SMM 210
Assessing Quality and Customer Satisfaction with service delivery of mobile telecommunication networks in the UK.
Dissertation
Student Number: 0847416
MBA International Business
ABSTRACTDeadline: Monday 16th August 2010
Market Research on Service Quality and Customer Satisfaction 2010
Purpose - There are a lot of service quality dimensions derived from the Service
Quality models and frameworks. The aim of this dissertation is to find out the
significance of these dimensions as perceived by the customers and compare it with
the level of service offered by the UK’s Mobile Service Providers.
Review/Methodology – A review was conducted on the relevant models and the gaps
were found using the Qualitative (Focus Group Interview) and Quantitative research
(Questionnaire) methods.
Findings – Five attributes of service quality are found to be deemed with high
importance by the customers and lacks attention from the Mobile Service Providers.
Limitations/Implications – As this research has been conducted using limited time
and resources, the Mobile Networks could conduct research specific to their market
potential and offered service level.
Keywords – Service Quality, customer satisfaction, mobile telecommunication
networks, customer expectations and SERVQUAL
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Table of contents
1. INTRODUCTION.............................................................................................5
1.1. Background of the study……………………………………………....5
1.2. Overview of Telecommunications Market……………………...…....6
1.3. The current state of telecommunication industry in the UK……….6
1.4. Problem Identification & Purpose of the Study……………………..8
1.5. Research Questions……………………………………………………9
1.6. Research Objectives…………………………………………………...9
1.7. Significance and Limitations of this dissertation……………………10
2. LITERATURE
REVIEW.................................................................................11
2.1. Purpose of Literature review………………………………………….11
2.2. Customer Psychology………………………………………………….11
2.3. Role of Customer Satisfaction………………………………………...12
2.4. Measuring Customer Satisfaction…………………………………….13
2.5. Customer Satisfaction Indices (CSI)……………………………………..13
2.6. Disconfirmation Models………………………………………………..15
2.7. Service Quality………………………………………………………….16
2.8. Relationship between Service Quality and Customer Satisfaction…18
2.9. Service Quality Dimensions……………………………………………19
2.10. Service Quality Models…………………………………………………19
2.11. SERVQUAL…………………………………………………………….20
2.12. Gronroos’ Model of SERVQUAL……………………………………..23
2.13. Addressing the Research Questions…………………………………...24
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3. RESEARCH METHODOLOGY.................................................................26
3.1. Research Purpose ……………………………………………………...26
3.2. Research Philosophy…………………………………………………...26
3.3. Research Approach……………………………………………………27
3.4. Research Method ………………………………………………………27
3.5. Operationalisation of Concepts………………………………………….30
3.5.1. Minnesota Customer Satisfaction Index (MnCSI)…………..30
3.5.2. Defining Hypothesis…………………………………………....32
3.5.3. Disconfirmation Models……………………………………….33
3.5.4. Over-all Satisfaction…………………………………………...33
3.5.5. Procedures to test Hypotheses………………………………..34
3.6. Sample Selection and Data Collection………………………………..37
3.7. Reliability………………………………………………………………38
3.8. Validity…………………………………………………………………39
4. DATA ANALYSIS AND DISCUSSION………………………………….41
4.1. Introduction……………………………………………………………41
4.2. Demographic profile…………………………………………………..41
4.3. Assessing Customer Satisfaction with the Service Quality…………41
4.3.1. Results of Minnesota Customer Satisfaction Index…………42
4.3.2. Results of Disconfirmation Models and Over-all
Customer Satisfaction Measure……………………………...43
4.3.2.1. Irrespective of cellular network……………………...43
4.3.2.2. With respect to cellular networks…………………....47
4.4. Customer satisfaction with each service quality dimension………..57
5. SUMMARY AND CONCLUSION.............................................................65
6. BIBLIOGRAPHY........................................................................................69
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1. INTRODUCTION
1.1 Background to the study:
During the last few years, the Telecom industry has experienced an enormous
growth across the world and there has been a rapid growth in the wireless technology
(Bharat Book Bureau, 2008). According to an industry market study, by 2013 the
telecommunications industry is anticipated to attain revenue of $2.7 trillion with an
average growth rate of 10.3 percent an year (Bharat Book Bureau, 2008). In the
present dynamic and interactive market place, the organisations are proposing various
strategic methods to achieve effective Customer Satisfaction (CS) strategy decisions
and eventually increase the CS success rates to sustain long term relationship with the
profitable customers (Chien and Su, 2003; Gronroos, 1994). “Loyal customers are
reported to have higher customer retention rates, commit a higher share of their
category spending to the firm, and are more likely to recommend others to become
customers of the firm.” (Keiningham et al., 2007, p. 362). Hence the organisations are
becoming more customer centric, giving more importance to retaining old customer as
the business would end up spending an approximate of five times more in attracting
new customers than retaining the existing customers in terms of time, money and
resources (Reichheld, 1996; Pizam and Ellis, 1999).
As the growth of the organisation and its survival in the market is driven by
customer loyalty and customer retention, each of these companies is continually
improving on their service quality standards to survive in this highly competitive
market (Keiningham et al., 2007). Hence, in order to maintain these service quality
standards, organisations frequently adopt new measures to check if the customers are
satisfied with the service quality provided. For e.g. by conducting customer surveys
and analysing the acquired data statistically, which would help them make the right
decision to increase customer satisfaction and eventually customer loyalty among
their customers (SPSS White Paper, 1996). Organisations adopt both quantitative and
qualitative methodologies to evaluate CS and the data obtained from these measures
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provide constructive feedback to help the organisation know the satisfactory level of
its customers with its products, which would help the organisation to: i) take reliable
steps to improve the quality of service, ii) adding more value to its customers and iii)
achieving high customer satisfaction rates (Amaratunga et al., 2002).
1.2 Overview of the UK Telecommunications Market:
Telecommunications is one of the best growing sectors of the UK economy.
The competition developed strongly in 1984 after the privatisation of British Telecom
(BT) and as of 2004, the UK had an approximate of 170 fixed telecommunications
provider and 59 mobile service providers (CWU research, 2004). The market for fixed
telephone network has been declining since the evolution of mobile / cellular phone
networks and in 2003 due to flat call volumes and pricing competition, it fell by
£400m (CWU research, 2004). Eventually, the consumers preferred the cellular phone
networks as the mode of communication which was faster and easier than the fixed
telephones (CWU research, 2004).
According to the UK Mobile Operator Subscriber Data, Statistics and Market
Share 2006 - 2008, there are five primary cellular network operators in the UK:
Vodafone, Telefonica O2, T-Mobile, Orange and 3 UK and it was reported to have
73.1 million cellular service subscribers in the last quarter of 2007, which represents
almost 9% of the total European mobile subscriber market and another statistical
report from IE market research Corp reveals that the wireless market is anticipated to
achieve 126% by 2010 and gradually the total subscribers would also reach 78 million
by 2010 (Telecoms Market Research, 2008).
1.3 The current state of telecommunication industry in the UK:
Today, the telecommunication industry has undergone a rapid transformation
creating a lot of new challenges for infrastructure and service providers. The rapid
advances in technology and increased market turbulences have added a lot of value to
the telecom industry (Lia and Whalley, 2002).
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Recently T-Mobile and Orange merged becoming a giant in the telecom
industry having 28.4 million customers and now they are the largest cellular service
provider in the UK with an approximate of 37% of the entire mobile market (BBC
News, 2009; The Register, 2010).
The 3G network is up to 40 times faster in data than the 2g or the GSM
networks. This high connection speed adds on more features such as sending Pictures,
MMS (Multimedia Messaging Service) or video clips and also promotes high quality
sound (Robins, 2003).
However this rapid growing mobile market is expected to face capacity-crunch
i.e. due to the increasing existence of several MVNOs (Mobile Virtual Network
Operators), the mobile data traffic has gradually increased 200% in 2009 and
according to the reports of Ofcom, few service providers such as O2 are about to hit
that capacity (Xln Business Community, 2010). Hence, this capacity-crunch may
bring down the quality of service delivery necessitating the network operators to take
precautions in order to maintain their service delivery standards.
The market share of mobile telecom industry in the UK as of September 2009:
Fig 1.3a Market Share of Mobile telecom industry in the UK
(Source: Guardian News, 2009)
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The Fig 1.3a indicates that, as of September 2009, T-Mobile / Orange had
37% of market share being the highest, followed by O2 with 28%, Vodafone with
23% and 3-mobile with the least at 5.8%.
The total number of subscribers for the UK’s mobile telecom industry as on
September 2009:
Fig 1.3b Number of subscribers for the UK’s mobile telecom industry
(Source: Guardian News, 2009)
The Fig 1.3b indicates that, as of September 2009, T-Mobile / Orange had
28.4 million customers being the highest followed by O2 having 21.5 million
customer, Vodafone with 17.7 million customers and 3-mobile having the least at 4.5
million customers.
1.4 Problem Identification & Purpose of the Study:
Though majority of the customers for UK mobile telecommunication networks
use all of their mobile services like text, data and mobile internet services, they are
dissatisfied with the service-availability and it’s quality; especially the network
coverage is a crucial concern to all of its consumers. (Telecom paper, 2009) Due to
the existence of several MVNOs, customers switch to different service providers
frequently and they are also concerned about the self-regulatory schemes by their
network providers (Telecom paper, 2009).
Customers are known to have reported that there is no network clarity and
coverage. They are not being told if they would have network coverage in their area
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before they could sign a contract with the company and they are unhappy with the
after sales service that is being provided to them (Poulter, 2009). “A study on 5,000
people revealed the telecom giants are nearly twice as bad at dealing with issues and
complaints compared with their successors British Gas.” (Xln Business Community,
2009). The customers don’t get reliability and assurance in the services they are being
offered, as they have to go through a sequence of inconsistencies such as waiting in
long queues to speak to representative, incompetent employees who do not understand
the correct issue that is being faced and bear with their rude behaviour at times (Xln
Business Community, 2009). These situations create a bad impression in the
customer’s mind and lead them to change the service provider. Also, this word of
mouth communication can spoil the image or reputation of the company.
Hence the main research aim of this study would be: To measure and critically
analyse the level of customer satisfaction with regards to service delivery among
different mobile service providers (Mobile Telecommunication Networks) within the
UK.
1.5 Research Questions:
How the customers’ satisfaction with the service quality is described in the UK’s
MTNs with and without respect to the customer’s service providers?
Which attributes of service quality do the customers perceive to be of more
importance that lacks attention from the service providers in the UK?
1.6 Research Objectives:
To find out the level of customers’ satisfaction with the service quality offered to
them by the UK’s MTNs with and without respect to which network customers
subscribe to.
To find out which dimensions of service quality are the customers
satisfied/dissatisfied with in the UK’s MTNs.
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To identify the Service Quality dimensions that the customers perceive to be of high
importance in the UK’s MTNs.
1.7 Significance and Limitations of this dissertation:
This study is significant in various ways to business consultants and business
partners. The results and findings of this study would be helpful to the management of
UK’s cellular service providers, as it provides a reliable scientific measure to evaluate
customer satisfaction level with the services delivered by them. It will reveal the
dimensions of service quality which are considered more important from the
customer’s perspective, which would provide them with a priceless empirical support
to make right strategic decisions in the required areas of operations and over-all it
would act as reliable guide to improve their service delivery standards and create
customer-value. This dissertation would provide enormous valuable information to
business partners such as share-holders and investors which would help them provide
useful suggestions to their respective mobile service providers to improve their
service delivery standards. The dissertation enables the customers to analyze the
ratings of the various dimensions with respect to the service providers so that bringing
in awareness among customers.
The limitations of this dissertation are that, the research would not have access to
every locality in the UK and as the research is mostly done in the city of London. But
London, being a cosmopolitan city, gives us a gist of UK and a right place to conduct
the research. It doesn’t allow us to conduct the analysis on large samples, which is a
prerequisite to have more reliability on surveys (Saunders et al., 2007). But, as the
MTNs are a public service and have millions of users, the samples are obtained from a
much diversified respondents to obtain the best possible results.
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2. LITERATURE REVIEW
2.1 Purpose of Literature review:
The literature review aims at critically exploring the existing knowledge and
theories that are relevant to the research objectives, so that we can develop and refine
the key areas of our research (Saunders et al, 2007). To generate and refine the
research ideas the ‘Relevance Tree’ technique is used in this review of literature i.e. a
broad concept is studied from the view of various authors via which a new sub-
concept is developed and as we proceed deep into the subject new ideas are
formulated (Saunders et al, 2007). The customer satisfaction is measured through the
service quality dimensions defined for that particular product or service. These
dimensions are based on different models created by academics which I critically
analyse in the literature and adopt those that best suit the aim of this dissertation.
2.2 Customer Psychology:
A ‘Customer’ is usually the final user of any product where the purpose of it
being made gets fulfilled (Hayes, 1997). Understanding the psychology of customers
plays a very important role in determining their satisfaction over a product or service.
This includes designing a product according to the needs of the customer. The
satisfaction of a customer starts well before manufacturing the product rather than the
moment after sale. During the service encounters the customers’ values, perceptions,
beliefs and expectations motivate them to choose one service provider rather than
another (Lynch, 1992; Pizam and Ellis, 1999).
At any point of sale, there are four options available for the customer to
choose: Purchase – where the customer is convinced to buy a product or service,
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Rejection – where the customer rejects the offer, Postponement – where the customer
is partly convinced and postpones the offer to think at a later date and substitution –
where the customer compares the product with other contemporary offers. Hence
influencing the customer’s choice to purchase a product is very crucial (Lynch, 1992;
Pizam and Ellis, 1999). Therefore, it is very essential for us to know the customer
expectations and their requirements, to understand customer’s view and perspective
about the quality of services and products they need (Pizam and Ellis, 1999).
2.3 Role of Customer Satisfaction:
Customer Satisfaction (CS) is said to be the customer’s post-purchase
evaluation of services or a product. When the CS level of an organisation is high,
even the market share and profits of the organisation grow higher leading the
company to a stronger competitive position in the market place (Turkyilmaz and
Ozkan, 2007). The customer satisfaction is built on the varied experiences, positive
and negative that the customer has come across at different points of time (Satari,
2007).
The impact of customer care in service quality system would maximize profits
and help the organisations grow by providing customer satisfaction and building great
customer experiences. Customer care is therefore a key to gain the competitive
advantage among the competitors (Lynch, 1992).
“Satisfaction of customers also happens to be the cheapest means of
promotion and therefore, customer satisfaction is recognized as of great importance to
all commercial firms because of its influence on repeat purchases and word-of mouth
recommendations.” (Pizam and Ellis, 1999, p. 326). Hence, it becomes important for
the organisation to offer customers a good experience that exceeds their expectation
and if the customers have bad experiences, then the reputation of the company
reduces rapidly due to word-of-mouth communication.
Satisfaction of customers over a telecommunication product can be two
dimensional: i) It can be component specific – i.e. service specific, over the MMS
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services, 3G services, speed etc. and ii) It can be product specific – satisfaction on the
overall performance and responsiveness of the mobile service provider (Cronin and
Taylor, 1992). These dimensions require us to measure the satisfaction level of the
customers in different particular components as well as on the whole.
2.4 Measuring Customer Satisfaction:
In order to take managerial decisions, the CS needs to be measured in an
organisation and this Customer Satisfaction Measurement (CSM) is used to determine
the customer satisfaction level based on the valuable feedback from the customers and
identifying the customer expectations (Crosby, 1991). The service quality can be
achieved only by knowing the customer’s total needs or customer expectations and
with the help of this data, the service standards and processes may be altered to
achieve customer satisfaction (Crosby, 1991).
After in depth research on CSM, nine distinct theories were developed such
as: Expectancy disconfirmation (Parasuraman et al, 1988), Assimilation contrast,
Comparison level (Gronroos, 2001), Value precept (Zeithaml, 1988), Cognitive
dissonance, Equity, Generalised negativity, Contrast and Attribution (Kauppinen et
al., 2007). Most of these theories were based on cognitive psychology, but they were
developed with no empirical research. However, among these, only two of them were
widely accepted i.e. the expectancy disconfirmation theory and customer satisfaction
indices (Pizam and Ellis, 1999) because all the theories mentioned above use these
two models as a common base (Parasuraman et al, 1988; Gronroos, 2001; Zeithaml,
1988; Kauppinen et al., 2007). Therefore, we would review the customer satisfaction
indices and disconfirmation models which would form the crux of this study.
2.5 Customer Satisfaction Indices (CSI):
This model focuses more on customer’s overall satisfaction with a product or
the services offered to them till date and it is based on a cumulative view of
satisfaction (Turkyilmaz and Ozkan, 2007). “The CSI model is a structural model
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based on the assumptions that customer satisfaction is caused by some factors such as
perceived quality (PQ), perceived value (PV), expectations of customers, and image
of a firm.” (Turkyilmaz and Ozkan, 2007, p. 673). It is equally important to
understand the customer perceived value and their expectations to attain high degree
of customer satisfaction.
The Swedish Customer Satisfaction Barometer (SCSB) is reported to be the
first national customer satisfaction index (NCSI) which was developed in 1989, then
the model was followed by the Germans, they named it as German Customer
Barometer (Fornell, 1992).
The Americans adapted this model in 1993, it was developed by Claes Fornell,
who was the founder of SCSB and they named it as the American Customer
Satisfaction Index (ACSI). The ACSI is a cause and effect model using the responses
from the respondents to form a ‘Multi-Equation Econometric’ model. The responses
were collected according to different variables in a 0-100 scale (Turkyilmaz and
Ozkan, 2007; Fornell, 1992). The European Organisation for Quality (EOQ) and
European Foundation for Quality Management (EFQM) jointly developed the
European Customer Satisfaction Index (ECSI) in 1999. Then gradually many other
countries followed the CSI model (Turkyilmaz and Ozkan, 2007). The ECSI model
included the ‘Corporate Image’ as a component on top of the ASCI model. But, these
indices do not measure the CS levels for specific components and overall CS together
(Turkyilmaz and Ozkan, 2007).
The Workforce Centre developed the Minnesota Customer Satisfaction Index
(MnCSI). The MnCSI model is specifically used to evaluate over-all customer
satisfaction with service delivery of the MTNs on a single scale (Positively
Minnesota, 2007). This model uses the variables of disconfirmation models: both
desire disconfirmation as well as expectation disconfirmation and it combines three
questions which includes the disconfirmation models also (As discussed earlier
disconfirmation models are the second CSM tool which was widely accepted) It also
gets more stable when there are three questions instead of one. In addition, it is
comparatively flexible and best suited for any number of responses (Positively
Minnesota, 2007).
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2.6 Disconfirmation Models:
According to Parasuraman et al. (1988), customer expectations are one of the
most important factors of CS, as they play a major role of ascertaining customer
satisfaction. Even the SERVQUAL model uses the disconfirmation model as its base
and it is basically used for conceptualizing service quality (Parasuraman et al., 1988).
The disconfirmation model was tested and confirmed in a lot of studies conducted
across the world and there are two different types of disconfirmation models - Desire-
Disconfirmation model and Expectancy disconfirmation model (Pizam and Ellis,
1999; Parasuraman et al., 1988). The expectancy disconfirmation model states that
quality is assessed by comparing perceived and expected performance i.e. to examine
if the customer expectations were met during the service delivery process (Oliver and
DeSarbo, 1988; Kang and James, 2004).
According to Oliver (1980), the expectancy disconfirmation model has got
two internal attributes, which are known as positive disconfirmation and negative
disconfirmation. If the performance of the product or service exceeds the customer
expectations and when the customer is highly satisfied with the product or service
delivered, then it is called as value disconfirmation. However, if the customer’s
expectations are met and he/she is satisfied with the product or services offered, then
it is positive disconfirmation and finally if the product or service perceived is below
his/her expectations, then it is called negative disconfirmation (Oliver, 1980). This
theory focuses more on the antecedents of satisfaction, which occurs at the initial
stages of the service-delivery process (Oliver, 1980; Oliver and DeSarbo, 1988; Kang
and James, 2004).
Recently Khalifa and Liu (2002) built a theory that embedded both desire as
well as expectancy disconfirmation theory. They have proved that both these factors
impact the over-all customer satisfaction, as they both are of cognitive standards and
it is hard to evaluate which one of these factors explains CS better.
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2.7 Service Quality:
Service Quality means the service that meets all the customers’ expectation
and satisfies their needs and requirements or it is defined as “a consumer’s judgment
about an entity’s overall excellence or superiority.” (Kang and James, 2004, p. 267)
This term is purely customer oriented. Hence excellence in service requires an
understanding of customer needs and expectation (Edvardsson, 1998).
As there was an enormous growth in mobile telecommunications market in the
last few years, the customers are more conscious about the quality of services being
offered to them (Kumar and Lim, 2008). According to Kumar and Lim (2008), the
service quality in MTNs can be perceived through the technical as well as the
functional attributes of mobile services in which the technical attributes include the
pricing/tariff plan, the network quality & data services and the functional attributes
include the customer service quality and the billing system. “Overall perceptions of
service quality are formed by a consumer’s evaluation of multiple quality
dimensions.” (Kumar and Lim, 2008, p. 569). Hence in order to enhance the
customer’s perceived value and their satisfaction level, it is important for the
organisations to create positive perceptions of service quality among its customers
(Kumar and Lim, 2008).
Service quality enhances the organisation’s operational efficiency as well as
improving the retention rate of its firm (Edvardsson, 1998). The customers assess the
product quality in various tangible ways such as its colour, style and feel. But in most
of the cases only few of these tangibles exist and meet the customers’ expectation
(Parasuraman et al., 1985).
According to Parasuraman et al. (1985), as the services being intangible in
nature, most of it cannot be measured and their heterogeneous nature makes them
vary from time to time and customer to customer. Hence because of these natures, it
becomes hard to evaluate the service quality of an organisation.
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Gronroos (2001) introduced the concept of Consumer Perceived Quality
(CPQ), which evaluates to what extent the service delivered, meets the customer’s
expectation. It compares the consumer’s expectations and the customer’s perception
of service received. According to this theory, over-all satisfaction of the customer
with the organisation is based on every encounter or experience he had with that
organisation. Hence they claim that service quality and customer satisfaction are
distinct conceptually but they are closely related constructs (Kang and James, 2004;
Sureshchandar et al., 2002). A recent study has proved that “the CPQ influences
profitability directly as well as indirectly through market share.” (Crosby, 1991, p. 6).
Hence it is equally important to take CPQ under consideration for this research.
According to Parasuraman et al. (1988), the long term and global evaluation of
a service is related to the service quality perceived by the customers and the customer
satisfaction can be obtained by evaluating specific service transactions and they have
also clearly pointed out that the customer experience with the provided service,
influence the perceptions of service quality. Hence, it could be said that both service
quality and CS are closely related terms.
2.8 Relationship between Service Quality and Customer Satisfaction:
The relationship between service quality and customer satisfaction has gained
a lot of attention in the last few years and they are considered to be the two core
components that frame a crux of the marketing theories (Sureshchandar et al, 2002).
In the current competitive market, the companies can sustain its competitive
advantage by providing service quality of higher standards, which would result in
satisfied customers (Sureshchandar et al, 2002).
Customers are one of the important assets of an organisation as they are the
only ones who keep the business running. As it was already discussed earlier that
retaining existing customers is more essential than generating new ones, it is
important to have service quality in every stroke to build a long term relationship with
the customers, which adds more value to the consumers as well as the company
(Nguyen et al, 2007). Based on the quality of service delivered, is the consumer’s
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commitment to renew/continue our service consistently in the future (Nguyen et al,
2007).
Figure 2.8: Five critical factors of customer perceived service quality
Source: (Sureshchandar et al., 2002)
The figure 2.8 indicates the five critical factors of customer perceived service
quality, in which the core services refer to the content of the services i.e. the different
features offered in a service. The human element of services refers to the empathy,
assurance, reliability and responsiveness i.e. includes the factors that affect the human
behaviour. Standardisation of services refers to the systematizing and simplifying the
systems, processes and the procedures. The tangibles refer to the physical facilities
available, equipments and the appearance of their workers and finally the social
responsibility refers to encouraging ethical behaviour in every aspect, which would
improve the image of the company and also promote customer loyalty and overall
customer satisfaction (Sureshchandar et al., 2002).
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2.9 Service Quality Dimensions:
According to Johnston (1995), it is crucial to identify the determinants of
service quality before we proceed with the service research. Hence this becomes a
central concern, as it is necessary to find out the determinants of service quality to
define measures and control customer perceived service quality.
In 1980s, Parasuraman et al. (1985, 1988, 1994) developed the SERVQUAL
model to determine what service quality meant to the consumers, followed by the
measures they developed strategies to meet customer’s expectations. It is considered
to be the most popular instrument, which is widely used by many researchers and
practitioners to measure service quality (Sureshchandar et al., 2002).
2.10 Service Quality Models:
Many models were developed to capture the quality of service at different
points of time to suit different business objectives (Nitin et al, 2005). The earliest ones
were that of Gronroos’, (1984) ‘Technical and Functional Quality Model’ where the
perceived quality was compared with the Expected Service with reference to the
Functional and Technical dimensions. The next popular model was Parasuraman et
al.’s (1985) GAP model. This model analysed the gaps between the customers’
expected and perceived service forming a base for the SERVQUAL model with
several dimensions like Tangibles, Reliability etc. However, the SERVQUAL model
has been subjected to a lot of criticisms and there have been many scholars who had
tried to modify or restructure this model conceptually (Kang and James, 2004). The
next model designed by Haywood (1998) called as ‘Attribute ServQual Model’
incorporated 3 attributes: ‘Physical facilities and process’, ‘People’s Behaviour’ and
‘Professional Judgement’ into the SERVQUAL components. Haywood (1998) also
said that all the three attributes needs to have a balance and if not leads to fall in
quality. The ‘Synthesized ServQual Model’ by Brogwicz et al. (1990) explained the
importance of the customer’s perception of the brand and image before even the
product launched. This model added up the ‘Company Image’ component and its
elements to the SERVQUAL model.
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Meanwhile, Cronin and Taylor (1992) developed ‘SERVPERF’, the
‘Performance Only Model’ which states that the consumers’ perceptions on the brand
actually predict the service quality and the perception index is a worthy indicator of
the Service Quality. It also criticises that the SERVQUAL model mixes satisfaction
with perception. But the perception cannot always be a proper service quality
indicator because perceptions do change with time, and the organisation that provide
unmatched service excellence always lead even when started with comparatively
lesser brand awareness and marketing system. The Mattson’s (1992) ‘Ideal Value
Model’ calculates the Service Quality in comparison with the Ideal Industry Standard
rather than the Customers’ perceptions. This model may strive to provide the best
service in line with the technological capability but the innovation may not be
focussed on the customer’s requirements. The ‘IT Alignment Model’ (Berkley and
Gupta, 1994) introduced Information Technology for improving the service quality.
Meanwhile, Dabholkar (1996) introduced the ‘Attribute and Overall Affect Model’
which examines the technology used self service options to minimize labour costs.
The PCP Attribute (Philip and Hazzlet, 1997) egg prioritized the dimensions as
Pivotal, Core and Peripheral. Oh (1999) depicted the importance of Customer Value.
Frost and Kumar (2000) proposed the ‘Internal Service Quality’ dimensions based on
the GAP model for the Internal Customers of the organisation. In the ‘Internal Service
Quality DEA model’ (Soteriou and Starvinide, 2000), the Data Envelope Analysis
maps the depreciation in service quality from the client base to branches. Santos’
(2003) ‘e-Service Quality’ is developed on the antecedents of service quality using e-
commerce.
2.11 SERVQUAL:
SERVQUAL is a multiple item scale developed to measure the Service quality
and this instrument illuminates the different dimensions of customer’s perception and
helps assessing the service quality (Parasuraman et al., 1985, 1988).
It has illuminated five dimensions via which customers perceive and assess service
quality of the organisation and each dimension has a sub-set called ‘items’ via which
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the dimensions are being measured (Parasuraman et al., 1988). The five dimensions
are:
1. Tangibles: This includes the physical facilities available, equipments and the
appearance of their workers.
2. Assurance: This includes the courteous nature and the product knowledge of
the employees and also if they are confident and trust worthy.
3. Responsiveness: Providing quick service and their willingness to help the
customers.
4. Empathy: Caring for the customers with more individualised attention.
5. Reliability: Providing accurate service and performing the promised
commitments (Parasuraman et al., 1988).
The required data is collected via structured questionnaire or surveys from a
sample of customers in which many questions are formulated based on the key service
quality dimensions (Parasuraman et al., 1988, 1994). Before reviewing other models
based on SERVQUAL, it is better to look into the advantages and disadvantages of
SERVQUAL.
Advantages and Disadvantages of SERVQUAL:
SERVQUAL has overlooked at some of the important factors of service
quality such as the social responsibility of the organisation, core service and
standardisation of service delivery and there is also a general agreement towards the
22 items scale, that they are reasonably good predictors of service quality
(Sureshchandar et al., 2002). Most of the research models till date have used
SERVQUAL as its base for development (Sureshchandar et al., 2002).
The SERVQUAL model has also been severely criticized in many cases. The
contents of the service quality dimensions obtained from the SERVQUAL model has
not been accepted by everyone, as service quality is generally viewed as a multi-
dimensional construct and it focuses mainly on the service delivery aspects and there
are many additional factors also to be considered for e.g. Considering only the
functional attributes to predict customer’s behaviour may have low predictive
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validity, the semantic differences are not being withstanded in each dimension, etc.
(Kang and James, 2004; Sureshchandar et al., 2002). The criticisms also include “the
use of difference scores, dimensionality, applicability and the lack of validity of the
model, especially with respect to the dependence or independence of the five main
variables” (Kang and James, 2004, p. 267). Hence considering all these criticisms that
SERVQUAL is renowned for its widespread use by other researchers and scholars
and it also has got lot of disadvantages it is advisable to look into other models based
on SERVQUAL.
In 1992, Cronin and Taylor developed the Performance only model, which
they called it SERVPERF. It states that service quality can only be assessed by
perceptions and it is not necessary to measure expectations (Cronin and Taylor, 1992).
The author views service quality as a link between purchase intentions and customer
satisfaction and they challenged the SERVQUAL framework by Parasuraman et al.
(1985), that perceptions are the only predictors of service quality where as
SERVQUAL model confuses consumer satisfaction with attitude of the consumers
(Cronin and Taylor, 1992).
Similarly, Brogowicz et al. (1990) argued that there are many chances for the
service quality gap to occur well before the customer experiences the service, as the
customer may learn through various ways such as word-of-mouth communication and
advertisements. It integrates the traditional managerial framework to the service
quality which comprises of three factors: image, traditional marketing activities and
external influences and the model was called synthesized model of service quality
(Brogowicz et al., 1990).
Another study by Haywood-Farmer (1988) suggests that the attributes has to
be separated into three groups: professional judgement, processes & facilities and
consumer’s behaviour and each of the attributes comprises of various factors. It also
states that all the three groups must be given equal importance, in case if any one of
the attribute is given more importance than others, then it may lead to a disaster
(Haywood-Farmer, 1988).
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Similarly, Parasuraman et al. (1985) had stated that service quality cannot be
assessed only with service outcomes but even the service delivery process needs to be
evaluated, the SERVQUAL is composed of only functional dimension of service
quality and they lack technical dimension and corporate image. Both these dimensions
are inter correlated.
The attributes of functional quality refers to the American perspective of
service quality but however according to the European perspective, the service quality
needs two more attributes in addition, which are technical quality and the corporate
image (Kang and James, 2004). The Gronroos SERVQUAL model includes all the
three attributes i.e. necessary from the European perspective. Moreover, the
Gronroos’ ServQual model was used in an empirical research in the
telecommunications field, which had proved that Gronroos model is more appropriate
to represent service quality in telecommunications industry (Kang and James, 2004).
2.12 Gronroos’ Model of SERVQUAL:
It is a multi dimensional model. According to this model there are two service
quality dimensions, firstly the technical aspect (what kind of service is provided) and
the functional aspect (how is the service being provided).They introduced the
corporate image concept, as one of the other important element in the perceived
service-quality model, as the customers would bring their perceptions and past
experiences with the firm in each encounter with the organisation (Kang and James,
2004). If a positive image about the firm is created in the mind of a customer, then
they wouldn’t bother much about the minor mistakes that happens and in case there is
a negative image about the firm, then the mistakes would be magnified in their mind
(Gronroos, 1994; Kang and James, 2004).
In the mobile telecommunications industry the customers look for both – How
they are being served (functional dimension) as well as the nature of services and
service outcomes which constitute the technical dimension (Kang and James, 2004).
Hence these three dimensions (technical dimension, functional dimension and
corporate image) are considered the most important.
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2.13 Addressing the Research Questions
As discussed earlier in the ‘current state of telecommunication industry in the
UK’ and ‘Problem Identification’ in the introduction (section 1.3 and 1.4), the
network operators are likely to face capacity crunch which induces network coverage
and clarity issues. This in turn shall reduce the service quality standards to a new low.
Moreover, even the reliability, assurance and responsiveness factors are not addressed
with proper concern increasing the customer’s switching intention.
At this juncture it is important to know the service quality dimensions valued
more by the customers and to give more attention towards those in order to achieve
positive customer service experience. These problems led to the main research
objectives specified. Based on the reviewed literature the research objectives can be
obtained using the following theoretical models which has been justified in this
chapter:
i) The MnCSI model, Disconfirmation models (both desire and expectation) and
over-all satisfaction measure is used to assess and describe the level of customers’
satisfaction with the service quality offered to them by the UK’s MTNs with and
without respect to which network customers subscribe to.
ii) The expectation disconfirmation model is used in order to find which dimensions of service quality the customers are satisfied or dissatisfied with in the UK’s MTNs.
iii) The Gronroos’ Servqual model is used to identify the service quality dimensions that the customers perceive to be of high importance in the UK’s MTNs.
The research question one: ‘How the customers’ satisfaction with the service
quality is described in the UK’s MTNs with and without respect to the customer’s
service providers?’ is answered by critically analysing the results obtained from the
first research objective and the research question two: ‘Which attributes of service
quality do the customers perceive to be of more importance and lacks attention from
the service providers in the UK?’ is answered by critically analysing the results
obtained from objectives two and three.
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3. RESEARCH METHODOLOGY
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3.1 Research Purpose:
According to Saunders et al. (2007), research is a systematic or a step by step
procedure to increase the knowledge of a new or an existing subject. The purpose of
this research is to key out the main service quality dimensions/attributes as perceived
by the customers and find out how satisfied they are with these attributes and also to
explore the reasons for their the intention to change their service providers (Saunders
et al., 2007).
3.2 Research Philosophy:
Research philosophy brings up different philosophical assumptions and beliefs that
would support this research and help us selecting the appropriate research strategy and
phenomenon. It has two core traditions: ‘Positivism’ and ‘phenomenological approach’
(Saunders et al., 2007). Positivism deals with the fundamental laws perceived by us and
their scientific explanations. ‘Phenomenological’ helps in trying to understand a
particular phenomenon (Saunders et al., 2007). The three main characteristics of
positivism are:
The explanations and knowledge attained in this method are similar to that of
natural science.
The ‘hypothetico deductive methodology’ which is followed by positivism is
same as natural science.
It treats its’ subject matter (i.e. mobile telecom networks in UK, in this study) just
like how a natural scientist would treat the world (of natural forces/things)
(Saunders et al., 2007).
Hence, it implies that positivism deals with observable social reality. So, this research is
built on this approach as it involves customer perceptions and identifying relationships
through different theoretical frameworks.
3.3 Research Approach:
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According to Saunders et al., (2007), there are two broad methods of reasoning:
deductive approach and inductive approach. The deductive approach is based on the top-
down approach mode where a theory is developed and subjected to more observation
after hypothesis as shown in the fig 4.3. It works from more general to specific reasoning
(Saunders et al., 2007). Conversely, the inductive approach is based on the bottom-up
approach model i.e. the theory is developed based on the data collected during research.
However, the deductive approach is also said to have degrees of uncertainty (Saunders et
al., 2007) and moreover, as this research is based on theoretical considerations, our
research employs the deductive approach.
Fig 3.3: Deductive Approach
3.4 Research Method:
There are two different groups of research methods: ‘quantitative’ and
‘qualitative’. In quantitative analysis, we obtain statistical data that represents the
concepts empirically. This data is further measured using the quantitative statistical
methods which links the data to concepts (Neuman, 2006). On the other hand,
qualitative analysis explains the social phenomena which involve interviews and
observations from real life situations (Saunders et al., 2007) and the data here includes
written/spoken words, physical objects, sounds or visual images measured
simultaneously while collecting the data (Neuman, 2006).
This research uses both quantitative as well as qualitative methods to get
accurate results. The quantitative measurement uses the following models as justified
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THEORY
HYPOTHESIS
OBSERVATION
CONFIRMATION
Market Research on Service Quality and Customer Satisfaction 2010
in the literature review: Gronroos’ SERVQUAL model (Gronroos, 1994) to evaluate
CS with the Service Quality dimensions (functional dimensions, Technical dimension
and Corporate Image); ‘Disconfirmation models’ to analyse and evaluate customer’s
desires and expectations both with and without respect to their service provider
(Oliver 1980; Parasuraman et al., 1988) and the MnCSI model to evaluate the over-all
customer satisfaction with service delivery of the UK’s MTNs with and without
respect to which Mobile Telecom Network customers subscribe to (Positively
Minnesota, 2007).
According to Neuman (2006, pg. 412), “Researchers often combine focus group
with quantitative research, and the procedure has its own specific strengths and
weaknesses”. The strengths are: the lively setting that allows respondents to express
their opinions or ideas freely and interpretation of ideas is facilitated (Neuman, 2006).
This helps in bridging rich ideas and data in a continuing and interactive manner via
which we could have a better understanding of the subject in a bigger view and these
strengths overwrites the weaknesses which are: ‘polarization effect’ and limitation in
the number of topics discussed in a session (Neuman, 2006). Hence focus group
interview is the chosen Qualitative method as the research also includes quantitative
measurement. The focus group interview uses the Delphi technique to refine the
research ideas. This process involves employing a group of people who can contribute
some more value to the research idea (Saunders et al., 2007). The members of the
group were initially briefed about the research idea and were asked to suggest other
important elements to measure the service quality. According to respondents, among
these attributes they consider the balance between quality and cost as the most
important. It was then derived as another dimension to the Gronroos SERVQUAL
model called as ‘Value for Money (VFM)’. This focus group interview lasted for 60
minutes and the details of which is described in Appendix-A.
All the Service Quality Dimensions and its items (variables) used are listed in
table 3.4. Each dimension is represented with indicators as shown in the table below.
For e.g., Tangibles is TN, Reliability is RE, etc. A set of 3 items were added for every
dimension based on its properties except VFM which has 2 items. The items/variables
under each dimension are defined in the Appendix-H.
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Table 3.4: Service Quality dimensions and its comprising items
No. of
Items
Service Quality Dimensions No. of
Items
Service Quality Dimensions
3 TANGIBLES (TN) 3 ASSURANCE (AR)
3 RELIABILITY (RE) 3 TECHNICAL QUALITY (TQ)
3 RESPONSIVENESS (RP) 3 CORPORATE IMAGE (CI)
3 EMPATHY (EP) 2 VFM (Value for Money) (VM)
According to Neuman (2006), structured questionnaire is the most viable option
for quantitative measurement to get precise information in all respective areas and
also because of its ease of use nature. Since this research analyses several areas of
service quality, the quantitative method is used via closed-ended survey or structured
questionnaire designed based on all the items mentioned in Table: 3.4 to evaluate
customer satisfaction with service delivery.
A questionnaire was deployed for capturing the perceptions of customers about
their mobile service provider. The questionnaire consists of three sections with several
items as represented in Appendix-B: The first section includes age, sex and service
provider to get variety of responses, and help us set a pattern for that specific group.
The pattern analysis helps in satisfying the needs of specific groups in the society.
The second section consists of disconfirmation measures (desire and
expectation) derived from ‘Disconfirmation Models’, ‘Over-all customer satisfaction’
measure and ‘Service quality’ dimensions derived from Gronroos’ SERVQUAL
model and focus group interview (VFM). The third section includes all Service
Quality dimensions and asks the customer to rate the importance of each dimension
from their perspective, which is measured on a five-point likert scale ranging from
‘Least Important’ to ‘Most important’. The items in section 2 and 3 extensively
analyzes the requirements of all groups of customers ranging from basic to advanced
mobile services as well as the after sales service provided by their service provider.
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3.5 Operationalisation of Concepts:
3.5.1 Minnesota Customer Satisfaction Index (MnCSI):
This index may have up to 5 responses for 3 questions by which the customer
satisfaction levels are evaluated. The responses are measured using a likert scale of 1
to 5 i.e. ‘1’ being least satisfied and ‘5’ being highly satisfied.
The three questions asked to the customers are:
Overall, how satisfied or dissatisfied you are with the services being provided by
your network?
How well does the service fulfil your expectations?
To what extent did the services you received from them match your desired set of
services?
The questions mentioned above are rated on a five point likert scale i.e. each response
would have a value from ‘1’ to ‘5’.
Table 3.5.1a: Measuring MnCSI model on 5-point Likert scale
RESPONSES
1 2 3 4 5
Question 1 Very
dissatisfied
Dissatisfied Neutral Satisfied Very
Satisfied
Question 2 Much worse
than
expected
Much better
than
expected
Equal to
expectation
Better than
expected
Much better
than
expected
Question 3 Much worse
than desired
Worse than
desired
Equal to my
desire
Better than
desired
Much better
than desired
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The table 3.5.1a indicates the three questions with its corresponding values
ranging between 1 and 5 where ‘1’ indicates the customer’s very dissatisfaction with
the services and ‘5’ indicates the very satisfaction with the services.
Then the answers to these three questions are then calculated using this
formula (Positively Minnesota, 2007):
Further, it is calculated using the following procedure:
Step A: Frequency of each scale has to be found for all three answers.
Step B: The weight of each response must be calculated as shown in table
3.5.1b
Table 3.5.1b: Weight of each response
Responses 1 2 3 4 5
Weight 0 8.32 16.65 24.97 33.30
Step C: The frequency of each response obtained from the customer is then
multiplied with the response weight for all the three answers.
Step D: The Sum of the values for all three answers is then evaluated
Step E: The total sum is divided by (sample size-1) i.e. in our case it is 4.
The Minnesota Customer Satisfaction index is evaluated using these steps.
Then a description for customer satisfaction level is given to the derived value as
shown in the table below:
Table 3.5.1c: Description for each MnCSI value
MnCSI Value Description
81-100 Very High
61-80 High
51-60 Fair
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31-50 Low
Below 30 Very Low
Table 3.5.1c indicates that MnCSI value between 81-100 is marked ‘Very High’
implying the high level of customer satisfaction, and subsequently low as the range
decreases until Below 30 which is marked ‘Very Low’ implying the low level of
customer satisfaction level (Positively Minnesota, 2007).
3.5.2 Defining Hypothesis:
Now we explain how the research objectives are transformed into hypotheses
and executed. The following hypotheses are being used for this study:
H1: Customers dissatisfied with services offered by cellular network in the UK
with and without respect to which cellular network customers subscribe to.
Sub-Hypotheses Dissatisfied with
H1a Vodafone
H1b O2
H1c T-Mobile/Orange
H1d 3-Mobile
H2: The Disconfirmation models impact the over-all CS positively in UK’s
MTNs.
H2a: Expectancy disconfirmation impacts the over-all CS positively.
H2b: Desire disconfirmation impacts the over-all CS positively.
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3.5.3 Disconfirmation Models:
As justified in the literature review we use both desire as well as expectation
disconfirmation models to measure satisfaction. The table 3.5.3 shows the indicators
for these variables.
Table 3.5.3: Variables for Disconfirmation models
DD Desire Disconfirmation
To what extent did the services you received from them match your desired set of
services?
ED Expectation Disconfirmation
How well does the service fulfil your expectations?
Both these variables are measured using a 5-point likert scale. For DD, the
scales vary from ‘Much worse than desired’ to ‘Much better than desired’. Similarly,
for ED the scales varied from ‘Much worse than expected’ to ‘Much better than
expected’.
3.5.4 Over-all Satisfaction:
It refers to the customer’s over-all judgement on the service quality delivered
by their service provider. Here, we use only one indicator as shown in table 3.5.4
below, using a single question, to which the respondents rate their over-all satisfaction
with service quality on the 5-point likert scale which vary from very dissatisfied to
very satisfied.
Table 3.5.4: Variable for over-all Satisfaction Measure
OCS Over-all Customer Satisfaction
Overall, please rate how satisfied or dissatisfied you are with the services
being provided by your network.
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3.5.5 Procedures to test Hypotheses:
The following describe how the research objectives are met and tested with the
hypotheses.
Research Objective One (RO 1)
To find out the level of customers’ satisfaction with the service quality offered to
them by the UK’s MTNs with and without respect to which network customers
subscribe to.
The procedure outlined for MnCSI model (as described in section 3.5.1) is used.
3.5.5a Testing Hypotheses 1a to 1d (as mentioned in 3.5.2) under RO 1
One-Sample T test is used to test hypothesis H1a to H1d with and without
respect to the subscribed cellular network. Cut-off points 3 and 4 are chosen for
disconfirmation measure and Over-all customer satisfaction measure respectively with
significance level of 0.05. The null hypothesis assumes that customers are satisfied for
both with respect to and irrespective of cellular network. We take 3 as the cut-off
value for DD and ED because in disconfirmation scales, any rating between 3 and 5
indicates that the customer is satisfied. However, 1 and 2 indicates the customer’s
dissatisfaction. Cut-off point 4 is chosen for OCS measure, because in over-all
satisfaction scale, ratings from 1 to 3 indicates the customer’s dissatisfaction and
ratings 4 and 5 indicate that the customer is satisfied with the service delivery.
Procedure to test first hypothesis:
Step1: The Null hypothesis:
H0: x ≥ 3 (Equal to / Better than desired or expected)
H1: x < 3 (Worse than / Much worse than desired or expected)
H0: x ≥ 4 (Satisfied / Very Satisfied)
H1: x < 4 (Neither dissatisfied nor satisfied, dissatisfied / very dissatisfied)
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Step2: One-Sample T test is conducted at significance level 0.05
Step3: The t-statistics, confidence intervals and p-value (Critical value) is extracted
from SPSS output.
Step4: The null hypothesis is rejected under the following 2 conditions. Firstly, in
case the mean difference is significantly negative and secondly, if the confidence
interval is showing negative. It is not rejected if the mean difference is significantly
positive or any value under confidence interval includes a positive value.
3.5.5b Testing Hypothesis two and sub hypotheses (as mentioned in 3.5.2)
Here a linear regression is used as each sub hypothesis involves one
independent and one dependent variable. The three models that have to be tested are
as follows:
M1: Over-all CS = n + ED + DD + x
M2: Over-all CS = n + DD + x
M3: Over-all CS = n + ED + x
Where ‘n’ is a constant and ‘x’ is the error-term and here the null hypothesis states
that there is no significant relationship between both the disconfirmation models (DD
and ED) together and OCS.
The procedure to test these three models is mentioned below:
Step1: The Null hypothesis:
H0: DD ≤ 0 Variable DD is not significantly greater than 0
H1: DD > 0 Variable DD is significantly greater than 0
H0: ED ≤ 0 Variable ED is not significantly greater than 0
H1: ED > 0 Variable ED is significantly greater than 0
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Step2: Linear regression F test is conducted at significance level 0.05
Step3: p-value (critical value) is extracted from the SPSS output
Step4: The null hypothesis is rejected under following two conditions: If the p-value
is less than the significance value 0.05 and if the co-efficient is positive.
3.5.5c Research Objective Two (RO 2)
To find out which dimensions of service quality are the customers
satisfied/dissatisfied with in the UK’s MTNs?
As discussed earlier in Research Method (in section 3.4), customer satisfaction
is measured for four service quality dimensions: functional, technical, image and
VFM dimensions. Items under each dimension are defined in Appendix-H. One-
Sample T test is used to verify the significance of the mean differences with
significance level of 0.05 and test-value 3 in order to split the entire sample into
satisfied and dissatisfied customers for each of the items in each dimension of service
quality.
The following procedure is being used:
Step1: The Null hypothesis:
H0: x ≥ 3 (Equal / better than expected)
H1: x < 3 (Worse than / Much worse than expected)
Step2: One-Sample T test is conducted at significance level 0.05
Step3: Confidence intervals and p-value (Critical value) is extracted from SPSS
output.
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Step4: The null hypothesis is rejected under the following two conditions: If the mean
difference is significantly negative and if the confidence interval is showing negative.
It should not be rejected if the related mean difference is significantly positive or any
value under confidence interval includes a positive value.
3.5.5d Research Objective Three (RO 3)
What Service Quality dimensions do the customers perceive to be of high importance
in the UK’s MTNs?
One-Sample T test is conducted at significance level 0.05 with a cut-off value 3
to split the service quality dimensions that are considered important by the customers
from those that are unimportant. Then each service quality dimension is ranked in an
order of magnitude to point out the importance of each dimension from the
customer’s point of view.
3.6 Sample Selection and Data Collection:
According to Neuman (2006), the sample size for focus group interview must
range from 6 to 12 people. Hence, initially a sample size of 12 respondents are
selected to conduct a focus group interview, the selection was based on purposive
sampling method because the respondents had to pass the eligibility criteria before
they could participate (Neuman, 2006). All the respondents were students doing their
masters and they all were mobile telecom users, who had wide subject knowledge
regarding the quality concerns in mobile telecom networks in the UK.
The data was also collected via structured questionnaire which targeted only the
mobile telecom users. In this survey-process, emphasis was given to include people of
all groups within the UK (age groups, sex, etc), but more attention was given to the
younger generation and student sector, as they are considered to be one of the most
active cell phone users (Clickz, 2005). From the sample frame of 78 million cellular
service subscribers in the UK (Telecoms Market Research, 2008), a sample size of 100
respondents are selected due to the time and cost constraints. The time limit provided
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to complete this research was very less and using a larger sample size may require
huge financial resources, which was unaffordable. Two different types of survey
instruments are used here for the collection of data. Firstly, out of the total sample
size of 100 respondents, 33 respondents responded via simple random sampling
method. This method was chosen because the population is comprised for mobile
service providers in the UK, each constituting a stratum. All these respondents were
students of UEL using UK cellular service. The survey was hosted on survey monkey
website and the link <http://www.surveymonkey.com/s/SGVRP5X> was sent to all
the students of UEL via university’s webmail and the link was also posted on several
social networking sites such as Facebook, Twitter and Orkut. Secondly, the remaining
67 respondents were selected randomly using the ‘personal contact’ approach from
different areas of London (Stratford, Bow Road, East Ham and Barking). In this
method, the respondents from the different areas are approached in person and they
are explained in detail about this survey. Out of the total 100 questionnaires collected
through various survey instruments, 17 are partially filled and hence it is being
rejected for data analysis. Overall there are 83 questionnaires that are usable for
further analysis.
3.7 Reliability:
Reliability refers to the consistency of measurements. A test is considered
reliable, if the test yields similar results repeatedly for similar set of inputs. In this
study we use the Cronbach’s Alpha test is used to assess the internal consistency of
the chosen likert scale and measure reliability of different service quality dimensions.
It is calculated using the formula mentioned below
Where ‘K’ is the number of items or components in the questionnaire and is the
mean of (Pallant, 2005).
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With the help of reliability co-efficient Cronbach’s alpha we are checking the internal
consistency of each scale.
Table 3.7: Results of Chronbach’s α test
Service Quality
Dimensions
Chronbach’s α value No. of items/components
Tangibles 0.972 3
Reliability 0.963 3
Responsiveness 0.967 3
Empathy 0.975 3
Assurance 0.964 3
Technical-Quality 0.966 3
Corporate Image 0.981 3
VFM(Value for Money) 0.930 2
Importance of dimensions 0.973 8
Table 3.7 indicates that all the items under each dimension are above the
minimum scale of 0.7. Hence these values indicate that all of these dimensions are
reliable and internally consistent.
3.8 Validity:
Validity is concerned with accuracy of the measurements. It is one of the most
important factors for an experimental research. In other words, it is about testing the
data analysis procedure, if it is measuring in a right way and in an accurate manner.
Validity is of two types: Internal and external validity (Saunders et al., 2007). To
ensure validity in this research, there were many steps taken:
All the relevant theoretical frameworks, models and literature were examined in
an exhaustive manner i.e. viewed from different author’s/researcher’s perspective.
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Most of the questions are based on the theoretical frame works and literature, except
the service quality dimension- ‘VFM (Value for Money)’ derived from the focus
group interview. Still to ensure criterion validity, the structured questionnaire was
compared with other validated SERVQUAL models, which are similar to the one
created.
Pilot testing:
According to Saunders et al (2000) and Malhotra et al., (2007) the structured
questionnaire must be pre-tested before final administration. Hence the preliminary
draft of the questionnaire was pre-tested by the members of focus group interview to
check the clearness and significance of the questions and it was also checked
thoroughly by 3 employees and 2 managers who work for different mobile telecom
networks in the UK. Most of the parameters and wordings were changed based on
their advice, so that respondents can understand the questions clearly. Then it was
pre-tested to a sample size of ten telecom users who were selected through simple
random method. This sample size was suggested by Fink (2003b in Saunders et al
2007), who had mentioned that it is adequate to have a minimum of ten members for
the pre-testing. Before giving the questionnaire, each of these members were
described about the purpose of the questionnaire and ensured confidentiality and
anonymity.
It was also ensured that the questionnaire was filled by the mobile telecom
users of UK only, in both via e-survey as well as personal contact approach.
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4. DATA ANALYSIS AND DISCUSSION
4.1 Introduction:
This chapter focuses on statistical analysis of quantitative data which was
collected during the process of surveying. It comprises of data presentation that
covers demographic profile of respondents, measurement of customer satisfaction,
customer satisfaction with different service quality dimensions and relative
importance of those dimensions. The discussion includes analysis of different
hypotheses and their relative results and findings in order to answer the research
questions.
4.2 Demographic profile:
This shows the demographic grouping of all the respondents who participated
in the surveying process. It indicates that among the total of 83 respondents more than
half are males i.e. 67.5% are male respondents and the remaining 32.5% are the
female respondents and as mentioned previously in the research methodology,
majority of the respondents are youngsters, between 21 – 30, as they are the
economically active-group constituting 77.1%, whilst the rest constituting 22.9%
includes respondents of age group below 20, 31 – 50 and above 51.
4.3 Assessing Customer Satisfaction with the Service Quality:
To assess customer satisfaction with service quality four different measures are
used namely: MnCSI model, Desire and Expectation Disconfirmation models and
Over-all Satisfaction. All these models are supported by theory in the literature review
and also mentioned in the sections 3.5.1, 3.5.3 and 3.5.4 of research methodology.
Here the customer satisfaction is assessed with respect to cellular network and
irrespective of cellular network.
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4.3.1 Results of Minnesota Customer Satisfaction Index
The result for MnCSI model was arrived from the formula and steps that was
mentioned earlier in section 3.5.1. The raw data for this model was obtained from the
structured questionnaire, which is based on 83 responses.
Table 4.3.1: Customer satisfaction index using MnCSI
Cellular Network MnCSI value Description
Irrespective of cellular
network
52.2 Fair
Vodafone 46.3 Low
O2 54.8 Fair
T-Mobile / Orange 51.5 Fair
3-Mobile 51.3 Fair
The table 4.3.1 indicates the satisfaction index for all the four mobile service
providers (Vodafone, O2, T-Mobile / Orange and 3-mobile) and also index for the
total sample population without respect to which network the subscriber has
subscribed to.
Firstly, for all the mobile networks together the MnCSI value is 52.2, which is
represented as ‘Fair’ as it is above the satisfactory index of 50. This result shows that
in general the customer satisfaction in the UK’s cellular telecom market is
substantially fair.
Secondly, The MnCSI value for Vodafone, O2, T-Mobile / Orange and 3-
Mobile were 46.3, 54.8, 51.5 and 51.3 respectively. This implies that Vodafone has
got considerably low customer satisfaction with service quality, but it is fair for O2,
T-Mobile / Orange and 3-Mobile. The customer satisfaction index gives the
perception of a customer over the mobile service providers. The satisfaction score
reflects the past experiences of the customer with the providers, both positive and
negative and the result draws on the average of their experiences. Hence, we could
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say that except Vodafone customers, the individual experiences of customers of all
other networks have been fair with their respective service providers.
4.3.2 Results of Disconfirmation Models and Over-all Customer Satisfaction
Measure:
4.3.2.1 Irrespective of cellular network:
The descriptive statistics for all three dimensions is mentioned below:
Table 4.3.2.1a: Descriptive-statistics of DD, ED and OCS
N MeanStd. Deviation
Std. Error Mean
OCS 83 3.33 1.138 .125
The details of this descriptive statistics is available in Appendix-E and the table
4.3.2.1a indicates the ratings by the 83 respondents for all the three measures i.e., for
DD measure the customers mean rating was 2.98 with standard deviation (SD) of
1.126, for ED measure the customers mean rating was2.96 with SD of 1.234 and for
OCS measure, the customers mean rating was 3.33 with SD of 1.138, being the
highest. The mean rating for ED and DD measures are very close to the cut-off value
3 and for OCS measure, it was below the cut-off value 4 and has a wider deviation
than the other two attributes (ED & DD).
Fig 4.3.2.1b: Customer satisfaction rating irrespective of cellular network
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One-Sample Statistics
N MeanStd. Deviation
Std. Error Mean
Desire 83 2.98 1.126 .124
expectation 83 2.96 1.234 .135
Market Research on Service Quality and Customer Satisfaction 2010
Table 4.3.2.1c: Customer satisfaction rating irrespective of cellular network
1 2 3 4 5
DD 12 18.1 39.8 20.5 9.6
ED 15.7 19.3 28.9 25.3 10.8
OCS 7.2 18.1 22.9 38.5 13.3
In the fig 4.3.2.1b the x-axis indicates the measurement models: Desire
Disconfirmation(DD), Expectation Disconfirmation(ED) and Over-all Customer
Satisfaction(OCS) and the y-axis indicates Percentage(%) of customer satisfaction
rating, the details of these frequencies is given in Appendix-C and the table 4.3.2.1c
indicates that applying DD measure we could assess that 12% and 18.1% (a total of
30.1%) rated their satisfaction level as much worse than desired and worse than
desired respectively. 39.8% of the respondents rated that the service delivery is equal
to what they desire and 30.1% (20.5 + 9.6) rated that the services were better than or
much better than what they desired.
Applying ED measure we could assess that 15.7% and 19.3% (a total of 35%)
rated their satisfaction level as much worse than expected and worse than expected
respectively. 28.9% of the respondents rated that the service delivery is equal to what
they expected and 36.1% (25.3 + 10.8) rated that the services were better than or
much better than what they expected.
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The first hypothesis and its sub hypotheses are tested as per the procedure
shown in section 3.5.5a in order to verify if the mean values are significant or not,
one-sample t test is conducted to test their significance level. The result obtained from
the test is presented in the table 4.3.2.1d below and the descriptive statistics is
available in Appendix-E.
Table 4.3.2.1d: One-Sample T test for ED & DD irrespective of cellular network
One-Sample Test
Test Value = 3
95% Confidence Interval of
the Difference
t df Sig. (2-tailed)
Mean
Difference Lower Upper
Desire -.195 82 .846 -.024 -.27 .22
expectation -.267 82 .790 -.036 -.31 .23
The table 4.3.2.1d indicates that, with the cut off point 3 the mean differences
are -0.24 and -0.36 for DD and ED respectively and the observed significance level
(p-value) being 0.846 and 0.790 for DD and ED respectively, which are more than the
significance level of 0.05 and the upper limit of their confidence intervals provides a
strong support towards not rejecting the null hypothesis. Therefore with 95%
confidence it can be concluded that the provided services are at least equal to their
desire and expectation.
Applying OCS measure we could assess that 7.2% and 18.1% (a total of 25.3%)
rated their satisfaction level as very dissatisfied and dissatisfied respectively. 22.9%
of the respondents rated that they were neither satisfied nor dissatisfied with the
service delivery and 51.8% (38.5 + 13.3) rated that they were satisfied / very satisfied
with the services.
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The first hypotheses are tested as per the procedure shown in section 3.5.5a to
verify if the mean value is significant or not, one-sample t test is conducted to test
their significance level. The result obtained from the test is presented in the table
4.3.2.1e below.
Table 4.3.2.1e: One-Sample T test for OCS irrespective of cellular network
One-Sample Test
Test Value = 4
T df Sig. (2-tailed)
Mean
Difference
95% Confidence Interval of
the Difference
Lower Upper
OCS -5.401 82 .000 -.675 -.92 -.43
The table 4.3.2.1e indicates that, with the cut off point 4, the mean difference
for OCS measure is -.675 and the observed significance level (p-value) being .000,
which means that the mean is significantly lesser than 4. This provides a strong
support towards rejecting the null hypothesis. Therefore with 95% confidence it can
be concluded that customers are not over-all satisfied with the service delivery from
their service providers irrespective of cellular networks in the UK however, they are
at equal to their desire and expectation.
The CS in general with the UK’s cellular network is deemed to be fair as
obtained from the MnCSI value which is 52.2, slightly greater than the satisfaction
index of 50. It is at least equal to the customers’ desire and expectation. However, the
overall satisfaction of the customers with the service quality of the operators is
significantly low.
4.3.2.2 With respect to cellular networks:
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The details of frequencies with respect to cellular network is available in Appendix-D
4.3.2.2a Testing significance of the OCS measures for all cellular networks:
The first hypotheses are tested as per the procedure shown in section 3.5.5a to
verify if those mean values are significant or not, one-sample t test is conducted to test
their significance level. The result obtained from the test is presented in the table
4.3.2.2b below and the descriptive statistics is presented in Appendix-E.
Table 4.3.2.2b: One-Sample T test to measure OCS with respect to cellular
networks
One-Sample Test
Test Value = 4
Company
t df Sig. (2-tailed)Mean Difference
95% Confidence Interval of the Difference
Lower Upper
Vodafone
OCS -1.941 8 .038 -.778 -1.70 -.15
O2 OCS -2.832 21 .010 -.682 -1.18 -.18
T-Mobile/ Orange
OCS -3.291 32 .002 -.667 -1.08 -.25
3-Mobile OCS -2.364 18 .030 -.632 -1.19 -.07
The Table 4.3.2.2b above shows that, having a cut off value 4, the mean
differences for over-all customer satisfaction are -0.778, -0.682, -0.667 and -0.632
and their p-values are 0.038, 0.010, 0.002 and 0.030 for Vodafone, O2, T-Mobile /
Orange and 3-Mobile respectively.
Their respective p-values show that all of their mean satisfaction is
significantly lesser than the cut off value 4 (as the p-value is less than 0.05 in all
cases) and even all of their confidence intervals are negative, providing a strong
support to reject the null hypothesis. Therefore, we can conclude with 95%
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confidence that, the customers of all the four service providers are not satisfied with
the service quality provided by each of these companies and moreover, the over-all
satisfaction of the customers is very much worse with service quality of Vodafone
than the other cellular networks because it holds the highest negative mean difference.
Vodafone:
Table 4.3.2.2c: Mean satisfaction rating for Vodafone
DD ED OCS
2.22 3.11 3.22
Fig 4.3.2.2d: Satisfaction rating for Vodafone
The table 4.3.2.2c and the fig 4.3.2.2d indicate the mean ratings of the
customers of Vodafone for all the three models used. The mean rating for desire
disconfirmation and expectation disconfirmation are 2.22 and 3.11 respectively and
the mean for over-all satisfaction is 3.22.
The first hypotheses are tested as per the procedure shown in section 3.5.5a to
verify if those mean values are significant or not, one-sample t test is conducted to test
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their significance level. The result obtained from the test is presented in the table
4.3.2.2e below and the descriptive statistics is presented in Appendix-E.
Table 4.3.2.2e: One-Sample T test to measure DD & ED for Vodafone
Test Value = 3
Company 95% Confidence Interval of the Difference
t df Sig. (2-tailed)Mean
Difference Lower Upper
Vodafone DD -2.800 8 .023 -.778 -1.42 -.14
ED .286 8 .782 .111 -.79 1.01
The Table 4.3.2.2e above indicates that the mean differences using DD and ED
for Vodafone are -.778 and .111 respectively. The p value for DD measure is 0.023
(less than 0.05) which implies that the mean is significantly lesser than the cut off
value 3 which provides a strong support towards rejecting the null hypothesis. The p
value or significance for ED is 0.782 and as the mean is more than the test-value 3,
the null hypothesis is being considered positive in this case. Hence, we can conclude
with 95% confidence that, the customer satisfaction for Vodafone is at least equal to
their expectation and worse than the customer’s desire. With the evidence obtained
from section 4.3.2.2a, the over-all satisfaction of the customers is much worse than all
other service providers and even the satisfaction index in Table 4.3.1, indicated that
the CS is considerably low (with MnCSI value of 46.3) only for Vodafone, whereas
all other networks had their satisfaction index above 50, which indicates that CS is
fair for all other service providers. There are many inconsistencies faced by its
customers in terms of software updates, process delays, bad handoffs, etc. For
instance, Vodafone has still not attempted to take any measures to improve their
service delivery standards, as recently the company has angered many of its’
customers because they failed to test the software updates before pushing it to the
customers (Wattanajantra, 2010) Hence, Vodafone has to take some serious measures
in order to build their service delivery standards and customer satisfaction level.
O2:
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Table 4.3.2.2f: Mean satisfaction rating for O2
DD ED OCS
3.09 3.18 3.32
Fig 4.3.2.2g: Satisfaction rating for O2
The table 4.3.2.2f and the fig 4.3.2.2g indicate the mean ratings of the
customers of O2 for all the three models used. The mean rating for desire
disconfirmation and expectation disconfirmation are 3.09 and 3.18 respectively and
the mean for over-all satisfaction is 3.32.
The first hypotheses are tested as per the procedure shown in section 3.5.5a to
verify if those mean values are significant or not, one-sample t test is conducted to test
their significance level. The result obtained from the test is presented in the table
4.3.2.2h below and the descriptive statistics is presented in Appendix-E.
Table 4.3.2.2h: One-Sample T test to measure DD & ED for O2
Test Value = 3
Company 95% Confidence Interval of the Difference
t df Sig. (2-tailed)Mean
Difference Lower Upper
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Test Value = 3
O2 DDED
.370
.6782121
.715
.505.091.182
-.42-.38
.60
.74
The p-values are 0.715 and 0.505 for DD and ED respectively, which are more
than 0.05 (significance level) which implies that the mean is significantly more than
the cut off value 3. The mean differences using DD and ED measures are 0.091 and
0.182 respectively. Hence the null hypothesis is being considered positive in both the
cases. Hence, we can conclude with 95% confidence that, the customer satisfaction
for O2 is at least equal to the customers’ expectation and desire. Even the satisfaction
index in Table 4.3.1, indicated that the CS is fair for O2. However, the evidence
obtained from section 4.3.2.2a states that still the customers are not satisfied with the
overall service quality provided by their network.
T – Mobile / Orange:
Table 4.3.2.2i: Mean satisfaction rating for T – Mobile / Orange
DD ED OCS
2.94 2.91 3.33
Fig 4.3.2.2j: Satisfaction rating for T – Mobile / Orange
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The table 4.3.2.2i and the fig 4.3.2.2j indicate the mean ratings of the customers
of T-Mobile / Orange for all the three models used. The mean rating for desire
disconfirmation and expectation disconfirmation are 2.94 and 2.91 respectively and
the mean for over-all satisfaction is 3.33.
The first hypotheses are tested as per the procedure shown in section 3.5.5a to
verify if those mean values are significant or not, one-sample t test is conducted to test
their significance level. The result obtained from the test is presented in the table
4.3.2.2k below and the descriptive statistics is presented in Appendix-E.
Table 4.3.2.2k: One-Sample T test to measure DD & ED for T-Mobile/Orange
Test Value = 3
Company 95% Confidence Interval of the Difference
t df Sig. (2-tailed)Mean
Difference Lower Upper
T-Mobile/
DD -.297 32 .768 -.061 -.48 .35
Orange ED -.415 32 .681 -.091 -.54 .36
The mean differences for DD and ED are -0.061 and -0.091 respectively but however
the p-values are 0.768 and 0.681 which are more than 0.05 (significance level). Here
though the mean differences are not significant, the corresponding upper limits of the
confidence intervals are positive (0.35 and 0.36), providing a strong support to
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consider the null hypothesis. Hence, we can conclude with 95% confidence that, the
customer satisfaction for T-Mobile / Orange is at least equal to the customers’
expectation and desire. Even the satisfaction index in Table 4.3.1, indicated that the
CS is fair for T-Mobile/Orange. However, the evidence obtained from section 4.3.2.2a
states that still the customers are not satisfied with the overall service quality provided
by their network.
3 – Mobile:
Table 4.3.2.2l: Mean satisfaction rating for 3-Mobile
DD ED OCS
3.05 2.74 3.37
Fig 4.3.2.2m: Satisfaction rating for 3-Mobile
The table 4.3.2.2l and the fig 4.3.2.2m indicate the mean ratings of the
customers of 3-Mobile for all the three models used. The mean rating for desire
disconfirmation and expectation disconfirmation are 3.05 and 2.74 respectively and
the mean for over-all satisfaction is 3.37.
The first hypotheses are tested as per the procedure shown in section 3.5.5a to verify
if those mean values are significant or not, one-sample t test is conducted to test their
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significance level. The result obtained from the test is presented in the table 4.3.2.2m
below and the descriptive statistics is presented in Appendix-E.
Table 4.3.2.2m: One-Sample T test to measure DD & ED for 3-Mobile
Test Value = 3
Company 95% Confidence Interval of the Difference
t df Sig. (2-tailed)Mean
Difference Lower Upper
3-Mobile DD .213 18 .834 .053 -.47 .57
ED -.925 18 .367 -.263 -.86 .33
For 3-Mobile, the mean differences for DD and ED are 0.053 and -0.263 with p-
values 0.834 and 0.367 respectively. For DD measure, the mean is significantly more
than the cut off value 3, providing a strong support to consider the null hypothesis. In
the case of ED measure the mean difference of -0.263 is not significant but however,
the corresponding upper limit of the confidence intervals is positive (0.33), providing
a strong support to not to reject the null hypothesis i.e., satisfaction level is at least
equal to expectation. Hence, we can conclude with 95% confidence that, the customer
satisfaction for 3-Mobile is at least equal to the customers’ desire and expectations.
Even the satisfaction index in Table 4.3.1, indicated that the CS is fair for 3-Mobile.
However, the evidence obtained from section 4.3.2.2a states that still the customers
are not satisfied with the overall service quality provided by their network.
Though the services provided by O2, T-Mobile/Orange and 3-Mobile is at
least equal to customer’s desire and expectation, the Over-all Customer Satisfaction
with service delivery is considerably low. This could be very low because of the
following reasons:
i) The customers are very diversified with varied requirements on the Value Added
Services (Mobile Internet – 3G, e-mail services, News Updates, etc) and the Tariff
plans (Free Local Minutes/Texts Limits, Data Limits) etc, virtually having to
customize the plans to suit their particular needs. The people interviewed in the focus
group emphasized that they do not get the plan customized, for eg. One respondent
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said ‘I need more call minutes and don’t need texts, but there is no plan where I can
reduce the text limit and increase the call limit for the same amount I pay’ and the
other said ‘I don’t need minutes and all I need is Data, but I have a plan where I pay
unnecessarily for minutes which I don’t use’. The service providers don’t usually let
the customers decide on what and exactly how much they want of these services,
letting down their satisfaction at the very stage of purchase.
ii) There exists a severe inconsistency between physical hardware capability and the
service capability. The technology is rapidly growing to enable supreme features in
the handsets but the service providers are unable to cope up with that growth. For eg.
The latest handsets are capable of transferring data at 7.2 Mbps while the real time 3G
speed is much lesser than 1 Mbps. The revolutionary 4G featured handsets Evo and i
phone 4G has no better use in the market where no provider has a 4G service.
The second hypothesis and its sub hypotheses are tested as per the procedure
shown in section 3.5.5b in order to find the relationship between disconfirmation
models and Overall satisfaction measure. The detailed results of this regression
analysis are presented in Appendix-G.
Table 4.3.2.2n: Result of regression analysis for Disconfirmation models
Models
Unstandardized Co-efficients
R² Std Error of the Estimate
Sig. F-TestBeta R
M1(constant)DDED
.652
.377
.563
.928 .861 .429
.000
.000
M2(constant)DD
.587
.910
.910 .829 .474
.000
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M3(constant)ED
.810
.920
.920 .847 .448
.000
The Table 4.3.2.2n, points out that in the first model, DD & ED together affect
customer satisfaction positively, as the coefficients are greater than zero i.e. .377
and .563 for DD and ED respectively and it is significant as the P-value is also less
than 0.05, hence the null hypothesis is being rejected. In the second model, the co-
efficient is greater than zero (.910) and it is significant as the P-value is .000. In the
third model again the co-efficient is greater than zero (.920) and it is also significant,
as the P-value is .000. Hence we can conclude that all the three models significantly
and positively affect the over-all customer satisfaction.
Firstly, in model 1, the R (0.928) indicates that there exists a strong relationship
between desire disconfirmation, expectation disconfirmation and over-all satisfaction.
The R² (strength of the relationship): 0.861 shows that variations of about 86% in
over-all customer satisfaction are caused/explained by DD & ED collectively. Hence
we can conclude with 95% confidence that desire disconfirmation model and
expectation disconfirmation model together impacts OCS significantly. The results of
disconfirmation models for all the network operators were at least equal to the
customers’ desire and expectation except Vodafone, as their service quality was worse
than what they desired though it is at least equal to their expectation. Hence, if the
satisfaction level for disconfirmation models had been better than or much better than
desired or expected, then definitely the customers’ overall satisfaction with the service
delivery would have resulted positive.
Secondly, in models 2 & 3 (Table 4.3.2.2n) both the P-values are .000 (less than
0.05) and R values are .910 and .920 for DD & ED respectively, which shows that
both these models impact OCS. The outputs for R² (strength of the relationship)
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are .829 and .847 for DD & ED respectively, which shows that variations of about
83% and 85% in over-all customer satisfaction are caused by DD and ED
respectively. Hence, it is validated that ED impacts OCS stronger than DD in the
UK’s cellular networks. So priority must be given to customers’ expectations than
their desires. Therefore, all the service providers must aim at determining what
exactly the customers expect from them in order to keep their customers overall
satisfied with their service delivery and eventually gain customer loyalty.
4.4 Customer satisfaction with each service quality dimension
A detailed descriptive statistics is found in Appendix-F which has got customer
satisfaction ratings for all the four service quality dimensions. One-Sample T test is
used to verify the significance of the mean differences. In this case, null hypothesis
(H0) states that the customer satisfaction level is least equal to his/her expectation and
the alternative hypothesis (H1) states that the customer satisfaction level is worse or
much worse than their expectation. The results of this test are presented in Table 4.4a
and it is tested as per the procedure presented in section 3.5.5c.
Table 4.4a: One-Sample T test for all the SERVQUAL dimensions
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One-Sample Test
Test Value = 3
95% Confidence Interval of the Difference
t df Sig. (2-tailed)Mean Difference Lower Upper
TN1 3.933 82 .000 .422 .21 .63
TN2 2.356 82 .021 .265 .04 .49
TN3 1.694 82 .094 .205 -.04 .45
RE1 5.524 82 .000 .530 .34 .72
RE2 -3.484 82 .001 -.410 -.64 -.18
RE3 -2.373 82 .020 -.289 -.53 -.05
RP1 1.504 82 .137 .169 -.05 .39
RP2 -.094 82 .926 -.012 -.27 .24
RP3 -5.477 82 .000 -.614 -.84 -.39
EP1 .366 82 .715 .048 -.21 .31
EP2 2.556 82 .012 .325 .07 .58
EP3 1.228 82 .223 .145 -.09 .38
AR1 3.942 82 .000 .434 .21 .65
AR2 -1.341 82 .184 -.169 -.42 .08
AR3 -.107 82 .915 -.012 -.24 .21
TQ1 -3.866 82 .000 -.446 -.68 -.22
TQ2 1.341 82 .184 .169 -.08 .42
TQ3 3.203 82 .002 .325 .12 .53
CI1 1.341 82 .184 .169 -.08 .42
CI2 1.706 82 .092 .193 -.03 .42
CI3 1.454 82 .150 .169 -.06 .40
VM1 -3.385 82 .001 -.398 -.63 -.16
VM2 1.382 82 .171 .205 -.09 .50
The items in the table 4.4a are indicators of different service quality
dimensions used in this research and the details of what each indicator stands for is
available in Appendix-H. In the table 4.4a, three different colour codes are given for
each item under the service quality dimensions. Green represents those items in which
the customer satisfaction level is better than or much better than their expectation.
Yellow represents those items in which the customer satisfaction level is at-least equal
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to their expectation and Red represents those items in which the customer satisfaction
level is worse than or much worse than their expectation.
The Table 4.4a shows that both the mean difference and confidence intervals
(both lower and upper) are negative for six items, they are: RE2, RE3, RP3, TQ1 and
VM1. For these items the customer satisfaction level is worse or much worse than
their expectation. According to Borzorgi M. M. (2007), the customers mainly look for
technical quality and reliability than the others in the public sector industry. However,
the results show that two items of reliability and one item of Technical quality have
been rated very poor by the customers. Hence, the network providers must focus on
developing their technical quality in terms of network coverage and reliability by
resolving the customers’ issues on time.
There are twelve items in which either the mean difference or any one of their
confidence intervals include a positive value, which means that customer satisfaction
level is at-least equal to their expectation, they are: TN3, RP1, RP2, EP1, EP3, AR2,
AR3, TQ2, CI1, CI2, CI3 and VM2. The remaining six items includes TN1, TN2,
RE1, EP2, AR1 and TQ3 in which both the mean difference as well as confidence
intervals are positive, which states that the customer satisfaction level is better than or
much better than their expectation.
As presented in the fig 4.4b below, precisely six of the items under different
service quality dimension had their means significantly equal to the test-value 3.
Twelve items were rated equal to expectation and eight items were rated below the
test-value 3. Over-all eighteen items have been given a satisfaction rating as at-least
equal to or better than their expectation
Fig 4.4b: Satisfaction level with the SERVQUAL dimensions
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Therefore, we can conclude with 95% confidence that, the customer’s are
dissatisfied with the 5 items of service quality dimension (RE2, RE3, RP3, TQ1 and
VM1) and at-least satisfied with 18 items of service quality (TN1, TN2, TN3, RE1,
RP1, RP2, EP1, EP2, EP3, AR1, AR2, AR3, TQ2, TQ3, CI1, CI2, CI3 and VM2).
Though these items meet the customers’ expectation in order to create a tremendous
(Wow!) experience, the organisations have to develop strategies to go an extra mile
and diversely satisfy its’ customers.
In order to find the importance of each of these dimensions as perceived by the
customers, they were also asked to rate the importance of each service quality
dimension from their perspective (or point of view) on a five point likert scale. The
values ranged from ‘Least Important’, ‘Not so important’, ‘Important’, ‘Very
Important’ and ‘Most Important’. A descriptive statistics of all the dimensions and its
corresponding substituted values is given in the table 4.4c below.
Table 4.4c: Descriptive Statistics for importance of service quality dimensions
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Descriptive Statistics
N Mean
Std.
Deviation
Std. Error
Mean
TECHNICAL
QUALITY
83 3.93 .712 .078
CORPORATE
IMAGE
83 3.04 1.163 .128
VFM 83 4.48 .755 .083
TANGIBLES 83 2.76 1.100 .121
RELIABILITY 83 3.93 1.124 .123
RESPONSIVENESS 83 3.98 .715 .079
EMPATHY 83 2.98 .975 .107
ASSURANCE 83 3.40 .855 .094
In the table 4.4c, six dimensions have mean above ‘3’ and the remaining two
have the mean below ‘3’. One-Sample T test is used in order to key out the important
and unimportant dimensions with 0.05 as its significance level and 3 as its test-value.
The results of this test are shown in the table 4.4d below.
Table 4.4d: One-Sample T test for importance of service quality dimensions
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One-Sample Test
Test Value = 3
95% Confidence Interval of the Difference
t dfSig. (2-tailed)
Mean Difference Lower Upper
TECHNICAL QUALITY
11.871 82 .000 .928 .77 1.08
CORPORATE IMAGE
.283 82 .778 .036 -.22 .29
VFM 17.886 82 .000 1.482 1.32 1.65
TANGIBLES -1.996 82 .049 -.241 -.48 .00
RELIABILITY 7.521 82 .000 .928 .68 1.17
RESPONSIVENESS
12.430 82 .000 .976 .82 1.13
EMPATHY -.225 82 .822 -.024 -.24 .19
ASSURANCE 4.239 82 .000 .398 .21 .58
The table 4.4d shows that all the dimensions are significantly important to the
customers. However, when it comes to the degree of importance for each service
quality dimension, Tangibles, Empathy and Corporate Image are significantly less
important to the respondents than the others because: either the mean difference or
any one of their confidence intervals include a positive value and the other five
dimensions of service quality (Technical Quality, VFM, Reliability, Responsiveness
and Assurance) have been rated with high degree of importance as it has got positive
mean difference as well as positive confidence intervals.
The rankings as to which dimensions are perceived to be more important than
the others is shown in Table 4.4e. These rankings are given to the service quality
dimensions with respect to their mean difference values i.e., the dimension with the
highest mean difference would be ranked one and correspondingly, the dimension
with the lowest mean difference would be ranked last.
Table 4.4e: Prioritized Service quality dimensions
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Service Quality Dimensions Rankings (Ascending Order)
VFM (Value for Money) 1
Responsiveness 2
Technical Quality 3
Reliability 4
Assurance 5
Corporate Image 6
Empathy 7
Tangibles 8
Table 4.4e indicate that VFM (Value for Money) is considered to be one of the
most important service quality dimensions, which is then followed by
Responsiveness, Technical Quality, Reliability, Assurance, Corporate Image,
Empathy and Tangibles.
The satisfaction matrix displayed in Table 4.4f below is designed after a careful
analysis of satisfied and dissatisfied dimension items of service quality in relation to
the prioritized dimensions in order to analyze which of the items of service quality
dimensions need more attention.
Table 4.4f: Satisfaction Matrix
Better / Much
better than
expected
At-least equal to
expectation
Worse / Much
worse than
expected
VFM VM2 VM1
Responsiveness RP1, RP2 RP3
Technical Quality TQ3 TQ2 TQ1
Reliability RE1 RE2, RE3
Assurance AR1 AR2, AR3
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Corporate Image CI1, CI2, CI3
Empathy EP2 EP1, EP3
Tangibles TN1, TN2 TN3
The Table 4.4f indicates the following:
Firstly, out of the six dimension items that has CS much better than or better
than expected (derived from Table 4.4a), three items are of high degree of
importance: TQ3, RE1 and AR1 while another three are considered to be of less
importance: EP2, TN1 and TN2. Hence, the focus on these particular attributes could
be shifted to those that are more significant but lacks attention.
Secondly, out of the twelve dimension items that has CS at least equal to their
expectations (derived from Table 4.4a), six items are considered very important:
VM2, RP1, RP2, TQ2, AR2 and AR3; while the remaining six items are of less
importance: CI1, CI2, CI3, EP1, EP3 and TN3. Hence the network providers need to
maintain the same service delivery standards for these attributes and eventually
increase it in order to achieve competitive advantage. Finally, under the dimension
items that has CS worse than or much worse than expected (derived from Table 4.4a),
all the items are considered very important VM1, RP3, TQ1, RE2 and RE3. Hence,
the attributes of service quality those customers perceive to be of high importance and
lacks attention from the service providers in the UK are mentioned in the table 4.4g
below:
Table 4.4g: The Service quality dimension items and their description which are
considered to be of high importance and lacks attention by network providers
VM1 How economical is the call charge per minute?
RP3 Ability of the employees to communicate clearly with the customers
TQ1 The network coverage
RE2 Dependability and consistency to resolve customer issues (or complaints)
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RE3 Ability to perform the service request on time
The description for each item is derived from the Appendix-H.
This gives the operators a note on what to concentrate to improve their CS
scores. The most important factor, Value for Money on how economical the charges
are; is mainly collected in comparison with other service providers, but the complaint
is that, the operators do not price the components equally, for e.g. if the call cost is
low, the data charge is high, and if both are low the roaming charges soar. Even if
these are considered to be business strategies, the hidden costs (fair usage guidelines,
starred conditions apply, etc) fuel the customers’ dissatisfaction. The incremental
usage of Virtual Networks (MVNOs) reasons the signal and clarity issues (Xln
Business Community, 2010). Hence, there has to be some limits set for these MVNOs
and gradually reduce their number in order to avoid capacity-crunch and by doing so
even the switching attitude of the customers can be brought under control, as the
customer’s may have limited service providers to choose. However, the
responsiveness, dependability and consistency factors are with respect to the
particular network and still no network operator has very satisfied customers on those
factors.
5. Summary & Conclusion
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The main purpose of this dissertation was to measure the level of customer
satisfaction with regards to service quality delivered by the UK’s MTNs with and
without respect to which network customer subscribes to; via four models: The
MnCSI model, Disconfirmation models (Desire & Expectation) and Over-all
Customer satisfaction model that was developed. This dissertation examined the
customer’s satisfaction level with several service quality dimensions and also finds
the dimensions that the customers perceive to be of very important.
Data for analysis was derived from Eighty three (83) survey responses. The following
summary of major findings & conclusions are based on the data analysis and the
discussions made:
Irrespective of cellular network in the UK, three models (MnCSI, DD and ED)
indicated that Customer Satisfaction is fair and at-least equal or equal to the
customer’s desire and expectation but one model (OCS) pointed out that
customer’s are dissatisfied. So considering the results of all the four models,
we can conclude that customers are neither satisfied nor dissatisfied with the
service quality delivered by cellular networks in the UK.
With respect to cellular networks, for the customers of Vodafone, their
satisfaction level is worse than desired and at-least equal to expectation. For
the customers of O2, their satisfaction level is at-least equal to desire and
expectation. For the customers of T-Mobile/Orange, their satisfaction level is
at-least equal to desire and expectation and for the customers of 3-Mobile,
their satisfaction level is at-least equal to desire and expectation.
The Over-all customer satisfaction has been rated as dissatisfied by the
customers of all the four networks. The ratings obtained are approximately
same for all the four companies.
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Regarding Customer-Satisfaction with various service quality dimensions, the
customer’s satisfaction level is better than expectation for the following six
items of service quality dimensions: TN1, TN2, RE1, EP2, AR1 and TQ3. The
customer’s satisfaction level is at-least equal to expectation for the following
twelve items: TN3, RP1, RP2, EP1, EP3, AR2, AR3, TQ2, CI1, CI2, CI3 and
VM2. The customers rated the following five items as dissatisfied: RE2, RE3,
RP3, TQ1 and VM1.
According to the customer’s priority, VFM is the most important dimension
followed by Responsiveness, Technical Quality, Reliability, Assurance and
Corporate Image, which scores the least importance. Tangibles and Empathy
are unimportant to the customers.
Most of the service quality dimension items which have been rated ‘satisfied’
by the customers are less important to them, while most of the service quality
dimension items which has been rated dissatisfied are more important to them.
Both the disconfirmation models (Desire and Expectation) collectively impact
OCS. However, ED impacts OCS stronger than DD in the UK’s cellular
networks.
A significance matrix was developed to gather data on the most important
dimensions that the respondent’s perceive and lacks attention from the service
providers in the UK. It is found that some items under the ‘Value for Money’,
‘Responsiveness’ and ‘Technical Quality’ are highly valued high by the
customers but the network providers have failed to achieve them.
Conclusion
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The mobile networks in the UK must acquire superior measures to increase the
quality of service in order to gain competitive advantage. The level of customer
satisfaction delivered by the mobile networks in the UK is considerably low and not
up to the mark. The process of amending the service quality standards begins from
identifying the customers’ needs and then taking required actions to satisfy them.
However, all the network providers have problems in identifying their customers’
needs. In most cases, the service quality provided is at least equal to the customers’
desire and expectation. The mean score just meets the threshold and significant
improvements have to be made on certain areas. As a result, it is highly essential for
all the cellular network providers to understand how the customers estimate the
quality of services. This research has identified five key attributes of service quality
which are considered to be of high importance by the customers and lacks attention
from network providers, they are: pricing issues, communication problems, network
coverage and lack of ability to resolve complaints and service requests on time.
Hence, it is crucial for the network service providers to concentrate on these five areas
to improve their service standards and eventually gain competitive advantage.
Recommendations for Future Research
This dissertation has primarily measured and analyzed the customer satisfaction level
with service quality in the UK’s cellular networks. Hence it is recommended that
future research could:
Analyze customer satisfaction in particular service areas such as Internet Services,
Video calls, SMS, MMS and other value added services.
Compare customer satisfaction level and Service quality with the current
technology (3G network) and the upcoming technology (4G network).
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Analyze customer satisfaction with fixed line services for e.g. with BT (British
Telecom) customers.
Verify the models and theories used in this dissertation with different industry
settings.
Finally, this study comprises a mixture of both qualitative as well as quantitative
models. Therefore, it is recommended that other models and approaches could be used
for a similar study and the results could be compared.
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