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Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
An Online International Research Journal (ISSN: 2306-367X)
2015 Vol: 4 Issue: 2
1588 www.globalbizresearch.org
Zone of Tolerance and Organizational Competitiveness in Selected
Commercial Banks in Lagos State, Nigeria
Obianuju Mary Chiekezie,
Department Of Business Administration,
Nnamdi Azikiwe University, Nigeria.
Email: om.chiekezie@unizik.edu.ng
Hope Ngozi Nzewi,
Department Of Business Administration,
Nnamdi Azikiwe University, Nigeria.
Email: hn.nzewi@unizik.edu.ng
Beauty Mmachinyere Obianefo,
Department Of Business Administration,
Nnamdi Azikiwe University, Nigeria.
Email: Obianefobeauty@gmail.com
___________________________________________________________________________________
Abstract
The study examined zone of tolerance and organizational competitiveness in selected
commercial banks in Lagos State. The purpose was to determine the extent to which
customer’s service expectations affect quality of service delivery. Research question and
hypothesis were formulated in line with the objective. The research adopted a descriptive
survey research design. The population of the study is infinite and the sample size of 384 was
derived using the formula for infinite population. 384 copies of structured questionnaire were
used to collect data and 294 were found suitable for analysis. Spearman correlation and
regression analysis were used to test the hypothesis. Cronbach alpha was used to test the
reliability of the instrument. It was discovered that there is a positive relationship between
customer’s service expectations and quality of service delivery. The findings revealed that
customers had higher expectation levels compared to their perceptions of the service quality
on all the service attributes that were used to evaluate the expectations of quality of service
delivery. In conclusion, zone of tolerance is a key determinant of commercial banks
competitiveness in the banking sector. The study recommended that managers of these
commercial banks should prioritize meeting customers’ expectations and they should adopt
‘customer appreciation day’ in their bank calendar so as to reward customers for their
continuous patronage.
___________________________________________________________________________
Key Words: Zone of Tolerance, Organizational Competitiveness, Commercial Banks, Service
Delivery, Lagos State
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
An Online International Research Journal (ISSN: 2306-367X)
2015 Vol: 4 Issue: 2
1589 www.globalbizresearch.org
1. Introduction
1.1 Background of the study
The major goal of every business organization is to make profit and on the long run be a
market leader amongst other competitors. No business starts with the intention of running at a
loss. They therefore constantly develop new strategies to keep abreast with the rapid changes
in the business environment. Unlike manufacturing industry, service industry is more
complex and technical because of the intangibility of their ‘product’. It becomes necessary to
ensure the efficiency in service transaction in order to keep customers within the zone of
tolerance during service process. This may help to reduce the defection of customers to other
service providers, increase their repurchase intention and encourage continuous patronage.
United Bank for Africa Plc., First Bank of Nigeria Plc., Zenith Bank Plc., and Access
Bank are service provider’s that operate in a highly competitive market of Nigeria,
particularly Lagos State. Their long-term success is essentially determined by their ability to
maintain and expand a large and loyal customer base. Maintaining loyal customer base may
be achieved only when they meet up to their customers’ expectations of service delivery.
When deciding the level of service delivery, these banks probably need to keep their
customers’ zone of tolerance in mind. The zone of tolerance represents the range of service
performance that customers are able to tolerate. It is essential because it is central to
customers evaluation of service quality and satisfaction (Gwynne, Devlin and Ennew, 2000),
and it helps managers to analyze the effectiveness of service quality and to identify problem
areas that need improvement (Lo YL, Cavana and Corbett, 2002). The concept of zone of
tolerance is highly useful when trying to understand variability in customers’ service
expectations and perceptions as well as customers’ satisfaction.
A customer satisfaction survey of the Nigerian banking industry conducted by KPMG
International in 2014 showed that an overwhelming majority (92%) of those who reported
excellent customer service as their primary reason for maintaining banking relationships also
rated staff attitude as being important to their banking relationships – more than any other
service measure. With customers now having more choices than ever before, a positive
personal experience or professional touch may often be the differentiator. Out of the four-in-
ten customers who have multiple bank relationships, fewer customers (7% in 2013 compared
to 10% last year) expressed the willingness to change their banking relationships. Over half of
those who may switch banks, most likely do so because of service quality issues.
The survey conducted by KPMG International in 2014 also revealed the perception of
customers on what they consider as the top ten most customer focus banks in three segments;
namely the Retail, Small and Medium Enterprise (SME) and Corporate Banking showed the
level of competitiveness of these banks. For the second consecutive year in the retail segment,
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
An Online International Research Journal (ISSN: 2306-367X)
2015 Vol: 4 Issue: 2
1590 www.globalbizresearch.org
Zenith Bank emerged as the most customer-focused bank with 75.67%, while First Bank and
Access Bank where 8th and 10th position with 72.58% and 72.11% respectively. United Bank
for Africa did not meet up. In the SME segment, Zenith Bank moved from second position in
2013 to become the most customer focused bank, in 2014, with 77.61%, while First Bank
ranked 7th position with 74.96% and Access Bank ranked 10th position with 74.40%. United
Bank for Africa did not meet up as well. Corporate banking customers also ranked Zenith
Bank as the most customer focused for the year 2014 with 77.37%. First Bank ranked 6th
position with 73.35% and United Bank for Africa ranked 8th position with 72.32%. In this
segment Access bank did not meet up.
It is imperative that service companies’ measure and monitor service quality and
satisfaction to gain uniqueness and to influence the behavioral intentions of their customers
(Saha and Theingi, 2009). Due to the knowledge explosion and better-educated bank
customers, the need to measure up is no longer a choice but a necessity in meeting rising
expectations of more knowledgeable customers. The ability of United Bank for Africa Plc.,
First Bank of Nigeria Plc., Zenith Bank Plc., and Access Bank Plc., to understand and meet
customers’ expectations and subsequently differentiate their service from competitors are
important for survival in today’s globalized world. Hence, the study of zone of tolerance and
organizational competitiveness is paramount.
1.2 Statement of the problem
The banking sector is known for its competitive nature. The critical nature of the service
industry makes a service provider prone to service failures even with an excellent service
blue-print back-up. Customers tend to be sensitive to little failure in service performance.
Customers’ experience of service failures while performing service transactions, such as
network failure, system delay, poor or slow processing of request and power failure, may lead
to customers’ consideration in withdrawing their patronage from the bank.
A perceived failure in service to meet customer expectations is most likely to cause customer
to lose their trust and loyalty to the service provider. For financial service providers like
United Bank for Africa Plc., First Bank of Nigeria Plc., Zenith Bank Plc., and Access Bank,
error-free service delivery is important as customers are sensitive to service performance.
Error in service delivery may lead to dissatisfaction of customers and consequently lead to
losing of customers trust and loyalty.
A lot of service providers tend to focus on the number of customers they serve without
giving sufficient attention to the value of each customer, which is essential to continuous
patronage and a source of advertising strategy for them. How well a customer is valued leads
to satisfaction and referral of the business by the existing customers to prospective customers.
Moreover, inadequate market research to understand customers’ expectations or insufficient
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
An Online International Research Journal (ISSN: 2306-367X)
2015 Vol: 4 Issue: 2
1591 www.globalbizresearch.org
use of that information by management in formulating their service strategies may cause poor
quality of service delivery.
Another challenge faced by the service firms is the inability to maintain customers
purchase and repurchase intention. Some commercial banks may not place great importance
on the value of their existing customers, but rather seek to get new customers without regards
to the retention of existing customers. Their shift in attention from existing customers to new
or prospective customers may lead to negligence in meeting up with their existing customers’
service expectations. It is therefore these problems that prompted this research study.
1.3 Objective of the study
The broad objective of this study is to examine the extent to which zone of tolerance
influence organizational competitiveness of selected commercial banks in Lagos state of
Nigeria. Specifically, the objective is to examine the extent to which customer’s service
expectations influence quality of service delivery.
1.4 Research Question
The following research question is raised for the study:
To what extent has customer’s service expectations influenced quality of service delivery?
1.5 Research Hypothesis
The following research hypothesis is formulated for the study:
Ho: There is no positive relationship between customer’s service expectations and quality of
service delivery.
1.6 Significance of the Study
This study will help commercial banks and other service organizations to match their
companies’ capabilities and strengths with customer needs. It will also help to analyze the
effectiveness of service quality and to identify problem areas that need improvement. Again,
it will help managers of commercial bank and other related managers to effectively
investigate their customers’ point of view, in order to improve on their service delivery. The
study will also serve as a vital reference material for the academia.
2. Review of Related Literature
2.1 Conceptual Review
2.1.1 Zone of Tolerance
Zone of tolerance is an innovative concept that has attracted considerable attention in the
service marketing arena (Lobo, 2009). It is the extent to which customers recognize and are
willing to accept variation in service performance. The zone of tolerance (ZOT) is defined as
“the difference between desired service and the level of service considered adequate”
(Zeithaml, Berry, and Parasuraman, 1993). According to Zeithaml, Bitner and Gremler
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
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(2009), one can consider the “zone of tolerance” as a range in which customers do not
particularly notice service performance.
In their original framework for measuring service quality, (Parasuraman, Zeithaml, and
Berry, 1994) used a single expectation standard, desired expectation (that is, what a consumer
feels a service provider should offer) as a comparison against which service performance is
assessed. More recently, these same authors have developed an integrative concept that
captures both service quality and satisfaction perspective of expectations called the zone of
tolerance. The zone of tolerance framework offers a powerful way of understanding levels of
satisfaction that may not be captured by the conventional way of measuring satisfaction.
The zone of tolerance, recognizes that a consumer enter service encounters with different
expectation levels, desired service’ at the top and ‘adequate service’ at the bottom of the scale
(Parasuraman, 2004). Desired service is “the level of service the customer hopes to receive
and the adequate service is “the level the customer will accept”. The customer satisfaction
will result as long as customer perception of service performance, fall in this zone of
tolerance (Zeithaml et al, 1993).
Figure 1: Zone of Tolerance
Source: Parasuraman, Berry, and Zeithaml (1991)
There appear to be three main, though overlapping, applications of the zone; as a
description of an outcome state, a description of a range of pre-performance expectations, and
as the satisfactory range of in-process service performances. Poiesz and Bloomer (1991)
proposed that the zone of tolerance can be used as unifying construct between expectations,
performance and outcomes. Zone of tolerance raises the question of the basis of expectation
formation (Kenesei, Zsófia, Keszey and Tamara, 2014).
2.1.2 Quality of Service Delivery
Service delivery indicates ‘where’, ‘when’ and ‘how’ the service product is delivered to
the customer (Lovelock and Writz, 2004). The service delivery process can be broken down
into service encounters that comprise the main part of the whole process (Danaher and
Mattsson, 1994) and, as noted by Chowdhary and Prakash (2007), some generalization within
service types is possible for different services and service providers, and managers may have
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
An Online International Research Journal (ISSN: 2306-367X)
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to consider this in its design. Thus, the power to deliver optimal service quality will get the
service firms competitive advantages among others in the same industry (Turel, Serenko and
Bontis, 2007).
In terms of the service provider, service quality is related to productivity, in that improving
service quality and boosting productivity are in conflict (Parasuraman, 2002). Quality in
service suggested starting from comparisons between what users considered that they should
be offered by the provider and what he actually offered (Zeithaml and Parasuraman, 1990). In
this direction, quality service can be considered the ratio of the level of service effectiveness
and expectations of the user. They also stated that, to promote quality service means to meet
the needs and expectations of a user in an effective manner
To evaluate a service is more complex than to evaluate a product, because the product is
tangible and its defects can be detected, its functioning assessed and its durability compared.
Conversely, service is first purchased and then it is produced and consumed simultaneously,
and then the possible nonconformities are produced and experienced, characterizing their
inseparability (Cruz and Melleiro, 2010). Quality of service delivery can be measured with
the use of the SERVQUAL instrument developed by Parasuraman, Zeithaml, and Berry
(1985). Although amended by several researchers over the years, SERVQUAL is still
considered as a reliable tool to measure service quality. The SERVQUAL instrument relies on
five primary dimensions; tangible, reliability, assurance, empathy and responsiveness
(Marshall and Murdoch, 2001).
Tangibility: Physical aspects of what is provided to users.
Reliability: Ability to fulfill what was promised accurately.
Responsiveness: Ability to attend to the users and provide the service promptly,
capturing the notion of flexibility and ability to adapt to the needs of the service user.
Assurance: Competency and courtesy extended to the users and the security provided
by the operations.
Empathy: Individualized attention to the users (Marshall and Murdoch, 2001).
SERVQUAL measures customers’ perceptions. Once these measurements are acquired they
can be used to establish the customer’s zone of tolerance for each of the five dimensions. The
zone of tolerance is the difference between the customer’s minimum service level and the
desired service level. The perceived service level can now be measured in relation to the zone
of tolerance.
2.2 Theoretical Review
The study is hinged on the expectancy disconfirmation theory by Oliver (1977; 1980).
This theory holds that satisfaction is related to the size of the disconfirmation experience. The
theory implies that consumers enter service transactions with pre-purchase expectations about
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
An Online International Research Journal (ISSN: 2306-367X)
2015 Vol: 4 Issue: 2
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the anticipated performance which becomes a standard against which the product is judged.
That is, once the service has been used, outcomes are compared against expectations of
quality of service delivery. If the outcome matches the expectation, confirmation occurs.
Disconfirmation occurs where there is a difference between expectations and outcomes.
The relevance of this theory to the study is that commercial banks and other service
providers are expected to deliver quality service that meets customers’ expectations. It is only
then that they can keep customers within the zone of tolerance and by so doing achieve
organizational competitiveness. Customers are aware that service performance varies and as a
result their expectation might not be met or exceeded most of the times, so customers enter
into a service transaction, having room for variation in service expectations (zone of
tolerance), of quality of service delivery; which they regard as the minimum or adequate
level. Any transaction within the minimum level of expectation or above it (desired level) will
bring about satisfaction of service delivery which is a normal service experience that
customers expect.
2.3 Empirical Review
A number of studies have been carried out that is related to zone of tolerance. Havinal and
Sirigeri (2013) carried out an empirical study on the relation between zone of tolerance and
importance of service quality attributes in commercial banks. Their study was aimed at
identifying the service quality dimensions, establishing the zone of tolerance based on the
minimum and desired service and exploring the relation between the height, width of
tolerance zone. A structured questionnaire was used to collect the data responses from 500
customers of the commercial banks. Spearman rank correlation was used to analyze the data.
The study revealed that the perceived service with respect to all the service quality attributes
were within the tolerance zone. It was also observed from the study that there was positive
correlation between importance of service quality attributes and the height of tolerance zone,
negative correlation between importance of service quality attributes and the width of
tolerance zone.
Salleh, Ariffin, Tih, and Asbudin (2010) carried out a research on ‘Zone of tolerance for
service attributes in full-service airlines versus low-cost carriers.’ The study investigated how
low cost level moderates the effect of service quality attributes on customer satisfaction by
measuring and comparing the zones of tolerance for operation specific services attributes
between full-service airlines and low-cost carriers in Malaysia. A total of 249 copies of
questionnaire were distributed to the passengers of full-service airlines out of which only 109
completed questionnaires were useable. While 100 completed questionnaires were useable
from the low cost carrier passengers. The independent-sample t-test was employed to
compare the size of zone of tolerance between the full-service airlines and low cost carriers
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
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with respect to the 17 attributes. The results revealed that the zones of tolerance for full-
service airline are basically larger than those of low-cost carriers with the exception of four
service attributes, which reported significant differences.
Campos and Nóbrega (2009) investigated on ‘Importance and the Zone of Tolerance of
Customer Expectations of Fast Food Services’. The study was aimed at determining the
perceptions of users regarding the importance of attributes and their expectations in relation to
levels of desired service and the minimum acceptable service. The data was obtained using a
sample of 500 students from a local private university. The interviews were completed on
three different campuses of the university. The results reflected the ascertainment of 442 valid
responses of 500 questionnaires applied. The Statistical Package for Social Sciences (SPSS),
version 12.0 was used to analyze the quantitative data including correlation and reliability.
The finding of the empirical test showed that, as the importance of attributes for service
quality increases, the tolerance zone gets closer and higher for customers.
Durvasula, Lobo, Lysonski and Mehta (2006) investigated on ‘finding the Sweet Spot: A
Two Industry Study. They used zone of tolerance to identify determinant of service quality
attributes. They examined the relationships of perceptions and expectations of service quality,
mean service adequacy (MSA) and mean service superiority (MSS) with service satisfaction
and loyalty. Through a detailed comparison of two major financial services in Singapore: life
insurance and stockbrokerage. In the stockbrokerage study, a total of 170 questionnaires were
returned out of the 240 distributed, however 147 were found useable for the research. In the
life insurance study the 210 survey forms distributed in Singapore, 189 forms were returned
and 182 were found usable for the research. The findings revealed that in the two industries,
expectations drive evaluations of service quality by consumers. Also, results indicated that the
reliability aspect of service quality is strongly related to satisfaction and loyalty in the
stockbrokerage industry, while the assurance aspect of service quality enjoyed a similar status
in the life insurance industry.
Nadiri (2012), investigated on ‘how to determine whether it is narrow or broad’. The aim
of the study was to discover to determine when a zone of tolerance is narrow or broad. He
used correlation analysis to analyze the width of width of the zone of tolerance. He
discovered that a narrow or broad perspective in zone of tolerance is related to its width.
When the width of zone of tolerance is found to be less than 20% of the point-of-scale used, it
should be considered ‘a narrow zone of tolerance’ and when the width is found greater than
60% of the point-of-scale used, it should be considered ‘a broad zone of tolerance’. In the
remaining case of the middle condition, the neutral zone of tolerance exists. He also noted in
his findings that, the percentages were only suggestions and that other range and descriptions
of wideness are possible.
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
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Teas and Decarlo (2004) conducted a study on “An Examination and Extension of Zone-
Of-Tolerance Model”. Their focus was on universities student’s perception of lecturing
performance. Spearman rank correlation was used to analyze the data. A structured
questionnaire was used to gather data from the respondents. They discovered that
performance based models offered more explanatory power than zone of tolerance regarding
the relationship between perceived quality and purchase intensions. They also found that zone
of tolerance offered superior performance when evaluating the linkage between perceived
quality and satisfaction.
Yap and Sweeney (2007) investigated on how ‘Zone-of-tolerance moderates the service
quality-outcome relationship’. They used exploratory and confirmatory factor analyses to
assess measurement properties and regression analysis to test the hypotheses regarding the
zone of tolerance. Survey was conducted on customers of the retail banking sector in
Australia. A multi-stage sampling method was used. 400 copies questionnaires were
distributed and 203 were returned. They discovered that the relationship between service
quality and outcomes did not strengthen above or below the zone of tolerance for any of these
outcomes and was significantly weaker below the zone of tolerance for satisfaction, loyalty
and propensity to switch. They concluded that, there should be a focus on increasing service
quality beyond the adequate level, rather than seeking to develop a customer franchise by
creating “delight.”
Gwynne, Devlin, and Ennew (2000) investigated on ‘the zone of tolerance: Insights and
influences’. They focused on the width of the zone of tolerance relative to the different
service quality dimensions. The sample comprised of 218 students. They found in their study
that, service quality dimensions that are perceived as more important enjoy a wider zone of
tolerance. Their results attribute this to higher levels of desired expectations for the most
important service quality dimensions. It was also found that these desired expectations tend
to be relatively stable.
Stodnick and Marley (2013) investigated on ‘A longitudinal study of the zone of
tolerance’. The aim of their study was to use a longitudinal analysis of the zone of tolerance
to reconcile the difference between the acceptance of the theoretical model and the lack of
empirical support for it. A combination of simple linear regression and piece wise regression
was used to analyze the data. 699 respondents of a focus group were observed in a training
program from the telecommunication industry. They discovered that, exceeded expectations
result in higher satisfaction, while not meeting expectations, satisfaction decrease can be
huge.
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
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2.4 Summary of Related Literature
From the empirical work reviewed such as Havinal and Sirigeri (2013); Campos and
Nóbrega (2009) and Salleh, Ariffin, Tih, and Asbudin (2010). Their study was aimed at
establishing the zone of tolerance based on the minimum and desired service level with the
service attributes and exploring the relation between the height, width of tolerance zone. Their
focus was majorly to measure the width and height of the zone of tolerance in order to
determine the exact zone of tolerance (desired and adequate level of expectation) which still
results in satisfaction. The difference is only in the varying degree of satisfaction. However,
fewer studies have been carried out to determine customers’ service expectations on the
quality of service delivery in the banking sector in Nigeria, it is therefore the gap in
knowledge that the study seeks to fill.
3. Methodology
The research adopts a descriptive survey research design. The population under
consideration consists of the customers of United Bank for Africa Plc., First Bank of Nigeria
Plc., Zenith Bank Plc. and Access Bank Plc. in Lagos State. The customers comprise of both
account holders and non-account holders. The sample size is three hundred and eighty-four
(384). It was derived using the formula for infinite population:
n = P (1-P) z 2
e
Where,
n = Sample size
P = Population parameter (0.5)
Z = Level of confidence is 90% (1.65)
e = Level of significance (0.05)
1 = a constant
Substituted:
n = 0.5 (1-0.5) 1.96 2
0.05
n = 0.25 (1536.64)
n = 384.16
Judgmental sampling technique was used in selecting respondents who were drawn from
the United Bank for Africa Plc., First Bank of Nigeria Plc., Zenith Bank Plc. and Access Bank
Plc. 384copies of questionnaire were administered and returned. However 294 copies were
properly filled and found suitable for use. The hypothesis was analyzed using Spearman
correlation and regression was used to test how the independent variable influences the
dependent variable on SPSS ver.20.
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3.1 Test of Hypothesis
3.1.1 Hypothesis Test using Spearman correlation coefficient
Ha: There is no positive relationship between customer's service expectations and quality of
service delivery.
Source: SPSS Analysis, 2015
3.2 Decision
Spearman correlation coefficient shows statistical dependence of two variables, and
statistical correlation is significant if coefficient is more than 0.5. Moreover, if p-value is low
(under 0.01), it means that the correlation actually exists. If p-value is high, it cannot be
determined that the correlation actually exists. Table-1 shows the p-value (0.000) is less than
0.01 (at a 2-tailed test), customer's service expectations and quality of service delivery are
highly positively correlated with each other with the correlation coefficient of 0.991.This
means that with the high increase of customer's service expectations, quality of service
delivery also increases at a high pace due to the competitive nature of the banking sector.
Source: SPSS Analysis, 2015
Regression analysis is also used to see the influence of independent variable on dependent
variable. Table-2 shows regression model summary, in which adjusted R2 is found to be
0.967. This adjusted R2 means that “how much variability is explained by the independent
variable (customer's service expectations) on the dependent variable (quality of service
delivery).
Table 1: Spearman correlation coefficient
CSE QSD
Spearman's rho
CSE
Correlation Coefficient 1.000 .991**
Sig. (2-tailed) . .000
N 294 294
QSD
Correlation Coefficient .991** 1.000
Sig. (2-tailed) .000 .
N 294 294
**. Correlation is significant at the 0.01 level (2-tailed).
Table 2: Regression Model Summary
Model R R Square Adjusted R
Square
Std. Error of the
Estimate
1 .989a .977 .967 .90023
a. Predictors: (Constant), SE
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
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4. Discussion and Implications
This study tested whether there is a significant relationship between customer’s service
expectations and quality of service delivery. The result confirmed that customer’s service
expectations affect the quality of service delivery. The findings of this study also addressed
the gap in literature because the major reason why an organization exists is to meet the needs
of the customers. Customers are ‘King’ and they are the major determinant of commercial
banks competitiveness in the market. This supports Campos and Nóbrega (2009), Yap and
Sweeney (2007) and Salleh, Ariffin, Tih, and Asbudin (2010), that customer’s expectations
determine quality of service delivery.
The finding showed that custo mer’s expectations are generally anticipated to be in line
with the acceptable levels of service quality in the banking sector. The results revealed that
customers had higher expectation levels compared to their perceptions of the service quality
on all the service attributes that were used to evaluate the expectations of service quality. The
results highlighted the importance of high expectations on service quality on all constructs.
The analyses revealed a significant positive relationship between these variables, which
agreed with the study carried out by (Havinal and Sirigeri, 2013).
5. Conclusion
In view of the above findings, the study concludes that zone of tolerance is a key
determinant of commercial banks competitiveness in Lagos state. It enables commercial
banks to match their customers’ needs with the services delivered. This is because with the
awareness of customers’ zone of tolerance level, commercial banks can deliver services that
meet up to their customers’ expectations. When customers’ expectations are met by the bank,
it increases customer loyalty and increases repurchase intentions.
6. Recommendations
On the basis of the findings and conclusion drawn from the study, the following
recommendations are proffered.
The managers of these commercial banks should prioritize meeting customers’
expectations, by constantly developing strategies to improve the quality of their
service delivery.
Commercial banks should devise policies and procedures that will ensure that
customers expectations are within the zone of tolerance
Also, they should adopt ‘customer appreciation day’ in their bank calendar, where
customers are given gift items and treated with special attention on arrival for
business transaction so as to reward customers for their continuous patronage.
Employees in these banks should be properly trained on how to handle customer’s
request. Periodic training such as negotiation skills, customer relations skills, and
communication skills should be undertaken by all their employees. This will help
them in their service delivery.
Journal of Emerging Issues in Economics, Finance and Banking (JEIEFB)
An Online International Research Journal (ISSN: 2306-367X)
2015 Vol: 4 Issue: 2
1600 www.globalbizresearch.org
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