Tesfaye Melkamu

ADDIS ABABA UNIVERSITY
COLLEGE OF BUSINESS AND ECONOMICS

MASTERS OF BUSINESS ADMINISTRATION (MBA)
The Effect of Service Quality on Customer Satisfaction, the Case of Hibret Bank
Four Selected Branches (Bole, Bole Medhanialem, Misrak and Beklobet)
By:
Tesfaye Melkamu Asmare
A Thesis Submitted to Addis Ababa University College of Business and

Economics in Partial Fulfillment of the Requirements for Master’s Program in
Masters of Business Administration (MBA)
April, 2021
Addis Ababa, Ethiopia
Addis Ababa University College of Business and Economics MBA program
This is to certify Ato Tesfaye Melkamu Asmare that he has done a research on the topic The Effect
of Service Quality on Customer Satisfaction, In The Case of Hibret Bank Four Selected Branches
(Bole, Bole medhanialem, Misrak and Beklobet). This research is of his original work and all the
sources of material used for the study had been dully acknowledged.
Advisors Name:-Asres Abitie (PhD)

Signature: _________________________
Date: _____________________________
Place: Addis Ababa University, College of Business and Economics
The Effect of Service Quality on Customer Satisfaction, The Case of Hibret Bank S.C.
ii
Addis Ababa University

College of business economics
Masters of business administration (MBA)
Thesis on the Effect of Service Quality on Customer Satisfaction, the Case of Hibret Bank Four
Selected Branches.
By:-
Tesfaye Melkamu Asmare
Approved By
Asres Abitie (PhD) ................................... .............................

Advisor Signature Date
Zelealem G/Tsadik (PhD) ............................. .............................

Internal examiner Signature Date
Getie Andualem (PhD)

getand
.................................. 25/4/21
…………………
External examiner Signature Date
Place: - Addis Ababa University, College of Business and Economics
iii
Declaration
I, Tesfaye Melkamu Asmare, declare that this thesis is my original work, that complies with the
regulation of the university, fulfill the accepted standard of thesis quality and all the material
resources I use during the thesis had been duly acknowledged.
By: Tesfaye Melkamu
Signature _____________
Date _______________
Place: Addis Ababa University, College of Business and Economics
iv
Acknowledgments
The first and for most my thanks enchanted to the Almighty God and his mother saint marry for
graciously help me in all my life endeavors me including the accomplishment of the thesis from
the beginning to its finishing.
I would like to express my greatest & deepest appreciation to my advisor Asres Abitie (PhD), for
his constructive and valuable criticism as well as advice in the course of this thesis preparation,
who genuinely guided me to the right direction.
My special thanks go to my father and mother, which they lead me the best of my life and shaped
me through all my personal life as well as unforgettable supported to my education.
I am much indebted to my wife W/ro Ayal Negash, who unconditionally support and loves me,
without the support of her, this paper work would not have gone this far.
The last but not the least, I want to express my gratitude to those who have shared me their busy
time and. Their effort in responding the questionnaires.
v
Acronyms
ATM = Automated Teller Machine
HB= Hibret bank
POS= Point of Sale
SERVQUAL= Service Quality
SPSS = Statistical Package for Social Science
ETB=Ethiopian Birr
vi
Abstract
Following liberation of financial sector Hibret Bank S.C had incorporated as a Share Company
on Sept 10, 1998 and Licensing and Supervision of Banking Business Proclamation No. 84/1994.
Even if the bank operate more than two decades still there are customer complaint on the service
quality delivered by the bank. Therefore, the aim of the study were studying the impact of service
quality on customer satisfaction, the case of Hibret bank four selected branches. For this study a
questionnaire was designed under five service quality dimension model. A sample consist of 364
were selected based on convenience sampling technique. Primary data were analyzed using SPSS
software version 24. The researcher also used correlation and multiple regression for showing
the relationship of service quality variables to customer satisfaction. Correlation analysis
indicates that, there is positive relationship each service quality variables with customer
satisfaction. On the other hand multiple regression shows that there were a strong positive impact
on customer satisfaction from the four service quality variables (tangibility, reliability,
responsiveness and empathy). While assurance as a negative impact on customer satisfaction.
Among the five service quality variable empathy had a very strong correlation with customer
satisfaction. In general the finding of the research showed that the performance of service quality
of Hibret bank didn’t make satisfy the customers need. So, this lead to low customer satisfaction.
based on this the researcher recommended the bank to train the front line employee and prepare
complaint handling mechanism as well as modernizing the office structure to make the office
impressive to customers.
Key Words: Service Quality, Customer Satisfaction, Tangibility, Reliability, Responsiveness,

Assurance and Empathy,
vii
Table of Contents
Approved........................................................................................................................................ iii
Declaration ..................................................................................................................................... iv
Acknowledgments........................................................................................................................... v
Acronyms ....................................................................................................................................... vi
Abstract ......................................................................................................................................... vii
CHAPTER ONE ............................................................................................................................. 1
INTRODUCTION .......................................................................................................................... 1
1.1. Background of the Study ......................................................................................................... 1
1.2. Background of the Organization .............................................................................................. 3
1.3. Statement of the Problem ......................................................................................................... 4
1.4. Basic Research Questions ........................................................................................................ 4
1.5. Objective of the study .............................................................................................................. 5
1.5.1. General objective............................................................................................................... 5
1.5.2. Specific objective .............................................................................................................. 5
1.6. Significance of study................................................................................................................ 5
1.7. Scope of the study .................................................................................................................... 5
1.8. Limitation of the Study ............................................................................................................ 5
1.9. Organization of the Study ........................................................................................................ 6
CHAPTER TWO ............................................................................................................................ 7
LITERATURE REVIEW ............................................................................................................... 7
2.1 The Theoretical Foundation ...................................................................................................... 7
2.1.1 Definition of Service .......................................................................................................... 7
2.1.2 The Characteristics of Service............................................................................................ 7
2.1.3 Service Quality ................................................................................................................... 8
2.1.4 SERVQUAL....................................................................................................................... 8
2.1.5 The Gap Model................................................................................................................... 9
2.1.6 Customer Expectation and Satisfaction............................................................................ 11
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2.1.6.1 Customer expectations............................................................................................... 11

2.1.6.2 Customer Satisfaction ................................................................................................ 11
2.1.7 Factors that Influence Customer Satisfaction................................................................... 13
2.2 Empirical Review` .................................................................................................................. 13
2.2.1 The Relationship between Service Quality and Customer Satisfaction ........................... 14
2.2.2. Choice of Service Quality Model of the Study ............................................................... 14
2.3 Conceptual Framework of the Study ...................................................................................... 16
2.4 Hypotheses .............................................................................................................................. 17
CHAPTER THREE ...................................................................................................................... 18
THE RESEARCH METHODOLOGY ......................................................................................... 18
3.1 Research Design...................................................................................................................... 18
3.2 Sampling Techniques .............................................................................................................. 18
3.3 Populations.............................................................................................................................. 19
3.4 Sample size ............................................................................................................................. 19
3.5 Data collection ........................................................................................................................ 20
3.5.1 Primary data ..................................................................................................................... 20
3.6 Validity and Reliability ........................................................................................................... 21
3.7 Data Analysis .......................................................................................................................... 21
3.8 Ethical Considerations ............................................................................................................ 22
CHAPTER FOUR ......................................................................................................................... 23
DATA ANALYSIS AND DISCUSSION .................................................................................... 23
4.1 Descriptive Analysis for Demographic variables ................................................................... 23
4.2 Reliability test ......................................................................................................................... 25
4.3 Descriptive Analysis for SERVPERF Dimensions................................................................. 26
4.3.1 Tangibility ........................................................................................................................ 27
4.3.2 Reliability ......................................................................................................................... 27
4.3.3 Responsiveness................................................................................................................. 28
4.3.4 Assurance ......................................................................................................................... 28
4.3.5 Empathy ........................................................................................................................... 29
4.4 Descriptive analysis for overall Customer Satisfactions ........................................................ 30
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4.5 Correlation analysis ................................................................................................................ 30

4.6. Assumption Tests ............................................................................................................... 32
4.6.1. Multi-collinearity test ................................................................................................. 32
4.6.2. Linearity test ............................................................................................................... 32
4.6.3. Hetero-scedasticity Test ............................................................................................. 33
4.6.4. Normality Test ............................................................................................................ 34
4.7 Multiple Regression Analysis ................................................................................................. 35
4.8 Hypothesis testing results ....................................................................................................... 36
CHAPTER FIVE .......................................................................................................................... 38
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS................................................. 38
5.1 Summary of Findings .............................................................................................................. 38
5.2 Conclusions ............................................................................................................................. 40
5.3 Theoretical Contribution and Policy Implication ................................................................... 40
5.4 Limitation and Future Research Direction .............................................................................. 42
References ..................................................................................................................................... 43
Appendix I Questionnaire ............................................................................................................. 48
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List of tables
Table 3.1 population of sample ..................................................................................................... 20
Table 3.2 Summary of valid sample vs. sample selected ............................................................. 20
Table 3.3 Reliability...................................................................................................................... 21
Table 4.1: Gender distribution ...................................................................................................... 23
Table 4.2: Age distribution ........................................................................................................... 24
Table 4.3: Customer Type distribution ......................................................................................... 25
Table 4.4: Reliability analysis (Cronbach’s Alpha) ...................................................................... 25
Table 4.5: Mean score of respondents .......................................................................................... 26
Table 4.6: Tangibility dimension analysis ................................................................................... 27
Table 4.7: Reliability dimension analysis .................................................................................... 27
Table 4.8: Responsiveness dimension analysis ............................................................................ 28
Table 4.9: Assurance dimension analysis ..................................................................................... 28
Table 4.10: Empathy dimension analysis ..................................................................................... 29
Table 4.11 Overall Customer Satisfactions distribution ............................................................... 30
Table 4.12: Correlation coefficient table ...................................................................................... 30
Table 4.13: Pearson’s correlation matrix for SERVPERF dimensions and satisfaction .............. 31
Table 4.14: ANOVA (analysis of variance) ................................................................................ 34
Table 4.15: Multiple Regression of SERVPERF Dimensions and its impact on satisfaction ...... 35
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Table of figures
Figure 2.1 Service quality assessments ........................................................................................... 8
Figure 2. 2 Customer service gap ................................................................................................... 9
Figure 2.3 Situational factor for customer satisfaction ................................................................. 12
Figure 2.4 Factors that affecting customer satisfaction ................................................................ 13
Figure 2.5 Conceptual framework ................................................................................................ 16
Figure 4.1 Level of Education Distribution .................................................................................. 24
Figure 4.2 Linearity Assumption .................................................................................................. 33
Figure 4.3 Hetero-scedasticity Assumption .................................................................................. 33
Figure 4.4 Normality Assumption ................................................................................................ 34
xii
CHAPTER ONE
INTRODUCTION
This chapter shows the overall map of the study. It contented with background of the study, of
the organization, statement of the problem, research questions, objective of the study, significance
of the study, scope of the study, and eventually organization of the study.
1.1. Background of the Study

Service quality may be a technique that facilitates to administer business processes so as to
make sure to make full customer satisfaction of which help to extend aggressive and effectiveness
of the business. The potential of a service render to make high degree of satisfaction is crucial for
product differentiation as also developing sturdy long last relation with customers. The one
challenges of this market is how ever company satisfy and keep their customers and conjointly
manage service quality, which holds a dominant importance to client satisfaction (Atalik & Arslan
2009) as cited (Million, 2017). Furthermore, delivering high quality services can help in meeting
several requirements such as customer satisfaction, customer loyalty, market share, soliciting new
customers, improved productivity, financial performance and profitability (llosa et al., 1998 as
cited in Mesay 2012).
According to Ledet (2019) service quality may help as predictor of customer satisfaction. The
higher the service quality the higher will be customer satisfaction. The major customer
expectations are customers expect solid information, customers expect options, customers expect
superior communication, customers expect consulting, and customers expect a seamless
relationship. Meeting these expectations would cement the relationships, increase their
satisfaction, help to gain customer loyalty, and which in term retains the business.
In service delivering companies all staffs has to be customer orientated in addition to this interact
with customers to satisfy their needs in order to make customer delighted, basically there must be
service commitment from employees and support from all levels of management. So as, it is
important for employees who provide goods or services that they must constantly keep track of
information about the company’s wellbeing as far as meeting its customers’ needs are concerned
(Abdullah, Abang, Francine & Rozario, 2009). Service organizations stands from huge
international corporations for instance airlines, motels, telecommunication, banking industries,
1
hotel and freight logistics to the huge of locally operated small businesses, including restaurants,
barberry, baking, transportation, parking, education, and other numerous businesses services are
assumed to be service delivering organizations (Wright, 2009).
Defining service quality is not as such simple as defining product quality; this is because of the
nature of services. Parasuraman, Zeithaml & Berry, (1985) have developed service quality
measurement tool (SERVQUAL) & defined the service quality as the gap between customer
expectation and perception based on five dimensions. They further define consumer’s perception
of service quality as a function of the difference between expectations about the performance of a
general class of service providers and assessment of the actual performance of a specific service
within that class. The author identifies five dimensions of service quality measurement as a tool
these are: tangibles, reliability, responsiveness, assurance, and empathy.
Currently, service quality has been the most important factor for the success as well as survival
in banking industry and also to differentiate one from other competing banks. Service quality is
very sensitive in a highly competitive environment such as that of the Hibret Bank operating
environment. Beyond that, delivering high quality services support in meeting several
requirements such as customer satisfaction, customer loyalty, market share, soliciting new
customers, improved productivity, financial performance and profitability (Shanka, 2012).
Because of increasing competition in banking industries, customer service is a most important part
that must give due attention to the customer’s satisfaction. The Banks challenged by the pressures
of globalization, as well as competition from financial institutions, in addition volatile market
dynamics are constantly seeking new strategies to add more value to their services (Stafford,
1996).
The goal of many banks is to develop services which attract and keep customers satisfied, loyal
and speak well of the bank which in turn would increase revenue, customer equity, market share
and profitability. In banking industry, service quality is being increasingly viewed as a competitive
marketing strategy revolving around customer focus, innovation, and creative service and striving
towards service excellence (Andotra & Gupta, 2008).
2
1.2. Background of the Organization

Banking industry currently in Ethiopia comprises eighteen commercial banks, of two are
state owned banks and while others other privately owned by shareholders. Those private banks
joined the financial sector after liberation of financial industries in 1992 (Rahel, 2015).
Hibret bank change its name from united bank to Hibret bank during Jun, 2020 which is the middle
time of this research. So, the researcher may use the name interchangeably.
Following this liberation of financial sector Hibret Bank S.C had incorporated as a Share
Company on Sept 10, 1998 and Licensing and Supervision of Banking Business Proclamation No.
84/1994 with initial capital of ETB 25,000,000.00 twenty five million by 336 shareholders and the
bank incorporate currently more than 4,000 employees (Annual report2018/19).
Today, Hibret Bank delivering a full-fledged Bank service that gives its customers a large vary of
business banking services with 324 Branches and Nine sub-Branches (Internal memo dated Aug,
2019).
Hibret Bank is functioning in prioritizing the approaching years is to strengthen its capital
base, maximizing it’s come on equity and cashing in on the most recent technology that follow
with the most recent developments within the native and international money service business
(Annual report2018/19).
The year ended June 30, 2019, the total asset of Hibret Bank has reached ETB 35.74 Billion and
its capital has reached Birr 3.86 Billion (Annual Report 2018/19).
Moreover to the institutional banking services rendered throughout its branches, currently the bank
is delivers the following multichannel banking services to its customers,
 Debit card service for 211,207 customers of the bank,
 POS and ATM services using its own 118 ATM machines and 244 POS machines,
 Mobile Banking and Internet services with a brand name called Hiber Online and Hiber-
Mobile banking. Hiber Online 19,222 and Hiber-Mobile 179,072 were registered and used
at the end of June 2019.
 Further the bank is giving International Cards Payment Services for Visa, Master card and
Union Pay International Card Clubs. (Annual Report 2018/19).
3
1.3. Statement of the Problem

Service quality and client satisfaction are becoming a lot of attention focus area of all banking
establishments around the world and in recent years, academicians and practitioners offer a great
deal of attention throughout this area as a result of it understood that service quality is also a vital
live of firm performance (Yavas & Yasin, 2001).
Mualla (2011) specific that banks amend, develop and, produce effective ways to ascertain the
assorted ways that of service quality, therefore on extend the number of their clients supported the
competitive market situation by evaluating shopper satisfaction with connection the numerous
dimensions that inﬂuence service quality competition and technological up gradation have resulted
in pressure on customer service
As the competition in commission industries is increasing from time to time, the notion of service
quality has become more and additional very important. Service quality has been referred to as a
determinant of market share, come on investment and discount (Anderson, 1984).
Therefore, therefore on attract and retain customers by properly characteristic and serving their
wish, service suppliers are actively involved among the strategy of understanding customers‟
perception of service quality.
This days in Ethiopia new banks are coming to exist and the competition among existing banks
increased dramatically, while there are a number of complaints on the service delivery system of
Hibret bank, such as, network failures, inefficient functioning service and, are the major problems
in most branches of Hibret bank that can adversely affect the service quality and customer
satisfaction.
Even if Several researches has been done on the banking industries of Ethiopia, there is a few
research done on Hibret banks service quality, for instance Tigist.M (2017) conducted a research
on assessment of service quality on customer satisfaction and he recommended in her paper to
carry out research in similar area so as to generalize the issues in Hibret bank. Therefore the
researcher want to identify the impact of service quality on customer satisfaction in case of Hibret
bank S.C.
1.4. Basic Research Questions

This study is aimed to answer the following research questions: -
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 Does the service quality have a significant impact on customer satisfaction in Hibret Bank?
 Does the customers satisfy with the service provided by Hibret Bank?
 Which dimensions of service quality contribute significantly to determine customer
satisfaction in Hibret Bank?
1.5. Objective of the study

1.5.1. General objective
The main aim of this thesis was to investigate the impact of service quality on customer
satisfaction in the case of Hibret Bank S.C.
1.5.2. Specific objective

The specific objective of the study:
 To examine that does service quality have significant effect on customer satisfaction.
 To examine the customers satisfaction with the service provided by Hibret Bank.
 To investigate the dimensions of service quality that contribute significant impact on
customer satisfaction in Hibret Bank.
1.6. Significance of study

This study helps Hibret Bank to ascertain its strength and weakness towards its service
delivery and levels of its client satisfaction; besides this, the study is vital for the organization to
require corrective action, helps to form decision by distinguishing that dimensions are a lot of vital
to focus and to enhance service quality of the organization.
1.7. Scope of the study

Hibret Bank. although there have been various factors that have an effect on service quality
and customer satisfaction, during this research only five service quality dimensions were used i.e.
reliability, responsiveness, assurance, empathy and tangibility.
1.8. Limitation of the Study

Although Hibret Bank operates throughout the regions of the country, this study is limited to the
impact of service quality on customer satisfaction in Addis Ababa branches specifically four
5
selected branches (Bole, Bole Medhanialem, Beklobet and Misrak). Even if, the findings of this
study would have had paramount importance if more customers had been included in the research,
for customers who live in different regions may have different perceptions towards customer
services.
However, due to time and financial constraints, it was not possible to broaden the study to see the
relationship between city branches and outlying branches customer satisfaction level in terms of
their perception with respect to the need for bank service. As a result, all the major customers in
the city branches only were taken as the subject of the study.
1.9. Organization of the Study

The study was incorporated into five chapters, which has the following:-
Chapter one was all regarding introduction of the study, background of the organization, statement
of the problem, basic research questions, objectives of the study, significance of the study, and
scope of the study and limitation of the study.
Chapter two deals with the literature review that consists of theoretical and empirical frame works
chapter three deals with the overall research methodology.
Chapter four deals with information presentation, analysis, interpret and at last chapter five affect
the outline of findings, conclusions and suggestions and limitation and future research directions
of the study.
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CHAPTER TWO
LITERATURE REVIEW
2.1 The Theoretical Foundation
2.1.1 Definition of Service
Because of their diversity, services have traditionally been tough to outline. The method in
which services are created and delivered to customers is usually onerous to know since several
inputs and outputs are intangible. Most of the people have very little problem defining
manufacturing or agriculture, but defining service can elude them (Lovelock & Lauren,1999).
Recent studies on services have shown that service specifications and agreements present associate
on-going process within which service definitions evolve through emptor service provider
interactions (Gelderman, Semeijn & Bruijn, 2015).
According to Kotler & Keller,(2009) "Service outlined as any act and performance that one
party can give to another that's basically intangible and doesn't result in the possession of
something".
Services are deeds, processes and performances. They elaborate their definition as all economic
activities whose output is not a physical product and construction, is usually consumed at the time
it's created, and provides further value in forms that are primarily intangible concerns of its 1st
customer (Gupta & Zeithaml, 2006).
2.1.2 The Characteristics of Service

Four distinctive service characteristics greatly have an effect on the design of promoting
programs: intangibility, inseparability, variability, and perishability (Kotler & Keller, 2006).
1. Intangibility in contrast to physical products, services can't be seen, tasted, felt, heard, or
smelled before they're bought (Kotler & Kotler, 2006).
2. Inseparability Whereas physical goods are manufactured, then inventoried, then
distributed, and later consumed, services are usually created and consumed at the same
time. As a result of this also is additionally usually present, provider–client interaction
could be a special feature of services promoting (Kotler & Keller, 2006).
3. Variability because the quality of services depends on who provides them, when and
where, and to whom, services are highly variable (Kotler & Kelller, 2009).
7
4. Perishability Services cannot be stored, so their perishability can be a problem when

demand fluctuates (Kotler & Keller, 2006).
2.1.3 Service Quality

Service quality is vital aspect that affects the aggressiveness of business. Banks must always
increase the standard of service incessantly since there is no assurance that the current
outstanding service are appropriate for future. Thus, banks ought to develop new strategy to
satisfy their client and should give quality service to realize competitive advantage over
competitors (Siddiqi, 2011). service quality is an advanced and ephemeral construct that refers to
some attribute of what's offered, provided whereas satisfaction or discontentedness refers to a
customer’s reaction to that offer (Pluta & Olearnik, 2011). Service quality is that the totality of
features and characteristics of service that bear on its ability to satisfy explicit or implied wants
(Kotler & Keller, 2009). According to, (Gronroos, 1982) there are two sorts of service quality these
are technical quality and functional quality. Technical quality is what the client is truly receiving
from the service (outcome) while functional quality is the manner in which the service is delivered
process.
2.1.4 SERVQUAL
The evaluation of service quality is formed during the service supply is process. The figure
bellow depicting service qualities is focused evaluation that reflects the customer’s perception.
Showing in the figure that five principal dimensions that customers use to judge service, i.e.
Quality, reliability, responsiveness, assurance, empathy and tangibles (Fitzsimmons. J,
Fitzsimmons. M & Bordoloi, 2008).
Figure 2.1 Service quality assessments

Source: (Fitzsimmons. J, Fitzsimmons. M & Bordoloi, 2008).
8
2.1.5 The Gap Model

The Gaps Model of Service Quality defines service quality as the difference between
customers “perceived service and expectations of service or in terms of the gap between the
customer’s perceptions of what the service actually provides and what the service should provide.
It assumes that the smaller the gap, the higher the quality of services. Moreover, if expectations
are greater than performance, then perceived quality is less than satisfactory and hence customer
dissatisfaction occurs (Parasuraman, 1985).
Figure 2. 2 Customer service gap
Source: (Parasuraman, 1985) as cited (Million.T, 2017 pp 21).

GAP1:- Consumer expectation to management perception gap,
The executive perceptions about what consumers need in a quality service is congruent with
the consumer expectations revealed in the focus groups. However, discrepancies between
executive perceptions and consumer expectations existed, confidentiality during transactions
emerged as a pivotal quality attribute in every banking and securities brokerage focus group.
Rarely was this consideration mentioned in the executive interviews (Parasuraman, A.; Berry, L.;
and Zeithaml, V, 1988) (Parasuraman.A, Zeithaml.A & Leonard L. Berry, 2009).
9
GAP2:- Management perception-service quality specification gap:

Executives cited constraints which prevent them from delivering what the consumer expects
(Parasuraman.A, Zeithaml.A & Leonard L. Berry, 2009) (Parasuraman.A, A. Zeithaml, & Leonard
L. Berry, 1990).
GAP3:- Service quality specifications-service delivery gap:-
Executives acknowledge that a service firm's staff exert a strong influence on the service
quality perceived by customers and that employee performance cannot always be standardized.
Once asked what causes service quality problems, executives systematically mentioned the pivotal
role of contact personnel (Parasuraman.A, Zeithaml.A & Leonard L. Berry, 2009). (Parasuraman,
A, Zeithaml, V, and Berry, L, 1985) (Parasuraman.A, A. Zeithaml, & Leonard L. Berry, 1990).
GAP4:-Service delivery-external communications gap:-
Media advertising and other communications by a firm can affect consumer expectations. If
expectations play a significant role in client perceptions of service quality (as the services literature
contends), the firm should make certain to not promise a lot of in communications than it will
deliver in reality. Promising more than can be delivered can raise initial expectations however
lower perceptions of quality once the guarantees aren't consummated? The chief interviews
recommend another perhaps a lot of intriguing manner within which external communications may
influence service quality perceptions by customers. This happens once companies neglect to tell
customers of special efforts to assure quality that aren't visible to consumers. Comments of many
executives implied that customers aren't always awake to everything done behind the scenes to
serve them well (Parasuraman.A, Zeithaml.A & Leonard L. Berry, 2009; Parasuraman, A,
Zeithaml, V, and Berry, L, 1985) (Parasuraman.A, A. Zeithaml, & Leonard L. Berry, 1990).
GAP5:- expected service – perceived service gap:-
The focus groups unambiguously supported the notion that the key to ensuring good service
quality is meeting or exceeding what consumers expect from the service. A male respondent in a
banking services focus group described the frustration felt when his bank would not cash his
payroll check from a nationally known employer because it was postdated by one day. When
someone else in the group pointed out legal constraints preventing the bank from cashing his check,
he responded, "Well, nobody in the bank explained that to me. This in turn resulted in a perception
10
of poor service quality (Parasuraman.A, Zeithaml.A & Leonard L. Berry, 2009) (Parasuraman.A,
A. Zeithaml, & Leonard L. Berry, 1990) (Parasuraman, A, Zeithaml, V, and Berry, L, 1985).
Judgment of high and low service quality depends on how consumers perceive the actual service
performance in context of what they expected. The quality that consumers perceive in a service is
a function of the magnitude and direction of the gap between expected service and perceived
service (Tsegaye, 2017).
2.1.6 Customer Expectation and Satisfaction

2.1.6.1 Customer expectations
Customers hold different types of expectations concerning service, the very best form of these
are desired service and adequate service. Desired service is that the level of service the client hopes
to receive (Dr Maxwell. A & Thobeleni. W, 2013).
The expectations signal the extent of client hopes and desires and belief that they will be
consummated, so failure to satisfy these expectations could result to customers lowering on
purchase, customers usually settle for that the service wouldn't continually be performed in step
with their expectations and this is often rest referred to as adequate service (Dr Maxwell. A &
Thobeleni. W, 2013).
Adequate service is that the level of service that customers can settle for though' customers’
hopes and desires should be high; they but have a particular level of understanding in cases
wherever receiving desired service don't appear realistic in the slightest degree. For instance
customer’s area unit wont to the self-service approach employed in market and so have sure levels
of understanding or tolerance towards food retailers‟ service delivery (Dr Maxwell. A &
Thobeleni. W, 2013).
2.1.6.2 Customer Satisfaction

Customer satisfaction is that the feeling of somebody who is satisfied or otherwise once comparing between
reality and expectations received from a product or service suggested that satisfaction isn't solely a way broader
concept than simply assessment of service quality, however also influenced by alternative factors. Client
satisfaction is influenced by customer perception of service quality, product quality, price, and by situational
factors and private factors of the client (Genoveva, 2015) (Genoveva, 2015).
11
Figure 2.3 Situational factor for customer satisfaction

Source: (Genoveva, 2015).
There are five components in customer satisfaction according to Wilkie (2004), as cited by
(Genoveva, 2015).
(1) Expectation is consumer expectation for an honest or service that has been established before
customers purchase goods or services;
(2) Performance is client expertise on the performance of the particular product or services once
they used while not impact by their expectations;
(3) Comparison is completed by scrutiny the expectations of the performance of the products or
services before buying and also the perception of the particular performance of the products or
services;
(4) Confirmation/Disconfirmation is client expectations are influenced by their experiences to
use of the mark from the products or services completely different from others.
Confirmation happens once expectations correspond to actual performance product.
Disconfirmation happens once expectations are higher or less than the particular performance of
the product (Genoveva, 2015).
Customer satisfaction is dynamic and relative. Solely the concept “customer-centric” can
facilitate firms improve satisfaction and keep client truly, conversely, if competitors improve client
satisfaction, then it's going to loss corporate customers. Whereas rising client satisfaction, client
expectations ought to be noticed. Service quality, product quality and worth for cash have a right
away positive impact on client satisfaction. Employee satisfaction is equally necessary before
achieving the client satisfaction. If staff have a positive influence, then they'll play a giant role to
extend client satisfaction level. Satisfaction could be a dynamic, moving target which will evolve
12
overtime, influenced by a range of things. Notably once product usage or the service expertise
takes place over time, satisfaction could also be extremely variable looking on that purpose within
the usage or expertise cycle one is focusing. (Lovelock, C & Wright, L.2007, 86-87.), as cited
(Kabu. K & Soniya M, 2017).
2.1.7 Factors that Influence Customer Satisfaction

According to (Hokinson, 1995) these factors embody friendly workers, knowledgeable workers,
useful workers, accuracy of charge, charge timeliness, competitive pricing, service quality, good
value, charge clarity and fast service.
Figure 2.4 Factors that affecting customer satisfaction

Source: (Sharmin, 2012; Hokinson, 1995)
2.2 Empirical Review`

Empirical studies show that the standard of service offered is expounded to overall satisfaction
of the client. Most researchers counsel that a high level of service quality ought to be delivered by
the service supplier is that the tool for achieving a high level of client satisfaction. Because the
quality of services improves the extent of client satisfaction will increases (Zewditu, 2017).
(Zewditu, 2017).
13
2.2.1 The Relationship between Service Quality and Customer Satisfaction

Customer satisfaction is changing into one of the foremost essential objectives that any firm
seeking for long-run relationship with customer considers as the high priority. In retail banking
context wherever the contacts with customers are one in all the foremost core business processes,
client satisfaction is changing into the key for successful (Ngo Vu Minh, & Nguyen Huan Huu,
2016). One of the most components deciding client satisfaction is that the customer’s perception
of service quality. Client satisfaction is delineated as the results of a comparison of the customers’
expectations and his or her subsequent perceived performance of service (Ngo Vu Minh, &
Nguyen Huan Huu, 2016).
According to this conceptualization, perceived service quality is one in every of the
antecedents to overall client satisfaction. Previous studies showed the proof support this
relationship between client satisfaction and service quality (Yee, R. W. Y., Yeung, A. C. L., &
king Cheng, T. C., 2010). Despite the fact that, there also are debates regarding the causative
relationship between client satisfaction and service quality. Specifically, there are three major
positions regarding this relationship within the literature (Ngo Vu Minh, & Nguyen Huan Huu,
2016).
First, as indicated above, service quality is represented as antecedents to client satisfaction.
Second, some researchers recommend that client satisfaction is that the reason for service quality.
The third position of the service quality- satisfaction relationship argues that neither satisfaction
nor service quality is also antecedent to the other (Ngo Vu Minh, & Nguyen Huan Huu, 2016). In
general, though there's the shortage of accord regarding the conceptualization of the service
quality- satisfaction relationship, service quality is an antecedent to client satisfaction is considered
as dominant position in recent analysis, particularly in service context trade like banking (Ngo Vu
Minh, & Nguyen Huan Huu, 2016).(Ngo Vu Minh,& Nguyen Huan Huu, 2016).
2.2.2. Choice of Service Quality Model of the Study

SERVQ PERF is that the brain kid of Cronin & Taylor (1992) who after in depth analysis
and investigation tried that the model of SERVPERF is a higher measurement of service quality
for service providing industry. Primary, SERVPERF is found to be superior to the SERVQUAL
scale for having the ability to clarify greater variance within the overall service quality measured
through the utilization of single item scale and it's been through empirical observation treated. it's
14
conjointly evident that SERVPERF is a lot of efficient in reducing the amount of things to be
measured by five hundredth than SERVQUAL ( Babakus & Boller, 1992 cited in Shanka, 2012).
Moreover, in line with Cronin and Taylor (1992), their performance based mostly SERVPERF
scale may be a higher technique of measurement service quality. They claim that this scale‟s
dependableness ranges between 0.884 and 0.964 depending on the industry kind and exhibits each
confluent and discriminate validity (Mesay, 2012).
The developers of the size contend that, whereas each industry is exclusive in some aspects,
there are five finalized dimensions of service quality that ar applicable to service providing
organizations typically. These dimensions are; tangibility, reliability, Responsiveness, Assurance
and empathy.
1. Tangibility: representing the service physically
This includes physical facilities, equipment, and therefore the physical look of on employee.
Parasuraman (1985) outlined corporeality as the look of physical facilities, equipment, personnel,
and written materials.
2. Reliability: delivering on promise
Parasuraman et al (1988) outlined reliability as the most important consider conventional service.
This refers to the ability to supply the precise needed service in step with given specifications and
conditions. Reliableness depends on handling customers' services problems; playing services right
the first time; give services at the promised time and maintaining error-free record (Zewditu, 2017).
3. Responsiveness: being willing to help
The inclination and disposition of the workers to serve client quickly and properly,
responsiveness outlined as the disposition or readiness of staff to provide service. It involves
timeliness of services (Parasuraman, 1985).
4. Assurance: inspiring trust and confidence
Feelings of trust and confidence in addressing the organization, this reflects the workers'
information and skill and their ability to create sureness also as confidence in the within the.
Assurance is information and courtesy of staff and their ability to inspire trust and confidence
(Parasuraman, 1985).
5. Empathy: treating customers as individual
15
Understanding the customers' personal desires, taking care of them individually and showing
them all styles of sympathy and feeling, observing them as shut friends and distinguished clients,
(Zewditu, 2017). It involves giving customers individual attention and staff who perceive the wants
of their customers and convenience business hours (Parasuraman, 1985).
2.3 Conceptual Framework of the Study

The conceptual framework is that the blue print of the research work that guides the man of science
to conceptually understand the analysis and description and operationalize the dependent and the
freelance variables so the measuring, processing, analysis of the information and interpretation of the
result been simple and meaningful. Customer satisfaction is believed to have an effect on post-purchase
perception and future choices of consumers. According to Cronin and Taylor (1992) service to
customers and quality service are a significant antecedent of customer's satisfaction. From the above
discussion of literature review, it's clear that there's a relationship between service quality and
customer's satisfaction wherever the former eventually results in results in. Literature availed variety
of models to measuring service quality. SERVQUAL and SERVPERF are among the models that
investigator are using most frequently. Each models use five service quality dimensions. The empirical
studies additionally shows that service quality dimensions have relations with service quality. It’s
evident that service quality dimensions have impact on customer satisfaction as varied articles and
journals show though with varied degree. SERVPERF model is associate improvised model of
Parasurman‟s SERVQUAL. Whereas SERVPERF mainstay is perceived service quality, SERVQUAL
approach integrates the service quality and satisfaction. Having reviewed both theories and empirical
studies on service quality on the one hand and also the Hibret bank service delivery situation on the
other hand, the subsequent conceptual frame work is drawn for this study.
Tangibility
Reliability
Responsiveness
Customer satisfaction
Assurance
Empathy
Figure 2.5 Conceptual framework

Source: Own
16
2.4 Hypotheses
From the above framework the researcher develop to test the following hypotheses.
Based on above the expressed objective, the following hypotheses were investigated.
H1=tangibility has a significant positive impact on customer satisfaction.
H2=reliability has a significant positive impact on customer satisfaction.
H3=responsiveness has a significant positive impact on customer satisfaction.
H4=assurance has a significant positive impact on customer satisfaction.
H5=empathy has a significant positive impact on customer satisfaction.
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CHAPTER THREE
THE RESEARCH METHODOLOGY

The aim of this section was to highlight the overall methodological content of the research.
Which contains research design, sampling techniques used, determination of sample size and
population, data collection techniques, validity and reliability and finally, presents the data analysis
method.
3.1 Research Design

The research was designed in a quantitative approach. So, it was predominantly quantitative to
generated numerical data for each variable. The researcher used both descriptive and explanatory
statistics for analysis purpose. Descriptive analysis used for demographic variables and describe
of each independent variable while Explanatory study is used to explain the relationship between
the independent variables (service quality dimensions) and the dependent variable (customer
satisfaction) A probability sampling technique was applied to determine the sample from
population. The questionnaire were designed in a SERV PERF dimension model as developed and
modified by (Cronin & Tylor, 1992).
3.2 Sampling Techniques

The researcher used multiple sampling techniques for different sampling stages. That happens
in branch grade selection, then Branch selection, finally population distribution. According
Creswell (2009) sampling technique outline because it is that the method of drawing inference a
few population while not learning the complete population below study.
The research worker choose four branches (Bole, Bole Medhanialem, Beklobet and Misrak) by
means of the convenience sampling technique. From sampling technique the research worker used
stratified sampling technique were for population of the study. “Sampling theory supports stratified
sampling as an economical and best alternative as a result of the suggest that of the stratified
samples measure to be nearer to the mean of the population overall” Robson (2002) as cited
(Bethlehem, 2015 pp23).
Based on stratified sampling technique branches of Hibret bank classified in to strata of
branches as Special Branch, grade A, grade B, grade C and grade D. The research worker choose
18
from these branch strata Two Special Branch and Two grade A branches for the study using
judgmental sampling technique. Finally, when knowing the sample from cluster the research
worker applied convenience sampling technique to distribute form for the respondent. The
rationale behind applying convenience sampling technique is as a result of all customers don't
seem to be accessible within the bank at a same time.
3.3 Populations
The study focuses on Hibret Bank’s provision of service quality rendered to its customers
located in Addis Ababa region.
According to the Internal memo dated Aug 18, 2020 over 980,000 customers were registered and
using services provided by the bank. Among these exceeding 92,800 of them were found in
selected branches. Those branches selected because of they carry out all banking service.
In order to produce a realistic outcome, the collections of data were distributed to major selected
four city branches. Around 92,800+ Customers are listed under those branches.
3.4 Sample size

Considering the size, still because the time, it had been onerous to gather data on the complete
population. Because of this, during this study to create the sample was determined representatives,
the sample size of the study was decided victimization the formula adopted from (Yamane, 1967).
Thus, the formula used to calculate the sample size is
n= N/ (1+N (e) 2)
Where: n=sample size
N=total population that is 92,800
e= is that the error term, that is five-hitter (i.e. at 95% confidence interval)
Using the on top of formula the easy size of the study is decided as
n= 92,800/ (1+92,800(0.05) 2)
n= (92,800/1+232)
n=398
Since the population isn't same in every branch, the man of science proportionate and distribute
the sample as follows,
19
n1=nN1
N
Where, n=total number of sample
N= total population
n1= sample in each branch, and
N1=total population in each sample
Table 3.1 population of sample
Name of branches Total population in branches Total numbers of sample selected
Bole 11,755 50
Bole medhanialem 13,433 58
Beklo bet 26,798 115
Misrak 40,813 175
Total 92,799 398
Source: Internal memo dated Aug 18, 2020
Table 3.2 Summary of valid sample vs. sample selected
S.No HB Branch list Questionnaire Questionnaire Response
distributed distributed rate
1 Bole 50 46 92.00%
2 Bole medhanialem 58 53 91.38%
3 Beklo bet 115 105 91.30%
4 Misrak 175 160 91.43%
Total 398 364 91.46%
Source: own survey (2020)
3.5 Data collection

3.5.1 Primary data
The primary data were collected through structured questionnaire. Five point Likert scale The
primary data were collected through structured questionnaire. Five point Likert scale questionnaire
used to get a more reliable output relating to their personal attitude concerning Hibret bank S.C.
In general, the designed questionnaire includes three main parts;
20
The first part aimed to gather information on demographic variables, second part aimed to gather
knowledge on independent variables and, the third part is aimed to gather data on the dependent
variables.
The SERV PERF questionnaire consists of twenty-two question statement aimed to measure the
variables of the study using five-point Likert Scale (1= highly dissatisfied/strongly disagree, 2=
Dissatisfied/Disagree, 3= Neutral, 4= agree/Satisfied, and 5= highly satisfied/strongly agree).
3.6 Validity and Reliability

Validity is key in evaluating measures in the thesis. During this thesis, the analysis is valid as a
result of the collected data and also the research questions are in a systematic manner. The SERV
PERF model questionnaire were developed once looking out different connected researches. So,
that the questionnaires adopted from other similar researches, it's famed to be valid.
In order to make sure the reliability of thesis the author had conducted the pre-test of reliability by
taking of thirty sample questionnaires. In keeping with martyr & Mallery (2003), states that it's
suggested that if a Cronbach‟s constant of a scale exceeds 0.70 is appropriate as internally
consistent, so more analysis may be carried unless it's unacceptable.
Table 3.3 Reliability
Service quality Number of attributes Cronbach’s alpha perceived performance

dimensions
Tangibility 4 0.874
Reliability 5 0.927
Responsiveness 4 0.898
Assurance 5 0.904
Empathy 4 0.846
Overall service quality 5 0.912
Source: Own survey (2020)
3.7 Data Analysis

After the responses gathered, every kind of data concerning the questions was separated and
gathered to answer different research objectives. The data received was classified into totally
different categories and expressed as percentage and frequencies. The analysis methodology that
21
utilized within the thesis was quantitative by using applied mathematics software Package for the
Social Sciences (SPSS) version 24 for the data analysis. Both descriptive statistics and inferential
statistics were applied.
Descriptive statistics used for measurement percentage and frequency of the information of the
respondents, it is additionally applied to for explaining every variable inside the study of service
quality and thus the customer’s satisfaction on service delivery.
Inferential statistics used for correlation, statistical procedure and analysis of variance analysis
performed to analyze whether or not there is relation between each item of the five service quality
dimension and repair quality. The investigator were used correlation analysis technique to
ascertain whether or not the service quality dimensions and customer’s satisfaction had relation.
ANOVA analysis was conducted to analyze customer’s satisfaction level and its level of
significance. Statistical procedure was done to determine the impact of service quality dimensions
on customer’s satisfaction.
3.8 Ethical Considerations

Researchers have to take care of various other issues at different stages of the research process.
Both the researcher and participants have an important role to play. Researchers have to take care
of the participants’ right and must consider their research from participants' perspective ( Huma
Parveen and NayeemShowkat, 2006).
The research was conducted after getting ethical approval from concerned organs. First the
researcher requested the permission of Hibret Bank S.C to access the documents of the bank and
to get major customers from selected branches to fill the questionnaires.
Moreover the questionnaire on its introduction explain purpose of the research will be academic
purpose and to keep respondents data confidentiality the research uses the codes instead of name
and other personal information related data.
Finally the respondent included based on their willingness and then the questionnaires distributed
to voluntary participants only.
22
CHAPTER FOUR
DATA ANALYSIS AND DISCUSSION
This chapter consists two parts, the first was present and discus on demographic data of
respondents and the second part presented the data collected through the questionnaire. The
questionnaire were explained by SERF PERF model, statistical graphs, tables and figures, which
followed by interpretation. The researcher also done the test of assumptions, regression analyses,
ANOVA and reliability beyond descriptive analyses.
To conduct this research total of 398 questionnaire were distributed to four selected branches
(Bole, Beklo bet, Misrak and Bole medhanialem branches) which mostly have corporate
customers. Out of the distributed questionnaire only 364 were filled and retuned. The remaining
28 questionnaires were not filled properly and 6 were retuned without having any responses, so
the researcher analyzed and discussed only based on those fille d properly and retuned
questionnaires.
4.1 Descriptive Analysis for Demographic variables

The first part of the questionnaire is all about demographic information of the respondents.
Accordingly the demographic characteristics include Gender, Age, Education level and Customer
types. Accordingly demographic information analyzed and summarized as follows.
Gender Frequency/Number of respondents (n=364) Percent (%)

Male 246 67.60
Female 118 32.40
Total 364 100.00
Table 4.1: Gender distribution
According to the above table 4.1 the researcher found that 67.6% were male and were 32.4%
females. This indicates both sex were included in the research, so that the researcher did not suffer
from age bias.
23
Table 4.2: Age distribution

Age Frequency/Number of respondents (n=364) Percent (%)
18-24 21 5.80
25-35 162 44.50
36-45 133 36.50
46-54 40 11.00
Above 55 8 2.20
Total 364 100.00
Source: own survey (2020)
From the above table 4.2 the researcher can infer that largest respondent’s age falls in between
25-35, 44.5% and then respondent’s age held 36-45 was 36.5%, 46-54 was 11%, and above 55
was 2.2%. Generally, more than 80% of Hibret Bank customers aged 25-45 which shows that the
customers are in working age which show that bank a potential customer. The implication behind
this figures was the researcher participates all age groups so that the research didn’t suffer from
homogeneity of responses bias.
Figure 4.1 Education level distribution

24
As the fig 4.1clearly depict 243 of respondents were degree holder which almost 2/3 of
respondent was degree holder and the second largest group of respondents were Diploma holder
60 (16.5%). While 51(14.5%) and 10 (2.70%) is MA & Above and Less than grade 12 respectively.
This all implies the respondents had a higher literacy rate and they had research knowhow on the
subject matter of the research, which lead to more accurate survey result.
Table 4.3: Customer Type distribution
Customer Type Frequency/Number of respondents (n=364) Percent (%)
Personal 206 56.60
Company 99 27.20
Employee 59 16.20
Total 364 100.00
The final demographic variable was customer type which indicates whether the respondent
was personal saving account holder or company account holder as well as Employee salary account
holder. From the above table 4.4, 56.6% of respondents were private saving account holder and 99
(27.2%) company or current account holder and 59 (16.2%) of respondent was staff salary account
holder. Those figures show that a good input for the research. Since all customer types included in
the research it was vital to articulate external customers like personal and company account holders
expectation of service and the internal customer (employees) knowhow on the policy and service
of the bank with the actual service delivered by the bank.
4.2 Reliability test

Table 4.4: Reliability analysis (Cronbach’s Alpha)
Dimensions Cronbach's Alpha Value Number of items
Tangibility 0.883 4
Reliability 0.893 5
Responsiveness 0.886 4
Assurance 0.919 5
Empathy 0.924 4
25
Overall reliability 0.927 22

Reliability analysis made for testing does the scale used in the study internally consistent and
accuracy. Reliability test has to be undertaken to measure repeatability and accuracy (Bryman and
Bell, 2007). According to Field (2009), a variable whose alpha value exceeded 0.7 is accepted for
analysis. George & Mallery (2003),states that it is recommended that if a Cronbach‟s coefficient
of measurement scale exceeds 0.70 is acceptable as an internally consistent so that further analysis
can be carried unless it is unacceptable. Therefore the above table indicates that all variables have
alpha value of greater than 0.7 which was the minimum requirement to be reliable. The highest
reliability from the variable is empathy that is 0.924. In general the overall reliability is 0.927
which shows higher consistency and 92.40% of data was reliable. So, the research was reliable
enough for further analysis.
4.3 Descriptive Analysis for SERVPERF Dimensions

The mean value represent all arithmetic average of customer responses on certain dimension
and standard deviation indicate how diverse the response of customers. The higher the value of
mean indicate that most of customers perception rate service quality of Hibret Bank better or agree
on the service quality. While the higher value of the standard deviation indicates higher response
diversity towards the mean. If respondents have similar perception about service quality the
standard deviation becomes smaller. According to Zaidatol & Bagheri (2009),
Table 4.5: Mean score of respondents
Mean score Description
Less than 3.39 Low
Between 3.40 and 3.79 Moderate
Above 3.80 High
26
4.3.1 Tangibility
Table 4.6: Tangibility dimension analysis

HB has HB has attractive The employees are Materials
modern physical facilities. neat, disciplined, and associated with
equipment. professional the service.
Mean 3.165 3.280 3.341 3.330
Std.deviation 0.9507 0.8929 0.7921 0.8535
From the table 4.6 in general all tangibility questions have mean score value below 3.39 which
indicate respondents did not perceive that Hibret bank have good physical make up that is office
layout, employee professional clothing and equipment’s at all. This indicate that most of the
respondents don’t believe Hibret bank have modern equipment and attractive physical facilities to
deliver the service. Among tangibility question employees well groomed, disciplined and neat
have better mean value that indicate smallest gap when compared to the other. The Hibret bank
has to work more on installation modern equipment since most of respondent don’t agree that it
has sophisticated of equipment.
4.3.2 Reliability
Table 4.7: Reliability dimension analysis
HB promise HB show HB provide On time Sufficient
to deliver, it sincere interest accurate as manpower and
does so to solve the information to promised material for
problem customer. service
Mean 3.272 3.346 3.258 3.253 3.173
Std.deviation .8333 0.7792 0.9087 0.8826 0.8784
As the table 4.7 depict all question mean value fall under the low range <3.4. This indicate
that the respondent did not believe the bank have sufficient man power and material, punctual,
deliver accurate information to customer, keep its promise to deliver, sincere interest to solve the
27
customer problem. Therefore the bank add more new employees and material and give training for
both new comer as well as the existing employees because lack sincere interest to solve and fail to
deliver accurate information may arises from lack knowledge about the service well.
4.3.3 Responsiveness
Table 4.8: Responsiveness dimension analysis

Make info Employee gives Employees are happy Employees are
easily prompt service. and willing to serve not too busy to
obtainable. the customer. respond
Mean 3.192 3.327 3.225 3.258
Std.deviation 0.9368 0.7962 0.8712 0.8491
This table provides information about the how employee makes the information easily
obtainable, the employee gives prompt service, the employees are happy and willing to serve the
customer and the employees are not too busy to respond to the customers’ requests. All
responsiveness questions mean fall under lower category. That indicates the respondent didn’t
perceive Hibret bank employees make information easily available and happy to and willing to
serve the customer. The bank higher management has to make an inspection on employee’s service
deliverance and follow what is going in the branch.
4.3.4 Assurance
Table 4.9: Assurance dimension analysis
Employees have The customers The The The employees
required skill in feel safe on the employee employees of HB are
providing service provided trust inspire polite to the
services. by the employees. worthy. confidence. customer
Mean 3.297 3.310 3.522 3.459 3.390
Std.deviation 0.7855 0.7889 0.6979 0.7318 0.8602
28
As the table 4.9 depict clearly most question of assurance have mean value on middle range
indicates that most respondent agree on assurance dimension question. The assurance dimension
refers to the knowledge and courtesy of employees and their ability to inspire trust and confidence
including competence, courtesy, credibility and security (Parasuraman et al., 1991).
The respondent indebted with employees have required skill in providing services this question
which have lower mean(3.297) among all assurance dimension and linked with the reliability
question Hibret bank employee didn’t provide accurate information to customer. This implies
that even if employees didn’t have the required skill and knowledge, the employees are polite to
customer, build confidence and trustworthy. If this sufficiently supported by training to acquire
the necessary skill and knowledge it will enhance the bank service quality more.
4.3.5 Empathy
Table 4.10: Empathy dimension analysis
HB employees The employees do HB and its HB has
give individual know promptly employees have the operating hours
attention. what your needs customer’s best convenient to the
are. interest at heart. customers.
Mean 3.297 3.3297 3.250 3.335
Std.deviation 0.8397 0.8164 0.8564 0.8116
The last table of descriptive analysis table 4.10 can be analyzed as follow, the empathy
dimension of service quality respondents mean value for all four questions is fall under low mean
which means that the respondent perceive employees are not giving individual attention to
customer, don’t promptly what customer’s need are, its employees don’t have the customer’s best
interest at heart and the service provider didn’t have convenient operating hours to the customers.
The implication here is that has to segment and create a corporate client relationship officer that
give individual attention and to know best interest to the customer as well as make the service
convenient to the customer by extending the time to 7 pm and more.
29
4.4 Descriptive analysis for overall Customer Satisfactions

Table 4.11 Overall Customer Satisfactions distribution
Response Frequency Percentage
Strongly Agree 0 -
Agree 182 50.00%
Neutral 151 41.50%
Disagree 31 8.50%
Strongly Disagree 0 -
Total 364 100.00%
From the table 4.11 we can say the half of 182(50.00%) of customers satisfied with service
delivered by the bank and 151(41.50%) of customers are neither satisfied nor dissatisfied with the
service delivered by Hibret bank. Only 31(8.50%) or small number of customer dissatisfied with
service and there are no customer extremely satisfied as well as dissatisfied with the service
delivered through Hibret bank. this indicate that 41.5% of the bank customers are indifferent to
rate the service quality satisfying or not. So, the bank may need little effort to satisfy their need.
4.5 Correlation analysis

The parametric statistic can range from -1 to +1, with -1 indicating an ideal correlation, +1
indicating a perfect correlation, and zero indicating no correlation the least bit (Ratner, 2009).
Table 4.12: Correlation coefficient table

Value of coefficients Relation B/n variable
Above 0.69 Very strongly association
0.50-0.69 Substantial association
0.30-.49 Moderate association
0.10-.29 Law association
Bellow 0.1 Negligible Association
Source: Million.T (2010, pp46).
30
Table 4.13: Pearson’s correlation matrix for SERVPERF dimensions and satisfaction
Tangibility Reliability Responsive Assurance Empathy Overall
ness satisfaction
Tangibility 1
Reliability .754** 1
Responsiveness .647** .795** 1
Assurance .617** .626** .727** 1
Empathy .702** .781** .754** .787** 1
Overall 0.748** 0.817** 0.775** 0.599** 0.822** 1
satisfaction
Correlation is significant at the 0.01 level (2-tailed).
As the objective of the study and conceptual frame work indicated to test that there is
relationship between service quality and customer satisfaction, the following correlation analysis
were made and found all independent variables had a positive and significant relationship with
customer satisfaction. From the above table 4.13 the researcher can infer about the correlation of
independent variables with dependent variable. The dependent variable customer satisfaction has
relationship with tangibility (r = 0.748, P < 0.01) correlation that indicate there is a very strong
association between them. Reliability has a correlation of (r = 0.817, P < 0.01) with customer
satisfaction which indicate a very strong relationship of dependent variable customer satisfaction
with reliability.
The findings of this analysis match therewith of Zeithaml (1990), who noted that reliability is
one in every of the important factors of customer satisfaction.
According to Zeithaml et al. (1988), responsiveness dimension involves willingness to help
customers and provide prompt services. Responsiveness has a correlation value(r = 0.775 4, P <
0.01) with customer satisfaction which implies us there is a very strong association between
dependent variable customer satisfactions with independent variable responsiveness.
On the other hand assurance has association coefficient (r = 0.559, P < 0.01) which indicate that
there is substantial relationship between dependent variable customer satisfactions with assurance.
The independent variable empathy has the highest association with dependent variable customer
satisfaction that is (r = 0.822, P < 0.01) which is a very strong association.
31
The indication of this result was that empathy is the most significant of the entire five service
quality dimension used in this study. Due this, giving attention to individual customers, such as;
convenience of Hibret bank operating hour and understanding of customers’ specific needs have
positive link with customer satisfaction.
All this finding supported by the following researchers,
According to Parasuraman, Zeithmal and Berry, (1985), who denote service quality and client
satisfaction are closely related.
By Cronin and Taylor, (1992) express as Service quality is antecedent of client satisfaction.
4.6. Assumption Tests

4.6.1. Multi-collinearity test
According to Hair et al (1995), 10 is the maximum level of VIF allowed in a research.
Detecting multi-collinearity is important while it doesn’t reduce the explanatory power of model,
it reduce the statistical significance of the independent variables. Large variance inflation factor
(VIF) or a very small value of tolerance value in the dependent variable shows us there is a high
multi-collinearity problem. To say there is no multi-collinearity or strong relation between
independent variables the value of tolerance must be greater than 0.1 and the variance inflation
factor must be less than 10. From the table 4.15 shows the tolerance value and VIF (variance
inflation factor) of multi-collinearity beta (β).As the table shows the tolerance value of all
independent variables are between 0.233 and 0.389 which is above 0.1 and variance inflation factor
(VIF) for each independent variables fall between 2.570 and 4.285 which is also on accepted
interval of variance inflation factor that is 10. So, the table in general confirms to us none existence
of multi-collinearity problem in the multiple regression analysis.
4.6.2. Linearity test

The model that relates the response Y to the predictors X1, X2, X3... Xp is assumed to be linear in
the regression parameters (Chatterjee & Hadi, 2012).
Linear regression needs the relationship between the independent and dependent variables to be
linear. It is also important to check for outliers since linear regression is sensitive to outlier effects.
The linearity assumption can best be tested with scatter plots. Based on this explanation and the
bellow figure the researcher can conclude the linearity assumption is fulfilled.
32
Figure 4.2 Linearity Assumption

4.6.3. Hetero-scedasticity Test

Hetero-scedasticity happens when the standard deviations of a predicted variable, monitored over
different values of an independent variable or as related to prior time periods, are non-constant.as
shown in figure the hetero-scedasticity assumption has been full filled.
Figure 4.3 Hetero-scedasticity Assumption

33
4.6.4. Normality Test

According Osborne and Waters (2002) the normality assumption do not explicate which variables
in particular they are referring to, but the implication seems to be that multiple regression requires
that the predictor and/or response variables be normally distributed. In reality, only the assumption
of normally distributed errors is relevant to multiple regression: Specifically, we may assume that
errors are normally distributed for any combination of values on the predictor variables. Based on
this idea and the bellow figure the researcher can say the assumption of normality fulfilled.
Figure 4.4 Normality Assumption

Table 4.14: ANOVA (analysis of variance)
ANOVAa
Model Sum of Squares Df Mean Square F Sig.
1 Regression 121.133 5 24.227 296.746 .000b
Residual 29.227 358 .082
Total 150.360 363
a. Dependent Variable: Customer Satisfaction
34
b. Predictors: (Constant), Empathy, Tangibility, Responsiveness, Assurance, Reliability

Source: Own survey (2020).
As shown above the ANOVA table 4.19, the significance value of F statistics is.000 that is
less than the 0.05 this shows that there is significant relationship between the dependent (predicted)
and (Predictors) independent variables.
4.7 Multiple Regression Analysis

Table 4.15: Multiple Regression of SERVPERF Dimensions and its impact on satisfaction
Model summary of SERVPERF Dimensions on Customer Satisfaction
Model R R square Adjusted R square
F change Sig. F change
1 .898a .806 .803 296.746 .000
Coefficient
Model Unstandardized Standardized T Sig Multi-collinearity
Coefficients Coefficients
B Std. error Beta (β) Tolerance VIF
Constant 0.86 0.082 - 10.495 .000
Tangibility 0.193 0.031 0.229 6.136 .000 0.389 2.570
Reliability 0.165 .044 0.181 3.743 .000 0.233 4.285
Responsiveness 0.254 0.038 0.296 6.706 .000 0.280 3.577
Assurance -0.258 0.039 -0.274 -6.677 .000 0.323 3.100
Empathy 0.438 0.041 0.513 10.740 .000 0.238 4.200
Source: Own survey (2020).
The multiple regression formula Y=a0+a1x1+a2x2+a3x3+a4x4+a5x5+e
Where Y= the dependent variable (customer satisfaction)
a0= constant (y-axis)
a1-a15= beta coefficient for their respective variables
x1-x3=the independent variables
e= the standard error
Therefore; the regression model is
35
y (customer satisfaction)=0.86+0.229(Tangibility)+0.181(Reliability)+0.296(Responsiveness)-
0.274(Assurance)+0.513(Empathy)+e
As the table 4.15 clearly depict the independent variable (tangibility, reliability, responsive
and empathy) has a positive beta coefficient that confirms the four service quality dimension have
significant impact to customer satisfaction. Even though the four dimension have positive
significant impact the most important variable for customer satisfaction is empathy which have
beta coefficient value 0.513. The next most contributor to customer satisfaction is responsiveness
which beta value 0.296. The independent variable tangibility and reliability have lower impact
respectively compared to the other.
The indication is that (tangibility, reliability, responsive, and empathy) combined significantly
influence customer satisfaction.
The adjusted R-square 0.803 implies that 80.3 % of the variance of customer satisfaction can be
predicted by the service quality dimension. This result is similar with Betelehem.T (2015) had an
adjusted R square value of .816.
4.8 Hypothesis testing results

As multiple regression beta show the five hypothesis tested and the result presented shortly,
H1=tangibility has a significant positive impact on customer satisfaction. Accepted
Tangibility has a beta value of 0.229 that show a significant positive impact on customer
satisfaction.
H2=reliability has a significant positive impact on customer satisfaction. Accepted
Reliability has a beta value 0.181 that a significant positive impact on customer but the least among
other.
H3=responsiveness has a significant positive impact on customer satisfaction. Accepted
Based on beta value 0.296 responsiveness has second significant positive impact on customer
satisfaction.
H4=assurance has a significant positive impact on customer satisfaction. Rejected
Unlikely the correlation analysis the multiple regression beta value for assurance become negative.
This case happen sometime as With the exception of simple linear regression, we cannot guarantee
that correlation coefficient and regression slope will always have the same sign. (Chappers, 2020).
36
Result can be due to the customer‘s perception for assurance from other variables result has
negative impact (Tigist.M, 2017).
H5=empathy has a significant positive impact on customer satisfaction. Accepted
The highest significant positive impact were found on empathy beta (.513). This indicate that
empathy contribute more than two time of tangibility and three time that of reliability to the
customer satisfaction.
37
CHAPTER FIVE
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Based on chapter four data analysis of service quality and its impact on customer satisfaction
of Hibret bank S.C, the researcher took a sample of 364 from near to one million customers by
using a random sampling technique to get an utmost representative sample from the population.
The researcher show the effect of service quality dimensions from different perspective using
different method to show their impact, like descriptive, regression analysis, ANOVA and
hypothesis tests to see there effect from different side. Finally, the researcher drew the following
summaries of finding, conclusion and recommendations.
5.1 Summary of Findings

The purpose of this study was to investigate the effect of service quality on customer
satisfaction of Hibret bank. The theoretical, conceptual and empirical frame works of chapter two
related literature review confirms us the five dimensions (Tangibility, Reliability, Responsiveness,
assurance and Empathy) have significant impact on customer satisfaction.
The study was undergone though self-administered questionnaire selected in simple cluster
sampling way. The study used a quantitative research as a strategy, descriptive statistic were used
for analysis of demographic variables, and for testing its correlation like percentage, frequency,
mean, standard deviation, and Pearson’s correlation to show relationship of each independent
variables with dependent variable. Regression analysis also used for showing the impact of service
quality on customers’ satisfaction and as well as for testing the hypothesis.
From 364 respondents 246 are male, Large number of respondent age held 25-35 and 36-45;
162 133 respectively which accounts almost 81% of the total population and the list number of
respondent is above 55 age which is 8 (2.20%). This shows that majority of respondent are in
working age. Out of 364 respondents 243 of respondent is degree holder and followed by 60, 51
diploma and MA above holders respectively, this show that there is higher literacy in Hibret bank
customer and has significant impact on the research accuracy. From customer type perspective 206
of are personal account holder and 99, Company or corporate check account and 59 employee
account holder respectively. From these we can say that personal and Company account holder
38
responded the questionnaire from there service expectation and actual service side while the
employees responds the questionnaire from banks service quality strategy and actually existing
service side. Since, they are as the same time customer and employees of the bank.
Reliability analysis all independent variables has highest consistency and reliability as per sited
standard. Empathy is the most reliable among the five service quality dimensions with 92.4% of
reliability and the overall reliability is 92.7% which shows highest reliability for further analysis.
From the descriptive analysis of service quality dimensions and According to descriptive statistics
following summary can be drawn as.
Tangibility dimension service quality questions in general fall under the low mean indicates
that the customers did not believe that the bank has modern equipment, attractive physical layout,
neat and professional employees. The reliability dimension of service quality also rated as low
compared to sited mean standard. Then customers don’t believe that Hibret Bank keeps its
promises to supply service within a specific time to you, has sincere interest to solve the problem
of the customer, gives accurate information to customer and service is provided on time as
promised as well as sufficient man power and material is kept to avoid the interruption of service
provision. Responsiveness dimension of service quality also of has low ratings as above two
dimensions by customers so, still the descriptive analysis show us the service quality needs
improvement. According the overall satisfaction distribution 182 agree on service quality or they
are comfortable with the service given by the Hibret bank and 151 are indifferent about the service
quality of the bank.
From correlation analysis except assurance other four independent variable has very strong
relationship with dependent variable while assurance has a substantial relationship.
The ANOVA depict that significance value of F statistics is .000 that is less than the 0.05, which
means there is significant relationship between predictor and dependent variable. As the table
shows the tolerance value of all independent variables are between 0.233 and 0.389 which is above
0.1 and variance inflation factor (VIF) for each independent variables fall between 2.570 and 4.285
which is also on accepted interval of variance inflation factor that is 10. That confirms to us none
existence of multi-collinearity problem in the multiple regression analysis.
39
5.2 Conclusions
The primary purpose of this thesis was for investigating the effect of service quality on
customer’s satisfaction of Hibret bank.
From the data analysis result the researcher reached and proposed managerial implication for
satisfying customer with the bank’s service. The following are conclusion drawn from the data
analysis.
 The demographic information of respondent shows that even if the numbers found in each
variable a symmetrical, it was enough for the research.
 The descriptive analysis shows that all service quality measuring element (tangibility,
reliability, responsiveness, assurance and empathy) has low mean value which indicate the
customers of Hibret bank are not satisfied with the service rendered by the bank. The
customers are complaining about the delay of service, network interruption, hard to get
accurate information from the bank and employee looks busy to respond to the customer.
 The regression analysis in shows that tangibility, reliability, responsiveness and empathy
and has a significant impact on customer satisfaction and positive correlation with the
customer satisfaction. The highest impact exists between empathy and customer
satisfaction while lowest reliability exist between assurance and customer satisfaction.
 The dominant factor in the SERVQUAL dimension is empathy (beta value .513).This
dimension indicate to the level of caring and individual attention provided to customers.
Service customers often have expectation with regard to the extent to which the service
providers appear to understand and be concerned about their individual needs and wants.
Therefore, in today’s dynamic business environment high service quality is an important
weapon to survive, the higher the service quality lead to the higher customer satisfaction.
Therefore, Hibret bank and the management office should influence those dimensions as a way
of ensuring that their customers get the satisfaction, as they expect in the services offered.
5.3 Theoretical Contribution and Policy Implication

Upon the research findings and conclusion the following recommendations and policy implication
were forwarded;
1) Previous researchers indicated that reliability plays a good role to produce quality service.
Consequently, Hibret Bank needs to improve its overall reliability dimension of service quality.
40
Hence, the following recommendations are recommended reliability Hibret Bank’s reliability
service quality dimension:-
a) Hibret Bank ought to improve its service as quality as promised initially with consistency of
performance.
b) Hibret Bank should show sincere interest to solve to customer’s problems by adopting systems
which may fasten the service process so on improve the service quality problems as an entire.
c) Hibret Bank ought to do an equivalent once promising to do to make and should maintain
error free records to form the corporate and service area additional trustable by avoiding over
promising and underperformance.
2) Hibret managerial employees ought to be aware that, among the five service quality
dimension, empathy has great impact on customer satisfaction. therefore the bank and its staff
ought to target in giving individual attention, promptly apprehend what they need and creating
operating hour convenient to the customers. It’s vital that giving attention on delivering prime
quality services and improving service quality effectively because it is important for client
satisfaction.
3) It's to have to own a client relation desk, free call centers so bank assign client relation
officers that agitate customers in need of special assistance .If there have been a client relation
officers within the bank, the client will simply express their feeling regarding the bank before
departure forever.
4) Hibret Bank ought to offer prompt and fast response to its customers‟ compliant by making
an easy and quick compliant handling system by forming a separate section to handle customers‟
complaints.
5) Hibret Bank ought to offer caring and personalized attention to its major customers since
they generate immense quantity of financial gain for the corporate and provides immediate
response to every major customer’s complaints.
41
6) Hibret Bank has to perceive the dynamic desires of consumers, their aspirations and
expectations to create worth by making effective and continuous feed backing system. The
company ought to even have a powerful client relationship management and be able to perceive
the customer’s desires whereas interacting with them.
7) The company should use a feedback system to understand the client service quality
expectation and perceptions for rising the extent of client satisfaction and also to give notice
customer’s criteria in judging the service quality regarding the bank service quality also.
8) Generally, the management and employees of the bank ought to work on exceeding the
perception than expectation of customer to ideal service by rising in line with the above
recommendations. Therefore, those key aspects can change the Hibret bank to create customer
satisfaction..
5.4 Limitation and Future Research Direction

The research was found the following limitations and future research direction:-
Because of time the research is limited to city branches, so rural area branches were not
included in the study,
The research on the same area make widens the scope.
The recommendation drawn from the research was as per selected branches means others
branches assumed as the same as those selected branches.
The research focus were over all service quality. So, to deepen the research.
A) Online banking service quality and customer satisfaction,
B) Institutional banking service quality and customer satisfaction and
C) Diaspora banking service quality and customer satisfaction are area for more clarify
and recommend specific policy and strategy.
42
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Appendix I Questionnaire
Dear respondents,
I would like to thank you in advance for taking your time to fill out this questionnaire as your input
will be a key in developing my research on the Impact of Service Qualities of Hibret Bank S.C on
its Customer Satisfaction. This form is part of a process called “informed consent” to allow you to
understand this study before deciding whether to take part. So the information that you give here
is only used for the research purpose and there is no other intention behind.
The purpose of this survey questionnaire is to make a partial fulfillment of the requirements for
the Masters of Business Administration in Addis Ababa University college of Business and
Economics. The questionnaire has three major parts. Part one deals with the background of the
respondent, part two deals with service quality items to be measured by the level of customer
satisfaction and part three is all about the overall satisfaction level of the customers and
recommendations of customer to the bank. The questions take only few minutes to complete so
you are kindly requested to fill all questions completely.
Thank in advance again.
Name: - Tesfaye Melkamu

Phone: - No +251-918-643-901
E-Mail:- [email protected] or
E-Mail:- [email protected]
Part I - Background of respondents
Instructions: please select an appropriate response category by circling an appropriate choice
against each question.
1. Gender
A) Male B) Female
2. Age
A) 18-24 B) 25-35 C) 36-45 D) 46-54 E) Above 55
3. Educational background
A) less than 10+2 B) Diploma C) Degree D) MA and above
4. Type of customer
48
A) Personal B) Company C) Employee

Part II –Service Quality Questions
Instructions: Please put a tick (√) in the boxes which mostly explain your attitudes on a five point
Likert scale questions.
Where 1. Strongly Disagree 2. Disagree 3. Neutral 4. Agree 5. Strongly agree
S. Service Quality Dimension Strongly Disagree Neutral Agree Strongly

N Disagree (1) (2) (3) (4) Agree (5)
Tangibility
1 The service deliverer (Hibret Bank) has
modern equipment.
2 The service deliverer has attractive physical
facilities.
3 The employees delivering the services are
neat, disciplined, professional in their
appearance,
4 Materials associated with the service
(pamphlets, sign posts etc.) are visually
appealing.
Reliability
5 When Hibret Bank promises to supply
service within a specific time to you, it does
so
6 The service provider has sincere interest to
solve the problem of the customer.
7 The service provider gives accurate
information to customer.
8 The service is provided on time as promised.
9 Sufficient man power and material is kept to
avoid the interruption of service provision.
49
Responsiveness
10 The employees makes the information easily
obtainable,
11 The employee gives prompt service ,
12 The employees are happy and willing to serve
the customer,
13 The employees are not too busy to respond to
the customers’ requests.
Assurances
14 The employees have the required skill in
providing services.
15 The customers feel safe on the service
provided by the employees,
16 The employee trust worthy,
17 The employees inspire confidence ,
18 The employees of the service provider polite
to the customer,
Empathy
19 The service provider employees usually give
individual attention.
20 The employees do know promptly what your
needs are.
21 The service provider and its employees have
the customers best interest at heart ,
22 The service provider has operating hours
convenient to the customers.
50
Part III
Over all evaluation of service quality and recommendation by customers,
1. Overall, how satisfied are you with the Hibret Bank S.C services provided?
A) Strongly Dissatisfied B) Dissatisfied C) Neutral D) Satisfied
E) Strongly Satisfied
2. What are the major challenges you have faced when using services provided by Hibret Bank
S.C?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………….
3. What do you suggest to overcome these challenges?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………
4. Please provide any comment, feedback or suggestion to the company regarding services you
receive?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
…………………………………….………………………………………………………………
………………………………………………………
51

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ADDIS ABABA UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

A Thesis Submitted to Addis Ababa University College of Business and

Advisors Name:-Asres Abitie (PhD)

Place: Addis Ababa University, College of Business and Economics

Addis Ababa University

Asres Abitie (PhD) ................................... .............................

Zelealem G/Tsadik (PhD) ............................. .............................

Getie Andualem (PhD)

Place: - Addis Ababa University, College of Business and Economics

By: Tesfaye Melkamu

Place: Addis Ababa University, College of Business and Economics

Key Words: Service Quality, Customer Satisfaction, Tangibility, Reliability, Responsiveness,

2.1.6.1 Customer expectations............................................................................................... 11

4.5 Correlation analysis ................................................................................................................ 30

1.1. Background of the Study

1.2. Background of the Organization

1.3. Statement of the Problem

1.4. Basic Research Questions

1.5. Objective of the study

1.5.2. Specific objective

1.6. Significance of study

1.7. Scope of the study

1.8. Limitation of the Study

1.9. Organization of the Study

2.1.2 The Characteristics of Service

4. Perishability Services cannot be stored, so their perishability can be a problem when

2.1.3 Service Quality

Figure 2.1 Service quality assessments

2.1.5 The Gap Model

Figure 2. 2 Customer service gap

Source: (Parasuraman, 1985) as cited (Million.T, 2017 pp 21).

GAP2:- Management perception-service quality specification gap:

2.1.6 Customer Expectation and Satisfaction

2.1.6.2 Customer Satisfaction

Figure 2.3 Situational factor for customer satisfaction

2.1.7 Factors that Influence Customer Satisfaction

Figure 2.4 Factors that affecting customer satisfaction

2.2 Empirical Review`

2.2.1 The Relationship between Service Quality and Customer Satisfaction

2.2.2. Choice of Service Quality Model of the Study

2.3 Conceptual Framework of the Study

Figure 2.5 Conceptual framework

THE RESEARCH METHODOLOGY

3.1 Research Design

3.2 Sampling Techniques

3.4 Sample size

3.5 Data collection

3.6 Validity and Reliability

Service quality Number of attributes Cronbach’s alpha perceived performance

3.7 Data Analysis

3.8 Ethical Considerations

DATA ANALYSIS AND DISCUSSION

4.1 Descriptive Analysis for Demographic variables

Gender Frequency/Number of respondents (n=364) Percent (%)

Table 4.2: Age distribution

Figure 4.1 Education level distribution

4.2 Reliability test

Overall reliability 0.927 22

4.3 Descriptive Analysis for SERVPERF Dimensions