Quality Article

Return on Quality—Quality's Impact on Customer Satisfaction Shah andRegassa

RETURN ON QUALITY—QUALITY'S IMPACT ONCUSTOMER SATISFACTION, REVENUE GRO\VTH,

PROFITABILITY AND COST EFFICIENCY—A CROSSNATIONAL COMPARATIVE ANALYSIS OF JAPANESE ANDAMERICAN MANUFACTURERS IN THE AUTO INDUSTRY

ABHA Y SHAH, Colorado State University-PuebloHAILUREGASSA, Colorado State University-Pueblo

Product quality has been regarded as a key component in a corporation's marketing strategy, and itis part of the product component (along with the brand name, packaging, etc.) in thé marketing mix.Findings from the private corporate sector overwhelmingly support the belief that firms with higherquality have higher customer satisfaction, which in tum leads to better financial performance.However, in marketing, little attention has been given to understanding the impact of quality on theperformance of a firm in the manufactured goods sector. Sttidies in marketing involving quality andsatisfaction have mostly been done in the service sector. This study uses data from General Motors,Ford, Chrysler, Toyota, Nissan, and Honda and uses four simple regression equations to test theimpact of quality on customer satisfaction, revenue growth, profitability, and cost in the autoindustry. The study then tests five hypotheses involving auto companies from Japan and the U.S., andfinds that Japanese automakers have higher overall quality than U.S. aidtomakers, which result inhigher levels of consumer satisfaction, greater rate of growth in revenue, higher profitability, and anoverall lower cost of production.

INTRODUCTION

Marketing executives have always faced thedilemma of how to allocate resources todifferent marketing activities of say advertising,pricing, loyalty programs, improvingservice/product qualify, and these decisions aretypically made by executives based onexperience and intuition (Rust, Lemon andZeithaml 2004). Expenditures in marketinghave typically been viewed as short-term costsinstead of long term investments, andmarketing executives have been accused ofbeing financially unaccountable (Schultz andGronstedt 1997). We attempt to study one ofthe ignored marketing initiatives - productqualify - and link it to firm performance, inparticular, customer satisfaction, rate ofrevenue growth, profitabilify, and costefficiency.

The Mariceting Management JournalVolume 20, Issue 2, Pages 163-179Copyright O 2010, The Marketing Management AssociationAll rights of reproduction in any form reserved

THEORETICAL BACKGROUND

Firms can achieve competitive advantage bydifferentiating themselves from competitors,and one of the most commonly used strategiesin differentiation is having a superior productqualify (Phillips, Chang and Buzzell 1983;Powell 1995; Reed, Lemak and Mero 2000).Product qualify also has a positive influence onmarket share (Jacobson and Aaker 1985, 1987;Tellis, Yin and Niraj 2009). Improvingperceptions of qualify for both goods andservices can increases customer satisfaction(Anderson and Mittal 2000; Anderson andSullivan 1993; Blancbard and Galloway 1994;Boulding, et al. 1993; Cameran, Moizer andPettiniccbio 2010; Carter 2009; Cbangsu,Weinhong and Kyung 2008; Herrington andWeaven 2009; Heskett et ál. 1994; Huff,Fomell and Anderson 1996; Leonard 2008;Lovelock, Magi and Julander 1996; Sanchez-Fernandez and Iniesta-Bonillo 2009;Shamdasani, Mukherjee and Malhotra 2008;Simester, et al. 2000; Sloteg¡raff and Inman

163 Marketing Management Journal, Fall 2010

Return on Quality—Quality's Impact on Customer Satisfaction . . . . Shah andRegassa

2004; Spreng, Hui Shi and Page 2009;Vazquez-Casielles 2010; and Zeithaml et al.2000), loyalty (Bennett and Rundle-Thiele2005; Davis-Sramek, et al. 2009; Helgesen,Ivar and Nesset 2010; Lai, Griffin and Babin2009), customer retention (Larson andSteinman 2009; Rust, Moorman and Dickson2002), profitability (Aaker and Jacobson 1994;Al-Hawari 2005; Anderson, Fomell andMazvancheryl 2004; Cooil, et al. 2007; Guo,Kumar and Jirapom 2004; Gruca and Rego2005; Guo and Jirapom 2005; Haskett et al.1994; Liang and Wang 2006; Nilsson, Johnsonand Gustafsson 2001; Powell 1995; Reichheldand Sasser 1990; Zeithaml 2000; and Zhou etal. 2008), and higher life time value (Anderson,Fomell and Lehmann 1994; Bolton 1998;Hogan et al. 2002; Kumar 1999; and Wemerand Kumar 2003), higher cash flow, highershareholder value and are less costly and easierto deal wdth in comparison to new customers(Gruca and Rego 2005).

Customers will pay more if they are satisfiedwdth the quality (Homburg, Koschate andHoyer 2005; Iyer and Kuksov 2010), and willthen spread the word through word-of-mouth,which then leads firms to advertise the highquality of its offerings (Rust, Zahorik andKeiningham 1994). Firms should segmentcustomers based on their profitability, andshould then spend resources accordingly inorder to improve customer satisfaction(Keiningham et al. 2005).

Firms wdth high customer satisfaction index asmeasured by the American CustomerSatisfaction Index also have a higher marketvalue of equity (Hallowell 1996; Hogan,Lemon and Rust 2002; and Rust et al. 2002,2004) and stock retums risk (Tuli andBharadwaj 2009). There are a number ofresearchers who have studied the implicationsof satisfied customers due to improved quality,and consequently, its impact on the firm'sfinancial performance (Laldial and Pasin 2008),profitability (Anderson, Fomell and Lehman1994; Batty 2008; Bernhardt, Donthu andKennett 2000; Boulding et al. 1993; Danaherand Rust 1996; Fomell et al. 1996, 2006;

Hallowell 1996; Hegji and Self 2009; Ittner andLarcker 1998; Lee and Hwan 2005; Loveman1998; Rust, Moorman and Dickson 2002; Rust,Lemon and Zeithaml 2004; Rust, Zeithaml andLemon 2000). However, Rust, Zahorik andKeiningham (1994, 1995) fmd that firms thatput a lot of effort and expenses into programs toimprove quality have seen disappointingfinancial results. Ball (2006) suggests thatcompanies need to understand the cause-and-effect relationship between quality andfinancial performance, and the cost of qualityshould be determined, and only programs thatincrease profits should be implemented.

Improving quality through Total QualityManagement (TQM), also fosters theinnovation process, and it benefits firms whopursue it more than firms who do not(Martinez-Costa and Martinez-Lorente 2008).Higher quality leads to a better image for a firm(Homer 2007, Yen-Ku and Kung-Don 2009),and there is a need for quality managementfocusing on ciistomer satisfaction (Bengt,Bjame and Rickard 2008). More than 80percent of CEOs surveyed by Joanna, Lockeeand Bass (2008) report that their boards setstrategic goals for quality improvements, andtrack the performance, and take correctiveactions if needed.

Improving customers' perceptions of qualitychanges their behavior (Bolton 1998; Mittal andKamakura 2001), which leads to customerattraction (Johnson and Gustafsson 2000;Kordupleski, Rust and Zahorik 1993), purchaseintention (Chen 2008; Hong and Prybutok2008; Hueiju and Fang 2009; Narayandas 1998;Tsiotsou 2006), retention (Bennett and Rundle-Thiele 2005; Bolton 1998; Rust, Moorman andDickson 2002), and increased usage (Boltonand Lemon 1999).

Firms can use Six Sigma methodology tohighlight customer satisfaction and continuousimprovement (Aggogeri and Gentili 2008), andthey can also increase customer satisfactionthrough the improved capabilities ofinformation technology (Greenberg 2001; andPeppers and Rogers 1999). Japanese

Marketing Management Joumal, Fall 2010 164

Return on Quality—Quality's Impact on Custonier Satisfaction Shah and Regassa

companies have been regarded as customeroriented by Deshpande, Farley and Webster(1993), and they have been achieving customersatisfaction through superior technology and ITcapabilities (Song, Nason and Di Benedetto2008). Gonzalez, Mueller, and Mack (2008)recommend listening to customers beforedeveloping and improving service qualifysystems using Kansei Engineering and QualifyFunction Deployment similar to what is used inthe manufacturing sector.

Consumers use third party evaluation as aproduct qualify signal, and Dean and Lang(2008) recommend that firms should use thirdparfy evaliiations in their advertising.Improved qualify has also been seen to increaseword of mouth (Anderson 1998; Danaher andRust 1996), and increase in wealth and stockprices of firms (Hendricks and Singhal 1997,2001). However, there may be a lagged effectbetween changes in objective qualify andperceived qualify and the subsequent rewards tothe firm (Mifra and Golder 2006).

Firms can improve the qualify of their offeringsby listening to their extemal customers,competitors' customers, and their ownemployees (Berry and Parasuraman 1997). Inthe same vein, Kamakura et al. (2002), suggesta service profit chain framework, andrecommend that firms should perform astrategic and operational level analysis linkingthe operational inputs to perceptions of servicequalify by its consumer. Management may thenbe able to identify the most important inputsthat have the largest impact on perceptions ofqualify by the consumer, and allocate resourcesaccordingly (Kamakura et al. 2002; Rust,Lemon and Zeithaml 2004b).

Researchers like Anderson, Fomell andLehmann (1994), Anderson and Sullivan(1993), Boulding et al. (1993), Ekinci, Dawesand Messey (2008), Fomell (1992), Heskett etal. (1994), Kamakura et al. (2002), Mittal et al.(2005), Rust, Subramanian and WeUs (1992),Rust, Zahorik and Keiningham (1994, 1995),and Venkatesan and Kumar (2004), have founda positive relationship between customer

165

attitudes and perceptions through improvedqualify (Rust et al. 2004a).

Customers who are satisfied with high qualifyalso have a higher perception of the value of afirm's offerings (Srivastava, Shervani andFahey 1998), who are then more willing to paya premium price, give good publicify, buymore, are less costly to service, and are moreloyal to the firm for a long period of time(Davis-Sramek et al. 2009; Hogan, Lemon andRust 2002; Reichheld 1996; Reinartz andKumar 2000; and Sanyayei, Moeini and Shafiei2008). Improving qualify is usually done moreto improve revenue than to reduce costs,especially with improving the service (Rust,Zahorik and Keiningham 1995). However, if afirm simultaneously focuses on increasingrevenue and lowering costs, then competitorswill have a difficult time attacking it (Flynn,Schroeder and Sakakibara 1995).

Qualify can be improved by improving designqualify by collaborating with supply chainpartners (Yanmei et al. 2009), throughtechnology (Fisher-Vanden and Terry 2009),through inter and intra organizationalcoordination (Carr, Muthusamy, and Lee 2008),and also through multiple inspections (Chun2009). Efforts to improve qualify alwaysresults in reduced costs (Rosenfeld 2009,Scheeres 2010), through higher customersatisfaction, lower prices or increased reliabilify(Rust, Moorman and Dickson 2002).Profitabilify can be improved throughimproving qualify, efficiencies and cutting costsand reducing costs through improved qualify(Batfy 2008; Pande, Neuman and Cavanaugh2000). Qualify improvements lead to lowercosts due to increased efficiencies (Phillips,Chang and Buzzell 1983), increaseddependabUify and reliabilify, which in tumreduces costs through efficiencies in the processand also increase revenue (Rust, Moorman andDickson 2002). However, if a firm attempts toreduce costs through layoffs, and a reduction orloss of other benefits, then this may reduceemployee morale which in tum may result inlower customer service, customer loyalfy, andlower sales (Rust, Zeithaml and Lemon 2000).

Marketing Management Journal, Fall 2010

Return on Quality—Quality's Impact on Customer Satisfaction . . . . Shah and Regassa

Firms should have their employees engaged atthe highest level to obtain more profits(Minton-Eversole 2007).

Statistical quahty control techniques havebecome commonplace in companies due toadvances in computations through sophisticatedcomputers, which have resulted in loweringcosts (Rajaram and Zhili 2009; Wheeler andChambers 1992), and higher profits (Hendricksand Singhal 1997). However, present costaccoxmting systems are inadequate inaddressing costs of quality improvements, andTsai and Hsu (2010) and Yang (2008),recommend using different models to calculatethe total cost of quality. Similarly, Desai(2008) recommends a quality costing approachto calculate future quality costs that could bebudgeted with improving quality. Costreductions can also be achieved by improvingstandardized and customized quality(Anderson, Fomell and Rust 1997).

U.S. companies have shifted their strategicemphasis fi-om manufacturing to marketing andfinance in the last decade (Buffa 1984), but theJapanese are becoming more customer-oriented(Deshpande, Farley and Webster 1993).Japanese companies have been very successfiilirrespective of the country they have venturedinto. The Japanese first target their domesticcustomers through economies of scale, qualityimprovement and lower costs, beforepenetrating foreign markets wdth qualityproducts that were standardized, but at a lowercost (Abbeglen, Stalk and Kaisha 1985; Doyle,Saunders and Wong 1986, 1992).

The growth of Japanese companies has usuallycome through innovation and manufacturingexceüence (Kotabe 1990; Nonaka 1988), whichis the core of their business strategy. Japanesecompanies also spend far more than theirEuropean and American counterparts in R&Dactivities, and this may explain their superiorityover their counterparts in other countries onproduct quality, product and process innovation(Kotabe 1990).


In the engineering sector, European andJapanese companies are more competitive thanAmerican companies in markets wherecompetencies were not product specific (Aroraand Gambardella 1997), and Japanesecorporations think that strategies relating toproduct quality are more successful than thoseemploying price, promotion or organizationalsynergy (Kotabe et al. 1991). Japanese automakers have been known to raise productquality due to their superior capabilities andlower procurement costs (Lieberman andDhawan 2005). Japanese companies have alsostarted using relationship marketing in order toincrease long-term relationships withconsumers and ultimately customer satisfactionand profits (Osaki 2007), wiiich have helpedthem develop the right marketing strategies(Smothers 1990).

Japanese companies have been known to pursueglobally integrated strategies so that they canbenefit fi-om cost reductions (Kogut 1985),improved product quality (Yip 1989), andhigher customer preference (Levitt 1983) inorder to gain competitive advantage (Hout,Porter and Rudden 1982; Hamel and Prahalad1985). As a group, Japanese firms are muchmore competitive than their foreigncounterparts (Noland 2007).

In the auto industry, Japanese car companieslike Toyota, Nissan, and Honda have surpassedtheir American counterparts by developing carsto meet the unique demands of the U.S. market(Shirouzu 2001). Japanese carmakers have alsobeen among the first to use Quality FunctionDeployment techniques (Häuser and Clausing1988) which ensures that product development,manufacturing processes, process planning, andproduction are all market driven (Griffin 1992).The Japanese also invest in new capacity tosupport their objective of market domination,and their R&D policy is to constantly upgradetoday's existing technology in order to maintaintheir competitive advantage in the futurethrough improvements in product quality andprocess innovation (Ito 1995; Ito and Puick1993), and this may be the reason they havelower profits than their American counterparts

166

Return on Qnality—Quality's Impact on Customer Satisfaction . . . . Shah and Regassa

in the short run (Haar 1989; Johansson and Yip1994).

Economic growth over the very long runreqtiires a process of creative destmction inwhich new corporate giants continually rise tothe top and defeat old behemoths (Fogel et al.2008). This seems to be consistent with thetheory of creative destmction as proposed bySchumpeter (1912), which states that growthentails innovative and creative new firmsdestroying old stagnant ones.

RESEARCH OBJECTIVES

Based on the literature review, this study hastwo objectives. The first objective is to seewhether there is a relationship between quahfyand satisfaction, qtialify and revenue growth,qualify and profitabilify, and qualify and cost inthe auto industry, as shown by the model inFigure 1. The second objective is to test the fivehypotheses that state that Japanese automanufacturers will have higher qualify (Hi),higher customer satisfaction (H2), higherrevenue growth (H3), lower costs (H4), andhigher profitabilify (H5) than American automanufacturers.

The following equations are used to testwhether the above relationships hold good inthe auto industry also. Equation 1 states thatsatisfaction has a positive relationship withqualify. Eqtiation 2 states that revenue growthis positively related to qualify. Equation 3states that cost is negatively related qualify, andfinally, equation 4 states that profitabilify ispositively related to qualify.

S = ai + ßiQ + ei (1)R = a2 + b2Q + e2 (2)C = a3-b3Q + e3 (3)P = a4 + b4Q + e4 (4)

Where:S = SatisfactionQ = QualifyR = Revenue Growth RateC = Cost as a percentage of SalesP = Profitabilifye = Error term

Next, based on the findings and extension ofthe literature, the following five hypotheses(that compare Japanese and U.S. automanufacturers) are proposed and tested:

Hi! Japanese automakers have higheroverall qualify than U.S. automakers.

FIGURE 1Qualify's Impact on Performance

Quality

RevenueGrowth

»Satisfaction

Cost

Profitability



H2: Since Japanese automakers havehigher overall qualify than U.S.automakers, they will have highersatisfaction scores (ACSI) than U.S.automakers.

H3: Since Japanese automakers havehigher overall qualify than U.S.automakers, they will have higherrevenue growth rate than U.S.automakers.

H4: Since Japanese automakers havebigher overall qualify than U.S.automakers, they will have lower coststhan U.S. automakers.

H5: Since Japanese automakers havehigher overall qualify than U.S.automakers, they will have higherprofitabilify than U.S. automakers.

RESEARCH DESIGN

Data are collected on General Motors, Ford,and Chrysler, representing the U.S., andToyota, Honda, and Nissan representing Japanfor total qualify index, customer satisfaction,revenue growth, hours spent to make a vehicle(used as a surrogate for cost), and profitabilifyfor the years 1996-2008. Different sources areused for collecting the relevant data. Data forthe Qualify Index are collected from StrategicVision. Data on satisfaction are collected fromthe American Customer Satisfaction Index, ascompiled by tbe Universify of Micbigan. Dataon the financial performances - i.e., revenuegrowth, profitabilify, and cost as a percentageof sales, are collected from Yaboo Finance andStrategic Vision.

DATA ANALYSIS AND FINDINGS

Simple regression analysis is used to test tbefirst four equations. Tbe first equation statesthat satisfaction is positively related to qualify.The second equation states that revenue growthis positively related to qualify. The thirdequation states that cost as a percentage of salesare negatively related to qualify. Finally, thefourth equation states that profits are positivelyrelated to qualify. The results of the foursimple regression equations are shown below.

S = 14.026 + 0.401Q (1)R = -88.834 + 0.285Q (2)C = 139.692 - 0.232Q (3)P = 139.693 + 0.421Q (4)

The first equation that shows the relationshipbetween satisfaction and qualify has a t value of2.77 and is significant at the 0.05 level. Therelationship between revenue growth andqualify has a t value of 1.830, and is notsignificant at the 0.05 level, (but is significantat tbe 0.10 level). The relationship between costand qualify has a t value of -1.452, and is notsignificant at the 0.05 level (but is significant atthe 0.15 level). The relationship between profitsand qualify has a t value of 2.934 and issignificant at the 0.05 level.

The results of the regression analysis for thefour equations show that in the auto industry,qualify is positively related to satisfaction witha ßi value of 0.401, positively related torevenue growth with a b2 value of 0.285(altbough tbis was not as strong a relationshipas the others), negatively related to cost with ab3 value of -0.232 (although not as strong arelationship as others), and positively related toprofitabilify with a b4 value of 0.421). Thus,these findings from the auto industry areconsistent with the findings of studies in otherindustries involving the impact of qualify onsatisfaction, revenue growth, cost, andprofitabilify.

Next, tbe five bypotheses are tested. The firststep was to aggregate data for tbe companiesfrom tbe two countries. Thus, for each year, theaverage score for each item was found for eachcountry. ANO VA is used to test for significantdifferences between companies from the twocountries.

Even though the literature is fUled with findingsthat Japanese companies tend to have higherqualify than American companies, we decidedto confirm that this is also tme in the autoindustry. Analysis of variance is done on thetotal qualify scores for companies representingthe two countries - Japanese and Americanautomakers. Table 1 shows the results of

Marketing Management Journal, Fall 2010 168

R e t u r n o n Q u a l i t y — Q u a l i t y ' s I m p a c t o n C u s t o m e r S a t i s f a c t i o n . . . . Shah andRegassa

ANOVA for the first hypothesis. The tableshows that there is a significant difference atthe 0.05 level between the quality scores ofJapanese and American auto manufacturers,i.e., the Japanese automakers have higheroverall quality than U.S. automakers. This setsthe stage to test the next four hypotheses.

Hypothesis two states that because of the higherquality, Japanese automakers wdll have highercustomer satisfaction. Table 2 shows that thereis a difference in customer satisfaction scoresbetween the Japanese and Americanautomakers, at the 0.05 level. Thus, hypothesistwo is also supported.

The third hypothesis states that since Japaneseautomakers have higher quality than theirAmerican counterparts, they will have higherrevenue growth than American automakers.Table 3 shows that there is significantdifference at the 0.05 level between theJapanese and the American automakers in theirrevenue growth. Japanese automakers showmuch higher revenue grovvth than theirAmerican counterparts. Thus, hypothesis threeis also supported.

The fourth hypothesis states that since Japaneseautomakers have higher quality than theirAmerican counterparts, they vviU have lowercosts than the American automakers. Results of

TABLE 1Quality Index Differences Between Japanese and U.S. Anto Manufacturers

F,Countrv & Companv

JapanToyotaHondaNissan

U.S.GMChryslerFord

Companv Mean

849.86848.57845.43

840.86835.57836.29

Countrv Mean

848

837.6

6.148 0.017

TABLE 2Customer Satisfaction (ACSI) Differences Between Japanese and U.S. Auto Manufacturers

Countrv & Companv Companv Mean Countrv Mean F. Sig.


U.S.GMChryslerFord

83.2984.5984.8880.36

81.5379.3678.85

79.95

33.68 0.00


Return on Quality—Quality's Impact on Customer Satisfaction Shah and Regassa

TABLE 3Revenue Growth Rate Difference Between Japanese and U.S. Auto Manufacturers

F. Sig.Countrv & Comoanv

Jaj)an_ToyotaHondaNissan

U.S.GMChryslerFord

Companv Mean

9.987.972.89

-L77-L58-L67

Countrv Mean

6.95

-1.69

9.305 0.004

TABLE 4Cost (as a percentage of sales) Differences Between Japanese and U.S. Auto Manufacturers



U.S.GMChryslerFord

91.3392.1493.89

94.593.297.22

92.64

94.90

3.975 0.05

TABLE 5Net Profit Margin Differences Between Japanese and U.S. Auto Manufacturers



U.S.GMChryslerFord

5.434.642.85

-3.502.161.22

4.29

2.17

7.874 0.007



the analysis of variance in table 4 show thatthere is a significant difference in the cost (atthe 0.05 level) between the Japaneseautomakers and their American counterparts.Thus, the fourth hypothesis is also supported.

The fifth hypothesis states that because theJapanese automakers have higher quality thanthe Americans, their overall profitabüity willalso be higher. Results of the analysis ofvariance in Table 5 show a significantdifference at the 0.05 level, thus supporting thishypothesis. The table clearly shows that theJapanese automakers have significantly higherprofitabüity than their American counterpartsas measured by their retum on investment.

DISCUSSIONS AND CONCLUSION

In the last few months the media has beenawash (and stül is) with the problems thatToyota's customers have been having with thesudden acceleration in their cars. This has ledToyota to recall about 8.5 million vehiclesglobally, leading to congressional hearings wdthToyota's CEO. A recent survey of U.S. vehicleowners showed a drop of about 20 percent inthe perceived quality of Toyota's vehicles.Toyota's perceived quality score feu from 84 to67.6 last fall. Ford's Fusion also beat Toyota'sCamry in 2009 Consumer Report's covetedreliability survey.

This is further evidence supporting the mainhypothesis of this study that quality has a directimpact of customer satisfaction, revenuegrowth, profitability and cost.

As stated earlier, studies in marketing involvingthe effect of product quality on a firm'sperformance are quite lacking, especiaüy sincethe quality of a firm's product is such anintegral part of a firm's offerings. Marketingscholars have done very little in exploring theimpact of product (brand) quality on a firm'sperformance. The reason we think that this isimportant is because it is undisputed that thebrand equity of firm depends heavily on thequality of its product/brand. Similarly, a firm'simage also depends on the quality of its

171

products and brands. Subsequently, a firm canthen charge a higher price based on its quality.Unfortunately, marketing scholars haveoverwhelmingly emphasized service quality,ignoring product (goods) quality. Almost of theresearch involving antecedents andconsequences of product quality have beendone by scholars in management, and bydefault fallen in their domain.

This study had two objectives: (1) to findwhether the positive impact of quality onsatisfaction, revenue growth and profitability,and negative impact on cost is also seen in theauto industry, (2) whether firms wdth higherquality have higher levels of customersatisfaction, higher rate of revenue growth,higher profitabüity, and lower cost.

The findings of the study for the first objectiveshow that two of the four relationships are quitestrong and significant, wiiile the other two arenot as strong and not significant at the 0.05level, but they are significant at the 0.10 level.The findings of the study related to the secondobjective show that au of the five hypothesesproposed by this study are supported by thedata. Since Japanese automakers have higherquality than their American counterparts, whichleads them to have higher customer satisfaction,higher revenue growth, higher profit margin,and loser cost as a percentage of sales, i.e.,quality has a major impact on customersatisfaction, revenue growth, profit margin, andcost as a percentage of sales

It is the belief of the authors of this study thatdata involving a much larger time period wouldhave produced more significant results for thefirst objective. However, given the scope ofthis study, it was very difficult to get therelevant data for a longer time period sincedifferent sources were used to collect data onthe desired number of variables.

We think that future studies in the field ofbusiness, especially in marketing, shouldinvestigate the impact that a firm's productquality has on customer satisfaction andultimately the financial performance of the


Return on Qnality—Quality's Impact on Customer Satisfaction Shah and Regassa

firm. If this series of relationship holds good,then it should be a very simple decision formarketing executives on how to best gaincompetitive advantage in the marketplace usingproduct qualify as an effective tool of itsmarketing strategy.

REFERENCES

Aaker, David A. and Robert Jacobson (1994),"The Financial Information Content ofPerceived Qualify," Joumal of MarketingResearch, Vol. 31, May, pp. 191-201.

Abbeglen, J.C. and G. Stalk, Jr. Kaisha (1985),The Japanese Corporation, Basic Books,New York.

Aggogeri, Francesco and Enzo Gentili (2008),"Six Sigma Methodology: An Effective Toolfor Qtialify Management," IntemationalJournal of Manufacturing, Technology &Management, Vol. 14 (3/4), pp. 1.

Al-Hawari Mohammed (2005), "The Effect ofAutomated Service Qualify on BankFinancial Performance and the MediatingRole of Customer Retention," Joumal ofFinancial Services Marketing, Vol. 10, Iss. 3,pp. 228-243.

Anderson, Eugene W. (1998), "CustomerSatisfaction and Word of Mouth," Joumal ofService Research, Vol. 1, Iss. 19, pp. 5-17.

Anderson, Eugene W., Claes Fomell andDonald Lehmann (1994), "CustomerSatisfaction, Market Share, and Profitabilify:Findings from Sweden," Journal ofMarketing, Vol. 58, July, pp. 53-67.

Anderson, Eugene W., Claes Fomell and SanalK. Mazvancheryl (2004), "CustomerSatisfaction and Shareholder Value," Journalof Marketing, Vol. 68, October, pp. 172-185.

Anderson, Eugene W. and Vikas Mittal (2000),"Strengthening the Satisfaction Profit Chain,"Joumal of Service Research, Vol. 3, Iss. 2,pp. 107-120.

Anderson, Eugene W., Claes Fomell andRoland T. Rust (1997), "CustomerSatisfaction, Productivify, and Profitabilify:Differences between Goods and Services,"Marketing Science, Vol. 16, Iss. 2,pp. 129-145.

Anderson, Eugene W. and Mary Stillivan(1993), "The Antecedents and Consequencesof Customer Satisfaction for Firms,"Marketing Science, Vol. 12, Spring,pp. 125-143.

Arora, Asish and Alfonso Gamberdella (1997),"Domestic Markets and IntemationalCompetitiveness: Generic and Product-Specific Competencies in the EngineeringSector," Strategic Management Journal, Vol.18, Summer, pp. 53-74.

Ball, Steve (2006), "Making the Cost of QualifyPractical," Strategic Finance, Vol. 88, Iss. 1,pp. 34-41.

Batfy, Ricky (2008), "Maximize QualifyProfits", Quality, Vol. 46, Iss. 13, pp. 44-47.

Bengt, Klefsjo, Bergquist Bjame and GarvareRickard (2008), "Qualify Management andBusiness Excellence, Customers andStakeholders: Do We Agree on What We AreTalking About, and does it Matter?" TQMMagazine, Vol. 20, Iss. 2, pp. 120-129.

Bermett, Rebekah and Sharyn Rtmdle-Thiele(2005), "The Brand Loyalfy Life Cycle:Implications for Marketers," BrandManagement, Vol. 12, Iss. 4, pp. 250-263.

Bernhardt, Kenneth L., Naveen Donthu andPamela Kennet (2000), "A LongitudinalAnalysis of Satisfaction and Profitabilify,"Journal of Business Research, Vol. 47, Iss. 2,pp. 161-171.

Berry, Leonard L. and A. Parasuraman (1997),"Listening to the Customer - The Concept ofa Service-Qualify Information System,"Sloan Management Review, Spring,pp. 65-76.

Blanchard, R.F. and R.L. Galloway (1994),"Qualify in Retail Banking," IntemationalJournal of Service Industry Management,Vol. 5, Iss. 4, pp. 5-23.

Bolton, Ruth N. (1998), "The Dynamic Modelof the Duration of the Customer'sRelationship with a Continuous ServiceProvider: The Role of Satisfaction,"Marketing Science, Vol. 17, Iss. 1, pp. 45-65.

Marketing Management Joumal, Fall 2010 172


Bolton, Ruth N. and Katherine N. Lemon(1999), "A Dynamic Model of Customers'Usage of Services: Usage as an Antecedentand Consequences of Satisfaction," Joumalof Marketing Research, Vol. 36, May,pp. 171-186.

Boulding, William, Ajay Kalra, Richard Staelinand Valarie A. Zeithaml (1993), "A DynamicModel of Service Qualify: From Expectationsto Behavioral Intentions," Joumal ofMarketing Research, Vol. 30, Febniary,pp. 7-27.

Buffa, Elwood S. (1984), "Making AmericanManufacturing Competitive," CaliforniaManagement Review, Vol. 26, Spring,pp. 29-46.

Cameran, Mara, Peter Moizer and AngelaPettinlcchio (2010), "Customer Satisfaction,Corporate Image, and Service Qualify inProfessional Services," Service IndustriesJournal, Vol. 30, Iss. 3, pp. 421-435.

Carr, Amelia S., Senthikumar Muthusamy andPeggy D. Lee (2008), "The RelationshipBetween Intra-Organizational and Inter-Organizational Coordination and its Influenceon Product Qualify Improvement," Joumal ofApplied Business Research, Vol. 24, Iss. 1,pp.85-102.

Carter, Robert E. (2009), "The Impact ofPerceived Service Qualify on MBA StudentSatisfaction and Recommendations: DoExpectations Matter?" Services MarketingQuarterly, Vol. 30, Iss. 3, pp. 234-248.

Changsu, Kim, Zhao Weihong and Yang HoonKyung (2008), "An Empirical Study on theIntegrated Framework of e-CRM in OnlineShopping: Evaluating the Relationsbip amongPerceived Value, Satisfaction, and TrustBased on Customers; Perspectives," Joumalof Electronic Commerce in Organizations,Vol. 6, Iss. 3, pp. 1-19.

Cben, Ching-Fu (2008), "InvestigatingStmctural Relationship Between ServiceQualify, Perceived Value, Satisfaction, andBehavioral Intentions for Air Passengers:Evidence from Taiwan," TransportationResearch Part A: Policy & Practice, Vol. 42,Iss. 4, pp. 709-717.

Chun, Young H. (2009), "Improving ProductQualify by Multiple Inspections: Prior andPosterior Planning of Serial InspectionProcedures," HE Transactions, Vol. 41, Iss.9, pp. 831-842.

Cooil, Bmce, Timothy L. Keiningham, LerzanAksoy and Michael Hsu (2007), "ALongitudinal Analysis of CustomerSatisfaction and Share of Wallet:Investigating the Moderating Effect ofCustomer Characteristics," Joumal ofMarketing, Vol. 71, January, pp. 67-83.

Danaher, Peter J. and Roland T. Rust (1996),"Indirect Financial Benefits from ServiceQualify," Quality Management Joumal, Vol.3, Iss. 2, pp. 63-75.

Davis-Sramek, Beth, Comelia Droge, John T.Mentzer and Matthew B. Myers (2009),"Creating Commitment and Loyalfy BehaviorAmong Retailers: What are the Roles ofService Qualify and Satisfaction," Joumal ofthe Academy of Marketing Science, Winter,Vol. 37, Iss. 4, 440-454.

Dean, Dwane H. and Jane M. Lang (2008),"Comparing Three Signals of ServiceQualify," Journal of Services Marketing, Vol.22, Iss. 1, pp. 48-58.

Desai, Darshak. A. (2008), "Cost of Qualify inSmall and Medium-Sized Enterprises: Caseof an Indian Engineering Company,"Production Planning & Control, Vol. 19,January, pp. 25-34.

Deshpande, Rohit, John U. Farley andFrederick E. Webster (1993), "CorporateCulture, Customer Orientation, andInnovativeness in Japanese Firms: A QuadradAnalysis," Joumal of Marketing, Vol. 57,January, pp. 23-37.

Doyle, P, J. Saunders and V. Wong (1986),"Japanese Marketing Strategies in the UK: AComparative Study," Joumal of IntemationalBusiness Studies, Spring, pp. 27-46.

Doyle, P., J. Saunders and V. Wong (1992),"Competition in Global Markets: A CaseStudy of American and Japanese Competitionin the British Market, "Joumal ofIntemational Business Studies, Third quarter,pp. 419-442.



Ekinci, Yuksel, Philip Dawes and GrahamMassey (2008), "An Extended Model of theAntecedents and Consequences of ConsumerSatisfaction for Hospitality Services,"European Joumal of Marketing, Vol. 42, Iss.1/2, pp. 35-68.

Fisher-Vanden, Karen, and Rebecca Terry(2009), "Is Technology Acquisition Enou¿ito Improve China's Product Quality?Evidence from Firm-Level Panel Data,"Economics of Innovation & New Technology,Vol. 18, Iss. 1, pp. 21-38.

Flynn, Barbara B., Roger G. Schroeder andSadao Sakakibara (1995), "The Impact ofQuality Management Practices onPerformance and Competitive Advantage,"Decision Sciences, Vol. 26, Iss. 5, pp. 659-91.

Fogel, Kathy, Randall Mork and BemardYeung (2008), "Big Business Stability andEconomic Growth: Is What's Good forGeneral Motors Good for America?" Joumalof Financial Economics, Vol. 89, Iss. 1,pp. 83-108.

Fomell, Claes (1992), "A National CustomerSatisfaction barometer: The SwedishExperience," Joumal of Marketing, Vol. 56,January, pp. 6-21.

Fomell, Claes, Sunil Mithas, Forrest V.Morgeson m and M.S. Krishnan (2006),"Customer Satisfaction and Stock Prices:High Retums, Low Risk," Joumal ofMarketing, Vol. 70, January, pp. 3-14.

Fomell, Claes, Michael D. Johnson, Eugene W.Anderson, Jaesung Cha and Barbara EvirittBryant (1996), "The American CustomerSatisfaction Index: Nature, Purpose, andFindings," Joumal of Marketing, Vol. 60,October, pp. 7-18.

Gale, Bradley T. and Richard Klavans (1985),"Formulating a Quality ImprovementStrategy," Journal of Business Strategy, Vol.5, Winter, pp. 21-32.

Gonzalez, Marvin E., Renee Dentiste Muellerand Rhonda W. Mack (2008), "AnAltemative Approach in Service Quality: Ane-Banking Case Study," Quality ManagementJoumal, Vol. 15, Iss. 1, pp. 41-58.

Greenberg, Paul (2001), CRM at the Speed ofLight: Capturing and Keeping Customers inInternet Real Time, Berkley, CA:Osbome/McGraw-Hill.

Griffin, Abbie (1992), "Evaluating QFD's Usein U.S. Firms as a Process for DevelopingProducts," Joumal of Product InnovationManagement, Vol. 9, Iss. 3, pp. 171-87.

Gruca, Thomas S. and Lopo L. Rego (2005),"Customer Satisfaction, Cash Flow, andShareholder Value," Joumal of Marketing,Vol. 9, July, pp. 115-130.

Guo, Chiquan, Anand Kumar and PomsitJirapom (2004), "Customer Satisfaction andProfitability: Is there a Lagged Effect?"Joumal of Strategic Marketing, Vol. 12,September, pp. 129-144.

Guo, Chiquan and Pomsit Jirapom (2005),"Customer Satisfaction, Net Income andTotal Assets: An Exploratory Study," Joumalof Targeting, Measurement and Analysis forMarketing, Vol. 13, Iss. 4, pp. 346-353.

Haar, J. (1989), "A Comparative Analysis ofthe Profitability Performance of the LargestU.S., European and Japanese MultinationalEnterprises," Management InternationalReview, Vol. 29, Iss. 3, pp. 5-18.

Hallowell, Roger (1996), "The Relationship ofCustomer Satisfaction, Customer Loyalty,and Profitability: An Empirical Study,"Intemational Joumal of Service IndustryManagement, Vol. 7, Iss 4, pp. 27-42.

Hamel, G. and C. K. Prahalad (1985), "Do YouReally Have a Global Strategy?" HarvardBusiness Review, Vol. 63, Iss. 4, pp. 139-148

Häuser, John R. and Don Clausing (1988), "TheHouse of Quality," Harvard Business Review,VoL6,Iss. 3,pp. 63-73.

Hegji, Charles E. and Donald R. Self (2009),"The Impact of Hospital Quality on Profits,Volume and Length of Stay," HealthMarketing Quarterly, Vol. 26, Iss. 3,pp. 209-223.

Helgesen, Oj^ind, Jon Havold Ivar and ErikNesset (2010), "Impacts of Store and ChainImages on the 'Quality-Satisfaction-LoyaltyProcess' in Petrol Retailing," Journal ofRetailing & Consumer Services, Vol. 17,Iss. 2, pp. 109-118.



Hendricks, Kevin B. and Vinod R. Singhal(1997), "Does Implementing an EffectiveTQM Program Actually Improve OperatingPerformance? Empirical Evidence FromFirms That Have Won Qualify Awards,"Management Science, Vol. 3, Iss. 9,pp. 1258-74.

Hendricks, Kevin B. and Vinod R. Singhal(2001), "The Long-Run Stock PricePerformance of Firms with Effective TQMPrograms," Management. Science, Vol. 47,Iss. 3, pp. 359-368.

Herington, Carmel and Scott Weaven (2009),"E-Retailing by Banks: E-Service Qualifyand its Importance to Customer Satisfaction,"European Joumal of Marketing, Vol. 43, Iss.9/10, pp. 1220-1231.

Heskett, James L., Thomas O. Jones, Gary W.Loveman and W. Earl Sasser (1994), "Puttingthe Service Profit Chain to Work," HarvardBusiness Review, Vol. 72, March-April,pp. 167-74.

Hogan, John E., Donald R. Lehman, MariaMerion, Rajendra K. Srivastava, Jacquelyn S.Thomas and Peter C. Verhoef (2002),"Linking Customer Assets to FinancialPerformance," Journal of Services Research,Vol. 5, Iss. 1, pp. 26-38.

Hogan, John E., Katherine N. Lemon andRoland T. Rust (2002), "Customer EquifyManagement: Charting New Directions forthe Future of Marketing," Journal of ServiceResearch, Vol. 5, Iss. 1, pp. 4-12.

Homburg, Christian, Nicole Koschate andWayne D. Hoyer (2005), "Do SatisfiedCustomers Really Pay More? A Study of theRelationship Between Customer Satisfactionand Willingness to Pay," Journal ofMarketing, Vol. 69, April, pp. 84-96.

Homer, Pamela Miles (2007), "PerceivedQualify and Image: When All is Not 'Rosy',"Journal of Business Research, Vol. 61, Iss. 7,pp. 715-723.

Hong, Qin and Victor R. Prybutok (2008),"Determinants of Customer-PerceivedService Qualify in Fast-Food Restaurants andTheir Relationship to Customer Satisfactionand Behavioral Intentions," QualityManagement Joumal, Vol. 15, Iss. 2,pp. 35-50.

175

Hout, T., M. E. Porter and E. Rudden (1982),"How Global Companies Win Out", HarvardBusiness Review, September-October, pp. 98-108.

Hueiju Yu and Wenchang Fang (2009),"Relative Impacts from Product Qualify,Service Qualify, and Experience Qualify onCustomer Perceived Value and Intention toShop for the Coffee Shop Market", TotalQuality Management ce Business Excellence,Vol. 20, Iss. 11, pp. 1273-1285

Huff, L., C. FomeU and E. Anderson (1996),"Quahfy and Productivify: Contradictory andComplementary," Quality ManagementJournal, Vol. 4, pp. 22-39.

Ito, Kiyohiko (1995), "Japanese Spinoffs:Unexplored Survival Sfrategies", StrategicManagement Joumal, Vol. 16, pp. 431-446.

Ito, Kiyohiko and Vladimir Puick (1993),"R&D Spending, Domestic Competition, andExport Performance of JapaneseManufactur ing F i rms , " StrategicManagement Joumal, Vol. 14, pp. 61-75.

Ittner, Christopher and David F. Larcker(1998), "Are Non Financial MeasuresLeading Indicators of Financial Performance?An Analysis of Customer Satisfaction,"Journal of Accounting Research, Vol. 36,Supplemental, pp. 1-35.

Iyer, Ganesh and Dmitri Kuksov (2010),"Consumer Feelings and Equilibrium ProductQuality," Journal of Economics &Management Strategy, Vol. 19, Iss. 1,pp. 137-168.

Jacobson, Robert and David Aaker (1985), "IsMarket Share All That It's Cracked Up toBe?" Joumal of Marketing, Vol. 49, Fall,pp. 11-22.

Jacobson, Robert and David Aaker (1987),"The Strategic Role of Product Quahfy,"Joumal of Marketing, Vol. 51, October,pp. 31-44.

Joanna H. Jiang, Carlin Lockee and KarmaBass (2008), "Board Engagement in Qualify:Findings of a Survey of Hospital and SystemLeaders," Journal of HealthcareManagement, Vol. 53, Iss. 2, pp. 121-135.



Johansson, Johny K. and George S. Yip (1994),"Exploiting Globalization Potential: U.S. andJapanese Strategies," Strategic ManagementJournal, Vol. 15, pp. 579-601.

Johnson, Michael D and Anders Gustaffson(2000), Improving Customer Satisfaction,Loyalty, and Profit: An IntegratedMeasurement and Management System, SanFrancisco: Jossey-Bass.

Kamakura, Wagner A., Vikas Mittal, Femandode Rosa and Jose Alfonso Mazzon (2002),"Assessing the Service Profit Chain,"Marketing Science, Vol. 21, Iss. 3,pp. 294-317.

Keiningham, Timothy L., Tiffany Perkins-Munn, Lerzan Aksoy and Demitry Estdn(2005), "Does Customer Satisfaction Lead toProfitabüity? The Mediating Role of Share-of-Wallet," Managing Service Quality, Vol.15, Iss. 2, pp. 172-181.

Kogut, B. (1985), "Normative Observations onthe Value Added Chain and StrategicGroups", Joumal of Intemational BusinessÄM£//ei, Fall, pp. 151-167.

Kordupleski, Raymond, Roland T. Rust andAnthony J Zahorik (1993), "Why ImprovingQuality Doesn't Improve Quality," CaliforniaManagement Review, Vol. 35, Spring,pp. 82-95.

Kotabe, Masaaki (1990), "Corporate ProductPolicy and Innovative Behavior of Europeanand Japanese Multinationals: An EmpiricalInvestigation," Joumal of Marketing, Vol.54, April, pp. 19-33.

Kotabe, Masaaki, Dale F. Duhan, David K.Smith and R. Dale Wilson (1991), "ThePerceived Veracity of PIMS StrategyPrinciples in Japan: An Empirical Inquiry,"Joumal of Marketing, Vol. 55, January,pp. 26-41.

Kumar, Piyush (1999), "The Impact of Long-Term Client Relationships on thePerformance of Business Service Firms,"Joumal of Service Research, Vol. 2, Iss. 1,August, pp. 4-18.

Lai, Fujun, Mitch Griffin and Barry J. Babin(2009), "How Quality, Value, hnage andSatisfaction Create Loyalty at a ChineseTelecom," Joumal of Business Research,Vol. 62, Iss. 10, pp. 980-896.

Lakhal, Lasaad, and Fredirico Pasin (2008),"The Direct and Indirect Impact of ProductQuality on Financial Performance: A CausalModel," Total Quality Management &Business Excellence, Vol. 19, Iss. 10,pp. 1087-1099.

Larson, Brian V. and Ross B. Steinman (2009),"Driving NFL Fan Satisfaction and RetumIntentions with Concession Service Quality,"Services Marketing Quarterly, Vol. 30, Iss. 4,pp. 418-428.

Lee, Ming Chang and Ing San Hwan (2005),"Relationship Among Service Quality,Customer Satisfaction and Profitabüity in theTaiwanese Banking Industry," InternationalJournal of Management, Vol. 2, Iss. 4,December, pp. 635-648.

Leonard, Kenneth L. (2008), "Is PatientSatisfaction Sensitive to Changes in theQuality of Care? An Exploitation of theHawthome Effect," Joumal of HealthEconomics, Vol. 27, Iss. 2, pp. 444-459.

Levitt, T. (1983), "The Globalization ofMarkets", Harvard Business Review, May-June, pp. 92-102.

Liang, Chiung-Ju and Wen-Hung Wang (2006),"The Behavioural Sequence of the FinancialService Industry in Taiwan: Service Quality,Relationship Quality and BehaviouralLoyalty," The Service Industries Joumal,Vol. 26, Iss. 2, March, pp. 119-145.

Lieberman Marvin B. and Rajeev Dhawan(2005), "Assessing the Resource Base ofJapanese and U.S. Auto Producers: AStochastic Frontier Production FunctionApproach", Management Science, Vol. 51,Iss. 7, pp. 1060-1075.

Lovelock, Christopher H., Anne Magi andClaes-Robert Julander (1996), "PerceivedService Quality and Customer Satisfaction ina Store Performance Framework: AnEmpirical Study of Swedish GroceryRetailers," Joumal of Retailing andConsumer Services, Vol. 3, Iss. 1, pp. 33-41.

Loveman, Gary W. (1998), "EmployeeSatisfaction, Customer Loyalty, and FinancialPerformance: An Empirical Examination ofthe Service Profit Chain in Retail Banking,"Journal of Service Research, Vol. 1, Iss. 1,pp. 18-31.



Martinez-Costa, Micaela and Angel Martinez-Lorente (2008), "Does Qtialify ManagementFoster or Hinder Innovation? An EmpiricalStudy of Spanish Companies," Total QualityManagement and Business Excellence, Vol.19, Iss. 3, pp. 209-221.

Minton-Eversole, Theresa (2007), "LessEngagement, Less Profit, Research Finds,"HR Magazine, Vol. 52, Iss. 12, pp. 20-20.

Mitra, Debanjan and Peter N. Golder (2006),"How Does Objective Qualify AffectPerceived Qualify? Short-Term Effects,Long-Term Effects, and Asymmetries,"Marketing Science, Vol. 25, Iss. 3, May-June,pp. 230-247.

Mittal, Vikas, Eugene W. Anderson, AkinSayarak and Pandu Tadikamalla (2005),"Dual Emphasis and the Long-TermFinancial Impact of Customer Satisfaction,"Marketing Science, Vol. 24, Iss. 4, Fall,pp. 544-555.

Mittal, Vikas and Wagner A. Kamakura (2001),"Satisfaction and Repurchase Behavior: TheModerating Influence of Customer andMarket Characteristics," Journal ofMarketing Research, Vol. 37, February,pp. 102-112.

Narayandas, Das (1998), "Measuring andManaging the Benefits of CustomerRetentions: An Empirical Investigation,"Joumal of Service Research, Vol. 1, Iss. 2,pp. 108-128.

Nilsson, Lars, Michael Johnson and AndersGustafsson (2001), "The Impact of QualifyPractices on Customer Satisfaction andBusiness Restilts: Product vs. ServiceOrganizations", Journal of QualityManagement, Vol. 6, pp. 5-27.

Noland, M (2007), "From Industrial Policy toIrmovation Policy: Japan's Purstiit ofCompetitive Advantage", Asian EconomicPolicy Review, Vol. 2, pp. 251-252.

Nonaka, 1. (1988), "Japanese Methodology ofKnowledge Creation and ProductionSystem", Organizational Science, Spring,pp. 21-29.

Osaki, Takanori (2007), "RelationshipMarketing in Menicon: BuildingRelationships with Consumers in Associationwith Retailers in a Japanese Contact LensManufacturer", The Marketing Review, Vol.7,Iss.l, pp. 79-88.

Pande, Peter S., Robert P. Neuman and RolandR. Cavanaugh (2000), The Six Sigma Way:How GE, Motorola, and Other TopCompanies are Honing Their Performance,New York: McGraw-Hill.

Peppers, Don and Martha Rogers (1999),Enterprise One-to-One: Tools for Competingin the Interactive Age. New York:Doubleday.

Phillips, Lyn W., Dae R. Chang and Robert D.Buzzell (1983), "Product Qualify, CostPosition, and Business Performance: A Testof Some Key Hypotheses," Joumal ofMarketing, Vol. 47, Spring, pp. 26-43.

Powell. T.C. (1995), "Total QualityManagement as a Competitive Advantage,"Strategic Management Joumal, Vol. 16,pp. 15-37.

Rajaram, Kumar and Tian Zhili (2009), "BufferLocation and Sizing to Optimize Cost andQualify in Semi-Continuous MantifacturingProcesses: Methodology and Application,"HE Transactions, Vol. 41, Iss. 12,pp. 1035-1048.

Reed, R., Lemak, D.J. and Mero N.P. (2000),"Total Quahfy Management and SustainableCompetitive Advantage," Journal of QualityManagement, Vol. 5, pp. 5-26.

Reichheld, Frederick F. (1996), The LoyaltyEffect, Boston: Harvard Business SchoolPress.

Reichheld, Frederick F. and W. Earl Sasser(1990), "Zero Defections: Qualify Comes toService," Harvard Business Review,September-October, pp. 105-11.

Reinartz, Wemer and V. Kumar (2000), "Onthe Profitabilify of Long Lifetime Customers:An Empirical Investigation and Implicationfor Marketing," Joumal of Marketing, Vol.64, October, pp. 17-35.



Rosenfeld, Yehiel (2009), "Cost of QualifyVersus Cost of Non-Qualify in Constmction:The Crucial Balance," ConstructionManagement & Economics, Vol. 27, Iss. 2,pp. 107-117.

Rust, Ronald T., Tim Ambler, Gregory SCarpenter, V. Kumar and Rajendra K.Srivastava (2004), "Measuring MarketingProductivify: Current Knowledge and FutureDirections," Joumal of Marketing, Vol. 6,October, pp. 76-89.

Rust, Ronald T., Katberine N. Lemon andValarie A. Zeithaml (2004), "Retum onMarketing: Using Customer Equify to FocusMarketing Strategy," Joumal of Marketing,Vol. 68, January, pp. 109-27.

Rust, Ronald T., Christine Moorman and PeterR. Dickson (2002), "Getting Retum onQualify: Revenue Expansion, Cost Reduction,or Both?" Joumal of Marketing, Vol. 66,October, pp. 7-24.

Rust, Ronald T., R. Subramanian and MarkWells (1992), "Making Complaints aManagement Tool," Marketing Management,Vol. 3, pp. 40-45.

Rust, Ronald T., Antbony J. Zahorik andTimothy L. Keiningham (1994), Retum onQuality: Measuring the Financial Impact ofYour Company's Quest for Quality, Chicago,Free Press.

Rust, Ronald T., Anthony J. Zahorik andTimothy L. Keiningham (1995), "Retum onQualify (ROQ), Making Service QualifyFinancially Accountable," Journal ofMarketing, Vol. 59, April, pp. 58-70.

Rust, Ronald T., Valarie A. Zeithaml andKatherine N. Lemon (2000), DrivingCustomer Equity: How Customer LifetimeValue is Reshaping Corporate Strategy, NewYork: The Free Press.

Sanayei, Ali, H. Moeini and M. Shafiei (2008),"Relationship Between Service Qualify,Customer Satisfaction, & Customer Loyalfyin Shiraz Banking System," Joumal ofInternational Marketing & MarketingResearch, Vol. 33, February, pp. 31-44.

Sancbez-Femandez, Raquel, and Angeles M.hiiesta-Bonillo (2009), "Efficiency andQualify as Economic Dimensions ofPerceived Value: Conceptualization,Measurement, and Effect on Satisfaction,"Joumal of Retailing & Consumer Services,Vo. 16, Iss. 6, pp. 425-433.

Scbeeres, D. Junell (2010), Keeping QualifyWhile Cutting Costs," IE, Vol. 42, Iss. 3,pp. 24.

Schultz, Don E. and Anders Gronstedt (1997),"Making Marcom an Investment," MarketingManagement, Vol. 6, Iss. 3, pp. 40-49.

Schumpeter, Joseph (1912), The Theory ofEconomic Development, Cambridge, Mass.,Harvard Universify Press.

Shamdasani, Prem, Arvindan Mukherjee andNeem Malhotra (2008), "Antecedents andConsequences of Service Qualify inConsumer Evaluation of Self-service IntemetTechnologies," Service Industries Joumal,Vol. 28, January, pp. 117-138.

Shirouzu, Norihiko, (2001), "Tailoring WorldCars to U.S. Tastes," The Wall StreetJoumal, (January 15), Bl, B6.

Simester, Duncan I., John R. Häuser, BirgerWemerfelt and Roland T. Rust (2000),"Implementing Quality ImprovementPrograms Designed to Enhance CustomerSatisfaction: Quasl-Experiments In the UnitedStates and Spain," Joumal of MarketingResearch, Vol. 37, February, pp. 102-112.

Slotegraaf, Rebecca J. and Jeffrey J. Inman(2004), "Longitudinal Shifts in the Drivers ofSatisfaction with Product Qualify: The Roleof Attribute Resolvabilify," Joumal ofMarketing Research, August, Vol. 41, Iss. 3,pp. 269-280.

Smothers, Norman P. (1990), "Pattems ofJapanese Strategy: Strategic Combinations of

Strategies," Strategic Management Joumal,Vol. 11, pp. 521-533.

Song, Michael, Robert W. Nason and C.Anthony Di Benedetto (2008), "Distinctive

Marketing and Information TecbnologyCapabilities and Strategic Types: A Cross-National Investigation," Journal ofIntemational Marketing, Vol. 16, Iss. 1,pp. 4-38.


Return on Quality—Quality's Impact on Customer Satisfaction . . . . Shah andRegassa

Spreng, Richard A. Linda Hui Shi and ThomasF. Page (2009), "Service Quality andSatisfaction in Business-to-BusinessServices," Joumal of Business & IndustrialMarketing, Vol. 24, Iss. 7/8, pp. 537-548.

Srivastava, Rajendra K. Tasadduq Shervani andLiam Fahey (1998), "Market-Based Assetsand Shareholder Value: A Framework forAnalysis," Joumal of Marketing, Vol. 62,January, pp. 2-18.

Tellis, Gerard J., Eden Yin and Rakesh Niraj(2009), "Does Quality Win? Network

Versus Quality in High-Tech Markets," Joumalof Marketing Research, Vol. 66, April,pp. 135-149.

Tsai, Wen-Hsien and Wei Hsu (2010), "ANovel Hybrid Model Based on DEMATELand ANP for Selecting Cost of Quality ModelDevelopment," Total Quality Management &Business Excellence, Vol. 21, Iss. 4,pp. 439-456.

Tsiotsou, Rodoula (2006), "The Role ofPerceived Product Quality and OverallSatisfaction on Purchase Intentions,"Intemational Joumal of Consumer Studies,March, Vol. 30, Iss. 2, pp. 207-217.

Tuli, Kapil R. and Sundar G. Bharadwaj(2009), "Customer Satisfaction and StockRetums Risk," Journal of Marketing, Vol. 73,November, pp. 184-197.

Vazquez-Casielles, Rodolfo, Leticia AlvarezSuarez and Ana Maria Martin Diaz (2010),"Perceived Justice of Service RecoveryStrategies: Impact on Customer Satisfactionand Quality Relationship," Psychology andMarketing, Vol. 27, Iss. 5, pp. 487-509.

Venkatesan, Rajkumar and V. Kumar (2004),"A Customer Lifetime Value Framework forCustomer Selection and Resource AllocationStrategy," Joumal of Marketing, Vol. 68,October, pp. 106-125.

Wemer, J. Reineartz and V. Kumar (2003),"The Impact of Customer RelationshipCharacteristics on Profitable LifetimeDuration," Joumal of Marketing, Vol. 67,January, pp. 77-99.

Wheeler, Donald J. and David S. Chambers(1992), Understanding Statistical ProcessControl. Knoxville, TN: SPC Press.

Yang, Ching-Chow (2008), "Improving tiieDefinition and Quantification of QualityCosts," Total Quality Management &Business Excellence, Vol. 19, March,pp. 175-191.

Yanmei, Zhu, You Jianxin, Robert Alard andPaul Schonsieben (2009), "Design Quality: AKey to Improve Product Quality inInternational Production Network,"Production Planning & Control, March, Vol.20, Iss. 2, pp. 168-177. '

Yen-Ku, Kuo and Ye Kung-Don (2009), "TheCausal Relationship Between ServiceQuality, Corporate Image and Adults'Learning Satisfaction and Loyalty: A Studyof Professional Training Programmes in aTaiwanese Vocational Institute," TotalQuality Management & Business Excellence,Vol. 20, Iss. 7, pp. 749-762.

Yip, G. S. (1989), "Global Strategy....hi aWorld of Nations?" Sloan ManagementReview, Vol. 31, Iss. 1, pp. 2^-41.

Zeithaml, Valarie A. (2000), "Service Quality,Profitability, and the Economic Worth ofCustomers: What We Know and What WeNed to Leam," Joumal of the Academy ofMarketing Science, Vol. 28, Iss. 1, pp. 67-85.

Zhou, Kevin Zheng, Julie Juan Li; Nan Zhouand Chenting Su (2008), "MarketOrientation, Job Satisfaction, ProductQuality, and Firm Perforrnance: Evidencefrom China," Strategic Management Joumal,Vol. 29, Iss. 29, pp. 985-1000.


Copyright of Marketing Management Journal is the property of Marketing Management Journal and its content

may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express

written permission. However, users may print, download, or email articles for individual use.

Documents

Quality Article