The Diffusion Of Quality Certification.
Organizational practices tend to diffuse unevenly throughout the world. Using comparative case
studies of a small number of countries, researchers have found that national institutions shape
processes of diffusion above and beyond the technical characteristics or efficiency of the practice
(Cole, 1985, 1989; Gooderham, Nordhaug, and Ringdal, 1999; Guillen, 1994a; Orru, Biggart, and
Hamilton, 1991). These differences in the rates of international diffusion of organizational
practices have not been conceptually and empirically examined for a sufficiently large number of
countries in order to understand the drivers of diffusion on a truly global scale.
The question of how practices travel from one organization or social setting to another has already
been of interest to a variety of fields in the social sciences, the life sciences, and engineering
(see Rogers, 1995 for a review) and, with the intensification of globalization has become even more
urgent to answer (Guillen, 2001; Meyer, Boli, and Ramirez, 1997). Some researchers have focused on
the technical merits of the practice or innovation in accounting for diffusion (e.g., Mansfield,
1961; Williamson, 1970; Davies, 1979), while others have examined the existence of institutional
effects on the diffusion of practices in single industries, fields, sectors, or countries, usually
the United States (e.g., Baron, Dobbin, and Jennings, 1986; Galaskiewicz and Wasserman, 1989; Davis,
1991; Galaskiewicz and Burt, 1991; Haunschild, 1993; Haveman, 1993; Davis and Greve, 1997). This line
of research has established that practices spread from one organization to another following a
process of institutionalization dri ven by resource dependence, social comparison, or network ties
linking potential adopters, but most work has not focused on diffusion to different organizations
across countries.
Previous research has paid attention to the effects of national institutions and forces on the
process of diffusion of certain organizational practices within countries (e.g., Kieser, 1989; Barley
and Kunda, 1992; Lazerson, 1995; Abrahamson and Fairchild, 1999). But neoinstitutional theorists have
explicitly argued that isomorphism occurs at the country level of analysis as well as at the level
of the organizational field or the industry (Jepperson and Meyer, 1991; Orru, Biggart, and Hamilton,
1991; Rosenzweig and Singh, 1991; Kostova, 1999). A few researchers have more specifically considered
the institutional factors that shape the cross-national diffusion of practices, focusing on state
structures, professionalization, and culture as explanations (e.g., Guillen, 1994a, 1997; Meyer et
al., 1997; Westney, 1987).
Most empirical research on cross-national diffusion falls under two rather restrictive categories.
The first comprises comparative studies based on a limited number of countries, including Cole's
(1985, 1989) analysis of the diffusion of small-group activities in Japan, Sweden, and the United
States; Gooderham, Nordhaug, and Ringdal's (1999) comparison of the adoption of human resource
management practices by firms in six European countries; and Casper and Hancke's (1999) study of
the implementation of quality management practices by automobile firms in France and Germany. The
second category of empirical research on cross-national diffusion includes studies based on evidence
drawn from a large number of countries, but dealing with practices adopted by governments or
nation-states as opposed to by organizations or firms. For instance, cross-national processes of
institutional isomorphism have been empirically documented in the cases of the spread of oil
nationalizations (Kobrin, 1985), decolonization (Strang, 1990), currency crises (Glick and Rose,
1999), and policies to protect the environment (Frank, Hironaka, and Schofer, 2000). The empirical
literature does not contain analyses of diffusion of an organizational practice among firms located
in a large number of countries, even though such diffusion is likely to be a powerful force in a
globalized economy. Moreover, the literature on cross-national diffusion has made very limited
progress in terms of specifying the institutional mechanisms that facilitate or impede acceptance
of a given organizational practice internationally. In this paper, we fill this gap as we identify,
conceptualize, measure, and test the effects of the institutional forces that produce isomorphic
behavior among firms located in different countries. We provide the first empirical test of the
cross-national diffusion of an organizational practice (ISO 9000 quality certification) based on 85
countries over a six-year period.
THE DIFFUSION OF ISO 9000 QUALITY CERTIFICATION
Quality certification has emerged as a key organizational practice helping companies worldwide
establish rationalized production processes. As such, it provides an appropriate empirical setting
for the study of the cross-national diffusion of organizational practices. The most influential and
pervasive quality practice in the world is associated with the 9000 family of certificates sponsored
by the International Organization for Standardization (ISO), based in Geneva, Switzerland. ISO's goal
is to "promote the development of standardization and related activities in the world with a view to
facilitating international exchange of goods and services, and to developing cooperation in the
spheres of intellectual, scientific, technological and economic activity" (ISO, 2001a). To understand
the diffusion of ISO standards, some background information is necessary.
The ISO 9000 standards were developed by Technical Committee ISO/TC 176, which comprises experts from
business and other organizations around the world (ISO, 1998). The first ISO 9000 certificates,
attesting that firms were adhering to standards, were issued in 1987 (ISO, 2001 b). By the end of
1999, more than 400,000 ISO certificates had been issued to firms in 158 different countries and
territories, up from 27,000 certificates in 48 countries in 1993. Having originated in Europe, the
ISO standards first diffused among firms in the member countries of the European Union (EU), with the
United Kingdom in particular playing an important role in this development and diffusion. The ISO
9000 standards were initially based on the BS5750 series of quality assurance system standards
developed by the British Standards Institution (851) in 1979 (Peach, 1997). When the first ISO 9000
certificates were issued in 1987. there were already about 6,000 B55750 certificates in Britain
(Abdul-Aziz, Chan, and Metcalfe, 2000). W ith the support of the British government, BSI played an
active role in increasing ISO 9001 certification in many countries around the world, an increase
that was further reinforced when the EU recognized ISO 9000 certificates as part of its harmonization
effort (Peach, 1997; Anderson, Daly, and Johnson, 1999). In recent years, certification has gradually
diffused to other countries in the world. While European certificates comprised 83 percent of all
certificates in the world in 1995, the proportion had come down to 54 percent by 2000 (ISO, 2001 b).
Moreover, while the early certificates were mostly issued to manufacturing firms, the standards have
diffused in many other areas, including service sectors, such as information technology, education,
and health and social work (ISO, 2001b).
ISO 9001 norms were developed as a set of international standards and guidelines that serve as the
basis for establishing quality management systems at manufacturing and service firms (150, 1998).
Certification is voluntary and is undertaken by various certification bodies called "registrars."
Registrars include government laboratories, private testing organizations, firms that were early
adopters of ISO, industry trade groups, and accounting firms (Anderson, Daly, and Johnson, 1999).
Registrars, in turn, are qualified to conduct audits and award certificates by national accrediting
agencies, which typically are the national standards body in each country.
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