Shedding Light on Causation between ISO 9000 and Improved Business Performance.

ISO 9000 Management Systems adoption (QCert) has proven to be a persistent and growing phenomenon, yet to date little research has been done that can safely attribute improved business performance benefits to it. The paper examines the evidence for the causal links between QCert and improved performance in the empirical literature. Tests for attribution of performance improvement are proposed that analyze, effect, cause and effect size and these are illustrated to show how they influence the interpretation of results. The attribution testing method is then used to interpret the results of two USA and two European longitudinal studies and the analyses show that reverse causation is a major mechanism that explains the superior performance of the certified firms. The analyses cast doubt on any inference of attribution being drawn from the broad literature that finds an association of ISO 9000 accreditation with better business performance since it indicates that the strongest direction of causality is that firms with superior performance are more likely to have certification, not that certified firms are more likely to have superior performance. The findings have profound implications for the interpretation of causation in the substantial literature that shows QCert is associated with improved business performance. For researchers the paper provides a logic for testing the influence of reverse causation on results and demonstrates the potential confusion of attribution in research designs that can only infer causation.