Working capital management and firm’s profitability: Evidence from Czech certified firms from the EFQM Excellence Model

Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F70883521%3A28120%2F21%3A63529298" target="_blank" >RIV/70883521:28120/21:63529298 - isvavai.cz</a>
Result on the web
<a href="https://www.tandfonline.com/doi/full/10.1080/23322039.2021.1954318" target="_blank" >https://www.tandfonline.com/doi/full/10.1080/23322039.2021.1954318</a>
DOI - Digital Object Identifier
<a href="http://dx.doi.org/10.1080/23322039.2021.1954318" target="_blank" >10.1080/23322039.2021.1954318</a>

Result language
angličtina
Original language name
Working capital management and firm’s profitability: Evidence from Czech certified firms from the EFQM Excellence Model
Original language description
Working capital management (WCM) is one of the most important decisions for all firms. The main components of WCM are days sales outstanding (DSO), days inventory outstanding (DIO), days payable outstanding (DPO), and cash conversion cycle (CCC). Using a sample of 332 Czech firms, including 20 certified firms from the EFQM (European Foundation for Quality Management) Model, the current study explored the effects of the main components of WCM on firms’ profitability. We used two different regression models to test the hypothesis, i.e. pooled regression and maximum likelihood estimation (MLE). The findings of the research revealed all the components of WCM have a negative impact on firm profitability. On the other hand, the interaction terms of the EFQM certified firms with the components of WCM showed a positive impact on firms’ profitability which means that there is a positive relationship between the components of WCM of the certified firms and profitability. However, it is examined that the quality certificate/award from EFQM Excellence Model decreases the firm’s profitability. The outcomes of the current research will be beneficial to academics, managers, leaders, and directors of the firms to improve their firm’s profitability.
Czech name
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Czech description
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Type
J<sub>SC</sub> - Article in a specialist periodical, which is included in the SCOPUS database
CEP classification
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OECD FORD branch
50204 - Business and management

Publication year
2021
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

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