensure that the firm’s motivation for implementing the
standard is internally oriented, rather than being externally oriented. The focus should
thus be on modifying the culture of the whole organization (including senior managers,
middle managers, and other personnel) with a view to transforming it into an overtly
quality-oriented culture. The quality manager should also aim to update the facilities,
equipment, and technological resources of the company. Attention to the culture and
MSQ infrastructure of the organization represent the major critical areas for ensuring that a
20,5 robust internal environment is created as a foundation for the effective implementation
of a QMS.
The next important area that a quality manager should focus on is the development
of human resources. The aim in this regard is to develop an educated workforce of
employees who are committed to quality procedures and are empowered to take part in
454 decisions about quality issues. The manager should also pay attention to financial
resources, time, and paperwork within the organization.
The final area for attention by the quality manager should be the attributes of the
external environment in which the company operates. Even if the potential influence of
the external environment appears to be very strong, managers should be aware that a
service company with a robust internal environment (as a result of having dealt with
the above-mentioned critical areas) can improve the external influence of the market on
ISO 9001 effectiveness.
In summary, quality managers of SME service companies should be aware that
simply fulfilling a quality standard’s minimal requirements is insufficient. The
effectiveness of implementing ISO 9001 requires a clear focus on all of the
above-mentioned critical areas. If quality managers fail to address these wider issues
(regarding motivation, organizational culture, human resources, infrastructure, and so
on), the full benefits of a QMS based on ISO 9001 will never be achieved.

7.3 Limitations of the study

The generalizability of the present research findings is limited by the nature of the
sample used in the study. Although it is reasonable to generalise the present findings
for other SME service companies (given the fact that the sample contained respondents
from a variety of service sectors), care should be taken in extrapolating the findings to
larger service companies and/or manufacturing companies.
The study was also limited by the rather small research sample, especially with
regard to the sub-samples within the overall category of SMEs (that is, “micro”,
“small”, and “medium” enterprises). It is therefore recommended that future studies
could undertake further analysis of the underlying structure of the critical factors
examined here using a broader sample of private SME service companies.
A wider sample of firms with regard to the duration of implementation of the ISO
9001 standard by service companies would also be valuable – given that the present
study was somewhat limited by the fact that several of the participating companies
had rather limited experience with ISO 9001.
It would also be interesting to validate the underlying structure in different
sub-sectors of the private service sector and/or in different sub-categories of SMEs.
The aim of these investigations would be to detect whether the service sector and the
size of the organization has any statistically significant effects on the findings.
Finally, it would also be worth examining the critical factors for effective
implementation of ISO 9001 in the public-service sector.

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About the authors

Evangelos L. Psomas is a Research Assistant in the Department of Business Administration of
Food and Agricultural Enterprises in the University of Ioannina. He received a PhD in total
quality management at the University of Ioannina, Greece, in 2008. He has dealt with issues of
Management and Marketing and has worked as a teaching assistant in the University of
Ioannina and Technological Educational Institute of Epirus. His research interests include: total
quality management, quality assurance, food safety management, human resource management,
supply chain management, agribusiness and food marketing. Evangelos L. Psomas is the
corresponding author and can be contacted at: epsomas@cc.uoi.gr
Christos V. Fotopoulos is a Professor of Marketing Management in the Department of
Business Administration of Food and Agricultural Enterprises in the University of Ioannina. His
scientific contribution includes the completion of 27 research projects, in 13 of which he was the
project leader. His scientific work includes 35 papers, 22 of which have been published in
international journals, over 13 books – monographs, over 30 papers presented in conferences
and many research project reports. His current research interests include management,
agribusiness, food marketing, total quality management, supply chain management, promotion
and marketing of PDO products.
Dimitrios P. Kafetzopoulos is a PhD candidate in the Department of Business Administration
of Food and Agricultural Enterprises in the University of Ioannina. His research interests
include: management, total quality management, quality assurance, food safety management,
agribusiness and food marketing.

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