BEYOND CONVENTIONAL MODELS: A QUANTITATIVE APPROACH TO ISLAMIC OPERATIONS MANAGEMENT

Abstract

The paper aims to introduce a quantitative model of Islamic operations management and empirically test how Shariah principles - such as amanah, adl, ihsan, shura, and maslahah - are integrated into key areas like human resource management, decision-making, supply chain, and productivity. It also examines the direct effects of these dimensions on organisational performance and evaluates the model's overall explanatory power using partial least squares structural equation modelling (PLS-SEM). Data were gathered using a structured questionnaire with 5-point Likert-scale questions, which were modified based on the literature, in a cross-sectional survey study, involving 211 educated and experienced professionals. The results show a high level of agreement between the perceptions and the Islamic principles, with the human resource management making the most significant positive impact on the decision-making and productivity, decision-making positively affects the productivity, layout management positively affects both. The study has limitations such as cross-sectional nature not making it possible to make causality across time. Additionally, the use of self-reported data, which is prone to social desirability bias. Practically, the findings inform managers in the Islamic-oriented organisations to focus on the ethical HRM practices and consultative decision-making and Shariah-compliant layouts to enhance productivity, employ lean implementations with care to fit within the values such as employee welfare, and instruct policymakers on human standards. This study is unique as it uses data to show that Islamic operations management is a highly effective ethical framework. It proves that when businesses prioritise morals and people, they actually become more productive, hence, proving that value-based management is a better way to do business.