The Effect of Total Quality Management on Firm Performance with the Mediating Roles of Innovation and Knowledge Management in Small Medium Enterprises

Abstract

In the present era, the policy and decision makers are quite concerned regarding quality, hence the firms are more intricate and facing questions concerning which quality management practice would be adopted to increase the firm’s performance. The primary objective of this paper was to identify the effect of total quality management on firm’s performance through the mediating roles of innovation and knowledge management in the SME’S of Pakistan. A sum of 280 respondents was selected for data collection from various SME’S and employing a structural equation modelling for data analysis. It was summed up that a statistically significant causal correlation has been found among the TQM, innovation, knowledge management and firm’s performance. This article is established on theories like resource based theory and institutional theory. The results give cognitive understandings regarding how the modern as well as present SME’s would accomplish higher performance and consistent competitiveness through the interplay of these variables in the local and international market.