Motivations and Limitations in Implementing Halal Food Certification: A Pareto Analysis

Transcription

1 Final Draft Post-refereeing (Post-Print) Motivations and Limitations in Implementing Halal Food Certification: A Pareto Analysis Mohamed Syazwan Ab Talib Faculty of Management, Universiti Teknologi Malaysia, Johor Bahru, Malaysia msyazwan79@live.utm.my Abu Bakar Abdul Hamid UTM International Business School, Universiti Teknologi Malaysia, Kuala Lumpur, Malaysia Thoo Ai Chin Faculty of Management, Universiti Teknologi Malaysia, Johor Bahru, Malaysia Appeared in: British Food Journal, Vol. 117 No. 11, pp DOI: /BFJ Publisher: Emerald Group Publishing Limited 1

2 Motivations and Limitations in Implementing Halal Food Certification: A Pareto Analysis Purpose: The purpose of this study is to review, analyse, and synthesise the motivation and limitation factors in implementing Halal food certification. Design/methodology/approach: A systematic online library search gathered 50 recent journal articles between the years 2004 and After common motivation and limitation factors were identified and reviewed, a Pareto analysis was performed. This is done to prioritise the motivation and limitation factors and ultimately revealed the major factors that influence the implementation of Halal food certification. Findings: A total of 36 motivation and 37 limitation factors were identified. Through Pareto analysis, 15 motivation factors accounted for percent and 20 limitation factors are responsible for percent. These factors are considered the major factors in implementing Halal food certification. Practical implications: For academicians, this study provides the most recent review of food safety and quality certification literature and the highlighted factors could assist in designing research instruments and set the foundation for future research endeavours. For industrialists, factors drawn from this study highlights the information critical for effective and efficient decision-making. Originality/value: This paper is unique as it is the first study to review and analyse the relevant literature from which we synthesised the major factors in implementing Halal food certification. The result of this study will provide greater insights to researchers, food companies, and other stakeholders in an effort to encourage greater implementation of Halal food certification. Keywords: Halal; Halal food certification; food safety certification; Pareto analysis; literature review Article Classification: Literature Review 2

3 1. Introduction The profound role of religion continues to be one of the most significant current discussions in food production and consumption. Consumers are seeking foods that are prepared in line with their religions teachings because eating is a form of worship and an act to safeguard their faith (Regenstein et al., 2003; Marzuki et al., 2012a). For food producers and manufacturers, religion dictates business conduct, and at times, is used as a guideline in ensuring food safety and quality (Abuznaid, 2009; Farouk et al., 2014). Unique to Muslim consumers, Islam urges its devotees to consume foods that are clean, safe, and wholesome; in other words, Halal. Linguistically, Halal derives from Arabic and translates as permissible in English. Putting Halal in the context of food and food industries, it indicates food that is safely and hygienically prepared and is permissible for consumption. Consuming only Halal food is one of the fundamental aspects of being a Muslim and such an obligation is specifically mentioned in both the Quran and Sunnah (the teachings and practices of Prophet Muhammad PBUH): O believers! Eat of the good (lawful) things which We have provided you, and be grateful to Allah, it is He whom you worship. (Al-Baqarah: 172) At present, Halal is no longer only for Muslims and is more than just a religious obligation. According to Lada et al. (2009, p. 66), [Halal] is in the realm of business and trade, and it is becoming a global symbol for quality assurance and lifestyle choice. Furthermore, Thomson Reuters reported that the Halal market, especially the Halal food market, is one of the largest consumer markets in the world with over US$ 1 trillion in value. The rising Muslim population and the wide acceptance among non-muslims contribute to the surge in demand for Halal food. This indicates that Halal food is at the centre of a global consumer market and food companies are aggressively incorporating Halal principles into their business operations. Major food companies, such as McDonald s and Nestle, are committed to ensuring that their products are Halal, especially when serving Muslim-majority markets (Fischer, 2012). Such a strategy is undertaken to further establish their market position, expanding their market share, and winning over the food-sensitive Muslim consumers. However, in order to do so, food companies must first ensure that their entire production chain and outputs are certified Halal by an established Halal certification authority. This exercise is crucial because obtaining Halal certification allows for greater domestic and international business opportunities (Hassan, 2011) while failure to do so may lead to reduced sales in addition to hefty fines (Rezai et al., 2012). Halal certification can be defined as a document issued by an Islamic organisation certifying that the products listed on it meet Islamic dietary guidelines (Riaz and Chaudry, 2003, p. 170). In addition, Halal certification is a type of food safety certification indicating that the bearer (a food company) has undertaken rigorous examinations and inspections to ensure 3

4 that the particular product adheres to the specified Halal best practices (Latif et al., 2014; Nawi and Nasir, 2014). Halal certification is in the form of authenticate certificate and a unique logo showcased on product packaging or business premises. 2. Problem Statement and Objectives Despite its importance, Halal certification suffers from several major drawbacks. First, the lack of knowledge among food companies devalues the true purpose of securing Halal certification. Drawing from the work of Othman et al. (2009), food companies lack a clear understanding and appreciation of the need to implement Halal certification. The study reported that firms are implementing Halal certification as a means to compete with rival firms, and on the basis of following local business norms. Motivations such as to ensure Halal product integrity or to maintain product safety and quality remain absent. This indicates that food companies have limited knowledge in the importance of implementing Halal certification. In recent years, there has been an increasing amount of literature on Halal certification. However, the scope heavily emphasises on consumerism, such as consumer purchase intention (Aziz and Chok, 2012), consumer confidence (Mohamed et al., 2013), consumer behaviour (Alam and Sayuti, 2011), and consumer willingness to pay (Verbeke et al., 2013). Unfortunately, there has been limited insights from the manufacturing side of the Halal food chain that specifically discuss the motivation to implement Halal food certification. Several attempts have been made to address the issue (see Othman et al., 2009; Badruldin et al., 2012; Marzuki et al., 2012b) but due to its limited range, findings remain largely inconclusive. One of the greatest challenges in Halal food certification is the use of fraudulent and dubious accreditation. According to Rezai et al. (2012), after a series of inspections and raids, authorities have uncovered numerous cases of fake Halal logos and the use of suspect ingredients. Moreover, Talib and Johan (2012) further stated that firms are able to acquire Halal certification from an unauthorised certification body, thus compromising the integrity of Halal food products in the market. These instances raise the questions of why firms seek fake certification?, and more precisely, what are the hindering factors that might have caused firms to commit fraudulent acts?. While some research (Badruldin et al., 2012; Talib and Hamid, 2014) has been carried out to pinpoint the limiting factors in securing Halal certification, no studies have provided a thorough investigation on the various limitations encountered prior to Halal food certification. Hence, an in-depth exploration on the topic of limitations to Halal food certification rightly calls for attention. Based on the issues mentioned above, this study sets out to investigate the motivation and limitation factors in implementing Halal food certification. Specifically, this study seeks to: 4

5 To determine the motivation and limitation to implement Halal food certification by reviewing relevant food certification literature. To analyse and prioritise, through the use of Pareto Analysis, the motivations and limitations in implementing Halal food certification. To identify the major motivation and limitation factors in implementing Halal food certification. The overall structure of this review takes the form of six sections, including the introductory section and this problem statement and objectives section. The third section of this paper reviews the motivations and limitations to implement certification. The fourth section presents the analytical analysis of the reviewed literature through the use of Pareto analysis. Section five provides a comprehensive discussion highlighting the major motivation and limitation factors in implementing Halal food certification. The last section concludes with a brief summary of the findings and highlights the potential areas for further research. 3. Literature Review Studying and understanding the motivation and limitation factors for Halal certification is important because it provides meaningful insights to researchers, food companies, and other stakeholders in an effort to inspire broader implementation of food safety certification (Tunalioglu et al., 2012). Moreover, it is equally important to rank and prioritise the motivation and limitation factors as it gives an in-depth understanding of the critical factors in implementing food safety certification (Fotopoulos et al., 2011). Accordingly, taking into perspective the points made by Fotopoulos et al. (2011) and Tunalioglu et al. (2012), we argue that it is imperative to study and understand the motivation and limitation factors in implementing Halal food certification. Furthermore, in view of the recent rise in demand for Halal food products, this study offers food companies a comprehensive understanding of the major factors that influence the implementation of Halal food certification. Before proceeding to review the relevant literature, and ultimately fulfil the first objective, it is necessary to note that due to the limited literature on Halal certification, the motivation and limitation factors to Halal food certification are extracted from other forms of food safety and quality certification standards, specifically the Hazard Analysis and Critical Control Points (HACCP) and the Food Safety Management System (ISO 22000). As pointed out by Latif et al. (2014), the Halal food certification approach is consistent with the best practices of other types of food quality assurance standards. Furthermore, Kohilavani et al. (2013) observed that the Halal dietary requirements can be harmonised with the principles and concepts of HACCP, thus indicating that Halal certification is engrained in the doctrines of safety, hygiene, and wholesomeness. Therefore, our method of reviewing HACCP and ISO relevant literature as the basis of the literature review is deemed appropriate. 5

6 3.1. Review Methodology Having explained the basis of our literature review, we now proceed to the scope of the review. Firstly, an exhaustive online library search was conducted from October until December This was approached with the aim to identify the existing literature on the motivation and limitation factors for certification. Secondly, the initial online search yielded 2,476 journal articles. As the number of search results was expected to be massive, timespecific and keyword-sensitive search techniques were applied. The search was limited to the most recent 10 years of publication, between 2004 and Only journal articles published within the last decade were included, thereby managing to omit redundancy and maintain relevancy of the topic at hand. Other types of publications such as conference papers and magazine articles were rejected. With regard to the keyword-sensitive search technique, several keywords were predetermined by the authors after a brainstorming session. The generic keywords used for online search were food certification, food safety/quality standards, food safety certification, food industry, certification motivation/barrier, motivation, barrier, HACCP, and ISO These generic terms must be included either in the title, the keywords, and/or the abstract of a journal article. In the end, a total of 50 journal articles were selected for the present review. The 50 selected journal articles from the systematic search is summarised in Table 1. The following subsections review the motivation and limitation factors in implementing certification Motivation to Certification Refer to Dataset for Table 1 Frequent cases of food contamination and foodborne illnesses have caused consumers to question the safety and quality of the food preparation, handling, and distribution. In an attempt to resolve the issue and to reinstate consumer confidence, food companies are striving to ensure that every product in the market is certified and endorsed by legitimate certification authorities. Recent evidence suggests that being certified signifies that a food company is determined to ensure and improve product safety and quality (Mensah and Julien, 2011; Macheka et al., 2013; Chen et al., 2014; Escanciano and Santos-Vijande 2014a). Moreover, the determination to increase product safety and quality is among the top motivation factor among food companies in the United Kingdom (Mensah and Julien, 2011), New Zealand (Chen et al., 2014), Malaysia, (Fernando et al., 2014), Serbia (Tomašević et al., 2013), and China (Bai et al., 2007). Similarly, aside from improving the food safety and quality, studies have shown that food companies are committed to implement certification as an effort to protect the consumers from the potential presence of foodborne diseases (Macheka et al., 2013) and to lower the risk of compromising food safety (Jin et al., 2008). Therefore, the motivation to implement food certification is motivated by the commitment 6

7 to offer safe and quality food in the market, while at the same time providing assurance to consumers that the products are safe for consumption. Even though it seems that firms are initiating the motivation towards food certification, several studies indicate that the initiative is in response to the demand and pressure from the consumers. According to Fikru (2014), international firms, especially food businesses, are being compelled by the demand from local consumers causing them to become certified. In addition, the demand from the domestic food market has put pressure on local food companies, and eventually motivating them to implement certification (Fotopoulos et al., 2010). The motivation to implement certification is also the result of ensuring consumer satisfaction and fulfilling the demand for quality and safer food (Psomas et al., 2012; Strohbehn et al., 2014). Thus, conforming to customer pressures and ensuring customer satisfaction is eminent because it enables firms to attract new customers, retain existing ones, and create loyalty (Herath and Henson, 2006; Sarter and Sarter, 2012). Aside from consumer pressure, pressure from government regulations and policies could also directly or indirectly motivate food companies to implement certification. Much of the available literature on motivation for food certification highlights governmental pressure as a significant driving factor (Yapp and Fairman, 2006; Celaya et al., 2007; Othman et al., 2009; Wilcock et al., 2011; Milios et al., 2013; Chen et al., 2014; Maldonado-Siman et al., 2014). For instance, Wilcock et al. (2011) observed that complying with the Canadian government regulation could become the main motivational factor for implementing HACCP in the coming years. This is consistent with Tomašević et al. (2013) where the Serbian government legislated industry-wide mandatory commitment to HACCP certification. In contrast, although food safety management standards are not mandatory in New Zealand, the food companies are still motivated to become certified (Chen et al., 2014). Regardless of whether certification is mandatory or non-mandatory, firms are motivated to become certified because it is believed to facilitate international market expansion. As highlighted by Arpanutud et al. (2009), Fotopoulos et al. (2011), Teixeira and Sampaio (2013), Escanciano and Santos-Vijande (2014a), and Fernando et al. (2014), firms are driven by the prospect of establishing business overseas and easy entry into the foreign markets. For instance, Arpanutud et al. (2009) mentioned that the adoption of food certification can broaden a firm s business territory, and although costs is an issue, the economic benefits outweigh the financial commitment. In terms of easing the entry into overseas markets, being certified is advantageous for food companies. Firms that possess internationally recognised food certification may overcome export barriers and easing market entry (Mensah and Julien, 2011; Massoud et al., 2010; Karipidis et al., 2009). This indicates that firms are motivated to implement certification as it offers benefits both in local and foreign markets. Resulting from the ability to operate in domestic and international food markets, firms are consequently motivated to implement certification because it can improve the market 7

8 share. Besides, although small firms may not have the financial muscle and infrastructure to expand their business overseas, they are still able to compete for local market share growth. Though it might be difficult, Karipidis et al. (2009) reported that the chance to increase market share motivates small food enterprises to opt for certification standards. In relation to medium and large food companies, Jin et al. (2008) expressed that the Chinese firms are also motivated to increase the market share and ultimately become a market leader in China. In comparison, referring to the review by Fotopoulos et al. (2011), becoming a market leader (increase market share) is a less significant motivation to certification. The review by Fotopoulos et al. (2011) may be theoretical, but in the actual scenario, several studies have revealed that enlarging the market share is one of the main motivations in implementing certification (Bai et al., 2007; Herath and Henson, 2006; Macheka et al., 2013; Milios et al., 2013; Escanciano and Santos-Vijande, 2014a; Fernando et al., 2014; Fikru, 2014). Inter-firm competition is another motivational factor that drives firms to implement food certification. Due to the highly competitive food market, rival firms are indirectly pressurising competing firms and thus incidentally motivating other competitors to become certified (Othman et al., 2009; Arpanutud et al., 2009; Fotopoulos et al., 2010; Mensah and Julien, 2011; Chen et al., 2014; Escanciano and Santos-Vijande, 2014a; Fikru, 2014). As pointed out by Othman et al. (2009), a non-certified firm feels the pressure when a certified-rival firm business is performing well. This instigates the non-certified firm to mimic the rival s strategy and hopefully emulate the rival s success. Concurrently, Fikru (2014) suggested that local food companies are motivated to implement certification in an attempt to mimic the international firms, while the international firms are mimicking local firms as an effort to adapt to local business practices. Therefore, regardless whether a firm is competing locally or internationally, they are indirectly coerced and motivated to implement certification because it can improve their image and reputation. Generally, food companies produce and sell homogeneous products within a competitive, sensitive, and saturated market. As a result, firms depend on their image and reputation in an effort to remain competitive. In particular, firms turn their attention towards implementing certification as a strategy to compete using the intangible element of image and reputation (Khatri and Collins, 2007; Ramnauth et al., 2008; Karipidis et al., 2009; Fotopoulos et al., 2011; Milios et al., 2013; Escanciano and Santos-Vijande, 2014a). The study by Khatri and Collins (2007) suggested that an effective food safety certification is vital in the present business environment as it can enhance a firm s image and reputation, and ultimately differentiate a firm from its competitors. A recent study by Escanciano and Santos-Vijande (2014a) reinforced the profound role of food certification as a tool to heighten a firm s reputation even in business-to-business export markets. This suggests that food enterprises are motivated to strive for certification in order to improve their corporate image and reputation, and in turn, attract more customers. 8

9 There is a large volume of published studies that described the role of food certification in improving the internal aspect of a company. To begin with, firms implement food certification with the objective of improving the internal operation (Strohbehn et al., 2004; Yapp and Fairman, 2006; Griffith et al., 2010; Vladimirov, 2011; Kafetzopoulos and Gotzamani, 2014; Chen et al., 2014). For example, the objectives behind the pursuit of certification are to improve production efficiency, to practice efficient internal food safety procedures, to have better internal communication, and to standardise internal processes and productivity. Additionally, past studies indicate that firms are motivated to implement certification as a way to reduce waste and practicing cost reduction. According to Psomas et al. (2012) and Milios et al. (2013), certification ensures food production and preparation are in-line with the stipulated guidelines and therefore could minimise production defects and marginalise rate of rejection and rework. As a consequence, the number of customer complaints can be reduced (Fotopoulos et al., 2011; Maldonado-Siman et al., 2014). Another internal aspect that motivates food companies to implement certification is the desire to have an effective and efficient workforce. A number of studies have found that food enterprises implement certification with the aim to stimulate employees motivation (Ramnauth et al., 2008), to encourage commitment and awareness in food safety among the employees (Fotopoulos et al., 2009; Maldonado-Siman et al., 2014), to improve employee performance (Psomas et al., 2012), as well as to attract and retain skilled employees (Karipidis et al., 2009; Wu, 2012). Admittedly, Wilcock et al. (2011) argued that the success of food safety certification lies in the availability of dedicated and meticulous experts who can supervise the entire certification exercises from the initial application to the maintenance of the certification. This signifies the criticality of human resource in implementing certification as it can be an impetus for other factors motivating food certification. In view of all that has been mentioned thus far, one may suggest that there are various motivational factors for certification. It should be emphasised that the motivation factors discussed earlier do not apply to every firm because the driving factors may vary depending on a firm s nature of business, geographical areas, target markets, size of operation, and the availability of resources. Furthermore, it is insufficient to concentrate and understand only the motivational factors because it could be offset by the barriers that might impede the success of certification implementation. Therefore, the following section will review the limitation factors in implementing food certification Limitations to Certification As mentioned earlier, human resource is one of the motivating factors in implementing certification. However, the human element could also be the limiting factor in successfully implementing certification. There is a general consensus that the lack of skills and knowledge in food safety is hindering the implementation of certification (Eves and Dervisi, 2005; Yapp and Fairman, 2006; Baş et al., 2007; Violaris et al., 2008; Karaman et al., 2012; 9

10 Tunalioglu et al., 2012; Pswarayi et al., 2014). In Turkey, Karaman et al. (2012) discovered that the lack of knowledge and poor understanding of food safety are impeding firms from engaging in certification standards. Similarly, due to the deprived knowledge, employees are having difficulties in interpreting the complicated certification manuals (Baş et al., 2007). The deficiency of knowledge in food certification causes the employees to neglect food safety and lessens their awareness of the importance of implementing certification (Macheka et al. 2013; Strohbehn et al., 2014). The lack of knowledge is attributed to the lack of training and education in food safety and quality. It is undoubted that training is important prior to certification but several factors hinder the execution of training in food safety and quality. Firstly, the high costs of training is a barrier in sending employees for food safety courses. As described by Semos and Kontogeorgos (2007, p. 16), the most important cost and difficulty encountered during the implementation and operation of the HACCP system was associated with the training of the companies staff. Managers are reluctant to send the employees for training as it means spending more money, especially when it involves retraining (Milios et al., 2013). Secondly, executing food certification is time consuming (Eves and Dervisi, 2005; Taylor and Kane, 2005) and the time spent on training and retaining new or existing employees prolong the time spent away from daily tasks and operations. Wilcock et al. (2011, p. 31) explicitly pointed out that time was a challenge common to all food safety managers/coordinators and this indicates that due to work commitments, managers are cutting short the training time. Hence, it can be summarised that the lack of training is because of the high costs of training, time constraints, and commitment issues. The low motivation among the employees is another factor that impedes the execution of food safety and quality certification. Much of the current literature on certification barriers pays particular attention to employees motivation (Semos and Kontogeorgos, 2007; Tunalioglu et al., 2012; Teixeira and Sampaio, 2013; Tomašević et al., 2013; Escanciano and Santos-Vijande, 2014b; Maldonado-Siman et al., 2014). Employees are not interested in food safety certification because it involves tedious recordkeeping and exhaustive processes, thus causing them to become demotivated (Baş et al., 2007). The demotivation among the employees towards food safety certification causes them to become resistant in practicing food safety. The resistance to change and adapting to new processes distort the execution in food safety certification. Herath and Henson (2010) stated that the employees are resisting departing from traditional methods because they are too accustomed to existing systems. Furthermore, Howells et al. (2008) reported that the struggle to comply with food safety practices is further worsened by the management s lack of commitment and monitoring. Past studies reported that managerial staff also encounter difficulties in managing change and implementing food safety certification (Eves and Dervisi, 2005; Karipidis et al., 2009; Escanciano and Santos-Vijande, 2014b). The cost of hiring experts and consultants (Eves and Dervisi, 2005; Escanciano and Santos-Vijande, 2014a), red tapes (Tähkäpää et al., 2009; 10

11 Escanciano and Santos-Vijande, 2014b), and the requirement of a wide-scale facility upgrading (Herath and Henson, 2010) are among the factors that cause managerial commitment issues. Hence, the review of past literature indicates that the issues of resistance to changes in food safety are attributed to both the employee and managerial commitment issues. Apart from the resistance to internal changes and commitment issues, the financial aspect of food safety can also hinder firms from implementing food certification. Several studies have thus far linked financial constraints with food safety certification (Yapp and Fairman, 2006; Herath and Henson, 2006, 2010; Khatri and Collins, 2007; Tähkäpää et al., 2009; Macheka et al., 2013; Escanciano and Santos-Vijande, 2014a). According to Herath and Henson (2010), internal budgetary constraints and difficulties in obtaining external funding impede firms in Canada towards HACCP implementation. This is supported by Tunalioglu et al. (2012) that highlighted the insufficient financial support from the Turkish government hampers the success of food safety certification. Past studies have shown that in order for food companies to effectively execute food safety certification, they require ample supply of internal and external financial resources. Financial strength is important because the cost of obtaining certification is capital intensive. The cost of securing a legitimate food safety and quality certification can cause firms to flex their financial muscles. A number of studies reported that the high costs of development, implementation, and maintenance are impeding firms from pursuing food safety certification (Eves and Dervisi, 2005; Baş et al., 2007; Karipidis et al., 2009; Massoud et al., 2010; Mensah and Julien, 2011; Karaman et al., 2012; Tomašević et al., 2013; Chen et al., 2014). For example, as mentioned by Baş et al. (2007), the high costs of operation and the additional cost of labour hinders food companies from food safety certification. Several costs incurred during initial setup include acquiring new equipment, appointing consultants and hiring experts, training manpower, and making physical changes in buildings and production layout (Tomašević et al. 2013). Teixeira and Sampaio (2013) further added there is a relation between the high costs of implementation and the size of firm operation. This indicates that small food companies may encounter more financial difficulties in implementing certification. The points mentioned earlier further strengthen the claim that financial constraint is one of the major limitation in implementing food safety certification, and therefore, firms should properly strategize or get assistance from the regulatory bodies. Although seeking help from responsible or correct regulatory bodies could help solve the issue, the assistance is still insufficient, and the authorities are often unreliable. The lack of government support is reflected in several past literature that signify it as a barrier that limits firms from implementing food certification (Fotopoulos et al., 2011; Mensah and Julien, 2011; Karaman et al., 2012; Tunalioglu et al., 2012; Tomašević et al., 2013; Chen et al., 2014; Pswarayi et al., 2014). According to Karaman et al. (2012), despite the lack of support, food companies in Turkey are hoping that the government will provide more financial support, offer attractive taxes, organise training, and provide expert consultation 11

12 on food safety certification. However, such assistance cannot materialise if the certification authorities themselves are unreliable and lack professionalism. Ethical issues such as bribery or corruption further complicate the implementation process and ultimately discourage food companies from pursuing food certification (Karipidis et al., 2009; Pswarayi et al., 2014). Thus, impeding regulatory issues such as the lack of support and unethical conducts are limiting the execution of food safety certification. Immediate corrective measures must take place in order to safeguard the safety and quality of food products in the market. Evidence of the limitations discussed in this section suggests that there are numerous factors that could hinder food companies pursuit towards certification. Collectively, the review of the motivation and limitation factors in implementing food safety and quality certification suggest that more needs to be done in stimulating the motivation factors and overcoming the limiting factors. Furthermore, looking from the Halal standpoint, it seems that there are a great number of factors that can influence Halal food certification. Consequently, the loaded information creates difficulties among managers in determining which pieces of information are crucial in Halal food certification. Therefore, in the next section, through the use of Pareto analysis, we will uncover the critical information by prioritising the motivation and limitation factors in implementing Halal food certification. 4. Pareto Analysis At the end of the nineteenth century, an Italian economist named Vilfredo Pareto observed that 80 percent of Italy s wealth derived from 20 percent of the total population (Sanders, 1992; Knights, 2001; Craft and Leake, 2002). Vilfredo Pareto s observation is the basis of what is known today as the Pareto Principle. The Pareto Principle was then popularised as the Pareto Analysis by Dr. Joseph M. Juran when he recognised the principles of the vital few and trivial many (Juran, 2005) where 80 percent of the overall impact of errors in any industrial scenario is due to a small number of error types, termed the vital few and 20 percent of the impact due to other error types, called the trivial many (Sarkar et al., 2013, p. 641). The Pareto analysis is a simple methodology commonly used in decision making (Cervone, 2009) and one that is often used by managers to direct efforts to the biggest improvement opportunity by highlighting the vital few causes in contrast to the useful many (Garg and Garg, 2013, p. 506). Despite its popularity and usefulness, several authors have highlighted its shortcomings (Sanders, 1992; Knights, 2001; Bamford and Greatbanks, 2005) For instance, Knights (2001) stated that misinterpretation of terms and the inability to compare trends are weaknesses of the Pareto analysis. Bamford and Greatbanks (2005) on the other hand noted that the Pareto analysis does not indicate relationships among the studied variables, while Sanders (1992) concluded that the factors identified through Pareto analysis are temporary as the environment keeps changing. 12

13 Nevertheless, the Pareto analysis has been deeply embedded in management sciences and literature. Various areas in management have applied the Pareto analysis as a means to identify major factors that can be individually dissected into minor and more manageable factors (Cervone, 2009). For example, Pareto analysis has been used for research in the field of project management (Cervone, 2009) organisational decision making (Craft and Leake, 2002), enterprise resource planning (Garg and Garg, 2013), supply chain management (Karim et al., 2006), and total quality management (Karuppusami and Gandhinathan, 2006). Besides, Pareto analysis is applicable in various fields such as in sociology, politics, economics, and even in physics and biology sciences (Sanders, 1992; Juran, 2005). This signifies that the Pareto analysis is relevant in many academic domains, including in the field of food safety and quality. Various types of analysis have been used to verify the motivation and limitation factors in implementing food safety certification, such as exploratory or confirmatory factor analysis (Psomas and Fotopoulos, 2010), regression analysis (Vladimirov, 2011), and descriptive analysis (Macheka et al., 2013). However, Pareto analysis is rarely used and the study by Fotopoulos et al. (2011) is the only attempt to do so. In the detailed analysis of critical factors for effective food safety certification, Fotopoulos et al. (2011) stressed that the Pareto analysis approach is an effective tool to assist managers in managing food safety issues. With that in mind, until now, no study has attempted to use Pareto analysis as a method to identify the motivations and barriers in Halal food certification. The absence of such study encourages the use of Pareto analysis to inspire more understanding on Halal food certification, as well as provide greater insights to researchers, food companies, and other stakeholders Pareto Analysis Methodology To address the second objective of analysing and prioritising the motivations and limitations in implementing Halal food certification, we replicate the steps performed by Fotopoulos et al. (2011). Firstly, we identify the motivation and limitation factors by reviewing relevant food certification literature. The first step was performed in the literature review section. Secondly, we group the motivation and limitation factors by using the semantic/linguistic technique. This is done in order to categorise various terms into individual groups that signify similar meanings. To illustrate, motivation terms such as meeting customer requirements, meeting customer needs and expectations, or pressure from the consumer are categorised as Customer Demand and Pressure. Likewise, terms such as cost of implementation, high cost of certifications, or substantial cost of development signify limitations and are therefore labelled as Cost of Implementation. The compilation of all motivation and limitation factors are showcased in Tables 2 and 3. Refer to Dataset for Table 2 and 3 13

14 Thirdly, in order to ascertain the number of occurrences, the compiled motivation and limitation factors in Tables 2 and 3 were cross-checked with Table 1. Once the occurrences were identified, the next step was to sort the motivation and limitation factors in descending order based on the percentage of occurrence (see Table 4 and Table 5). To achieve the third objective, based on the cumulative percentage, the major (80 percent; vital few) and minor (20 percent; trivial many) motivation and limitation factors were identified. Refer to Dataset for Table 4 and 5 Lastly, the major motivation and limitation factors were further dissected by categorising them into major internal motivation/limitation and major external motivation/limitation factors (see Figure 1). Internal factors indicate that the motivation or limitation originate from within a firm, while the external factors indicate the influence of the outer elements, such as governments and rival firms. Although the last step is not based on Fotopoulos et al. (2011), we believed that their study could be improved by identifying the internal and external factors. This channels managers focus and attention, and ultimately assist them in making efficient and effective decisions by means of capitalising on the major motivational factors or overcoming the major limiting factors. Refer to Dataset for Figure Categorising Motivation and Limitation Factors Table 2 shows the motivation factors to implement certification. As can be seen in Table 2, there are 36 motivation factors that can positively influence food companies in implementing food certification. Motivational factors in italic represent the domain factors while the factors in parentheses indicate the similarities with the domain. After an exhaustive process of categorising the motivation factors, the most frequently mentioned factors in food safety certification is Customer Demand and Pressure with 33 occurrences. Thus, we assert that the demand and pressure from the customers are motivating food companies towards the implementation of Halal food certification. Other apparent motivation factors in executing food safety certification include Production Safety and Quality and Government Regulations and Policies. These factors reflect that the motivation to ensure product safety and quality, and the act of complying with government regulation and policies drive food companies in pursuing Halal food certification. In Table 2, six factors are cited only once in the literature, namely Complement other Management System, Awareness and Exposure, Process and Data Quality Management, Cost of Implementation, and Recognition of the Certification Standard. Although they occurre only once, these factors are still considered motivational factors on their own, but it brings little attention in Halal food certification. Although the motivation of Cost of Implementation can be misinterpreted, this factor indicates that if the cost of implementing certification is favourable, then firms are more likely to become Halal certified. 14

15 Moving on to Table 3, this table comprises the limiting factors in implementing food safety certification. In Table 3, 37 factors could hinder a firm s drive towards becoming certified. Similarly, the domain limitation factors are in italics while the similar representations are in the parentheses. Among the most notable limitation factors are the high costs of implementation (18 occurrence), the lack of skills and knowledge in food safety (17 occurrence), the time factor (15 occurrence), and the lack of recognition and awareness of food safety certification (15 occurrence). The results of the review shown in Table 3 further signifies that the financial, knowledge, time, and awareness factors are barriers towards successful implementation of Halal food certification. Unlike the motivational factors in Table 2, there are only two factors with one occurrence in Table 3, namely the engagement with other tasks and the blame culture Prioritising the Occurrence Frequency Having grouped the motivation and limitation factors, we will now move on to prioritise the factors. The factors are ranked in descending order, from the most to the least frequently mentioned. The occurrence of each factor is shown in Tables 2 and 3. Once all the factor occurrences are sorted in descending order, the motivation and limitation occurrences are totalled, and the sum of occurrences for motivation factors is 296 while the limitation factors is 285 (see Table 4 and Table 5). Subsequently, in order to ascertain the frequency of occurrence (F), every individual motivation (MVx) and limitation factors (LMx) occurrences are divided by the summed value of occurrence ( MV or LM). The values are then multiplied by 100. To illustrate: Motivation Occurrence Frequency: Ϝ = MVx MV 100 Limitation Occurrence Frequency: Ϝ = LMx LM 100 The occurrence frequency for all motivation and limitation factors are shown in Tables 4 and 5 respectively. Finally, before performing the Pareto analysis, the cumulative frequency must be predetermined, as tabulated in Tables 4 and Identifying the Major Motivation and Limitation Factors To identify the major motivation and limitation factors in implementing Halal food certification, we use the theory of Pareto analysis where the vital few (major factors) accounted for 80 percent of the occurrence frequency while the useful many (minor factors) accounted for the remaining 20 percent. In Table 4, the major motivation factors in implementing Halal certification accounted for percent, while the minor factors are the remaining percent. Therefore, we argue that there are a possible of 15 major factors that can motivate firms to implement Halal food certification. Evidently, the findings are consistent with other research in Halal certification. For instance, the demand and 15

16 pressure from the customers are motivating food companies to implement Halal certification (Fischer, 2012; Marzuki et al., 2012b). In terms of the major limiting factors in executing Halal food certification, the results from Table 5 point out that 20 major factors are responsible for while percent explains the minor factors. This suggests that impeding factors such as high cost of implementation, financial constraints, and the lack of government support are hindering food companies from implementing Halal food certification. This interpretation is similar with that of Fischer (2015) who claimed that a government s limited financial assistance obstruct the promotion and Halal market, which entirely distorts the implementation of Halal certification. Lastly, the results of the Pareto analysis are comparable and consistent with findings from other food safety and quality certification, thus suggesting that the Pareto analysis technique can be applied in determining the motivation and limitation factors in implementing Halal food certification Major Internal/External Motivation and Limitation Factors As mentioned earlier, it is important to study the motivation and limitation factors because it offers a greater understanding of Halal food certification. In an attempt to add more value to the present study, we further divide the major motivation and limitation factors into internal and external factors. The internal and external factors are clustered into four quadrants, as depicted in Figure 1. The four quadrants are major motivation-internal factors, major motivation-external factors, major limitation-internal factors, and major limitation-external factors. The major motivation-internal factors and the major motivation-external factors contains nine factors (MV2; MV4; MV5; MV6; MV8; MV9; MV10; MV12; MV15) and six factors (MV1; MV3; MV7; MV11; MV13; MV14) respectively. In addition, the major limitation-internal factors is comprised of fourteen factors (LM 1; LM 2; LM 3; LM 5; LM 6; LM 8; LM 9; LM 10; LM 11; LM 12; LM 13; LM15; LM17; LM20) while the major limitation-external factors is consisted of six factors (LM4; LM7; LM14; LM16; LM18; LM19). The factors are sorted in each quadrant according to the individual occurrence frequency. This seeks to assist managers in decision-making, in terms of which areas (internal/external) need to be addressed and what tasks should be prioritised. 16

17 5. Discussion This part of the paper discusses the findings that emerged from the Pareto analysis presented in the previous section. A review of the past studies has proposed various motivation and limitation factors in implementing Halal food certification. From the systematic review and synthesis of relevant literature on food safety and quality certification, this study yields 36 motivation and 37 limitation factors in implementing Halal food certification. This large number of factors offers immense information for managers to operationalise. A more manageable amount of information, specifically those that are critical, is required to assist managers in decision-making. Therefore, the motivation and limitation factors were further analysed using the Pareto methodology. This approach is able to refine the factors into 15 major motivation factors and 20 major limitation factors. Lastly, the motivation and limitation factors were further categorised into internal and external factors. We argue that the findings from the present study offer a more comprehensive understanding of the motivation and limitation factors in implementing Halal food certification. As pointed out earlier, the common major motivation factors are from the internal part of the organisation. The most prevalent factor is the drive to improve internal processes and production output (MV2; MV4; MV5). This approach is similar with the work done by Escanciano and Santos-Vijande (2014a), who pointed out that the commitment to offer safer and higher quality products and to improve internal efficiency motivate firms in Spain to implement food certification. Fernando et al. (2014) also revealed that the drive towards product quality improvement and minimising the risk of food contamination are among the top motivators among Malaysian food companies in implementing food certification. These results reveal that firms are motivated to implement Halal food certification in order to ensure standardised internal operation that can be beneficial in reducing costs and ultimately offer safe and quality Halal food products to the consumers. Hence, based on our findings and supports from past studies, it can be outlined that the motivation to implement Halal food certification start from within an organisation. The motivation to improve employee performance is another driving internal factor in the pursuit for Halal food certification. Continuous improvement in staffs performance was identified as one of the most significant motivation in executing quality certification among food manufacturing firms in Greece (Psomas et al., 2012). Moreover, the employee dedication, knowledge, availability, and effective trainings are among the driving factors that can influence the implementation of food safety certification (Fotopoulos et al., 2009). Perhaps, in the case of Halal food certification, apart from the motivation of product safety and quality, the human element is equally important to prompt Halal certification exercise. We assert that the workforce play a pivotal role in stimulating Halal certificate implementation. Thus, managers must ensure that the employees are motivated and understand the importance of Halal certification. 17

18 Besides the internal employee factors, the findings pointed out that managerial commitment is also a major motivation factor in implementing Halal food certification. We emphasise that commitment from the management is fundamental in encouraging employees to carry out Halal principles, and eventually implement Halal certification. Similarly, Milios et al. (2013) stressed that managerial commitment and decision have severe implication on the overall success or failure of food safety certification. Moving forward, as past studies pointed out the significant role of managers, and to successfully implement Halal food certification, we urge managers to possess proper sets of managerial skills, particularly the human skill. Possessing this skill can influence demotivated employees, instil Halal principles, and eradicate the non-resistance attitude among employees. The present study asserts that for food companies to implement Halal operations, the managerial commitment and employee dedication must be parallel because these two factors are vital in designing, executing, and maintaining Halal food certification. Once the major motivation factors of improving internal processes and production output (MV2; MV4; MV5), and the elements of employees and management commitment (MV6; MV10) are aligned, only then can other motivational factors such as marketing motivation (MV8; MV9) and competitiveness (MV12; MV15) take place. In view of all that has been mentioned thus far, one may suppose that the internal motivation is foremost important, and that the human elements of both managers and employees set the pillar of Halal food certificate implementation. Focusing on the major external motivation, the coercive and mimetic pressure motivates firms to implement Halal food certification. In terms of coercive pressure, we argue that firms are either directly or indirectly compelled to implement Halal food certification. The pressure from the customer (MV1) and the regulatory and policy requirements from the government (MV3) coercively motivate firms in executing Halal food certification. Evidently, Fikru (2012) and Escanciano and Santos-Vijande (2014a) proved that our claim is justifiable because firms that encounter pressure from government regulations or consumer pressure groups are more prone to implement certification. However, although Halal food certification is not mandatory, food enterprises are still drawn to implement certification in an effort to adapt to the local business practices (Othman et al., 2009). This suggests that normative pressure is a prevalent force in motivating food companies in implementing Halal food certification. Although the findings did not highlight the normative pressure, we assert that the outcome of such pressure could positively implicate the expansion of market presence (MV7; MV13) and market share (MV11). Moreover, with regards to mimetic pressure, due to the intense competition within the food market, rival firms tend to replicate the popular and successful strategies, for instance the implementation of Halal food certification. Logically, this is the wise approach because business survival is a crucial as in the highly competitive Halal food market. Besides, because of the limited knowledge in the Halal food industry, the rationale means of sustainable 18