ISO 9000 Internalization and Organizational Commitment-Implications for Process Improvement and Operational Performance

This study presents an investigation of the relationship between internalization of ISO 9000 practices and the development of intellectual capital within organizations. We posit that intellectual capital, which comprises of human capital, organizational capital, and social capital, leads to improved processes in an organization. Process improvement, in turn, results in superior operational performance. Using a sample of 321 ISO 9001 certified organizations, the hypothesized relationships are tested by means of the structural equation modeling technique. The results of this study lend strong support for the hypotheses and show that performance benefits from the internalization of ISO 9000 standards occur mainly through the development of human and organizational capital, and the consequent improvement in business processes. This study discusses theoretical and managerial implications, and presents directions for future research.