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 International Journal of Quality and Service Sciences
Quality management practices and their effects on the performance of public
hospitals
Jingjing Xiong, Zhen He, Yujia Deng, Min Zhang, Zehong Zhang,
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Service Sciences, Vol. 9 Issue: 3/4, pp.383-401, https://doi.org/10.1108/IJQSS-02-2017-0019
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The
Quality management practices performance of
and their effects on the public
hospitals
performance of public hospitals
Jingjing Xiong 383
School of Public Health and Management,
Wenzhou Medical University, Wenzhou, China Received 27 February 2017
Accepted 23 May 2017

Zhen He, Yujia Deng and Min Zhang

College of Management and Economics, Tianjin University, Tianjin, China, and
Zehong Zhang
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School of Public Health and Management,

Wenzhou Medical University, Wenzhou, China

Abstract
Purpose – To face profound changes from decreasing funding, growing patient expectations and increasing
competition in the health-care market, public hospitals began to implement effective quality management
(QM) practices following manufacturing and other service industries. However, there was little knowledge
relevant to the impact of QM practices on the performance of public hospitals. The study aims to shed some
further light on this issue.
Design/methodology/approach – The paper extends the previous empirical research to the health-care
sectors and suggests the research framework of QM practice-performance relationships in public hospitals.
For validation purposes, a cross-sectional survey involving 204 quality managers and directors of large public
hospitals was carried out between April and October 2013 in Zhejiang Province, China. Structural equation
modeling was used to test the hypothesized relationship between QM practices and hospital performance.
Findings – Empirical results support that the implementation of QM practices can bring many benefits to
sample hospitals. The dimensions of employee relations and process management are directly related to the
health-care and non-health-care performance of public hospitals.
Originality/value – It explores the relationship between QM practices and hospital performance based on
empirical results from Chinese public hospitals, whereas few studies have been conducted within the context
of public health-care sectors in developing countries. The empirical results could enhance hospital managers’
understanding of the nature of QM practice-performance relationship and help mangers re-allocate more
resources to those elements of the QM systems that have the most significant impact on hospital performance.
Keywords Public hospital, Quality management practices, Hospital performance
Paper type Research paper

1. Introduction
The health-care industry presents a very dynamic, unexpected, ambiguous and uncertain
environment (Manjunath et al., 2007). During the past few years, hospitals experienced the
challenges of decreasing funding, growing patients’ expectations and increasing
competition in the health-care market. Public hospitals face the similar situation. Generally International Journal of Quality
and Service Sciences
Vol. 9 No. 3/4, 2017
pp. 383-401
The authors would like to acknowledge the contributions of the alumni of Wenzhou Medical © Emerald Publishing Limited
1756-669X
University who provided significant assistance in distributing and collecting the questionnaires. DOI 10.1108/IJQSS-02-2017-0019
 IJQSS speaking, public hospitals are mostly financed by the government (Gok and Sezen, 2013)
9,3/4 and mainly focus on fulfilling the demand for public goods or meeting health-care needs (Lee
et al., 2009). Due to the decline in government revenues and the increasing national health
expenditure, governments are beginning to reduce the funding to public hospitals. Taking
China as an example, from 1980, central government had to substantially limit its funding to
the health-care sector, which had accounted for 50-60 per cent of hospitals’ income in the
384 planned economy (Wagstaff et al., 2009). In addition, the health-care market is changing
from a seller-oriented to a buyer-oriented market, and health-care sectors including public
hospitals are requested to offer services that meet or exceed the patients’ expectations and
needs (Backman et al., 2016). Apart from the challenges mentioned above, public hospitals
have faced the problems to operate health-care facilities optimally, deliver health-care
services efficiently and serve the impoverished population who lack the ability to pay for
health care (Blecher et al., 2011). What is needed is a way of reorganizing management to
reduce the waste, inefficiency and mistakes (Short, 1995).
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Quality management (QM) can be seen as a management philosophy characterized by its

principles, practices and techniques which emphasize continuous improvement, increased
employee involvement and teamwork, process orientation, competitive benchmarking,
committed leadership, constant measurement of results and closer relationship with
suppliers (Rönnbäck and Witell, 2008). Public hospitals have become more aware of the
importance of health-care quality (Paquette et al., 2011). Many of them have turned to QM
practices that can resolve these problems and eventually provide superior organizational
performance (Evans, 2010; Lee et al., 2013).
The impact of QM practices on organizational performance has been the subject of
constant interest and challenge among researchers. Numerous empirical studies have
attempted to investigate the relationship between QM practices and firm performance.
However, only a few studies have attempted to investigate the relationship between QM
practices and hospital performance, compared with manufacturing industry (Ebrahimi and
Sadeghi, 2013). In addition, there was little knowledge relevant to the impact of QM
practices on the performance of public hospital. In many countries, the majority of low and
medium income population uses services provided by public hospitals. These services are
viewed as public goods, such as medical education, unique or specialized patient care
services and community programs (Fishman, 1997). Public hospitals play an important role
in the broad health-care safety net that supports the delivery of health-care services to a
variety of vulnerable population. For this reason, this study aims to shed some further light
on this issue. The following research questions are empirically examined in this study:
RQ1. What is the relationship between the dimensions of QM practices within the
context of public hospitals?
RQ2. What are the characteristics of public hospital performance?

RQ3. Which QM practices are directly related to the performance of public hospital?

RQ4. Which QM practices are indirectly related to the performance of public hospital?

The remainder of the paper is structured as follows. The next section presents literature
review. Afterwards, the paper provides the theoretical framework of the research and
hypotheses in detail. The subsequent section describes the research methodology and the
results of empirical findings in Chinese public hospitals. The implications of the results for
researchers and practitioners are then discussed. The last section draws some conclusions
and gives some suggestions for future work.
 2. Literature review The
QM is an integrated management philosophy aiming at continuous improvement of the performance of
performance of processes, products and services to achieve or exceed customer needs and
expectations (Prajogo and McDermott, 2005; Sousa and Voss, 2002). It helps organizations
public
achieve excellence. In comparison to manufacturing, health-care sectors have to a less extent hospitals
adopted QM practices. Nowadays, facing the challenge of decreasing funding and utilization,
and increasing consolidation and competition, survival of health-care sectors heavily
depends upon delivering high-quality service focusing on customer satisfaction (Short, 1995). 385
Therefore, hospitals have great motivation to incorporate QM initiatives. Four main QM
models have been applied in the health-care field; they are: ISO9000 model, the Joint
Commission International (JCI) model of accreditation, total quality management (TQM)
model and Six Sigma management model. Alongside these QM models, there are
standardized models used by organizations as a guide for quality improvement or to carry
out self-evaluations of their QM practices (Claver et al., 2003). These main models are the
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Malcolm Baldrige National Quality Award (MBNQA) model in the USA, the European
Foundation for Quality Management model in Europe and the Deming Prize model in Japan.
When choosing QM models, managers expect a successful implementation and hope to
explore what QM practices are the best predictors of health-care providers’ organizational
performance. From the extensive literature review, despite the perceived importance of
introducing and implementing QM, there is still little systematic evidence in the literature on
the relationship between QM practices and hospital performance on the whole (Macinati,
2008). There are, however, several studies focus on studying the relationship between, for
example, critical factors of TQM and hospital performance based on Turkish experience
(Dilber et al., 2005), QM systems and organizational performance in the Italian National
Health Service (Macinati, 2008), the critical success factors of TQM and organization
performance in the Oatari health-care sector (Salaheldin and Mukhalalati, 2009), TQM and
operational flexibility in Jordanian hospitals (Alolayyan et al., 2011), MBNQA for service
QM and performance in Asian health-care organizations (Souza and Sequeira, 2011; Lee
et al., 2013), critical TQM practices and hospital performance in Saudi Arabia (Alaraki,
2014), QM practices and organizational performance in Palestinian (Sabella et al., 2014).
The existing studies utilized different analytical models, measures, approaches and
sample populations. First, these studies have carried out different instruments to determine
the dimensions of QM practices such as MBNQA (Meyer and Collier, 2001; Lee et al., 2013;
Sabella et al., 2014; Souza and Sequeira, 2011), the framework of Saraph et al.(1989)
(Alolayyan et al., 2011; Dilber et al., 2005; Macinati, 2008). Second, the terms of performance
measured vary among these studies, e.g. organizational performance results (Lee et al., 2013;
Souza and Sequeira, 2011), financial and non-financial performance (Dilber et al., 2005) and
operational performance only (Alolayyan et al., 2011). Third, the type of analysis used in
measuring the relation also differs among the studies, e.g. regressions (Souza and Sequeira,
2011), correlations (Dilber et al., 2005, Macinati, 2008) or structural equation modeling (Lee
et al., 2013). Lastly, for reasons of practicality and convenience, the sample selection varies
among above empirical studies, such as the public and private hospitals (Alolayyan et al.,
2011; Lee et al., 2013; Sabella et al., 2014; Salaheldin and Mukhalalati, 2009; Souza and
Sequeira, 2011), small- and medium-sized hospitals (Dilber et al., 2005).
Above studies have tried to investigate QM practice-performance relationship in hospital
context. However, there is relatively little knowledge directly relevant to the situation of QM
practices implemented in public hospitals and their effectiveness. Public hospitals are
different from private hospitals in dimensions of ownership, goal setting, funding and
control. Public organizations are more bureaucratic, have a strong sense of public
 IJQSS responsibility and compliance with regulation (Goldstein and Naor, 2005). How are QM
9,3/4 practices implemented in public hospitals? What is the relationship between QM practices
and performance within the context of public hospitals? The purpose of this paper is to
answer these questions based on an investigation in China, a developing country with a
large amount of public hospitals.

386 3. Research model and hypotheses

3.1 Quality management practices
In this study, we adopt the instrument provided by Saraph et al. (1989) to construct QM
practices. Meanwhile, considering the characteristics of public health-care sectors and
covering more recent QM topics, we incorporate supplementary changes based on other QM
models (Macinati, 2008; Miller et al., 2009). The decision to follow Saraph et al.’s model is
based on two considerations. First, a review of several studies that adopted and replicated
Saraph’s instrument of QM practices in the USA (Miller et al., 2009), Italy (Macinati, 2008),
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Jordan (Alolayyan et al., 2011) and Turkey (Dilber et al., 2005), all indicated that the
instrument is reliable and valid across nations and adapted to health-care sectors. Second,
applying the Saraph et al.’s model that is widely recognized, but seldom used in public
health-care, may enrich the knowledge about “what works” in such a sector.
The instrument for measuring QM practices in this study includes nine dimensions: top
management leadership, quality policy, role of the quality department, training, process
management, customer focus, quality information and analysis, employee relations and
supplier QM. A brief presentation of the nine dimensions of QM practices and related
descriptions will be given in this section:

Top management leadership: to describe the crucial role of top managers in driving
hospital-wide QM efforts in public hospitals;

Quality policy: to examine how a public hospital develops and implements its quality
strategy and goals;

Role of the quality department: to describe the visibility and autonomy of the quality
department, the coordination between the quality department and other
departments in public hospitals;

Training: provision of quality-related training including quality concepts, quality
improvement tools for managers and employees;

Process management: to emphasize conformance to patients’ requirements by
means of managing, evaluating and improving hospital key processes. Clarity of
process ownership, boundaries and steps;

Customer focus: to describe the extent to which patients are satisfied and to which a
public hospital evaluates the feedback from its patients to improve quality;

Quality information and analysis: to describe how public hospital mangers ensure
the availability of reliable, adequate, timely and relevant data and information for
all key users to improve health-care quality;

Employee relations: a general component that encompasses a variety of human
resource management practices for the success of QM in public hospitals, such as
employee involvement, empowerment, recognition and so on; and

Supplier QM: to encourage an effective and long-term cooperation with fewer
dependable suppliers to improve quality. Purchasing policy emphasizing quality rather
than price.
 3.2 Performance measures The
Performance measurement is important for the optimum management of an organization performance of
and organizational performance is a complex phenomenon. According to the related
literature, organizational performance should be measured using a multi-dimensional
public
approach. Operational performance, quality performance, financial and market performance hospitals
and customer satisfaction are most widely cited (Ebrahimi and Sadeghi, 2013).
Exploratory factor analysis with varimax rotation was performed on the performance
measures of the public hospital to extract the dimensions. Performance of public hospital in 387
this study is measured by using operational outcomes, quality outcomes, financial and
market outcomes and customer outcomes. The factor analysis of the performance items
yielded two factors explaining 64.84 per cent of total variance. Based on the items loading on
each factor, the factors are labeled “Health-care performance” (Factor 1) and “Non-health-
care performance” (Factor 2). Health-care performance (HP) dimension includes directly
related to health-care service measures such as the level of medical quality (HP1), patient
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length of stay for care in hospital (HP2), bed cycle time (HP3). Non-health-care performance
(NHP) dimension contains subjective measures such as customer satisfaction (NHP1),
financial benefits and market development (NHP2) and reputation among major customer
segments (NHP3). In this study, HP and NHP dimensions are both measured on
respondent’s perception of how the organization is performing relative to the competition
over the past three years. The development of HP and NHP dimensions considers the
characteristics of public hospitals, differing from the division of financial and non-financial
performance measures (Dilber et al., 2005).

3.3 Hypotheses
3.3.1 Relationship between quality management practices in public hospitals
3.3.1.1 Top management leadership. In recent years, leadership has been connected to
quality of care in hospitals. Leadership ensures that a public hospital has a definite vision,
communicates directions and makes continuous improvement toward that vision.
Management commitment involves articulating a vision for the future that is clear and
compelling, providing strategic leadership (Tsang and Antony, 2001), creating an
organizational climate that empowers employees (Ugboro and Obeng, 2000), developing
systems to meet customer expectations and improving organizational performance (Fuentes
et al., 2006).
Previous studies indicate that QM cannot be effectively implemented if there is a lack of
commitment from the top management (Wilson and Collier, 2000). In addition, top
management leadership is an important factor in QM implementation because it improves
performance by influencing other QM practices (Parast et al., 2006; Wilson and Collier, 2000).
Leadership develops value and useful quality policies for patient focus and supports
employees for work efficiency. Top management commitment determines directly the
autonomy and effectiveness of the quality department in public hospitals. Top management
can ensure that the necessary resources for quality-related training are available. Strong
support by senior administrators is an accelerator in the implementation of quality information
and analysis in public hospitals. Effective leadership is also critical to affecting the interactions
with supply chain members. Consequently, the following hypotheses are proposed:
H1a. Top management leadership is positively related to quality policy.

H1b. Top management leadership is positively related to role of the quality department.

H1c. Top management leadership is positively related to training.

 IJQSS H1d. Top management leadership is positively related to quality information and
9,3/4 analysis.
H1e. Top management leadership is positively related to supplier QM.
3.3.1.2 Quality policy. Effective strategic quality planning is crucial to the success of quality
improvement programs (Brah et al., 2002). The dimension of quality policy focuses on
388 examining how a public hospital develops and implements its quality strategy and goals.
Because public hospitals face a variety of uncertainties, leaders or managers must consider
the risks within individual departments as well as the organization as a whole. If public
hospitals try to reduce uncertainty for quality improvement through comprehensive
planning, they must develop policies and goals that provide support to patients and
employees. Thus, quality planning affects the customer focus and employee relations.
H2a. Quality policy is positively related to customer focus.
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H2b. Quality policy is positively related to employee relations.

3.3.1.3 Role of the quality department. We identify the role of the quality department as
another important dimension of QM practices for public hospitals. Some studies highlight
that this dimension is an important underlying factor of the QM systems adopted by health-
care providers (Macinati, 2008; Miller et al., 2009). When an independent quality department
is established and supported with fulltime QM staff and budget allocation for QM, it is a
sign to hospital employees that top management is committed to quality improvement and
the commitment favors their acceptance of responsibility for quality. The quality
department in a public hospital can be in charge of implementing effective quality training
programs, dealing with quality complaints to improve the patients’ satisfaction, utilizing
extensive statistical process control methods to reduce variations in processes and selecting
what quality data are collected and used as tools to manage quality of care. Therefore, the
following hypotheses are offered:
H3a. Role of the quality department is positively related to training.
H3b. Role of the quality department is positively related to customer focus.
H3c. Role of the quality department is positively related to process management.
H3d. Role of the quality department is positively related to quality information and
analysis.
3.3.1.4 Training. In the literature (Alolayyan et al., 2011; Cohen et al., 2008; Miller et al., 2009;
Sutherasan et al., 2007; Wagner et al., 2014), employee training is clearly identified as a
critical component of workforce management when implementing significant changes in a
hospital. Public hospitals should develop suitable training programs to help managers,
direct doctors and nurses to enhance the quality-related skills, communications and
teamwork. If it is to be effective, i.e. transforming employees into creative problem solvers,
training in quality-related issues should result in a more satisfied workforce and help
employees to overcome their resistance to continuous quality improvement. Thus, we have
the following hypothesis:
H4. Training is positively related to employee relations.
3.3.1.5 Customer focus. Another critical success factor to ensure long-term organizational
survival and achieve organization goals is to understand and incorporate customer needs
 and expectations (Brah et al., 2002; Sharma and Gadenne, 2008). The dimension of customer The
focus is to describe the extent to which patients are satisfied and to which a public hospital performance of
evaluates the feedback from its patients to improve quality. Based on patient demands and
feedbacks, public hospitals can improve/redesign the service processes. Therefore, the
public
following hypothesis is suggested: hospitals
H5. Customer focus is positively related to process management.
389
3.3.1.6 Supplier quality management. Many researchers have stressed the importance of
effective supplier QM in the health-care sector (Alolayyan et al., 2011; Lee et al., 2011;
Macinati, 2008). Regarding supplier-related practices, suppliers of goods and services play a
critical role in the delivery of services in public hospitals as they do in the making of
products for manufacturing organizations. Good practices for supplier QM include fostering
a purchasing policy that emphasizes quality rather than price, being involved in hospitals’
service improvement processes, a strong interdependence between public hospitals and
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suppliers, reliance on supplier process control. Improving the quality of purchased parts and
materials, a main source of process variability, will have a positive effect on process
management by eliminating variance in materials and parts (Flynn et al., 1995; Kwon et al.,
2016). Thus, we lead to the following hypothesis:
H6. Supplier QM is positively related to process management.

3.3.1.7 Quality information and analysis. QM philosophy emphasizes that managers should
make quality decisions based on the analysis of real and relevant data (Gardner et al., 2015;
Sadikoglu and Zehir, 2010; Wu et al., 2016). Each department in a public hospital needs a
significant amount of useful information to make correct decisions and to provide high
quality service.
Top managers in public hospitals need reliable, adequate, high quality and timely data
and information to develop, implement and improve their quality strategy and policy to
drive quality excellence and improve performance. Through the creation of a supplier
performance measurement database, public hospitals can manage supplier quality to
enhance material quality, reduce development costs and purchase prices, and improve
supplier responsiveness. Quality data directly affect process management by informing
hospital workforce about changes in processes immediately so they can take corrective
actions to ensure operations not to be interrupted. A case in point, several QM techniques
such as control charts and cause and effect analysis are aimed at helping hospitals to
process information effectively. Moreover, this element is concerned with the scope,
management and use of data and information to maintain a customer focus and workforce
focus, to drive quality excellence and to improve performance. Consequently, the following
hypotheses are proposed:
H7a. Quality information and analysis is positively related to quality policy.

H7b. Quality information and analysis is positively related to supplier QM.

H7c. Quality information and analysis is positively related to customer focus.

H7d. Quality information and analysis is positively related to process management.

H7e. Quality information and analysis is positively related to employee relations.

 IJQSS 3.3.2 Relationship between quality management practices and the performance of public
9,3/4 hospital
3.3.2.1 The impact of employee relations on the performance of public hospitals. Workforce
focus is frequently recognized as one of the most important requirements for the success of
QM (Chandler and McEvoy, 2000; Vouzas, 2007). It is a general component that
encompasses a variety of human resource management practices for the success of QM,
390 such as employee involvement, empowerment, recognition, teamwork, etc. Satisfied,
motivated, trained and committed public hospital employees improve HP and patient
satisfaction. According to Tarí et al. (2007), workforce focus has a great effect on quality
outcomes. Yang (2006) empirically indicated that human resource management practices
have a significant, positive effect on QM implementation. Consequently, the following
hypotheses are proposed:
H8a. Employee relations is positively related to HP.
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H8b. Employee relations is positively related to NHP.

3.3.2.2 The impact of process management on the performance of public hospital. Process
management is a key part of any QM strategy (Anderson et al., 1995). The core idea is that
organizations are sets of interlinked processes, and the improvement of these processes is
the foundation of performance improvement (Fening et al., 2008). The practices of process
management are to emphasize conformance to patient requirements by means of managing,
evaluating and improving key processes in public hospitals. The goal is to increase the
quality of outputs as well as to reduce waste and costs (Anderson et al., 1995; Ahire and
Dreyfus, 2000). Based on the reviewed literature, the following hypotheses are suggested:
H9a. Process management is positively related to HP.
H9b. Process management is positively related to NHP.
3.3.2.3 The relationship between health-care performance and non-health-care
performance. In this study, HP dimension includes directly related to the measures of
health-care service, such as the level of medical quality, patient length of stay for care in
hospital and bed cycle time. And NHP dimension contains measures, such as customer
satisfaction, financial benefits and market development and reputation among major
customer segments. When a public hospital delivers high-quality health care, it usually
acquires a reputation among stakeholders. Improving health-care quality by reducing waste
and improving efficiency will increase the return on assets. Lastly, improvements in quality
will result in more satisfied patients with greater loyalty, increased sales and an enhanced
competitive position. Thus, we propose the following hypothesis:
H10. HP is positively related to NHP.
Based on the above hypotheses, we suggest the proposed research model as shown in
Figure 1. Each path in Figure 1 is labeled with the associated hypothesis.

4. Methods
4.1 Data collection
Hospitals in China are usually divided into three levels and ten classes according to certain
indicators such as the number of hospital beds, medical quality and facilities. In terms of
history and impact, the public hospitals enjoy the highest prestige and dominate the health-
care industry in China. Among them, tertiary (Level 3) hospitals are large hospitals, which
 The
performance of
public
hospitals

391
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Figure 1.
The proposed
research model

play an important role in the Chinese National Health Service system, as they provide a wide
variety of services and usually have the highest level of medical quality. Their core business
is described as health care, teaching and research. Because large hospitals are complex
organizations with a significant and sustained interest in developing and implementing
various QM practices, we selected large public hospitals (tertiary hospitals) in China as the
target population. For reasons of practicality and convenience, we selected a representative
province, Zhejiang, as our target sample. Zhejiang province is located in the southeast coast
of China and the number of resident population is 55.39 million by the end of 2015. In 2015,
the province’s GDP is 4,288.6bn RMB, an average growth rate of 8.2 per cent in the past five
years, an increase of 8 per cent compared with the same period past year. It is a typical
Chinese province in terms of economic development and marketization. To face great
challenges, large public hospitals in Zhejiang province have implemented various QM
initiatives such as TQM, JCI and Six Sigma management to improve organizational
effectiveness and competitiveness. It is easy to find some more information to analyze the
relationship between QM practices and hospital performance.
In this study, we used the survey questionnaire to collect data. This method was chosen
to get the most accurate information possible, given the time and distance constraints. The
survey questionnaire is developed based on the studies described above (Dilber et al., 2005;
Lee et al., 2013; Macinati, 2008; Saraph et al., 1989). Responses to these questions are scored
using a five-point Likert scale, with a value of 1 indicating “strongly disagree” and a value of
5 indicating “strongly agree”.
Because the questions were adapted from English literature, the English version was first
developed, then translated into Chinese by a senior professor of QM and checked by several
quality managers from public hospitals in China. The Chinese version was translated back
into English by a professor from Wenzhou Medical University who is fluent in both English
and Chinese. The back-translated English version was compared with the original English
 IJQSS version to improve the accuracy of the translation. The two English versions had no
9,3/4 significant difference. Besides, the instrument was pilot tested in three public hospitals to
confirm that the measurement items are clear and unambiguous. Each pilot included
structured interviews with relevant hospital quality managers to collect feedback.
There were 122 tertiary hospitals in Zhejiang province by the end of March 2013. In these
public hospitals, there are many alumni of Wenzhou Medical University. Under the help of
392 university alumni association, we contacted and fully communicated the objectives and
requirements of the survey with the relevant alumni. Voluntary alumni was responsible for
finding the appropriate respondents of the questionnaire, introducing the purpose of the
study, informing respondents of the anonymity of the survey and giving explanations for
specific items. In all, 40 of the 122 approached hospitals participated in the survey.
From April 2013, we delivered 400 questionnaires to public hospital managers with
sufficient knowledge and experience who are familiar with the QM implementation in
their respective hospitals. These participants are vice president of quality, director of
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medical department, quality manager, head of the nursing department, head of the
outpatient department, physician-manager, nurse-manager and so on. We received a total
of 229 completed questionnaires. After screening, we excluded 25 of the 229
questionnaires that were not completed properly. These invalid questionnaires had a
large number of missing values or almost identical answers for all items. The valid
response rate is 51 per cent.

4.2 Data analysis and results

The reliability analysis of a measurement instrument determines its ability to yield
consistent measurements. Using SPSS 22.0, we performed an internal consistency analysis
for each dimension. The Cronbach’s alpha for quality information and analysis is the
highest (0.917) and NHP the lowest (0.784). All the Cronbach’s alphas are greater than the
recommended value of 0.70, showing that the instrument is reliable (Nunnally, 1978).
Validity refers to the accuracy of a measure. Confirmatory factor analysis (CFA) is a way
of testing how well measured variables represent the dimensions. This model consists of
eleven major dimensions: top management leadership, quality policy, role of the quality
department, training, customer focus, quality information and analysis, employee relations,
process management, supplier QM, HP and NHP. Statistics of CFA for measurement
variables using the AMOS program are presented in Table I. AMOS is chosen for this study
by virtue of its powerful graphic representations and easy-to-use interfaces.
As Table I shows, the majority of the standardized loadings of the 11 dimensions are
above 0.7, and there is no significant cross loading, suggesting satisfactory
unidimensionality (Hair et al., 2009). The composite reliability of the dimensions used in this
study ranges from 0.791 to 0.880. The average variance extracted (AVE) of all the
dimensions is bigger than 0.5, ranging from 0.550 to 0.657. They indicate the satisfactory
convergent validity (Hair et al., 2009). Moreover, the square roots of the AVEs of dimensions
in this study are all higher than their correlation coefficients, providing evidence of
discriminant validity. Therefore, the measurement instrument in this study has satisfactory
unidimensionality, reliability and validity.
The results of goodness of fit test for the structural model show the value of chi-square
( x 2) of 1146.151, x 2/df 1.788, GFI 0.780, CFI 0.890 and RMSEA 0.062. Compared with the
recommended values for the goodness of fit tests, in this model, the values of x 2, x 2/df and
RMSEA are satisfactory. Figure 2 depicts the SEM results of the relationship between QM
practices and hospital performance. Each path in the figure indicates the associated
 Downloaded by Tianjin University At 00:00 21 November 2017 (PT)

Standardized
Dimensions Items SE t-value p-value loading SMC CR AVE x2 df x 2/df GIF AGIF RMSEA

Top management leadership TL1 0.893 0.797 0.849 0.657 0 0 – – – –

TL2 0.089 12.121 0.000 0.645 0.416
TL3 0.079 9.692 0.000 0.870 0.757
Quality policy QP4 0.719 0.517 0.811 0.593 0 0 – – – –
QP5 0.160 8.835 0.000 0.901 0.812
QP6 0.110 8.729 0.000 0.670 0.449
Role of quality department QD7 0.724 0.524 0.863 0.613 1.475 2 0.737 0.996 0.981 0.000
QD8 0.088 10.747 0.000 0.826 0.682
QD9 0.084 9.863 0.000 0.748 0.560
QD10 0.093 10.776 0.000 0.829 0.687
Training TR11 0.802 0.643 0.822 0.608 0 0 – – – –
TR12 0.113 9.950 0.000 0.861 0.741
TR13 0.096 9.088 0.000 0.664 0.441
(continued)

measurement model
public

Results for the

393
performance of

Table I.
hospitals
The
 Downloaded by Tianjin University At 00:00 21 November 2017 (PT)

394
9,3/4
IJQSS

Table I.
Standardized
Dimensions Items SE t-value p-value loading SMC CR AVE x2 df x 2/df GIF AGIF RMSEA

Process management PM14 0.848 0.719 0.820 0.605 0 0 – – – –

PM15 0.100 9.804 0.000 0.786 0.618
PM16 0.088 9.195 0.000 0.691 0.477
Customer focus CF17 0.733 0.537 0.837 0.564 0.270 2 0.135 0.999 0.997 0.000
CF18 0.100 8.624 0.000 0.769 0.591
CF19 0.105 8.925 0.000 0.830 0.689
CF20 0.104 9.289 0.000 0.661 0.437
Employee relations ER21 0.804 0.646 0.829 0.550 4.196 2 2.098 0.989 0.947 0.074
ER22 0.107 10.461 0.000 0.779 0.607
ER23 0.100 9.600 0.000 0.705 0.497
ER24 0.117 9.128 0.000 0.671 0.450
Quality information and analysis QI25 0.642 0.412 0.880 0.651 4.196 2 2.098 0.989 0.947 0.074
QI26 0.134 10.017 0.000 0.874 0.764
QI27 0.129 9.954 0.000 0.864 0.746
QI28 0.125 9.666 0.000 0.826 0.682
Supplier quality management SQ29 0.765 0.585 0.853 0.595 0.427 2 0.213 0.999 0.995 0.000
SQ30 0.100 11.880 0.000 0.885 0.783
SQ31 0.085 9.953 0.000 0.711 0.506
SQ32 0.099 9.944 0.000 0.710 0.504
HP HP1 0.598 0.458 0.824 0.617 0 0 0 – – –
HP2 0.205 8.546 0.000 0.815 0.664
HP3 0.194 8.204 0.000 0.910 0.828
NHP NHP1 0.882 0.778 0.791 0.562 0 0 0 – – –
NHP2 0.090 7.676 0.000 0.643 0.413
NHP3 0.091 8.009 0.000 0.703 0.494

Notes: SE: Standard Error; SMC: Square Multiple Correlation; CR: Composite Reliability; AVE: Average Variance Extracted
 The
performance of
public
hospitals

395
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Figure 2.
Hypotheses testing
results

hypotheses as well as the estimated path coefficients. Table II illustrates the results of
hypotheses.

5. Discussion
For the H1a-d tests, the standardized path coefficients between leadership and other
dimensions range from 0.262 to 0.550 and statistically significant at the 0.05 level. H1a, H1b,
H1c and H1d are supported. Top management leadership is directly related to quality
policy, role of quality department, training and quality information and analysis. When a
public hospital wants to encourage and leads its employees to improve quality, senior
leaders should place priority on quality planning. Leadership affects the autonomy of
quality department and the effectiveness of training for quality. Top leadership has strong
effects on the extent that quality data are used to make decisions for managing quality in
public hospitals. However, for the H1e test, the standardized path coefficients between
leadership and supplier QM is 0.077 and statistically not significant. H1e is not supported.
Based on follow-up interviews, some public hospitals introduced that they had made
supplier certification programs, but the execution of most programs was still in their
infancy. In addition, owing to the historical reason, the problem of drug-maintaining-
medicine still exists in China. The public hospitals’ reliance on drug sales needs more time to
change. There is a need for top management to develop the work of supplier QM in Chinese
public hospitals.
For the H2a and H2b tests, the standardized path coefficients between quality policy and
customer focus and employee relations are 0.219 and 0.366, statistically significant at the
0.05 level. H2a and H2b are supported. Strategic quality planning allows health-care
organizations to determine their strengths, weaknesses and opportunities in the service
 IJQSS Path Path coefficient t-value p-value Result
9,3/4
H1a TL ! QP 0.550 5.881 0.000*** Yes
H1b TL ! QD 0.481 5.431 0.000*** Yes
H1c TL ! TR 0.483 5.796 0.000*** Yes
H1d TL ! QI 0.262 3.453 0.000*** Yes
H1e TL ! SQ 0.077 1.020 0.308 No
396 H2a QP ! CF 0.219 2.444 0.015** Yes
H2b QP ! ER 0.366 3.930 0.000*** Yes
H3a QD ! TR 0.432 5.475 0.000*** Yes
H3b QD ! CF 0.110 1.116 0.264 No
H3c QD ! PM 0.111 1.290 1.197 No
H3d QD ! QI 0.581 6.218 0.000*** Yes
H4 TR ! ER 0.061 0.764 0.445 No
H5 CF ! PM 0.507 5.527 0.000*** Yes
H6 SQ ! PM 0.003 0.036 0.971 No
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H7a QI ! QP 0.321 3.924 0.000*** Yes

H7b QI ! SQ 0.700 6.876 0.000*** Yes
H7c QI ! CF 0.467 3.860 0.000*** Yes
H7d QI ! PM 0.346 2.631 0.009*** Yes
H7e QI ! ER 0.495 5.025 0.000*** Yes
H8a ER ! HP 0.299 2.735 0.006*** Yes
H8b ER ! NHP 0.192 1.656 0.098* Yes
H9a PM ! HP 0.178 1.670 0.095* Yes
H9b PM ! NHP 0.192 2.050 0.040** Yes
H10 HP ! NHP 0.564 6.435 0.000*** Yes
Table II.
Notes: Significant path coefficients in the model; *p < 0.1; **p < 0.05; ***p < 0.01; TL: Top management
Results of leadership; QP: Quality policy; QD: Role of the quality department; TR: Training; PM: Process management;
hypotheses of the CF: Customer focus; QI: Quality information and analysis; ER: Employee relations; SQ: Supplier quality
model management; HP: Health-care performance; NHP: Non-health-care performance

quality area, optimize the use of resources and have the importance of customer focus and
employee development through the quality planning to manage service encounters in public
hospitals. Therefore, quality policy has direct effect on customer focus and employee
relations.
For H3a and H3d tests, the standardized path coefficients are both statistically
significant at the 0.05 level. Meaning that the quality departments in Chinese public
hospitals have direct effects on training and quality data. However, the standardized path
coefficient between role of quality department and customer focus and process management
are 0.110 and 0.111, statistically not significant at the 0.05 level. H3b and H3c are not
supported. According to follow-up interviews, several respondents from public hospitals in
China mentioned that his or her hospital has set up the quality department owing to greater
consumers’ awareness as well as pressures from government and competitors. However, the
duties of quality department are not clear and easy to be confused with the existing medical
department. In addition, customer focus and process management in public hospitals often
need the cross-department coordination and communication, not rely solely on the quality
department.
For the H4 test, the standardized path coefficient between training and employee
relations is 0.061, statistically not significant at the 0.05 level. H4 is not supported. It reflects
the quality training in Chinese public hospitals has not produced an increase in employee
involvement with their jobs and in increased awareness of quality-related issues. The reason
 is that quality-related training in Chinese public hospitals is still in the initial stage. There is The
a lack of budget and effective management experience in training programs. Moreover, performance of
doctors and nurses in tertiary public hospitals are too busy to participate in quality-related
training programs.
public
For the H5 test, the standardized path coefficient between customer focus and process hospitals
management is 0.507, statistically significant at the 0.05 level. H5 is supported. Public
hospitals in China have applied process improvements to enhance or phase out certain
processes based on customer demands. 397
For the H6 test, the standardized path coefficient between supplier QM and process
management is 0.003, statistically not significant at the 0.05 level. H6 is not supported. It
means that supplier QM has not a direct effect on process management. The reason is that
Chinese public hospitals have not yet established the long-term relationship with suppliers
of goods and services. Suppliers have no opportunities to get involved in service design and
the improvement of processes.
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For the H7a-d tests, the standardized path coefficients between quality information and
data and other dimensions range from 0.321 to 0.700, statistically significant at the 0.05
level. Therefore, H7a, H7b, H7c, H7d and H7e are all supported. Quality information and
analysis has a significant effect on quality policy, supplier QM, process management,
customer focus and employee relations. Mobile internet era is coming. Due to the advances
of mobile technology and the popularity of intelligent terminals, the collection and use of
quality data are more convenient. Public hospital managers should make more quality
decisions based on the analysis of real and relevant data.
For the H8a and H8b tests, the standardized path coefficients between employee
relations and HP and NHP are 0.299 and 0.192, statistically significant at the 0.01 level and
0.1 level. H8a and H8b are supported. If employees are fully engaged and motivated, they
will take pride in doing quality work and strive to find ways to improve HP. Developing
better work systems, measuring and promoting staff well-being, all advocated by workforce
focus, should result in increased satisfaction of public hospital staff, which in turn should
improve patient satisfaction, higher public hospital reputation and better finance. Therefore,
the dimension of employee relations affects HP and NHP results.
For the H9a and H9b tests, the standardized path coefficients between process
management and HP and NHP are 0.178 and 0.192, statistically significant at the 0.1 level
and 0.05 level. Thus, H9a and H9b are supported. Effective and suitable processes in
hospital are operated and managed by employees to improve performance (e.g. improving
service quality, customer/employee satisfaction). Clarity of process ownership, boundaries
and steps contributes to achieving organizational goals. Therefore, process management
affects HP and NHP results.
For the H10 test, the standardized path coefficient between HP and NHP is 0.564,
statistically significant at the 0.05 level. H10 is supported. The direct effect of HP on NHP
validates the notion that the improvements in quality and operating performance result in
increased patient satisfaction, sales and market share, thereby providing a competitive edge
for public hospitals.

6. Conclusion and future research

This study proposes a research model to describe the relationship between the QM practices
and their impact on public hospital performance. This model is tested using data collected
from 204 respondents from Chinese public hospitals.
It is found that the dimensions of employee relations and process management are
positively related to HP and NHP. Therefore, it is critical for public hospitals to improve
 IJQSS their employee satisfaction by providing sufficient support for their work through
9,3/4 engagement, communication and compensation. Moreover, public hospitals should
undertake innovations on their existing processes to improve employees’ task efficiency.
The empirical results could help mangers to re-allocate more resources to those elements of
the QM systems that have the most significant impact on hospital performance.
The paper has also explored the relationship between the dimensions of QM practices.
398 Leadership and quality information and analysis, important at the first and later stages for
delivering quality of care, are positively related to other dimensions. The results could
enhance managers’ understanding of different QM activities and implement them
successfully.
Due to the limitations of research conditions, the survey data used in this study were
collected from large public hospitals in Zhejiang Province, China. Hospitals of different
categories are quite different in terms of service quality and performance. Therefore, the
generalizability of the results to public hospitals of other levels (small- and medium-sized
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hospitals) should be further studied. Moreover, the model is developed and tested in China,
thus limiting its appropriateness for studies in other countries. Thus, future research in this
area needs the larger and more broadly samples from different countries to investigate and
refine the linkages between QM practices and the performance of public hospitals. Further,
this study uses a cross-sectional survey to collect data and relies heavily on the use of
perceptual data. Different methodologies, such as case studies, longitudinal analysis and
secondary data study, could be the important direction of future research.
Disclosure statement: No potential conflict of interest was reported by the authors.
Funding: This work was supported by the National Social Science Foundation of China
[grant number 16BGL182].

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Corresponding author
Jingjing Xiong can be contacted at: xiongjj2004@163.com

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