Uneven Geographies of Organizational Practice: Explaining the Cross-National Transfer and Diffusion of ISO 9000

Abstract

There is growing recognition that organizational innovations can have a major influence on the geography of economic activity. Yet, very little is known about the mechanisms and geographic preconditions underlying their diffusion, particularly at the global level. In this paper we seek to fill this gap using the example of ISO 9000, the internationally-recognized set of standards for quality management. We develop a series of hypotheses about the conditions under which organizations are most likely to adopt ISO 9000 which we test using panel data for 130 countries over the period 1995-2001. Our findings support the idea that transnational networks connecting different countries at the international level provide conduits for the cross-national transfer of new organizational practices. Thus, exports to the EU, local involvement of transnational corporations (TNCs), European colonial ties, and the availability of telecommunications, all emerge as statistically significant determinants of ISO adoptions. Our findings also underscore the importance of national environmental conditions in influencing the receptiveness of organizations to new practices. Low regulatory burden, a high share of manufacturing activity, high rates of secondary school enrolment, and low levels of productivity, are positively correlated with the number of ISO 9000 certificates. The paper concludes by discussing the implications of our findings for current debates about the mechanisms, preconditions and scales of organizational transfer, diffusion and convergence.

Keywords: ISO 9000, standards, cross-national diffusion, globalization, institutionalism