Top management intention to comply with industry standards in the China automotive industry

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Top management intention to comply with industry standards in the China automotive industry

 

Author: Yip, Ming Tony
Title: Top management intention to comply with industry standards in the China automotive industry
Degree: D.B.A.
Year: 2010
Subject: Hong Kong Polytechnic University -- Dissertations
Automobile supplies industry -- China -- Management
Automobiles -- Parts -- Design and construction -- Quality control -- Standards -- China
Department: Graduate School of Business
Pages: viii, 185 leaves : ill. ; 30 cm.
InnoPac Record: http://library.polyu.edu.hk/record=b2394271
URI: http://theses.lib.polyu.edu.hk/handle/200/5983
Abstract: A key feature of globalization is the increasing economic and political importance of global standards. They have emerged to address a wide range of issues, from quality assurance, food safety, working conditions, to various ethical, environmental and social concerns. Compliance with global standards is a key political concern, especially in developing countries. To respond to strategic challenges in the automotive industry, practitioners declare that the adoption of the automotive components suppliers in these low-cost countries (e.g. China) in meeting the original equipment manufacturer's (OEM's) mandate on industry standards compliance is crucial. The Peoples Republic of China is not only one of the fastest growing markets for new car sales; it has also become one of the largest exporters for automotive components. The role of a components exporter has strategic importance in supporting the competitiveness of the U.S and European OEMs in the current global competitive landscape. To avoid costly recalls and production delays, global standards such as MMOG/LE (materials management and logistics) and TS 16949 (product quality), are the two key industrial standards, which have been widely adopted by the US and European OEMs as mandatory requirement (i.e. Ford's Q1) if a supplier was to obtain a preferable vendor status. To this end, one of the aims of this study is to investigate the paradox of managerial intentions towards the adoption of industrial standards. A theoretical model was developed using Institutional Theory, Theory of Planned Behavior, and General Deterrence Theory. To validate the research model, Partial Least Square (PLS) analysis was performed with a total of 378 valid samples obtained from automotive component suppliers in mainland China. Confirmatory factor analysis was applied to reveal the model fit of all the measurements of each construct. Satisfactory results were obtained; indicating that the data collected was well-fitted to the model. Further, PLS findings pointed out that, institutional forces of coercive pressure and normative pressure have significant direct and indirect impacts on managerial intentions of using compliance standards. Significant mediating role of top management belief was found, suggesting that attitudes of local government, competitors and customers of using MMOG/ TS 16969 have positive impacts on managerial beliefs, and in turn, have positive effects on managerial attitude. It is believed that this study will serve as an important secondary source that will contribute to the existing knowledge by applying the aforementioned theories in compliance research. Findings of this research are hoped to shed light on the identification of compliance motivators, and will therefore help industrial practitioners, especially the OEMs and related stakeholders, to further the strategic planning processes.

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