Financial accounting of
ISO 9001:1994 based on
quality information
system
S.R. Devadasan, N. Kathiravan
M. Sakthivel, K. Kulandaivelu
and G. Sundararaj
Introduction
One of the major managerial philosophies
that conquered and revolutionized the
organizations throughout the world during
the last century is total quality management
(TQM). The world witnessed the emergence
of TQM principles when quality gurus like
Juran, Deming, Crossby, Fiegenbaum and so
on brought out various quality improvement
oriented approaches on improving quality
from 1950 onwards. Thereafter, both
theorists and practitioners began to refer to
TQM principles with curiosity. During the
1980s, TQM was viewed as a magical
approach that would aid in attaining a higher
level of competitiveness. After some years,
there was apprehension that TQM projects
had not yielded the expected results. For
example, Cutler and Kleiner (1997) and
Ahire et al. (1996) have cited the surveys
which claim that nearly two-thirds of the
TQM projects have failed worldwide. On the
other hand, there were number of studies
(Zairi, 2001) reported in literature which
confirm that TQM philosophy indeed yields
results from the point of view of continuous
quality improvement. These contradicting
reports indicate that TQM is powerful as a
philosophy, but more effort must be exerted
so that it delivers good results in practice. One
such effort that is often missed in TQM
projects is the exploitation of quality
information system (QIS). Although the
world witnessed the power of information
system management during recent years due
to the explosion of information technology
revolution, the TQM field is yet to derive the
benefit of implementing QIS. However,
practitioners would appreciate a QIS project,
only if its performance is sensed through
financial values. In order to fulfill this
requirement, we carried out a research project
in which we designed and developed a system
The authors
N. Kathiravan and G. Sundararaj are both Lecturers,
K. Kulandaivelu is a former Junior Research Fellow, all at
Department of Mechanical Engineering, PSG College of
Technology, Coimbatore, India.
S.R. Devadasan is an Assistant Professor in the
Department of Production Engineering, PSG College of
Technology, Coimbatore, India.
M. Sakthivel is a Teacher/Research Associate at Anna
University, College of Engineering, Salem, Tamil Nadu
State, India.
Keywords
Total quality management, Sustainability,
Information systems, Financial accounting
Abstract
Cites the importance of quality information system (QIS)
in attaining the ultimate goals of TQM. Presents the
essence of QIS by describing a typical real time example.
Points out that practitioners show little interest in QIS
implementation as its results are seldom financially
sensed. Views that a system to financially account the
performance of QIS would contribute significantly towards
sustaining TQM projects. Briefs the efforts made to
develop the system to financially account ISO 9001:1994
based QIS and validate the same. Brings out the various
financial accounting documents, including income and
expenditure account and balance sheet pertaining to ISO
9001:1994 based QIS financial accounting system.
Concludes by claiming that the work has shown
promising results, but further research is required to bring
out much more valuable contributions.
Electronic access
The Emerald Research Register for this journal is
available at
http://www.emeraldinsight.com/researchregister
The current issue and full text archive of this journal is
available at
http://www.emeraldinsight.com/0954-478X.htm
Research work reported in this paper is a module of
a major sponsored research project titled ``Strategic
quality engineering accounting system''. This
project is sponsored by the Department of Science
and Technology (DST), Government of India
(vide DST Letter No. 111.5(128)/97-ET (PRU)
dated 18-08-1998). The support being extended
by DST to carry out this research project is greatly
acknowledged. The authors also thank MCB
University Press, UK, for allowing use of its online
Emerald library for referring to a large volume of
literature.
Perspective
275
The TQM Magazine
Volume 15
.
Number 4
.
2003
.
pp. 275-285
# MCB UP Limited
.
ISSN 0954-478X
DOI 10.1108/09544780310486182