Adoption of quality assurance systems in dairy processing firms in Vietnam

Abstract

Internationally, concerns over food safety and quality have been increasing as a result of a number of food safety scares. Governments worldwide have responded to these concerns through encouraging or mandating firms in the food industry to use quality assurance systems (QAS’s), such as HACCP, ISO 9000 and ISO 22000. In emerging economies, such as Vietnam, the importance of these systems is now being recognized. The dairy industry in Vietnam is small, but dairy production is increasing dramatically in line with growing consumption of dairy products. To address the increasing demand for milk quantity and quality, QAS’s are now being adopted by dairy processing firms. The purpose of this research was to gain an understanding of quality processes and adoption of QAS’s in dairy processing firms in Vietnam in the context of their wider supply chains. Five dairy processors and their associated supply chains were selected along with three QAS’s (HACCP, ISO 9000 and ISO 22000). A case study method was employed to explore and gain a greater understanding of quality at the processor and chain level and the adoption of QAS’s at the processor level. This was done by constructing and utilizing a model that linked processors’ motivations to adopt, factors that influenced adoption, and perceived outcomes from adoption, within the context of their wider supply chain environment. It was observed that quality management was fragmented along supply chains, with different QAS’s in place at different stages of the chain to different degrees. Quality assurance was observed to be weakest at the collector level, and the distributor and retail level. Also, it was seen that larger farmers had quality management than small farmers. Quality assurance was likely to be better throughout the chain when the processor had integrated forward or backwards. In addition, QAS’s were met to minimum standards necessary for certification and inspection for compliance could be infrequent. It was found that legal factors were a strong influence on processing firms in adopting QAS’s. Market pressure was also a strong influence for larger firms. Related to this factor was competition between dairy firms to position themselves in the growing market. External support had an important impact on the decision of small firms to adopt, and firm size did not emerge as a factor that had an impact on this decision. However, top management support was found to be an important factor. These factors influencing adoption varied across QAS’s, but overall trends were observable. The research showed that there were differences in perceived organisational outcomes from the adoption of QAS’s by processing firms. However, in general, the impact was perceived to be positive. This was particularly so for business performance and this was observed for both HACCP and ISO 9000, which have been operating in these companies for some time. This indicates that firms place importance on market positioning and that QAS’s are an important device in this market positioning. Insights that emerge from these results increases the understanding of quality processes and the adoption of QAS’s in food industries in emerging economies. Quality assurance in food industries in such countries is at an early stage, with fragmentation of quality assurance along the chain, but a willingness to adopt QAS’s to position favourably in a growing market. Processors could be well-positioned to take a lead role in improving quality, and along with government agencies, which also have a key role, could work towards diffusing quality up and down the chain.