TQM and innovation performance in manufacturing SMEs: the mediating effect of job satisfaction

This paper outlines the critical role of employees' job satisfaction in the link between TQM and innovation performance. The discussion arises primarily based on the considerable controversy concerning this relationship that appears in the literature. As of interest to resolve this controversy, a research framework is developed in which job satisfaction acts as the mediator between TQM and firm's innovation performance. The empirical findings from a survey of 90 manufacturing SMEs in Greece confirmed that job satisfaction exerts a mediating effect on the relationship between TQM and innovation. A TQM approach which emphasizes mainly to ¿soft¿ issues such as continuous training, performance-based rewards, teamwork and empowerment is necessary to foster job satisfaction that is conducive to innovation. Furthermore, ¿hard¿ TQM elements such as process and quality management, and information analysis facilitate at a lesser degree firm's innovativeness only through job satisfaction.