Definition of Service Quality

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1.2 Definition of Service Quality

Philip Kotler (1997) defined service as ‘an action or an activity which can be offered by a party to another party, which is basically intangible and can not affect any ownership. Service may be related to tangible product or intangible product’ On the other hand, Zeithaml and Bitner (2003:85) mentioned that, ‘Service quality is a focused evaluation that reflects the customer’s perception of specific dimensions of service namely reliability, responsiveness, assurance, empathy, tangibles.’ Based on the assessment of service quality provided to the customers, business operators are able to identify problem quickly, improve their service and better assess client expectation. (Business Dictionary.com)

1.3 Importance of Service quality

Londe et al, 1988 stated that it is the customer service management that will derive the importance of service. In services marketing, customer service is regarded as a component of marketing mix. Zeithaml and Bitner, 1996 mentioned that high quality customer service is not just customer service department but all levels of management and staffs need to accept and have a state of mind regarding customer care. On the other hand, Payne, 1995 added that there is pressure on customer service due to competition and technological. He also stated that higher standards of service are being demanded by consumers as they are becoming more sophisticated and updated in their requirements and to them service refers as customer satisfaction, customer delight, service delivery, customer relationship, hence, to provide good service to customers, service companies need to take into consideration the important variables of service quality namely, assurance, empathy, reliability, responsiveness and tangibles. Thus as per Payne, 1995 customer service and quality improvement initiatives are closely related to each other. Moreover, marketing, customer service and relationship marketing are brought together through relationship marketing and marketers are very concerned about the attainment of quality. (Christopher and Ballantyne, 1991)

However, different authors have stated that service quality has been associated as having clear relationships to the following factors:

• Costs ( Crosby,1979)
• Profitability ( Buzzell and Gale,1987;Rust and Zahorik,1993)
• Customer Satisfaction ( Boltan and Drew,1991; Boulding et al,1993)
• Customer retention (Reichheld and Sasser,1990)
• Behavioural intention and positive word of mouth
• (Anderson and Zeithmal, 1984; Philips, Chang and Buzzell, 1983)

Moreover, Anderson and Zeithmal, 1984; Philips, Chang and Buzzell, 1983 claimed that, customer’s buying decisions are influenced by quality which is considered as the most important purchase decision factor and it also contributes to market share and return on investment.Garvin,1983 added that quality has strategic benefits in terms of improving productivity and lowering manufacturing costs.

1.4 Dimensions of Service Quality: SERVQUAL Model

According to A. Parasuraman, V.A.Zeithaml, and L.L.Berry, it is during the service delivery that the quality of services is assessed and the contact with each customer implies as a chance to satisfy or dissatisfy the customer, a moment of truth. They defined customer satisfaction with regards to service as ‘by comparing perceptions of service received with expectations of service desired.’ They also mentioned that an excellent quality of service is perceived when expectations are exceeded and on the other hand, service quality is considered as unacceptable when expectations are not met. Lastly, quality is satisfactory when perceived service confirmed expectations.

In addition, Parasuraman, Zeithaml, and Berry (PZB’s1988) introduced five dimensions which led to the development of SETVQUAL, these dimensions are as follows:

Tangibles: These include the appearance of employees, physical facilities being offered and equipment which form part of service experience.

Reliability: The way the service is being delivered, that is, the ability to deliver the promised service precisely and consistently.

Responsiveness: Willingness to help customers, respond to their queries and also to provide rapid service to them.

Assurance: Understanding and courtesy of staffs and their capability to inspire trust and confidence.

Empathy: Helpful, care about the customers’ requirements and the firm provides individualised attention to its customers with compassion.

Furthermore, as shown in the figure 1.1 below ‘A conceptual model of service quality with the dimensions of service quality’ was developed by A. Parasuraman, V.A.Zeithaml, and L.L.Berry. They based their research on several different service categories like for example retail banking, long distance telephone service, credit card companies. Thus, they identified that tangibles, reliability, responsiveness, assurance and empathy were the five main dimensions used by customers to judge service quality.

Perceived Service Quality:-

1. Expectation Exceeds

ES<PS (Excellent Quality)

2. Expectation Met

ES = PS (Satisfaction Quality)

3. Expectation not met

ES>PS (Unacceptable Quality)

Dimensions of Service Quality:-

Reliability

Responsiveness

Assurance

Empathy

Tangibles

Word of Mouth

Personal

Needs

Perceived

Service (PS)

Expected Service (ES)

Past

Experience

As shown from the diagram above, A. Parasuraman, V.A.Zeithaml, and L.L.Berry added that customers’ judgements of service quality are based on a comparison between expected and perceived quality. They also stated that the gap between expected and perceived service is a measure of service quality that is satisfaction which is either negative or positive. They also found that in order to ensure consistent delivery of services organisations are faced with challenges to design their service delivery systems.

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However, many authors have also put forward different conceptualisations over the time, like for instance three component structure- functional, reputational quality and technical by Gronroo’s (1984).Five components namely level of customer satisfaction, customer interaction/staff, internal organisation, corporate image and physical support given to service producing system.( Nguyen, 1988)