Chapter 2 Lit Rev2

8/4/2019 Chapter 2 Lit Rev2

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Chapter 2:Literature Review

n this part of the dissertation, a wide range of literature that relevant to the dissertation

topic and influence, guide the methodology of the research as well. Here the literature

chosen on various factors. Such as customer satisfaction, service quality in banking in

different countries around the world, SERVQUAL model, dimensions of SERVQUAL etc.

2.1. Customer Satisfaction

Satisfaction is an emotional or feeling reaction (Westbrook, Newman, Taylor, 1978). It is the

result of a complex process that requires understanding the psychology of customers. The range

of emotion is wide with, for example, contentment, surprise, pleasure, or relief. Satisfaction is

influenced, in the end, by expectations and the gap between perceived quality and expected

quality, called "expectancy disconfirmation" (Rossat, J., Larsen, J., Ruta, D., Wawrzynosek, M.

1998). The figure below shows the predominant linkage of this process.

Figure 1: Customer satisfaction. Source: Rust, Zahorik, Keiningham, 1996


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There are many attempts to make a consensus regarding the definition of customer satisfaction,

but there still disappearance of it. Customer satisfaction is very famous research topic in

marketing research and academic studies. Several researcher study customer satisfaction, among

them Cardozo (1965), Giese and Cote (2000) try to define customer satisfaction. But they failed

again to give a consensus. According to Gundersen, Heide and Olsson, (1996), a typical

definition of customer satisfaction can be written as it is an evaluation of a definite product or

service after consumption. It is to be noticed that the evaluation is based on the expectation and

perception of the product or service in the mind of the customer. There are a lot of definitions of

customer satisfaction. In the following table some definitions of customer satisfaction are

tabulated.

Authors Definitions

Gundersen, Heide and Olsson, 1996 Customer satisfaction is typically defined as a postconsumption evaluative judgement concerning a specific

product or service

Oliver, 1980 CS is the result of an evaluative process that contrasts

pre-purchase expectations with perceptions of

performance during and after the consumptionexperience

Soscia 2002 Customer Satisfaction is considered a post choice

evaluative judgment concerning a specific purchase

selection

Swan & Trawick 1981 The concept of customer satisfaction describes

the emotional reaction to the degree in which a productmeets a buyers expectations

Yi ,1990 Customer satisfaction is a collective outcome ofperception, evaluation and psychological reactions to the

consumption experience with a product/service.

(Kotler, 2003) Satisfaction is a persons feelings of pleasure ordisappointment resulting from comparing a productsperceived performance (or outcome) in relation to his or her

expectations

In this regard, the concept which is very popular and widely accepted as well is expectancy

disconfirmation theory. In this theory, it suggested by the developer of this theory (Oliver, 1980),

that the satisfaction level is sourced from the difference of the expected performance and

perceived performance of consumer. Here satisfaction is a positive disconfirmation when the

consumption experience is better than expected. In the contrary, when the performance of the

product or service based on consumer experience is below the expectation of the consumer, it is


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negative disconfirmation. This theory is very influential for defining and conceptualizes the

concept of customer satisfaction (McQuitty, Finn and Wiley, 2000).

There are several other aspects of customer satisfaction. In the prior researches, customer

satisfaction is defined as the post evaluative judgment regarding purchasing decision. But as a

very commonly used theory is discussed in the earlier paragraph, customer satisfaction is a

function of disconfirmation. And the function is related to very important element of satisfaction

which is expectation and performance. This theory in practice covers various researches on

satisfaction of customers. In the researches, this model provides the ground for majority of

satisfaction studies. This model encompasses four pillars, namely expectations, performance,

disconfirmation and satisfaction. In this disconfirmation model, the effect of expectation of

consumer is in affect through the disconfirmation and later it is affected profusely by the

perceived performance of the product and services. More importantly, many studies proved that

there is direct effect of perceived performance on satisfaction (Finn and Wiley, 2000).

Satisfaction is closely associated with performance which can fulfill ones expectation, is firstly

argued by Swan and Combs (1976). They found in their research that the dissatisfaction resulted

when the performance is out of expectation. They found that the satisfaction is a result of

discrepancy between the observed performance of a product or service and desired performance

of that product or service as well. This is going with another theory which is the value percept

disparity theory. This theory was developed to solve the problem of customer behavior, where

they sometime satisfied by some aspects for which the expectation usually never existed. This

theory describes satisfaction as a cognitive-evaluative process which is triggered by emotional

elements of that consumer. It can be worded as the comparison of the product or services done

based on ones values instead of an expectation (Fornell and Wernerfelt, 1987).

In the progression of the earlier concepts, a customer want to balance their values based on their

needs and wants, which judge and compare the product or service which is consumed. In the

contemporary researches, the focus is driven to the nature of satisfaction which consists of

emotion, fulfillment and state of a consumer (Parker and Mathews, 2001). The researches in the

recent time, add to this perspective in two ways. Firstly, though the traditional view to customer


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satisfaction suggests that this satisfaction is a result of cognitive processes, but in the findings of

new researches which formed the new conceptual development, suggests that the satisfaction can

be sourced from the affective processes which can contribute to customer satisfaction and its

explanation and prediction as well (Westbrook, 1987; Westbrook and Oliver, 1991). Secondly,

satisfaction can be viewed as a cumulative experience instead of single transaction specific

phenomenon of a certain product or service (Wilton and Nicosia, 1986).

Usually satisfaction derived from pleasure or disappointment sourced from a product or service

performance (perceived) related to the expectation. In this way customer satisfaction is a result

of both cognitive and affective process evaluation, where a standard is compared between

perceived and expected outcome. And then the satisfaction come as it is. If the perceived

performance of that product or services is less than expected, the consumer will be dissatisfied.

In the opposite direction this will happen reversely. And if there is an equality between the

perception and expectation, then the consumer will be indifferent or neutral (Kotler, 2003).

There are some other aspects of customer satisfaction. Customer loyalty is an important factor in

customer satisfaction. Because customer satisfaction is resulted from the overall evaluation of an

offer of product or service. This overall satisfaction has strong positive effect on the intentions of

customer to be loyal with service provider across the various product or service categories.

moreover, the judgment of satisfaction is not only related with the single product or services but

it is also affected of other experiences also with the service provider or manufacturing

organization, such as the sales process, after sales service etc. additionally, customers

expectation is formed from the past buying experience, others word of mouth and advices,

advertising and promotional activities also. So the satisfaction has several dimension (Zairi,

2000). In the following figure the continuous improvement of customer satisfaction is depicted

in this regard.


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product offerings and secondly, a firm can target a specific customer segments to reap the full

benefits of the satisfaction through service delivery. In particular, improving the quality of

service offering and automated telephone service both offer considerable growth potential of a

firm (Krishnan, Ramashawamy, Meyer and Damien 1998).

Quality of customer interface is a key driver of customer satisfaction (Ruth and Jackson, 1995).

The above four factors are directly affected by multiple operational quality attributes. Firms need

identify and understand the relative effects of these operational quality attributes on the customer

rating of four factors (Soteriuo and Zenios, 1998; Armstrong and Harker, 1995).

Advances in IT open the door of innovation by financial firms. Using state of art, innovation in

product service offering and delivery is possible. The number of customer who engage in

electronic commerce for financial transaction has increased considerably over the years

(Businessweek may 25, 1998). In this twenty first century, use of information technology is

enormous in innovating and faster and comfortable service to customer of financial product and

services. So usage of IT is also an important driver of customer satisfaction.

2.1.2. Drivers of customer satisfaction for financial servicesThis research paper is based on financial service, especially banking sevice. There are several

types of financial service which are provided by a banking organization like HSBC. These

services ranges from checking account, brokering, settling customer financial transaction to

arrange large loan through syndication and supplying capital to other financial and commercial

organization. The important aspect of the financial service is, it is not fully fit with the full

service oriented organization like hotel and travel agencies and they somewhere between product

and service oriented organization, as a financial organization offers tangible products also

(Soteriuo and Zenios, 1998).

The types of financial service are different from the service of manufacturing organization. In

this way the quality of these two types of service is also varies and sometime financial services

quality is quite different from the other types of service providers. The character of financial


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service industry is very volatile as the products are mostly intangible. In a banking organization,

the service it gives, not only include the prior described services only, rather some other

peripheral services, such as online account information and inquiry service, ATM service etc are

also included. A very important aspect of a financial service is the continuity of service. It is

based on a unique feature of the financial service industry which is the daily consumption of

products of financial organization. And an important matter is the actual product is not viewed as

the full product, rather the total package of the financial product is accompanying the overall

satisfaction of customer with the firm. For this reason, a financial company needs to model its

services by including both product and service attributes (Roth and Jackson, 1995).

In several prior researches, some specific quality attributes are common in both manufacturing

and service industries which are linked to customer satisfaction very importantly (Zeithaml,

Parasuraman, and Berry, 1990). These researches investigated the level of service quality

attributes in the interaction with the customer or in different service encounters. It is found that

there is a scarcity or lacking of research and guidance to understand the drivers of total customer

satisfaction which is derived from overall judgment of satisfaction at the firm level. It is

important for the financial service provider, as they have multi channel firms and much

diversified services also (Frei et. Al., 1997).

One of many rigorous empirical studies regarding industry of financial service, Roth and

Jackson, (1995) identified various determinants of service quality of banking industry. The

analysis of their research shows that the quality of service encounters with customer affect the

service quality. In this analysis they use a composite measure of quality of service at service

encounter, which they termed as customer interface. The measure of quality of customer

interface involves several factors. They include employees response to customer questions,

providing accurate account statements, timeliness of employees when they perform for the

customers and problems solving approach towards the customer.

Another important issue regarding customer interface in financial services is the variety of

channels of service delivery, in addition, the notion of financial service customer interface is

multifaceted and it is dependent on the types of channel of service delivery. The nature of


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interacting customer at branch office is different from that of at IT office. This caused because

the medium of service delivery or the channels. So this is very important for developing qualigy

service to increase customer satisfaction of customer of financial service. The organization

should have better understanding this differences which can help to pull up the overall

satisfaction of customers. It proved that various components of customer interface has varying

impact on customer satisfaction (Peterson & Wilson, 1996).

2.1.3. Techniques to measure customer satisfactionThere are a number of techniques to measure customer satisfaction. These techniques include

customer satisfaction survey methodologies, focus groups to study customer satisfaction issues,

standardized packages for monitoring customer satisfaction, and various computer softwares

(Soteriuo and Zenios, 1998).

Among the techniques, some are somewhat problematic when it is implemented. So there are

some problem associated with typical customer satisfaction measurement techniques such as

focus groups, survey methodologies and customer satisfaction software (Ingrid Feelikova, 2004).

These include:

Analytical techniques involves with techniques modeled based on analysis, formalizeprocedure; analysis based systematic process of measurement etc.

Secondly, Behavioral measurements of customer satisfaction consist of customer attitude,beliefs, perceptions which can give good indication of customer satisfaction. In addition,

observe motivational factors, commitment and behavior of people related or involved in

the process are also fall in the behavioral technique to measure customer satisfaction

Lastly, Organizational technique to measure customer satisfaction cover the analysis oforganizational structure, organizations information flows, its management style and

culture of the organization etc (Piercy, 1996). (Ingrid Feelikova, 2004).

2.2. Service Quality


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In the contemporary global business arena, service qualities are playing an important role in the

success of business and contribute to the growth and profitability also. For this reason providing

excellent service quality to a customer is recognized as an important business requirement

(Vilares & Coehlo, 2003; Van der Weile et al, 2002).service quality is now treated as not just a

corporate offering to customer but also a competitive weapons to survive in the dynamic market

place (Rosen et al, 2003) which is very crucial to ensure the profitability of business and make it

certain to get growing in the coming years (Newman & Cowling, 1996). However, service

quality especially of financial service sector is very complex in nature and regarding the drivers

of effective delivery, a very little consensus is made by the prior researches. Some prominent

definitions of service quality are summarized in the following table.

Authors Definitions

Parasuraman, Zeithaml,

and Berry, (1985)

Service quality as the ability of an organization to meet or exceed

customer expectations

Gronroos (1991) Service quality is made up of three dimensions: the technical

quality of the outcome, the functional quality of the encounter,and the company corporate image.

Lehtinen (1982) Service quality in three dimensions: the physical quality (of

products and/or services), the corporate quality (the company

image) and interactive quality (interaction between the consumerand the service organization).

Parasuraman, Zeithaml,

and Berry, (1988)

Service quality is the overall evaluation of a specific service firmthat results from comparing that firms performance with the

customers general expectations of how firms in that industry

should perform.

Lewis & Booms, 1983 Definitions of service quality hold that this is the result of the

comparison that customers make between their expectations about

a service and their perception of the way the service has beenperformed.

2.2.1. Service Quality dimensions and SERVQUAL modelTo develop a model to find or analyze service quality, most famous researchers are Parasuraman,

Zeithaml, and Berry (1985) (otherwise referred to as PZB). They do much of the initial work for

development of a model in this purpose. PZB initially isolated some factors which are crucial

and influencing to service quality. These determinants of service qualities are of ten kinds. These


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are: the consumer reliability, responsiveness, competence, access, courtesy, communication,

credibility, security, understanding/knowing the customer and tangibility.

PZB (1985) found in their studies, that there are some discrepancies between the perception of

customer and that of service provider in terms of quality interacted or rendered. In the

investigation, they found that the service quality can be measured and assessed by the function of

the discrepancies or they called it the gaps which derived from the customer expectation and

what the same customer perceived.

Based on the review of previous research of service quality gap analysis and other factors that

influence service quality, PZB (1985) introduced the SERVQUAL scale for service quality

measurement. The model is designed in such a way, so that researcher can identify the good or

bad service quality and it can provide the service quality trends over time as well. This

SERVEQUAL scale is based the two different factors. The two factors are the expectations of a

customer and the perception of a customer regarding the service quality of a target commercial

organization. In this two broad categories, PZB (1985) select ten determinants that are most

important for service quality. These ten determinants of service quality already listed earlier in

this section.

In the later research, PZB (1985) select five most important determinants from the ten, they

discovered initially. It helps the researcher to be more specific in studying the service quality

attribute and its major determinants. To select the five major determinants, PZB (1985) took two

stages of purification. Now the final and major determinants of service qualities remains are

Tangibles, Reliability, Responsiveness, Assurance, And Empathy (PZB 1988).

The Five Key Service Dimensions

TANGIBLES - the appearance of physical facilities, equipment, personnel andinformation materials

RELIABILITY - the ability to perform the service accurately and dependably


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RESPONSIVENESS - the willingness to help customers and provide a prompt service ASSURANCE - a combination of the following

Competence - having the requisite skills and knowledge Courtesy - politeness, respect, consideration and friendliness of contact staff Credibility - trustworthiness, believability and honesty of staff Security - freedom from danger, risk or doubt

EMPATHY - a combination of the following: Access (physical and social) - approachability and ease of contact Communication - keeping customers informed in a language they understand and

really listening to them

Understanding the customer - making the effort to get to know customers andtheir specific needs

Table 1: Dimensions of service quality

Dimensions Particulars

Tangibles Appearance of physical facilities, equipments, personel and written

materials.

Reliability Ability to perform the promised service dependably and accurately.

Responsiveness Willingness to help customers and provide prompt service

Assurance Employees knowledge and courtesy and their ability to inspire trust

and confidence.

empathy Caring, easy access, good communication, customer understanding and

individualized attention given to customers.

Source: Adapted from Zeithaml et al. (1990)


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In this research paper, the model used to measure the service quality of HSBC bank is

SERVQUAL model. This model used commonly in other researches to know about the status of

service quality. This model is easy to understand and simple to apply, for this reason, the model

is selected for this paper. As it is mentioned earlier, that there are five major dimensions which

are covering the total representation of service quality of designated firm or organization. In this

stage of the literature review, another description by by Brysland, A. and Curry, A. (2001) about

the five dimensions will be given to help measuring the actual quality of the delivered service.

ReliabilityWhen a service is performed very dependably and accurately, it can be said that the service is

reliable. In more broader perspective of a company, reliability means the ability of the company

to deliver as it promises to its customers, maintain service provision, problem resolution and

more importantly rational pricing for the product or services (Brysland, A. and Curry, A. 2001)

Different types of attributes can be of this service quality dimension. Among them, keeping

service promises, giving adequate attention, and offering reasonable service charges fall into the

category of reliability, one of the service quality dimensions. This service quality dimension is

dissimilar to other dimensions, as this dimension is most uniform among the customers.

ResponsivenessAccording to Brysland and Curry (2001), responsiveness is involved with the willingness of the

service provider to assist customers and to render service on time. The main ingredients of this

dimension are timeliness and attentiveness to the customers. A service provider should give time

to hear the customer query, complaints, requests and problems and take action before it is too

late to hold the customer satisfaction which ultimately may reduce the service quality. Greater

emphasis on attentiveness also need to be given, because in this dimension, the two main parts

comprising responsiveness is dependent to each other, so if one fail to perform, then other will

also not perform that well or efficiently. So to achieve greater quality in this dimension, both

timeliness and attentiveness will need to be effective and efficient.


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AssuranceThe third dimension of the service quality dimensions is Assurance. Brysland and Curry (2001),

defines assurance as the knowledge and courtesy of employees of a service provider which will

enable the employees to arouse trust and confidence in the mind of a customer. This dimension is

very important for financial services. In financial services, customer has to take high risk in

taking service and they are not certain about the outcome of the service in the future because

banking , insurance, brokering etc service are very risky in nature and has very high uncertainty

in the future outcome as well. So in this way, assurance is playing very important role in the

satisfaction of customer deriving from service quality dimension.

In this research paper, banking service is taken in consideration. In this regard, banking service is

very sensitive and confidential to its customers. So assurance is very important than other

attributes of service quality. Customer expects financial safety from a banking organization. In

the research of Brysland and Curry (2001), the respondents mentioned some attributes which are

essential in this regard, are friendliness and professionalism of the employees, feeling of safety

etc. some other major attribute of this dimension are courtesy behavior and having adequate

knowledge to understand customers need and wants.

Care and EmpathyWhen the service tailored based on the individual customer, then it may be said that the service

provider has much care to its customer. Empathy is a very customer centered dimension of

service quality. It involves personalized and /or customized service for that segment of customers

who are special and unique in terms of their need and wants (Brysland and Curry, 2001),. In

financial service, a bank need to give customized service to the corporate customers and

customer who very loyal and has good contribution to banks profitability. This dimension is

given emphasis on the customization of service process so that each valuable customer will be

more satisfied, as the service is tailored to service their individual need and wants.

Tangibles


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Finally, tangibles which consist of everything that is tangible in the premise, indoor and outdoor

facilities. These include the appearance, physical facilities, and equipments used, material used

by personnel and for communication etc. this dimension give image of the service provider. So if

the tangible convey negative image in the mind of customer, then it will ruin the service quality

and spoil the customer satisfaction. More importantly, a very new customer will evaluate a

service provider based on the tangible. So necessary attention should be given to this dimension,

otherwise customer may be lost.

There might be a contradiction of service intangibility and tangible dimension. But it is need to

be in mind, that a customer trying to make the intangible service tangible by its physical

appearance, technologies used, cleanliness of the premises, communication material etc. apart

from these attributes, respondents mentioned location advantages and feature of a product or

service will contributed to the overall customer satisfaction.

2.2.2. Service quality gapsTo give services, financial firms can not satisfy their customers always. There are a gap exist

between the perception of customer and expectation of the same customer as it is discussed in the

earlier section. In the following page, a figure showing the types of gaps which are the result of

perceptional and expectation differences. There are seven gaps found as an extension of

Parasuraman et al. (1985). In the following part, three major gaps is explained with other four

gaps as well (ASI Quality Systems, 1992; Curry, 1999; Luk and Layton, 2002). The important

gaps identified by the researcher are gap one, gap five, gap six. These gaps are more associated

with external customers and have direct relationship with customers as well. Lets have the

explanation of each gap.

Gap1: this gap exists when there is a difference between managers perception and thecustomer expectation. This gap may arise as a result of different types of inter and outer

organizational reasons. Some common elements or stimuli that may cause this gap are

lack of marketing research effort, ineffective communication in the line of management,

and having too many layers in the management.


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Gap2: when the perception of managers and the service specification both do not match,the gap two arise in the service delivery. There are many reason identified by researchers.

Among them, lack of commitment to serve customer, having perception of infeasibility,

lack of standardization in the task management and inability to use the goal setting

effectively are prioritized by researcher to eradicate (Curry, 1999).

Gap3: Due to having ambiguous role in providing service there are some conflict arises.So as result there are the third gap is sourced. It caused from the lack of suitability

between the job and the employee who perform the job. Sometime poor technology job

fit, lack of appropriate supervisory control over the subordinate. Inadequate teamwork

and perceived control are also responsible for this sort of gap production.

Gap4: Service delivery versus external communication: it happens when thecommunication among the horizontal stakeholders of the service organization are not

performed effectively. Moreover, sometime companies make over-promise which is

leading to make this gap between service delivery and external communication very

effectively.

Gap5: it is among the three important gaps which are identified by the researchers. Thisgap sourced when there is a mismatch between what customer expected and what they

perceived at time, they getting the service. It is very important in a sense that it is an

outcome of different influences exerted from customers and inabilities or negligence

from the service provider. Moreover, the customers are influenced by different types of

word of mouth, past service experiences as well. Apart from these, personal needs are

also very influential external factor to this gap to be happened.

Gap6: This gap is another important gap among these seven gaps, which should beeradicated for the betterment of the service quality. This gap produced when there is a

discrepancy between what customer expecting to service provider and what employees

of the service provider organization are perceiving. And it occurred when there is a


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difference of understanding of customer expectation by the front end employees of a

service provider organization.

Gap7: when the managers and service provider have differences in the understading ofcustomer expectation, there exists the gap seven. Though this gap is not that important

like gap one, five and six but it can have a harmful effect on the service quality and it

should be minimized.

Figure 2.2: Model of service quality gaps (Parasuraman et al., 1985; Curry, 1999; Luk and

Layton, 2002)

Brown and Bond (1995) found in their several research of service quality that this gap model of

service quality is the most heuristically valuable contribution to the research of services and it is

one of the best models used in the service quality based research. As shown in the above figure,

this gap identifies the key incongruities in providing quality service which are related to

management perception to service quality, different activities related to service delivery to

customers etc. in these seven gaps, first six gaps excluding gap five, showing the functions of the


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way in which service usually delivered to the customer. In the gap five, the main emphasis is

given on the customer and their evaluation based on the perception and expectation of them. This

is the gap which is considered to research in this study by using a very famous model of service

quality, the SERVQUAL model.

2.3. Necessity of service quality for customer satisfaction

Spathis,Charalambos; Eugenia, Petridou and Glaveli, Niki (2004), in their study on Managing

Service Quality in banks: Customers gender effects discussed the service quality of Greek

banks on the basis of their customers perceptions, and analyses how gender differences affect

customers perceptions of service quality dimensions such as effectiveness and assurance,

access, price, tangibles, service portfolio, and reliability. The study supported the hypothesis that

gender affects service quality perceptions and the relative importance attached to various

banking service quality dimensions.

Yavas,Ugur., Benkenstein,Martin., & Stuhldreier,Uwe (2004) , examined the nature of

relationships between service quality, background characteristics, and satisfaction and selected

behavioral outcomes by using retail banking in Germany as its setting. Study results shown that

service quality is at the root of customer satisfaction and is linked to such behavioral outcomes

such as word of mouth, complaint, recommending and switching. The results indicate that

tangible elements of service quality and being a female are more closely associated with positive

word of mouth and commitment. On the other hand, timeliness aspects of service delivery are

more closely related to customer satisfaction, and complaint and switching behaviors.

Alka Sharma and Versha Mehta (2004-05) found that public sector banks enjoy a better quality

perception among their customers as for public sector banks, three out of five dimensions have

scored higher than average, however, in case of private banks, only two dimensions have higherthan average values.

Joshua, A.J. & Koshi, Moli.P. (2005), observed that recognition of service quality as a

competitive weapon is relatively a recent phenomenon in the Indian Banking sector. Prior to the

liberalization era the banking sector in India was operating in a protected environment and was


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dominated by nationalized banks. Banks at that time did not feel the need to pay attention to

service quality issues and they assigned very low priority to identification and satisfaction of

customer needs.

Nalini Prava Tripathy (2006) highlighted the facts of customer preferences towards the bank. It

is the need of the hour for PSBs to inculcate marketing orientation in their work culture. The

bankers should educate their front-end staff about the need to meet the customer expectations

which alone can build the reputation and image of the bank.

Ashutosh K.Singh and Shiv K.Tripathi (2007) found in their study, that the rating of executives

and customers of the Private Bank differs with each other on dimensions like responsiveness,

competence, product range and security and agree on dimensions like reliability, accessibility,

courtesy and tangibles. Therefore, they suggested that private banks should improve

responsiveness, competence, product range and security features in their services.

Purohit, H.C. & Pathardikar, Avinash, D. (2007) covered the issues in their study which related

with the measurement of service quality and recorded responses of the bank customers about the

services of the Nationalized Banks in India. They identified key elements of strategies seen to be

adopted by leading Indian banks include building a strong presence in India and international

markets, customer-focused product innovation, financial resilience and a strong operating

environment. They stressed the need that the policy decision makers should make multi-cornered

efforts to have a new perception of quality.

Vijayakumar T. & Velu.R (2007) collected data from 325 customers of various retail banks in

their study to identify the determinants of customer satisfaction in terms of service quality,

service feature, service problems, service recovery and product used and the intention of switch

over to other banks. He found that in retail banking, core and relational features ought to be

equally weighted when managers are interested in improving customer satisfaction. In contrast,

when the focus is on reducing switching intentions, considerable emphasis should fall on core

items, ensuring successful problem recovery. In this case, the influence of relational features is

far less important.


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Seema Girdhar (2008) conducted a study regarding banking on relationship which is related to

service quality of three co-operative banks in Surat found that the perceived performance of

Prime Bank (one of the bank) is relatively close to expectations in comparison to other two

banks. They also studied the variations in service quality across demographic variables and

income of customers.

R K Mohanty (2008) observed that there are wide gaps exist between the expectations and views

of customers on one hand and products and service delivery by banks on the other hand. Also,

there exist many socio-cultural aspects quite specific and relevant from the viewpoint of

customers as well as banks. Many of these issues are either not addressed so far or to a little

extent. Customer satisfaction is not only applicable to external customers; but also equally

applicable to internal customers (i.e. employees).

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