Influence of quality managament systems implementation on Organizational performance: (case study of south nyanza sugar company limited Migori county, Kenya)
Ogoye, Joyce Awuor
MetadataShow full item record
The Sugar industry in Kenya has been experiencing a lot of challenges ranging from high costs of production, dwindling cane yields, low sugar production volumes, use of outdated technology and stiff competition from cheap sugar imports, a trend that has led to poor organizational performance. To reverse this trend, most sugar firms in Kenya have adopted Total Quality Management concept of Quality Management Systems (QMS) by becoming ISO certified in an effort to enhance efficiency in their operations with the aim of improving overall organizational performance. QMS is defined as a set of coordinated activities to direct and control an organization in order to improve effectiveness and efficiency of its performance. This project set to find out the influence of QMS implementation by sugar firms in Kenya on organizational performance with respect to financial performance, market share and sugar production volumes. This was a case study of South Nyanza Sugar Company Ltd. but the findings can be a representation of all Sugar Corporations in Kenya. The study was guided by the following objectives: to determine the effect of top management commitment to quality management systems implementation on organizational performance of Sonysugar; to establish the influence of resource management on organizational performance at Sonysugar; to assess the effect of development and realization of products based on customer and statutory requirements on organizational performance of Sonysugar and to examine the effect of measurement, analysis and improvement through corrective and preventive actions on organizational performance of Sonysugar. The study used structured questionnaires and interviews with the target respondents being a sample of eight (8) top management staff , ten (10) QMS lead auditors, twenty (20) middle management employees, twenty (20) farmers and twenty (20) customers of Sonysugar. The researcher also used secondary data for the study. The data was analyzed using both descriptive and inferential statistical analysis. The findings of the study revealed that 92.16% of the respondents are of the opinion that implementation of quality management systems has had a positive influence on organizational performance. A study of the secondary data revealed that profits increased significantly from a loss of Ksh.60 million before ISO certification in 2009 to Ksh.1 billion in 2012; sugar sales increased from Ksh.2.5 billion in 2009 to Ksh.5.7 billion in 2012 while sugar production volumes remained a constant at 52,379 metric tones in 2009 compared to 52,470 metric tones in 2012 after ISO certification. Marginal costs of production based on income versus expenses remained the same at a constant ratio of 1 before and after ISO certification. The study concluded that quality management systems has had a positive impact on organizational performance in financial and sales returns but minimal effect on sugar production volumes and minimization of costs of production The researcher recommends that organizations must ensure that top management is committed to quality management systems, that there is proper resource management at all organizational levels, that organization’s products conform to customer requirements and that organization finds other means of minimizing costs and enhancing sugar production volumes. Other researchers can use this study as a basis to expand the scope to other sugar companies for purposes of comparison and generalization for the industry. This study can also form basis for research on what other factors affect organizational performance other than quality management systems.