Conclusions 236Part IV Summary and Conclusions 239
Summary and Conclusions 241References 251
Subject index 272Samenvatting 274Curriculum Vitae 281 XI
INTRODUCTIONThe issue of product quality has come to the forefront in Europe and the United States. The strategic importance of product quality is acknowledged at the macro level as well as at the micro level in Western societies. At the macro level, product quality has been identified as a key variable in determining 'national' competitiveness (i.e., competitiveness of a nation as a whole, as distinct from the competitiveness of individual firms). To mention a few examples, Naisbitt (1982) in his book Megatrends attributes the decline of American competitiveness to high quality of foreign products and the relative lack of emphasis on quality by U.S. firms and managers. Naisbitt's opinion is shared by scholars such as Leonard and Sasser (1982), Garvin (1983Garvin ( ,1984b, and Takeuchi and Quelch (1983), and by many business people and politicians
(Harvard Business Review 1987). Kennedy (1987) in his bookThe Rise and Fall of the Great Powers identifies the strong commitment to quality as one of the major causes of the 'Japanese miracle'. He predicts that the economic power of Japan will increase further in the next decades, and expects that high product quality will continue to be a major underlying cause of this trend. The competitive strength of the Federal Republic of Germany has also been traced to the quality of its products (Limprecht and Hayes 1982). A recent report of the Dutch Scientific Council on Government Policy has identified product quality as a key factor determining future growth in Dutch exports and GNP (WRR 1987). National quality programs have been developed in such countries as the USA, Belgium, the Netherlands, Sweden, United Kingdom, and France. At the micro level, product quality has been identified as an important variable for consumers as well as producers. It has been argued that the search for quality is the most important consumer trend of the 1980s (Rabin 1983). Consumers are now demanding higher quality than ever before , and are willing to pay more for better products (Sloan et al.
1984, Folkers 1986, Steenkamp and Van Trijp 1989a).In line with the importance consumers attach to product quality, managers today accord quality its place on the list of paramount strategic issues. In many markets, quality competition has supplanted price competition. Regardless of type of industry, size of the company, and type of manufacturing process, quality has become an essential element of competitive strategy (Wolff 1986).Companies are increasingly making adjustments in product designs, manufacturing processes, and marketing strategies to improve product quality. Frequently, improving quality may even determine whether a company survives in the marketplace. Porter (1980) posits that superior quality is an effective product differentiation strategy to create customer loyalty, to lower price elasticity, and to present 1 barriers to competition. Pe...