International Journal of Quality & Reliability Management

A critical evaluation of the EFQM model

Joaqun Gmez Gmez Micaela Martnez Costa ngel R. Martnez Lorente

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the EFQM model", International Journal of Quality & Reliability Management, Vol. 28 Iss 5 pp. 484 - 502
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(2004),"Implementation of EFQM excellence model self-assessment in the UK higher education
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IJQRM
28,5

A critical evaluation of the

EFQM model
Joaqun Gomez Gomez and Micaela Martnez Costa
Universidad de Murcia, Murcia, Spain, and

484

Angel R. Martnez Lorente

Universidad Politecnica de Cartagena, Cartagena, Spain

Received September 2010

Revised December 2010
Accepted December 2010

Abstract
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Purpose As with the ISO 9000 standard, some doubts arise from the scientific literature about the
impact of the EFQM model in companies success. This paper aims to present an analysis of the
relationships in the 2003 version of the EFQM model using data from the actual self-evaluations of 68
organizations. It also analyzes if there are possible differences in the EFQM implementation between
public and private organizations.
Design/methodology/approach The Partial Least Squares (PLS) method is used to test
hypotheses.
Findings Results show that the model does not behave in the way that the designers of the EFQM
expected. Two of the results variables are not sufficiently correlated with the others to be part of the
complete model. When the model is tested without these two variables, the connection between
enablers fails, since policy and strategy, people, and partnership and resources do not have
statistically significant effects on the process. There is a slightly higher achievement in the group of
manufacturing/private companies compared with the group of public/educational institutions.
Research limitations/implications This paper is an exploratory study. A deeper analysis of the
agency criteria might produce improved results. It would also be possible to examine sub-criterion
levels. Each enabler in the model is composed of different sub-criteria and the relationships among
them have not been explored in the literature. The question that needs to be addressed is whether the
inclusion of enablers in the EFQM Excellence Model can be justified on empirical grounds.
Originality/value Previous research has been conducted using secondary data. The study has
been made using the real self-evaluations of organizations, evaluations that have been validated by
official staff of the EFQM organization. In addition, whereas much of the previous research analysed
the 1999 version of the model, this paper focuses on the latest version of 2003.
Keywords European Foundation for Quality Management, Quality management,
Total quality management, ISO 9000 series, Spain
Paper type Research paper

International Journal of Quality &

Reliability Management
Vol. 28 No. 5, 2011
pp. 484-502
q Emerald Group Publishing Limited
0265-671X
DOI 10.1108/02656711111132544

1. Introduction
Since 1950 much has been written in the scientific arena about quality management
and its vital importance for company survival. The Japanese effort to reconstruct their
economy was the trigger of a series of fundamental changes in management that are
still affecting enterprises worldwide. Considering quality as the responsibility of all
areas in the company, prevention rather than inspection, customer orientation,
continuous improvement and quality leadership are some key characteristics of a
Financial support from Ministerio de Ciencia e Innovacion (Reference project ECO2008-02387) is
gratefully acknowledged.

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company implementing the Total Quality Management (TQM) principles, which were
initially used in Japan and quickly adopted by US and European companies.
Associated with these concepts were a number of statistical and teamwork tools that
could help to develop continuous improvement and a culture of participation. In the
words of Adebanjo (2001), TQM shifts from Management of Quality to Quality of
Management.
The Deming Prize in Japan was the outcome of the importance attributed to quality
management in that country. As previously with the TQM philosophy, the USA
quickly developed its own prize, the MBNQA and, with some delay (1992), Europe
followed this trend with the EFQM award. Later, many national prizes were created (53
according to Tan et al. (2003)) and most of them have been designed taking the first
three as models (Curkovic et al., 2000).
However, at the time of the birth of EFQM, companies in Europe were paying
attention to another management trend related with quality: the ISO 9000 series of
standards. These standards were initially designed as a quality assurance system but
they were later changed to converge towards a quality management system as well.
Europe has given great importance to this certificate, and in many cases, it has been
imposed, by industrial customers, or governments. As a consequence, the number of
certifications grew exponentially. In fact, it could be stated that, what at the beginning
was considered as a source of competitive advantage (Benner and Veloso, 2008), today
is simply a requirement to do business in some sectors in Europe.
The focus on quality management has also been reflected in the literature. Special
attention has been paid to the ISO 9000 standard. Most of these papers have tried to
find whether the ISO standard could drive companies to achieve higher performance
(Benner and Veloso, 2008). However, these studies have not been conclusive. Some of
them found positive effects (e.g. Corbett et al. (2005) while others did not
(Martnez-Costa et al., 2009). Possible factors that influence this relationship have
also been the subject of research, among them the TQM environment (Terziovski et al.,
1997), time since adoption (Corbett et al., 2005; Sroufe and Curkovic, 2008), motivation
(Martnez-Costa et al., 2008), the way in which the standard is implemented (Naveh and
Marcus, 2005), firm size (McGuire and Dilts, 2008) and technological coherence (Benner
and Veloso, 2008).
The question is: what is the next step for European companies? It seems that the
answer to this question may be the EFQM model. This is being applied in companies
and other organizations at a growing rate. The EFQM model is considered
synonymous with TQM by many researchers and practitioners (Hendricks and
Singhal, 1996; Adams et al., 1999; Forza and Filippini, 1998) and as a step forward after
ISO 9000 certification.
The EFQM model, as well as the Deming and the MBNQA models, was designed
looking at the TQM principles. In fact, some researchers have used it as a proxy when
analyzing the effect on performance of a TQM system (Santos and Alvarez, 2007a, b;
Prajogo and Sohal, 2004). Probably, one of the determinants of its success is that it
offers a clear framework, a terminology and a methodology that is not so clear in TQM.
Different papers that have tried to define TQM dimensions (Black and Porter, 1996;
Flynn et al., 1995; Saraph et al., 1989) and each includes different dimensions. The
elements of the EFQM model create a reasonably clear path that the company has to
follow in order to improve its results. In fact, results were introduced into the model

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and 50 per cent of the points that are earned by a company in this model depend on its
results with customers, workers, and society, and its key results. In addition, EFQM is
offered as a tool that managers can find useful for self-evaluation of their organizations
(Van der Wiele et al., 2000; Ahmed et al., 2003; Samuelsson and Nilsson, 2002).
Probably, the most important effect that ISO 9000 has had in European industries is
the dissemination of a general interest in quality management. Some authors even
consider it to be a good basis for later implementation of the EFQM model (Geraedts
et al., 2001). As has been previously stated, the EFQM model is now starting to be
valued as the next logical stage in the quality journey, in the framework of a
continual improvement philosophy.
However, as with the ISO 9000 standard, some doubts arise from the scientific
literature about the impact of the EFQM model in companies success. This model has
been called an excellence model, deleting the term quality from its name, despite
the origin and real substance of its concepts. This fact has been criticized by authors
such as Dale et al. (2000), who argue that it reinforces the erroneous belief that TQM is
a fad and quality is no longer an important issue for European businesses.
This paper tries to make a contribution to the scientific evaluation of the EFQM
model. It presents an analysis of the results of the evaluation of 68 organizations, 43
industrial companies and 25 service organizations mainly from the education sector
(public companies). Within the public sector in Spain, the education sector has been one
of the sectors where the EFQM Excellence Model has been more extensively applied
and more organizations have attained the excellence level.
Therefore, the importance of researching on the EFQM Excellence Model is clear,
since it is being used by an increasing number of companies and is presented not only
as a model of TQM application but as a model of excellence in management. Although
some previous papers have analysed this topic, two important contributions of the
present research are:
(1) All previous research has been conducted using secondary data. Our study has
been made using the real self-evaluations of organizations, evaluations that
have been validated by official staff of the EFQM organization.
(2) Whereas much of the previous research analysed the 1999 version of the model,
this paper focus on the latest version of 2003. Since the changes could be
considered relevant, it is necessary to know the usefulness of the model in its
present form. In fact, a new version of the model was approved while this
research was in progress, and this new version will have to be analyzed in the
future.
The EFQM Excellence Model has been adapted in its 2003 version for non-profit
organizations like public institutions (Eskildsen et al., 2004). There are several
differences with this kind of company, the most fundamental being that they do not
intend to secure financial results. The application of this model in public organizations,
raises the problem that they are much more regulated, and have less flexibility to adapt
to new models of management. This fact implies that, though managers of these public
organizations intend to implement the EFQM Excellence Model (and governments may
push them to do so), legal restrictions can be an obstacle to the application of many
elements of the model. In this sense, our second objective in this paper is to evaluate

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possible differences in the EFQM implementation between public and private

organizations.
2. Literature review
2.1 The EFQM model: history and main concepts
The European Foundation for Quality Management (EFQM) was founded in 1988 with
the objective of helping European companies to become competitive in the
international marketplace. One of the first decisions of this foundation was to create
the European quality prize, following the example of the American MBNQA (Conti,
2007). The pillars of these prizes are quite similar since all of them are based in the
TQM philosophy. However, there are some differences between countries. According
to Tan (2002), in less developed countries these prizes give less importance to aspects
such as social responsibility and more to leadership. In Europe, the model attaches
more relevance to social impact and human resource management.
Successive versions of the EFQM Excellence Model have been developed. The main
reason for these revisions is to be in line with the business situation. A clear example is
the evolution of the MBNQA from a mere quality assurance system to a quality
management system (Tan, 2002). The current version of the EFQM model dates from
2009. However, there is still not enough experience to analyze this new version
empirically. For that reason this paper will focus on the application of the 2003 EFQM
model.
The 2003 EFQM model differed in important ways from the previous one since it
incorporated some concepts, such as innovation and knowledge management, in order
to put greater emphasis on customer orientation and process management and to
highlight the improvement cycle (RADAR) and, overall, to make implementation easier
in all kinds of organizations, public or private, big or SMEs, or even in the
non-lucrative ones.
The EFQM model assumes that, in order for an organization to be successful,
whatever its sector, size, structure etc. it should have a good management system. In
this sense, the EFQM model is a tool that can be used to structure the management
system of an organization, by way of self-assessment.
Self assessment consists of a regular comparison of activities and results of a
company with the excellence model (Conti, 1993; Hillman, 1994) and it contributes to
identifying strong points or improvement areas that consequently could help to
establish improvement plans that should be integrated in the organizational strategic
plans (Porter and Tanner, 1996; Ritchie and Dale, 2000). The scientific literature
generally finds a positive relationship between the use of self-evaluation and company
performance (Ahmed et al., 2003; Brown and Van der Wiele, 1995; Finn and Porter,
1994; Samuelsson and Nilsson, 2002; Van der Wiele et al., 1996)
The EFQM Excellence Model is a non-prescriptive framework based on nine criteria
(see Figure 1). Five of these are Enablers and four are Results. The Enablers
criteria cover what an organization does. The Results criteria cover what an
organization achieves. Results are caused by Enablers.
The model, recognizing there are many approaches to achieve sustainable
excellence in all aspects of performance, is based on the premise that excellent results
with respect to performance, customers, people and society are achieved through
partnerships, resources and processes. The arrows emphasize the dynamic nature of

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488

the model. They show innovation and learning helping to improve enablers that in turn
lead to improved results.
This structure assumes the existence of interrelations among enablers and results
and the fact that having success in an isolated area is not enough to achieve excellence
(Naylor, 1999).
Adebanjo (2001) affirms that this model incorporates the quality of management
principles while largely leaving the management of quality issues to individual
organizations. This means that mere quality assurance aspects, related mainly to
production process control, are assumed and companies will probably count on other
systems such as ISO 9000, or six sigma to focus in those aspects.

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2.2 The validity of the EFQM relationships

In recent last years, some scientific papers have paid attention to the relationships in
the EFQM model (Bou-Llusar et al., 2009; Bou-Llusar et al., 2005; Calvo de Mora et al.,
2005; Dijkstra, 1997; Eskildsen and Dahlgaard, 2000; Eskildsen and Kanji, 1998;
Eskildsen et al., 2001). Previously, some other studies had analysed the relationships in
the MBNQA model (Collier et al., 2002; Curkovic et al., 2000; Evans and Jack, 2003;
Meyer and Collier, 1998; Wilson and Collier, 1996; Wilson and Collier, 2000).
However, except for the research of Bou-Llusar et al. (2009), all the papers study
versions of EFQM model prior to 2003. These papers provide evidence about the
relationships proposed in the EFQM model and occasionally find other new
relationships.
Within this group of literature, some papers are tried to analyze some specific
relationships in the EFQM model. For example, Eskildsen and Dahlgaard (2000)
focused their attention on the human resource aspects. They concluded that leadership
determines the management of people and processes, as well as policy and strategy.
They also found that people and processes have a direct impact on people results,
confirming that the improvement of key performance results is a consequence of
people, processes and partnership and resource management. Dijkstra (1997)
concluded that the enablers have a common latent factor that causes the positive
associations between them.
A second group of studies focuses on the whole model and finds some positive
relationships between some enablers/results. Eskildsen and Kanji (1998) show how
people and processes are interrelated and demonstrate that policy and strategy
condition people and resources management. Reiner (2002) finds that results in people
have a positive effect on results in customers and results in society. He also confirms

Figure 1.
The EFQM Excellence
Model

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the key role of policy and strategy in the results criteria, since it determines the impact
on society and results in customers.
Bou-Llusar et al. (2005) did not analyze all the relationships of the EFQM model, but
only how the agents impact on results, and confirmed that the enabler factor, as a
whole, improves results. In a more recent paper (Bou-Llusar et al., 2009) the same
authors group enablers into social and technical and measure their impact on four
types of results: customer, people, society and key. In their conclusions they find that
the Enabler Excellence construct is reflected to a greater degree by the criteria related
to the social dimension than the technical dimension, and that in the result domain,
Society results is the criterion which shows least relationship with the Result
Excellence construct.
A summary of the main studies analyzing EFQM relationships is found in Tables I
and II. These studies generally confirm the internal logic that underlies in the EFQM
model. However, apart from Bou-Llusar et al. (2009), all these papers are about previous
versions of the EFQM model and not about the 2003 version. On the other hand,

Author

Version

Information source

Dijkstra (1997)
Eskildsen and Kanji (1998)
Eskildsen and Dahlgaard (2000)
Prabhu et al. (2000)
Eskildsen et al. (2001)
Eskildsen et al. (2002)
Reiner (2002)
Bou-Llusar et al. (2005)
Calvo de Mora et al. (2005)
Calvo de Mora and Criado (2005)
Bou-Llusar et al. (2009)

1992
1992
1999
1992
1999
1999
1999
1999
1999
1999
2003

Secondary
Secondary
Secondary
Secondary
Secondary
Secondary
Secondary
Secondary
Secondary
Secondary
Secondary

Criteria
C1
C2
C3
C4
C5
C6
C7
C8
C9

C1

C2

C3

C4

C5

C6

C7

C8

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evaluation of the
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489

Table I.
Studies analyzing the
EFQM Excellence Model
relationships

C9

2,6,8,9,10
2,4,5
2,4,5
4,5,6
3

2,4,5,8
2,4,5
2,4,5,9

4,5
1,2,4,5,9,10
10
1,2,3,10
1,3,4,5,10

2,8,9
8,10
4,5,8

8,10
1,2

1,4,5

7,8,10

6,8

6
7,10

6,7

Notes: C1 Leadership; C2 policy and strategy; C3 People; C4 Partnership and resources;

C5 Processes; C6 Customer results; C7 People results; C8 Society results; C9 Key
performance results. 1 Eskildsen and Kanji (1998); 2 Eskildsen and Dahlgaard (2000);
3 Prabhu et al. (2000); 4 Eskildsen et al. (2001); 5 Eskildsen et al. (2002); 6 Reiner (2002);
7 EFQM (2003); 8 Tejedor (2004); 9 Calvo de Mora et al. (2005); 10 Calvo de Mora and
Criado (2005)

Table II.
Relations among the
EFQM elements
according to the literature

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Bou-Llusar et al. (2009) did not analyze specific relationships but the general impact of
agents in results. All these studies use secondary data collected from the companies to
analyse the relationships statistically.
Once the literature had been reviewed, a gap regarding the specific relationships of
the 2003 version of the EFQM model was detected. The main objective of this study is
to find out if the relationships in the new version of the model follow the EFQM logic.
This is, consequently, a first exploratory study with the following hypotheses derived
from the EFQM excellence model. These hypotheses assume the sense of the causal
relationships implicit in the model, from left to right. However, there are four
relationships that cannot be deduced using this criterion, since the connectors are
vertical. Therefore, these 4 relationships will be explained in detail.
H1.

There is a positive relationship between leadership and policy and strategy.

H2.

There is a positive relationship between leadership and people.

H3.

There is a positive relationship between leadership and partnership and

resources.

H4.

There is a positive relationship between policy and strategy and processes.

H5.

There is a positive relationship between people and processes.

H6.

There is a positive relationship between partnership and resources and

processes.

H7.

There is a positive relationship between policy and strategy and people.

The logic of management implies that the definition of policy and strategy
of a company will determine the human resource management system, since
this system has to be designed as part of the company strategy.

H8.

There is a positive relationship between policy and strategy and

partnership and resources. Following the same logic, the management of
partnerships and resources is defined as part of company strategy and,
therefore, the causal relationship has to be as stated in the hypothesis.

H9.

There is a positive relationship between processes and customer results.

H10.

There is a positive relationship between processes and people results.

H11.

There is a positive relationship between processes and society results.

H12.

There is a positive relationship between customer results and key

performance results.

H13.

There is a positive relationship between people results and key performance

results.

H14.

There is a positive relationship between people results and customer

results. People results can improve customer results since better-trained and
motivated employees will produce better products and/or services. This is
one of the main foundations of TQM theory, that customers are satisfied
when they are served by effective workers.

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H15.

There is a positive relationship between society results and customer

results. The number of consumers that make their purchasing decisions on
the basis of the company image has been increasing over recent decades
and, therefore, good society results can improve company image and,
subsequently, sales.

Critical
evaluation of the
EFQM model

H16.

There is a positive relationship between society results and key

performance results.

491

The EFQM Excellence model has been adapted in its 2003 version for non-profit
organizations like public institutions (Eskildsen et al., 2004). Differences between
public/private organizations have been addressed in political science literature (Lane,
1993). A key difference is that managers in public organizations have limitations at the
time of determining strategic objectives. This fact affects the decision-making process,
resources availability, personnel management, and so on. Despite these differences,
many models and norms have been developed for private/profit organizations
assuming that other organizations can adapt them (Eskildsen et al., 2004, Massey,
1999).
Tar (2008) analyzes differences in the implementation of the EFQM model between
a private company and five services of a public university. His conclusions are that
higher education institutions may adopt business practices, but these must be
adaptable to their own context.
In the light of these findings, the analysis of possible differences in the EFQM
relationships between these two types of companies may be interesting, comparing
ones from the education/public sector with others from private manufacturing
companies. In order to examine this question in the case of as many companies as
possible, H17 was developed:
H17. There are no differences in the relationships proposed by the EFQM model
between public/education organizations and private/manufacturing
companies.
3. Data collection and methodology
An important difference of the present study compared with previous research is that
the data for this study is composed of the real values in each criterion obtained from 68
Spanish organizations.
Data was provided by a consultancy agency licensed by EFQM to evaluate
companies. The sample provided were 68 organizations that were evaluated by this
agency in the period 2004-2007. This agency provided the scores on each factor and
main characteristic of the organizations for the research team without identifying the
organizations. Consequently, the data used for this study are the assigned scores on
each factor of the EFQM model collected by the consulting agency according to the
criteria of the EFQM organization. This ensures that the data are not collected by the
authors using a questionnaire, but are the real scores assigned to the companies by the
EFQM-licensed agency.
The 68 organizations in the sample include manufacturing/private companies from
different sectors (43) and service organizations from the education sector (25). Since the
organizations in the education sector were public organizations, these organizations

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are consequently non-profit organizations. The paper by Tar (2008) found similarities
in the application of the EFQM model in one private company and public universities.
Our paper analyses these two kinds of companies both jointly and separately.
Since scores on each criterion range over different scales, in order to get a
homogeneous scale scores on each criterion were divided by the maximum value of the
criterion according to the EFQM Model.
In this research the Partial Least Squares (PLS) method is used to test hypotheses.
PLS path modelling represents a well-substantiated method for estimating complex
cause-effect-relationship models in business research (Gudergan et al., 2008). It is
based on least squares estimation with the main objective being to maximize the
explanation of variance in a structural equation models dependent constructs
(Henseler et al., 2009).
One of the advantages of PLS is that it is more flexible in sample size than
covariance-based structural equation modelling (e.g. LISREL) when estimating path
coefficients (Anderson and Gerbing, 1988). In fact, the use of PLS is recommended
when samples are small (Reinartz et al., 2009). It is suggested that the sample size be
equal to the larger of the following:
.
ten times the number of indicators of the scale with the largest number of
formative indicators; or
.
ten times the largest number of structural paths directed at a particular construct
in the inner path model.
In this case our available information was from 68 companies. This sample size would
not be enough for using covariance-based structural equation modelling but it is
enough for PLS.
The second reason for using this method was that it is explicitly recommended in
early stages of theoretical development in order to test and validate exploratory models
(Henseler et al., 2009). As has been pointed out previously, the objective of this research
is exploratory.
A structural model using PLS consists of two models, the measurement model
(outer model) and the structural model (inner model). In the present research constructs
are composed of only one indicator since it is the real value of the construct provided
by the EFQM licensing company. For that reason, the only purpose of applying PLS is
to test the relationships between constructs (structural model or inner model) and not
the measurement instrument (outer model).
PLS does not use fit indices. For PLS (in contrast to covariance-based structural
equation modelling), a good model fit is established with significant path coefficients,
acceptably high R 2 values they should not be lower than 0.1 according to Falk and
Miller (1992) and internal consistency (construct reliability) above 0.7 (this last
point is not applied in this research since our constructs are formed with the real
indicators) for each construct (Gefen et al., 2000). Another assessment of the
structural model involves the models capability to predict. The predominant measure
of predictive relevance is Stone-Geissers Q2, which can be measured using
blindfolding procedures (Henseler et al., 2009). If this value for a certain endogenous
latent variable is larger than zero, its explanatory variables provide predictive
relevance.

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4. Results
Table III shows main descriptive statistics for the variables.
Since the sample is composed by two different kinds of organizations, industrial/
private, and education/public sector, tests were first conducted to see whether there
were differences between them. In general, companies in the manufacturing sector
obtained higher scores on most of the criteria, the most important differences being in
the results criteria. After having obtained these results an ANOVA was conducted to
evaluate if these differences were statistically significant. Table IV shows the results.
As can be seen, statistically significant differences were found for partnership and
resources, processes, society results and key performance results, where industrial
companies had higher scores.
Proceeding to test the hypotheses, Table V shows the main indicators of the
structural model, R 2 adjustment and Stone Geissers Q2. According to Falk and Miller
(1992) R 2 should not be lower than 0.1. The predominant measure of predictive

Minimum

Maximum

Mean

SD

Leadership
Policy and strategy
People
Partnership and resources
Processes
Customer results
People results
Society results
Key performance results

68
68
68
68
68
68
68
68
68

0.11
0.09
0.12
0.16
0.11
0.06
0.06
0.05
0.14

0.56
0.58
0.60
0.53
0.60
0.46
0.51
0.53
0.69

0.3065
0.2775
0.2986
0.3448
0.3373
0.2412
0.1929
0.1969
0.3141

0.09514
0.10074
0.08298
0.07827
0.10821
0.09000
0.08840
0.09356
0.11832

Variable

Organization

Mean

Sig.

Leadership

Industrial
Service
Industrial
Service
Industrial
Service
Industrial
Service
Industrial
Service
Industrial
Service
Industrial
Service
Industrial
Service
Industrial
Service

43
25
43
25
43
25
43
25
43
25
43
25
43
25
43
25
43
25

0.3068
0.3061
0.2821
0.2697
0.2994
0.2973
0.3688
0.3036
0.3619
0.2950
0.2426
0.2388
0.2022
0.1771
0.2122
0.1705
0.3625
0.2308

0.001

0.978

0.237

0.628

0.010

0.922

12.931

0.001

6.546

0.013

0.027

0.870

1.277

0.263

3.239

0.076

27.279

0.000

Policy and strategy

People
Partnership and resources
Processes
Customer results
People results
Society results
Key performance results

Critical
evaluation of the
EFQM model
493

Table III.
Descriptives

Table IV.
ANOVA to evaluate
differences between
private companies and
education organizations

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494

Table V.
R 2 adjustment and Stone
Geissers Q2

Table VI.
R 2 adjustment and Stone
Geissers Q 2: modified
model

relevance is Stone-Geissers Q2, which can be measured using blindfolding procedures

(Henseler et al., 2009). If this value for a certain endogenous latent variable is larger
than zero, its explanatory variables provide predictive relevance.
From the analysis it is found that people results and society results do not conform
to the minimum R 2 recommended. This means that these two variables reduce the
integrity of the model as a whole, since they are insufficiently interrelated with the
other variables. In order to test whether inter-correlated variables could define a new
model retaining the rest of the proposed relationships, people results and society
results were eliminated from the model and a new model a modified EFQM model
was tested. The new values of the measures for each criterion are shown in Table VI
and all R 2s and Q2s were over the minimum recommended. Therefore, the resulting
model is statistically superior to the original EFQM model.
After modifying the model, hypotheses relating to society and people results could
not been tested. These hypotheses were H10, H11, H13, H14, H15 and H16.
Once the test of the predictive relevance of the model was completed, results from
the path analysis to test the remaining hypotheses are shown in Table VII, with
standardized betas and their significance.
According to the results, the EFQM model has an important problem of definition.
Although leadership is a fundamental pillar of the model and it has a remarkable
influence on policy and strategy, people and partnership and resources, surprisingly,
none of these three elements has any influence on processes. Moreover, none of the
vertical relationships are statistically significant. That is to say, policy and strategy
does not have any significant effect on either people or partnership and resources.
Later on, processes do have an effect in customer results that is logically translated into
higher key performance results.

Policy and strategy

People
Partnership and resources
Processes
Customers results
People results
Society results
Key performance results

Policy and strategy

People
Partnership and resources
Processes
Customers results
Key performance results

R2

Stone-Geissers Q2

0.37
0.73
0.34
0.39
0.40
0.01
0.09
0.51

0.35
0.70
0.29
0.30
0.27
0.001
0.0024
0.47

R2

Stone-Geissers Q2

0.37
0.73
0.34
0.39
0.25
0.32

0.35
0.70
0.29
0.30
0.23
0.31

Leadership - . policy and strategy

Leadership - . people
Leadership - . partnership and resources
Policy and strategy . people
Policy and strategy . partnership and resources
Policy and strategy - . processes
People - . processes
Partnership and resources - . processes
Processes - . customer results
Customer results - . key performance measures

St. b

T-statistics

0.611
0.736
0.358
0.175
0.291
2 0.022
0.402
0.318
0.502
0.563

3.744 * * *
7.348 * * *
1.826 *
1.3574
1.265
0.072
1.524
1.308
2.888 * * *
4.192 * * *

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Notes: * * *Significance at a 0.01 level, * *Significance at a 0.05 level, *Significance at a 0.1 level

Critical
evaluation of the
EFQM model
495

Table VII.
Results from path
analysis: modified model

These results indicate the way the model functions. The EFQM model has been
designed following TQM principles and implies that leadership is the engine of the
system that makes the other elements function. Once running, processes are improved
by both policies and strategies designed to prioritize quality and empower and
motivate employees. The results of the present paper show that the EFQM model, as it
has been defined, does not work as a whole. This does not mean that the elements of the
model cannot be useful to organizations, but the set of relationships proposed in the
model does not work as the model proposes.
It may be that a model that is not valid for some types of organizations could be
valid for others. To test H17 and compare the model in manufacturing/private
companies and public/education organizations, a multi-group analysis was performed
(Chin, 2000; Keil et al., 2000). The results are shown in Table VII. Differences in the
EFQM relationships are shown for private/manufacturing companies and
public/education organizations in our sample. The standardized betas for each
group, and the T-statistics for their differences, are also listed (see Table VIII).
According to these results, there are some differences in the relationships between
manufacturing and service firms. There is slightly higher achievement in the

St. b manufacturing St. b service

Leadership - . policy and strategy
Leadership - . people
Leadership - . partnership and resources
Policy and strategy . people
Policy and strategy . partnership and resources
Policy and strategy - . processes
People - . processes
Partnership and resources - . processes
Processes - . customer results
Customer results - . key performance measures

0,679 * * *
0,7763 * * *
0,4294 * *
0,1394
0,2259
0,0609
0,5591 * *
2 0,0696
0,4434 * *
0,6998 * * *

0,6852 * * *
0,7943 * * *
0,2546
0,0918
0,4339 * *
0,3954
0,3327
2 0,3033
0,4342 * *
0,7119 * * *

Tmultigroup
0,214
0,683
3,516 * * *
1,460
3,448 * * *
4,539 * * *
3,475 * * *
2,924 * *
0,204
0,612

Notes: * * *Significance at a 0.01 level, * *Significance at a 0.05 level, *Significance at a 0.1 level

Table VIII.
Multigroup analysis:
differences in
manufacturing and
service companies:
modified model

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manufacturing/private companies group compared with the public/educational group.

This is explained by the fact that in industrial companies there is a significant
relationship between people and processes. In this sense, the chain agents-results is not
broken in this kind of company but there is still no relationship between strategy or
partnership and processes.
Despite these results, it is possible that the agents-results relationship appears to be
broken because there are no relationships between policy and strategy, people and
partnership and resources with processes. It is also possible that these agents have a
direct influence on the results at the same level as processes. To reinforce our findings
a new model that will be denominated Alternative EFQM model was added to the
analysis. In this alternative model processes appears at the same level as policy and
strategy, people and partnership and resources. Although the relationships proposed
by the EFQM model are not against the TQM philosophy, it is also true that according
to this same philosophy the construct people should have an effect on customer results
through better quality and, obviously, on people results through better training and
motivation. Moreover, the strategy of an organization has to have an effect on results,
since if it did not it would mean that the definition of strategy was irrelevant. The same
can be said of the management of resources and partnership. Since this is an
exploratory research, it was supposed that the four enablers had positive effects on
people, customer and society results. Figure 2 shows the new model.
Tables IX and X show the results for this alternative EFQM model. Table IX shows
the main indicators of the structural model, R 2 adjustment and Stone Geissers Q2. All

Figure 2.
Alternative suggested
model

Table IX.
R 2 adjustment and Stone
Geissers Q2: alternative
suggested model

Policy and strategy

People
Partnership and resources
Processes
Customers results
People results
Society results
Key performance results

R2

Stone-Geissers Q2

0.37
0.71
0.29
0.36
0.51
0.47
0.31
0.51

0.35
0.70
0.25
0.36
0.32
0.39
0.15
0.47

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Leadership - . policy and strategy

Leadership - . people
Leadership - . partnership & resources
Leadership - . processes
Processes . people results
Processes . customer results
Processes . society results
Policy and strategy . people results
Policy and strategy . customer results
Policy and strategy . society results
People . people results
People . customer results
People . society results
Partnership and resources . people results
Partnership and resources . customer results
Partnership and resources . society results
People results . customer results
Society results . customer results
People results - . key performance measures
Customer results - . key performance measures
Society results - . key performance measures

St. b

T-statistics

0,6111
0,8431
0,5362
0,603
20,3524
0,2727
0,0656
0,4163
0,4456
0,4586
0,4119
0,0847
0,0317
0,1151
0,0326
0,0815
0,111
20,0706
0,1174
0,3647
0,4166

4,17 * * *
12,52 * * *
3,53 * * *
5,25 * * *
1,28
0,91
0,23
1,45
1,50
1,63
1,36
0,28
0,08
0,51
0,12
0,28
0,43
0,30
0,58
2,26 * * *
2,05 * * *

Notes: * * *Significance at a 0.01 level, * *Significance at a 0.05 level, *Significance at a 0.1 level

elements comply with the minimum required. Table X shows the results of the path
analysis. These results show that leadership has a positive and significant impact on
processes, policy and strategy, people and partnership and resources. However, the
model is once again broken, because none of these agents have any impact on results.
Moreover, the positive effect of processes on customer results disappears, making the
gap with the official model even greater. Looking at the part of the model that deals
with results, customer results and society results do have a positive and significant
impact on key performance results but people results do not. People and society results
do not have a significant effect on customer results either.

5. Conclusions
The main contribution of this paper has been to analyze the relationships among the
criteria of the EFQM model (version 2003) using the actual results attained by the
companies in their evaluations and validated by approved staff, as the European
Foundation for Quality Management demands. This is the first work that uses this
kind of data and, since these data are the real points obtained by companies according
to the official criteria of the EFQM organization, this research offers a more accurate
evaluation of the functioning of the EFQM Excellence Model.
The model does not behave as expected according to its definition by the EFQM.
The test of the official EFQM model shows that two of the results variables are not
correlated with the others enough to be part of the complete model. The elimination of
the results in people and society indicates that the model is useful primarily for what

Critical
evaluation of the
EFQM model
497

Table X.
Results from path
analysis: alternative
suggested model

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498

could be considered the core and classic objectives of private companies, customer
satisfaction and obtaining good financial results.
However, when the model is tested without these two variables for kinds of results,
the connection between enablers fails, since policy and strategy, people, and
partnership and resources have no significant effect on processes.
Since the sample combined two very different types of organization,
manufacturing/private companies and public/educational organizations, the
performance of the model was analyzed separately for each group. The results show
that there are significant differences between the two groups, and that
manufacturing/private companies provide a better fit to the EFQM model than the
other entities. The fact that in manufacturing/private companies there is a positive
relationship between people and processes may indicate that the model is partially
valid for these industries. It would also provide support for TQM, as people are far
more important from a TQM point of view than strategy or resources and partnership
management. However, since after dividing the sample the number of organizations in
each group is very small, these results must be interpreted with caution.
Finally, based on previous results and using the logic identified in the literature on
management in general and TQM in particular, the model was redefined, so that
leadership has an impact on the other four enablers and all these have an impact on
people, society and customer results. The results of this last analysis reinforce the
previous results of this research in two ways. First, leadership again has a significant
effect on policy and strategy, people and partnership and resources. Second, the effect
of enablers on results is even worse, since now none of policy and strategy, people, or
partnership and resources have a significant effect on results, but neither do processes.
These results lead us to conclude that the EFQM fails to embody certain
relationships that the theory and practice of TQM indicate are important. The absence
of a relationship between people and processes or between processes and customer
results cannot be explained if it is intended to maintain EFQM as an interpretation of a
TQM system. In this regard, Ritchie and Dale (2000) conclude that Business
Excellence practices advocated today are not the equivalent of TQM, but a more
diluted version of the original TQM concept.
A key element of TQM, in order to improve processes, is good management of
human resources, especially motivation, and training. The lack of a relationship
between this element and process improvement would negate this principle. On the
other hand, the main objective of process improvement, according to TQM, is to
increase customer satisfaction, and this relationship is not clear, according to our
results. A possible explanation of these facts could be:
.
An exception to the general rule of the TQM philosophy has been found. Previous
studies see, for example, Flynn et al. (1995) have also found relationships that
were not in line with the expected model. However, in the present research there
are too many important exceptions to have happened by chance.
.
The EFQM model is not well defined as it is, and probably the methodology to
evaluate these aspects should be revised. The problem could derive from two
sources: the original model or how the evaluators interpret the model.
This research has important managerial implications. According to the results, the
effect of enablers on company results is not clear and appears to be null. If these results

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were confirmed in later research, managers should not follow the EFQM excellence
model if their intention is to improve their results, since it does not work as predicted.
However, this paper has its limitations and more research is needed.
The first limitation of the present study is that it is based on a limited number of
available cases in the sample. The sample was a convenience sample and researchers
could not control the process of data collection. On the other hand, the data were
provided by an organization licensed by EFQM, which implies that the data reliably
reflect the information that EFQM uses.
The transverse nature of the study produces another limitation, as it does not allow
the confirmation of causality in the relationships of the EFQM model, although
evidence of this causality is indicated.
The options for future research are wide. First, as usual in such cases, in order to
have more confidence in the causality of the proposed relationships, a longitudinal
design would be necessary. Second, an analysis of the agency criteria could also
produce improved results. An analysis of the interrelations underlying the EFQM
model could also examine sub-criterion levels. Each enabler of the model is composed
of different sub-criteria, and the relationships among them have not been examined in
the literature. The question that needs to be addressed is whether the inclusion of
enablers in the EFQM Excellence Model can be justified on empirical grounds.
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About the authors
Joaqun Gomez Gomez is Industrial Engineer and Master on Technology and Innovation
Management. He has worked as Director of the Research and Development Area of the Furniture
and Wood Technological Center of Murcia. Now he is Project Manager of the Business
Innovation Center of Murcia (Spain). Joaqun Gomez Gomez is the corresponding author and can
be contacted at: joaquin.gomez@ceeim.es
Micaela Martnez-Costa is Associate Professor of Operations Management at the University
of Murcia (Spain). Her research mainly focuses on quality management and its relationship with
company performance. She has published in eminent journals, including the Journal of
Operations Management, International Journal of Operations and Production Management,
International Journal of Production Economics and International Small Business Journal among
others.
Angel R. Martnez-Lorente was awarded his PhD by Murcia University in 1996 and is
Professor at the Polytechnic University of Cartagena, where he is the Head of the Management
Department. He teaches operations management and quality management. He has been visiting
researcher at the University of Manchester. His papers have been published in journals including
the Journal of Operations Management, International Journal of Production Research,
International Journal of Operations and Production Management and International Journal of
Production Economics. He is member of the Editorial Advisory Board of the International Journal
of Quality and Reliability Management.

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