Implications of quality systems in enterprises

In order to examine the implications derived from the use of quality systems it is necessary to analyze individually the elements that integrate them, both quality regulations and methodologies. This is generated because of the lack of research addressing this theme in an integral manner.

During the last two decades, interest over the study of quality regulations as a factor that contributes to the operative and financial performance has increased. The studies that tackle this relationship stem solely from the analysis of ISO-type standards, the Q tourism quality certification, and the European Excellence model (EFQM), without taking into consideration other norms of common use.

Some of the studies that examine the benefits derived from quality regulations are controversial. Many studies conclude that quality standards exert a positive effect on productivity (^{Sánchez-Ollero et al., 2014}), the supply chain (^{Houshmand and Rakotobe, 2012}), the market quota (^{Mak, 2011}), continuous improvement (^{Lizarzaburu-Bolaños, 2016}), client satisfaction (^{Chikuku et al., 2012}), and internalization of enterprises (^{Botello-Peñaloza, 2016}), while others have reached dissimilar conclusions regarding profitability (Table 1).

Diverse critical voices point out that this discord is because the studies in this line do not consider in their analyses the motives that guide the decision of certification, since these can be influencing the profitability of the companies. According to the experts, there are two groups of motivations: on the one side, the internal ones, referring to improvement in productivity, efficiency and profitability, and on the other, the external ones, related to the pressures from various agents such as clients, the government and the competition. The enterprises that are certified because of internal reasons obtain higher profitability than those that do it because of external reasons. In this sense, ^{Terziovski and Power (1997}) emphasize the need to develop a strong quality culture for the implementation of certifications that translate into increases in profitability.

On the other hand, quality methodologies are related to efficiency in processes (^{Tolamatl-Michcol et al., 2011}), reduction of delivery times (^{Fuente-Aragón de la et al., 2012}), optimization in the supply chain (^{Jones and Womack, 2012}), increase in the product quality (^{Álvarez-García et al., 2014}), increase in profitability (^{Oliva-Olivera, 2013}), and continuous improvement (^{Álvarez-García et al., 2014}).

^{Heras et al. (2009)} maintain that the quantitative or hard methodologies, such as the analysis of the mode and effect of faults, six sigma, and the statistical control of the process, are linked to a significant improvement in entrepreneurial performance. It should be highlighted that the hard techniques and tools are used less often than the soft, such as systems of complaints and suggestions and improvement groups, since they generally ignore and require greater financial investment, time, specialized knowledge and experience. Likewise, ^{Heras et al. (2011)} state that qualitative methodologies tend to be used by companies with quality management systems based on the ISO norms, while the quantitative ones tend to be implemented in enterprises that adopt the European Excellence model. These differences can be explained because ISO is focused on the processes and the client, while the EFQM has a broader and more complete perspective.

The market and its relationship with quality systems

The market is a complex and dynamic entity, studied in the theory of Industrial Organization. According to ^{Shepherd (1999)}, it is a group of buyers and sellers that exchange goods that are highly replaceable between each other. Defining the market means delineating its limits, so that it contains all the substitute goods and excludes all those that are not. This delimitation implies examining the conditions of demand that include the decision zone of the consumer with regards to a product. According to Shepherd and ^{Shepherd (2003)}, the markets are estimated based on the following dimensions: geographic area, crossed elasticity, and type and price of the product.

Once the market is defined, its structure can be evaluated. The main elements to determine the type of structure are: market quota, concentration and number of comparable rivals, and entry barriers (^{Shepherd, 1999}). According to the economic theory, the types of market structure are perfect competition, monopoly and oligopoly (Figure 1).

Source: ^{Garza-Lagler (2015)} based on ^{Bueno and Morcillo (1993)}.

Figure 1 Types of market structures. 

The oligopoly structure is the one that is of greater use to understand the functioning of current markets; in fact, the agrifood industries tend to identify increasingly more with this type of scheme (^{Taddei, 2008}; ^{Garza-Lagler, 2015}), so that strategic behavior takes place in it, since enterprises generate a high degree of competitiveness through differential characteristics on the competition.

In this regard, ^{Porter (1987)} identifies that low costs and the differentiation of products are two types of competitive advantages. In turn, these generate three types of generic strategies: approach, leadership in costs and differentiation, with the last two having a close relationship with quality and, therefore, with quality management systems. It can be thought that the differentiation strategy is linked more to quality than to leadership in costs; however, the praxis demonstrates that enterprises can produce with quality systems at low costs. In the current environment the enterprises that do not integrate both tactics to their strategic planning face disadvantages before their competitors, since the leader with these characteristics will have higher potential to position its products in a more competitive plane than its rivals.

Likewise, ^{Boyer and Freyssenet (2003}) recognize, in some segments of the industry, six profitability strategies in function of the market: quality in the products, diversity in the offer, productive flexibility, innovation, permanent cost reduction, and production volume. Certainly, it is impossible for all enterprises to adopt and combine the same tactics, for they must solve problems of different nature at different times and with diverse resources. However, in highly demanding markets, such as international ones and those of high spectrum products, it stands out that quality carries out a greater role than the other strategies. In export markets, ^{Botello-Peñaloza (2016}) points out that quality systems² have a differentiating role, in addition to a positive impact on the internationalization of the enterprises, since their probability of insertion in international markets increases in 20 %, differing from the ones that lack them.

Quality systems in food agroindustries

The strong food crises have caused for the requirements from buyers to increase and diversify, since their demands are increasingly stricter, critical and fragmented, since they require quality foods that are innocuous, nutritive, low fat, at accessible prices, of simple elaboration, traceable, among many other characteristics. Facing this situation, the industries devoted to food elaboration modify their techno-productive systems through the implementation of quality systems -regulations and methodologies- that lead to the assurance of quality.

In the food industry quality systems are part of the new regulatory framework that emerges from transformations of the international commerce regime (^{McNair, 2012}). They are created by large corporations, with the aim of categorizing, distinguishing and protecting different products from imitation, and thus legitimizing the increase in their commercial value when ensuring a higher added value (^{Rodríguez-Gómez, 2012}). When doing this, there is also an attempt to provide the different actors in agrifood systems with new market opportunities and competitive advantages when responding to consumers’ demands.

This gives rise to the proliferation of quality signs, such as brands, origin denominations, and quality standards. Some of these are of mandatory nature, such as: good agricultural practices, good manufacture practices, and integrated pest management; and others are voluntary, for example: ISO regulations, Hazard Analysis and Critical Control Points (HACCP), and international food standards (IFS). However, the nature and type of regulations will depend on the requirements imposed by each market, since these are not applicable to any industry, culture and environment. In the case of México, the most outstanding certification for the food agroindustry are: the Mexican Regulations, the Mexican Official Norms (Normas Oficiales Mexicanas, NOM), Supreme Quality México (México Calidad Suprema, MCS), and the certification of Federal Inspection Type (Tipo Inspección Federal, TIF).

Concerning quality methodologies, the literature does not document the types of techniques and tools used in food agroindustries. In turn, it should be highlighted that quality standards are not regulated by specific methodologies and their use depends on the particular needs of each industry. Despite this, in the manufacturing and services sector, various authors (^{Dale and Mcquater, 1998}; ^{Heras et al., 2009}; ^{Álvarez-García et al., 2014}) report the use of some methodologies such as: slender manufacture, seven quality tools, disciplines for problem resolution, and benchmarking, among others.

Likewise, it is important to mention that the implementation of quality systems has been increasing, even when their use is still limited and restricted to a few, especially in less developed countries (^{FAO, 2004b}; ^{FAO, 2006}; ^{López-Palacios et al., 2010}; ^{Álvarez-García et al., 2014}). ^{FAO (2006)} maintains that this problematic is due to the lack of the following resources: productive infrastructure, economic capacity, availability of quality inputs, certified suppliers and with traceability systems, homogeneity of regulations, updating of regulations, collaboration with research centers and government backing.

With the intention of addressing this problematic, the Mexican government provides financing to producers and entrepreneurs through the National Development Plan 2013-2019. These supports are granted for infrastructure, equipment and technical assistance (^{Secretaría de Hacienda y Crédito Púbico [SHCP], 2013}). Likewise, through the Sectorial Agricultural and Livestock, Fishery and Food Program (Programa Sectorial de Desarrollo Agropecuario, Pesquero y Alimentario) 2013-2018, and the National Development Plan 2013-2018, the SAGARPA (Ministry of Agriculture, Livestock Production, Rural Development, Fishing and Food, Secretaría de Agricultura, Ganadería, Desarrollo Rural, Pesca and y Alimentación) grants economic backing to meat industries to improve, renovate or build facilities that become incorporated into the TIF certification (^{Shared Risk Fund, Fideicomiso de Riesgo Compartido [FIRCO], 2014}).