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http://dx.doi.org/10.7469/JKSQM.2016.44.2.341

The Study on Relation between Implementation of Six Sigma Quality Management and Financial Performance using Propensity Score Matching  

Park, Byounghwa (Department of Applied Statistics, Yonsei University)
Park, Taeyoung (Department of Applied Statistics, Yonsei University)
Park, Minjae (College of Business Administration, Hongik University)
Publication Information
Journal of Korean Society for Quality Management / v.44, no.2, 2016 , pp. 341-356 More about this Journal
Abstract
Purpose: The purpose of this paper is to study whether the adoption of Six Sigma quality management by a firm positively affects its financial performance. The correlation between the duration of Six Sigma implementation period and the financial status of the firm is investigated as well. Methods: We conduct the analysis using data from Manufacturing Industry Productivity Panel Survey 2013 provided by Korea Productivity Center and Ministry of Trade, Industry and Energy. Propensity score matching is used to reduce sample selection bias of observational study. Furthermore, we use multiple linear regression in order to study the relationship between the implementation of Six Sigma quality management and financial performance. The return on assets and ratio of net income to net sales are considered as dependent variable and implementation of Six Sigma as independent variable. Results: The indication of this analysis is that implementation of Six Sigma quality management does not significantly enhance financial status. The firms that adopted Six Sigma quality management were categorized into three groups according to the implementation period. Comparison of each group with the firms that do not adopt Six Sigma quality management does not show statistically significant enhancement of financial status. Conclusion: In conclusion, both adoption and duration of six sigma quality management do not affect financial performance significantly.
Keywords
Financial performance; Propensity score matching; Quality management; Six Sigma;
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Times Cited By KSCI : 3  (Citation Analysis)
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