Purpose: The purpose of this paper is to analyze the relationship between innovation and total quality management (TQM), and also to identify the effects of innovation on organizational performance. This research proposes a conceptual model that intends to study several research hypotheses. Design/methodology/approach: The data were obtained through an online questionnaire, sent to small- and medium-sized Portuguese companies, having being conducted the study based on responses received from 287 valid questionnaires, and using a multivariate statistical analysis for statistical development. Findings: The findings indicate that companies that adopt strategies of process innovation get improvements in their performance, both operationally and financially, while product innovation only provides improvements in the financial performance of organizations. It was also found that TQM practices encourage the definition of innovation strategies of products and processes. On the other hand, it was found that only companies that adopt innovation strategies of their processes promote the adoption of TQM practices, and there is a statistically significant relationship between product innovation and the implementation of TQM practices. Originality/value: This research analyzed the dimensions studied in different aspects. It considered product innovation and process innovation, and with respect to performance, this dimension was analyzed through two different perspectives, namely, financial performance and operational performance. This research also provides a particular contribution to the literature with the analysis of the interdependencies between innovation and TQM in small- and medium-sized Portuguese companies.

This research study aims to study and identify which dimensions of TQM have influence on and support innovation strategies within the Portuguese small and medium enterprises (SMEs), in the context of products or services’ innovation and process innovation, as well as to analyze the extent to which this relationship occurs. To examine the linkage between TQM dimensions and innovation strategies, concerning innovation products and innovation processes, a multiple linear regression analysis was chosen and an eight-predictor multiple linear regression model was proposed. The data was collected through a questionnaire sent by email. This research study allows to conclude that several dimensions of TQM, such as benchmarking, quality/conception and product design, and continuous improvement, have a significant and positive association with product innovation. Although the data analysis/measurement of the results dimension has a significant association with product innovation, this association is negative. Conversely, several TQM dimensions, such as leadership/management’s commitment, benchmarking, involvement/empowerment of employees, and continuous improvement, revealed a positive and significant association with process innovation. Our research is of crucial importance for the knowledge of Portuguese SMEs and the fundamental factors that companies must address to both improve their efficiency and be more competitive, thereby increasing profitability and ensuring financial sustainability in the medium and long term.

Nowadays, the dynamism caused by constant changes to strategic decisions in markets poses an additional difficulty in an organization’s management. The strategic decisions made by managers can easily become obsolete. One of the major difficulties in managing a commercial organization is predicting, with some precision, the impact some strategic decisions have on the financial results. Business intelligence (BI) is widely used to help managers make strategic decisions. However, the methods used to achieve the conclusions are kept secret by BI company-based services. Modeling the environment may help predict the impact of an action in a real environment. A good model should provide the most accurate result of an applied action in a given environment. Artificial neural networks (ANNs) are proven to be excellent in modeling environments with very high data noise. The same strategic action can have different results when applied to different organizations. A tool that allows the evaluation of an applied strategic action in an environment will be of great importance in the field of management. Modeling the environment will save time and money for the organization, allowing the performance of the strategic plan to be improved. If one evaluates the state of the environment after a certain strategic action is applied, it can be possible to mitigate its risk of failure. As we will verify, it is possible to use ANNs to model strategic environments, allowing precision in the prediction of sales and operating results using particular strategies.