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Journal of Health Management
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The online version of this article can be found at:
DOI: 10.1177/097206341101400103
2012 14: 27 Journal of Health Management
Sunil C. D'Souza and A.H. Sequeira
Measuring the Customer-Perceived Service Quality in Health Care Organization: A Case Study
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Impact on Stock Price by the Inclusion to and Exclusion from CNX Nifty Index 27
Article
Measuring the Customer-Perceived
Service Quality in Health Care
Organization: A Case Study
Sunil C. DSouza
A.H. Sequeira
Abstract
In todays highly competitive environment, health care organizations are increasingly realizing the need
to focus on service quality as a measure to improve their competitive position. While there has been
a plethora of conceptual and empirical research regarding the many complexities involved in services
marketing, few endeavours have been directed towards integrating the customers assessment into
models to improve overall service quality. This article examines service quality through a case study of a
health care organization in Mangalore, Karnataka, India with a tertiary health provision. The population
consisted of patients aged 1865 years and 45 patients were considered through a purposive sampling
technique. The study basically started off using the grounded theory for patient of service quality and
this exploration was enabled to formulate a hypothesis; to test the specific hypothesis, the descriptive
approach was used. The grounded theory indentified service quality dimensions through open coding,
axial coding and selective coding. The analysis was done for the assessment of overall service quality
by doctors, quality of care, nursing quality of care and operative quality of care and the proportion
of statistically significant variance. The service quality in which operative quality of care yielded 79 per
cent; doctor quality of care yielded 45.6 per cent; and nursing quality of care yielded 63.8 per cent of
explanatory power.The results also indicated there is need to improve doctors care in the case of this
organization. Service attributes related to this dimension requires management attention to improve
the doctors care of quality. The article concludes by highlighting the dearth in services marketing
research for service quality measurement through patient perspective in health care organizations.
Keywords
Dimensions, health care organization, patient-perceived quality, service quality
Introduction
Patient-perception of health care quality is critical to the success of a health care organization because of
their influence on patient satisfaction and hospital profitability (Donabedian 1996). Patients demand
Journal of Health Management
14(1) 2741
2012 Indian Institute of
Health Management Research
SAGE Publications
Los Angeles, London,
New Delhi, Singapore,
Washington DC
DOI: 10.1177/097206341101400103
http://jhm.sagepub.com
Sunil C. DSouza, Department of Humanities, Social Sciences and Management, National Institute of Technology
Karnataka, India. Email: sunildsouza31@gmail.com.
A.H. Sequeira, Department of Humanities, Social Sciences and Management, National Institute of Technology
Karnataka, India.
by guest on May 4, 2014 jhm.sagepub.com Downloaded from
28 Sunil C. DSouza and A.H. Sequeira
Journal of Health Management, 14, 1 (2012): 2741
more information than ever and do not hesitate to switch to other health care providers if they do not
obtain satisfaction (Ramsaran-Fowdar 2008). In the new age of health care, the need is to shift the medi-
cal paradigm away from the traditional perception that the accepted standard is just to deliver health care
in a scientific and caring manner. Health care systems are a fundamental interest to all societies, as they
become more advanced and as standards of living rise due to economic development. Quality of life
becomes essential in a global context. The Indian health care industry is going through a transition and
the future is likely to see significant changes in the nature of provision of health care and roles of various
players in the industry. Health care organizations are considered the focal points for health services
delivery and consume nearly 30 per cent of the national health care budget (Pestonjee et al. 2005). A
hospital is an institution suitably located, constructed, organized and staffed to supply scientifically, eco-
nomically, efficiently and unhindered, all or any recognized part of the complete requirements for the
prevention, diagnosis and treatment of physical, mental and medical aspects of social ills, with function-
ing facilities, training the new workers in many special professional, technical and economical fields,
essential to the discharge of its proper function and adequate contacts with physicians, other hospitals,
medical schools and accredited health agencies engaged in better health programmes (Dorland Medical
dictionary).
In the case of health care services, the service providers are doctors, nurses, hospitals, nursing homes,
clinics, etc., because they offer health services for patients. The buyer is the client or a patient who
receives these health services at stipulated charges from government or private hospitals. The buyer
wants acceptable quality services, which must satisfy the predetermined norms. Customers being an
integral part of the health care system are becoming aware of the same. In the competitive world of
health care it becomes more difficult to satisfy a customer (patient). In a situation like this, it is necessary
to understand that one of the key factors satisfying a patient in a hospital is its service quality. It may also
include quality of performance that is directly connected and closely related to the health care such as
food, accommodation, safety, security, attitude of employees and other factors that arise in connection
with hospitals services. It may also include quality of performance that is directly connected and closely
related to the health care such as food, accommodation, safety, security, attitude of employees and other
factors that arise in connection with hospital services. Today, medical standards of all types define the
content and quality of health care in variety of contexts. A continual quality improvement is the basic
mantra of health care providers and there is need to get motivated towards improving the quality stand-
ards. Improving health care quality includes the doctors care of quality, nursing care of quality and
operational-care quality. What is needed for those involved in such medical systems is to realize the true
nature of quality of health care and to be motivated towards improving the quality; that is the greater
concern of this article in the dynamic health care environment.
Review of Literature
The literature on service quality has given various models around the world. Cronin et al. (2000) com-
mented that the literature in evaluating service quality, satisfaction and value is conflicting and confus-
ing. The inter-relationships between quality, value and satisfaction have recent focus of the research to
explain how they relate to each other and how they drive consumer behaviour (Cronin et al. 2000).
Consensus seems to be growing around the opinion that positive perceptions of service quality lead to
Customer-Perceived Service Quality in Health Care Organization 29
increased customer satisfaction and acknowledgement of value. Past research indicates that the value of
service was primarily measured by consumer perception of quality. The significant role that service qual-
ity plays in achieving customer satisfaction and importance of satisfying customers to gain loyalty and
increase profitability, indicates that focus on service quality is beneficial to organizations. Over the years
there has been significant progress noted in the measurement of the perceptions of external service qual-
ity (Cronin and Taylor 1992; Zeithaml et al. 1996). The perceived quality of given service will be the
outcome of an evaluation process where consumers compare their expectations with service they get
(Gronroos 1984). Perceived quality is a form of attitude, long-run overall evaluation where satisfaction
is a transaction-specific measure (Parasuraman et al. 1988). An evaluation of what the customer
receives in interactions with the service firm is technical quality; how the customer receives a service
a called functional quality (Gronroos 1984). Corporate image results from how consumers perceive the
firm (technical quality and functional quality) in addition to external factors (traditions, ideology, word-
of-mouth) and marketing activities (advertising, pricing and public relation) (Gronroos 1984).
Parasuraman et al. (1985, 1988 and 1991) define perceived quality as a gap between consumers expecta-
tions and consumers perceptions regarding the service. Arnauld et al. (2002) define perceived quality,
whether in reference to a product or service, as the consumers evaluative judgment about an entitys
overall excellence or superiority in providing desired benefits. The quality of serviceboth technical
and functionalis a key ingredient in the success of service organizations (Gronroos 1984; Sadiq Sohail
2003). Technical quality in health care is defined primarily on the basis of technical accuracy of the
diagnosis and procedures. Functional quality relates to the manner of delivery of health care services.
Patients are often unable to assess the technical quality of medical services accurately; functional quality
is usually the primary determinant of patients perception of quality (Donabedian 1982; Sadiq Sohail
2003). There is growing evidence to suggest that perceived quality is the single most important vari-
able influencing consumers perception of value and that this, in turn, affects their intentions to purchase
products or services (Bolton and Drew 1991; Zeithamal et al. 1988). Service quality has also become
recognized as a driver of corporate marketing and financial performance (Buttle 1996). Although it is
widely acknowledged that there is a need for quality indicators of patients perception of the quality and
some research in this area exist, Parasuraman et al. (1985) identified five dimensions of service quality
which includes responsiveness, reliability, assurance, empathy and tangibility for various services set-
tings. Based on these dimensions, the SERVQUAL instrument was developed. The SERVQUAL has
widely been used (Buttle 1996) and criticized for its empirical application failure to recover the five
dimensions and to suggest modifying them (Carman 1990; Cronin and Taylor 1992). The latter devel-
opment is in the modification and refinement of dimensions of various service settings. Specific to health
care organizations, the eight dimensions are identified as tangibles, reliability, responsiveness, compe-
tence, courtesy, communication, access and understanding customers (Parasuraman et al. 1988).
Dabholkar (1996) developed the retail service-quality scale in taking into account retailing service qual-
ity dimensions and five dimensions, which are personal interaction, policy, physical aspects, reliabil-
ity and problem solving. G.S. Sureshchandar et al. (Sureshchandar et al. 2001) identified 12 dimensions
of quality management for service organizations which includes top management commitment and
visionary leadership, human resource management, technical system, information and analysis system,
benchmarking, continuous improvement, customer focus, employee satisfaction, union intervention,
social responsibility, service-scapes and service culture. The enrichment of service quality literature is
observed in the form of dimensions as given by various researchers in changing business environments.
The phenomenon of contribution to service quality dimensions in health care was given by Parasuraman
et al. in 1988. Keeping the reference point of the eight dimensions (see column 1 of Table 1), the amount
of variation on service quality dimensions by key researchers was presented (Table 1). The identification
of service quality dimensions is becoming increasingly important in health care, as providers seek to
meet the challenges inherent in a more competitive health care environment. It is evident that the service
quality dimensions are seen as the criteria to assess the service quality in health care organizations.
Research Questions
1. What are the key attributes of patient-perceived service quality?
2. How to evaluate the service quality in health care organizations?
Research Objectives
1. To identify the key attributes of patient-perceived service quality
2. To analyze doctors care of quality in health care organization
3. To analyze nursing care of quality in health care organization
4. To analyze operational care of quality in health care organization
5. To suggest model for patient-perceived service quality
Hypothesis
H
1
: Doctors care of quality has a relationship with overall service quality.
H
2
: Nursing care of quality has a relationship with overall service quality.
H
3
: Operational-care quality has a relationship with overall service quality.
Research Methodology
The research used qualitative and quantitative methods so that the resultant mixture has complementary
strengths and non-overlapping weakness. The population consists of patients from a case health care
organization of South India and 50 patients were considered using purposive sampling technique.
Potential subjects who met the following inclusion criteria were selected from the roster of case health
care organization with the input from the senior nursing supervisor: (a) 1865 years of age, (b) ability to
speak Kannada or English, (c) hospitalised for at least three days, (d) not to be suffering from severe
mental or cognitive disorders, (e) willing to participate, ( f ) communicable and (g) to be well enough to
participate in the interview. The average length of an interview was 2530 minutes. For two interviews,
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the researcher remained as a listener and he was just taking notes and believed in the importance of
acquired experience as a listener. After each of these two interviews, he took time to exchange opinions
and to keep focus on the research problem. This method assures quality of classification and coding as
part of Grounded theory developed for patient service quality to indentify the service quality attributes.
Grounded theory methodology explains the area under investigation based around a core category
which is in turn supported by sub-core categories (Glaser 1978). The core category is the important gen-
eral level behaviour performed in a specific situation, which is then supported by more specific behav-
iours called sub-core categories. The core category is able to explain the majority of the behaviours
observed/reported in the area under study (Glaser 1978).
The study basically started off using the grounded theory for patient of service quality and this explo-
ration was enabled to formulate hypotheses; to test the specific hypothesis, the descriptive approach was
used. The initial study was conducted through personal interview using open-ended questions for
grounded theory. These interview transcripts were open coded for core categories; it was then supported
by more specific behaviours called sub-categories or axial coding and listing on core category items by
selective coding. Finally, the self-administered questionnaire was designed to capture data on the basis
of objectives and the levels of data to be captured. The survey questionnaire consisted of 38 statements
on the Likert scale, where 1 = strongly disagree, 2 = disagree, 3 = neither agree nor disagree, 4 =
agree and 5 = strongly agree. The validity of the instrument was obtained by experts and piloted for
a small group of respondents. The reliability was obtained by computing Cronbach Alpha that measures
the internal consistency of the items.
Out of 50 questionnaires, 45 were obtained in complete with a response rate of 90 per cent. In con-
formity with the ethical requirements of the study, formal consents for conducting research were obtained.
The model fit was determined through regression analysis and the significance by Pearsons correlation.
The model fit was determined through regression analysis (R, R
2
) and the significance by Pearsons
correlation.
Results and Discussion
Grounded Theory for Patient-Perceived Service Quality
After going through all the interview transcripts, the researcher identified three categories that were open
coded as doctors quality of care, nursing quality of care, and operative quality of care. This was the
first-level of categorization (see Table 2).
Axial Coding
Second-level categorization was done by axial coding based on the patients feelings regarding each of
the three dimensions and sub-categories of previous categories. The recorded feelings were positive,
negative and neutral (see Tables 3, 4 and 5).
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Table 3. Axial Coding: Doctors Quality of Care
Doctors Quality of Care Sub-Category
doctors are here always helpful and they explain me clearly about the surgery expenses Positive
Doctor answered my queries satisfactorily. Positive
Nobody cares for us; In these times there is no respect; Our world has become a
jungle.
Negative
Listen to me my friend. I am suffering from a kidney stone. Since now I have visited
many hospitals, doctors here are the best I have ever seenI do not feel pain.
Positive
Doctors are honest. Positive
They explain clearly about the treatment. Positive
Doctors here say there is no cure or treatment for thisI do not believe this! Negative
My doctor gave me worst advice. Negative

Source: Condensed Interview Transcripts.
Table 4. Axial Coding: Nursing Quality of Care
Nursing Quality of Care Sub-Code Category
Sometimes I feel caring is a curse; I just asked about my diethere nobody is

bothering.
Negative
Nurses are always helpful and supportive. Positive
Nurses communicate with the doctors very well. Positive
The nursing staff in this hospital is the best I have ever seen; I do not feel pain. Positive
Nurses communicate with supportive staff very well. Positive
They communicate with doctors very well. Positive
When I asked to call my doctors, she politely said, He is on the rounds. positive
Table 5. Axial Coding: Operational Quality of Care
Operational Quality of Care Sub-Code Category
He has to seek opinion from superior it seems; Nobody guides me. Negative
Admission process is simple. Positive
I waited for a long time; Bill is not ready; Now they are contacting the nursing
station!
Negative
Selective Coding
The third-level of categorization was done by selective coding; it finally gives the list of specific attributes
related to doctors quality of care, nursing quality of care, and operative quality of care (see Figure 1).
Reliability Analysis
The reliability was obtained by computing Cronbach Alpha that measures the internal consistency of the
items. Owing to the multi-dimensionality of service quality, Cronbach Alpha was computed separately
and it was ranged from 0.901 to 0.958 indicating higher level of internal consistency (see Table 6).
Typically, reliability co-efficient of 0.7 or more is considered to be adequate (Cronbach 1951; Nunnally
1978).
Descriptive Statistics
It includes means and standard deviations, which were reported for all variables in the data set. Standard
deviations (SDs) were used to indicate how far all of the scores in the distribution deviated or varied
Figure 1. Patient-Perceived Service Quality Using Grounded Theory
Source: Grounded Theory.
from the mean between each variable. Descriptive information regarding the means and standard devia-
tions gave respondents attitudes toward these dimensions regarding the usefulness of patient-perceived
quality in the health care organization. A five point Likert scale was used (1 = strongly disagree and
5 = strongly agree), and respondents indicated their strong response to doctors care of quality with
means ranging from 3.3 to 3.89, nursing care of quality with means ranging from 3.98 to 4.17, opera-
tional care of quality with means ranging from 3.6 to 3.94 and overall service quality with means ranging
from 3.77 to 4.06 (see Tables 7, 8, 9 and 10).
Table 6. Results of Reliability Analysis
Dimensions No. of Items Cronbachs Alpha
Doctors care of quality 11 0.958
Nursing care of quality 11 0.948
Operational care of quality 10 0.933
Overall service quality 6 0.901
Source: Author.
Table 7. Descriptive Statistics for Doctors Care of Quality
Questions P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11
Doctors care
of quality
Mean 3.81 3.85 3.68 3.66 3.51 3.51 3.66 3.89 3.77 3.47 3.30
SD 0.90 0.81 0.91 0.84 0.98 0.98 0.89 0.84 0.87 1.06 1.10
Source: Author.
Table 8. Descriptive Statistics for Nursing Care of Quality
Questions P12 P13 P14 P15 P16 P17 P18 P19 P20 P21 P22
Nursing Care
of Quality
Mean 4.00 4.13 4.04 4.13 4.06 4.04 3.98 4.04 4.09 4.13 4.17
SD 0.72 0.49 0.55 0.49 0.53 0.55 0.61 0.55 0.54 0.45 0.56
Source: Author.
Table 9. Descriptive Statistics for Operational Care of Quality
Questions P23 P24 P25 P26 P27 P28 P29 P30 P31 P32
Operational Care
of Quality
Mean 3.94 3.74 3.91 3.89 3.77 3.70 3.70 3.74 3.74 3.60
SD 0.79 0.85 0.58 0.67 0.70 0.75 0.78 0.77 0.79 0.90
Source: Author.
Table 10. Descriptive Statistics for Overall Service of Quality
P33 P34 P35 P36 P37 P38
Overall Service Quality
Mean 3.79 4.06 3.77 3.83 3.85 3.85
SD 0.81 0.53 0.73 0.67 0.81 0.66
Source: Author.
Factor Analysis
The results of the factor analysis confirmed that attributes on scale were reliable in their measurement
and most of them were found to be above the adequacy level. However, results suggested that doctors
care of quality and nursing care of quality in the case organization requires improvement. The attri-
butes related to these dimensions needs the management concerned to improve its service quality (see
Tables 11, 12, 13 and 14).
Testing Hypotheses
In this study, default of 0.05 was used to determine the level of significance. H
1
, H
2
and H
3
were statis-
tically significant (p less than 0.05). Doctors care of quality (H
1
), nursing care of quality (H
2
) and opera-
tional care of quality (H
3
) had a significant relationship with the overall service quality (see Table 15).
Table 11. Results of Factor Analysis for Doctors Care of Quality
Sl. No. Attributes Loadings
P1 Friendly 0.642
P2 Answers your queries 0.617
P3 Helpful and supportive 0.770
P4 Listening 0.683
P5 Explaining clearly 0.794
P6 Care a lot 0.764
P7 Treat your family and friends 0.831
P8 Communication with nurses 0.730
P9 Communication with supportive staff 0.639
P10 Readily clear doubts 0.848
P11 Available on time 0.533
Source: Author.
Table 12. Results of Factor Analysis for Nursing Care of Quality
P12 Sufficient care 0.643
P13 Helpful and supportive 0.877
P14 Listening 0.739
P15 Friendly 0.852
P16 Answers your queries 0.775
P17 Treat your family and friends 0.813
P18 Explaining clearly 0.819
P19 Communication with supportive staff 0.911
P20 Communication with doctors 0.689
P21 Understanding needs 0.761
P22 Available on time 0.862
Source: Author.
Table 13. Results of Factor Analysis for Operational Care of Quality
P23 Admission process 0.764
P24 Billing system 0.800
P25 Queue management 0.784
P26 Internal atmosphere 0.836
P27 Blood bank 0.744
P28 Laboratory 0.852
P29 Operation schedule 0.865
P30 Change of bed sheets 0.835
P31 Conducive interaction 0.672
P32 House keeping 0.648
Source: Author.
Table 14. Results of Factor Analysis of Overall Service Quality
P33 Expectation with doctors 0.498
P34 Expectation with nurses 0.485
P35 Expectation with support staff 0.732
P36 Overall administration 0.807
P37 Overall cleanliness 0.698
P38 Overall satisfaction 0.901
Source: Author.
Table 15. Hypotheses: Service Quality Dimensions
Hypothesis Test Value df Asymp.Sig. (2-sided)
H1 Pearson Chi-Square 29.769 12 0.003
Likelihood Ratio 25.138 12 0.014
Linear-by-Linear Association 12.058 1 0.001
Source: Author.
Using regression analysis, the extent to which independent variables accounted for variance in depend-
ent variables was assessed. The analysis was done for the assessment of overall service quality by three
independent variables and the proportion of variance statistically significant. In the three regression
models, doctors care of quality yielded 45.6 per cent of explanatory power in the quality perception of
patients, nursing care of quality yielded 63.8 per cent of explanatory power in the quality perception of
patients and operational care of quality yielded 79 per cent of explanatory power in the quality percep-
tion of patients (see Table 16). The results indicated that there is need to improve doctors care in the case
organization. Service attributes related to this dimension require management attention to improve the
service quality.
Table 16. Regression Analysis of Service Quality
Dimensions R
R
Square
Adjusted
R Square
Std Error
of the
Estimate
Change Statistics
R Square
Change
F
Change df1 df2
Sig. F
Change
Doctors care of quality 0.675 0.456 0.444 0.60108 0.456 37.681 1 45 0.000
Nursing care of quality 0.798 0.638 0.630 0.32117 0.638 79.171 1 45 0.000
Operational care of
quality
0.889 0.790 0.785 0.31029 0.790 169.360 1 45 0.000
Source: Author.
Figure 2. Customer-Perceived Service Quality Model for Health Care Organization
Limitations and Direction for Future Research
The study was limited for a case health care organization. The results are subject to a specific case and
findings cannot be generalized. Factor analysis was used only to specify loadings on each attribute and
considered for smaller sample size. The service attributes were limited for the customer assessment of
service quality. To ensure representativeness, the study should be replicated for a bigger sampling size
and results should be compared to those found in the study.
Conclusion
With the increasing awareness among consumers and with ever-increasing competition, medical services
will have to focus on customer assessment to improve service quality. The Health care systems are
required to decide whether they want to initiate change or adopt change that has been externally imposed
upon them. Results from the study suggest that customer assessment provides inputs for the case health
care organization to improve its service-quality attributes. The study suggests it was appropriate to iden-
tify and improve the service performance through patients perception of service quality.
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- Mar 8, 2012 Version of Record >>

Doctor answered my queries satisfactorily. Positive

Doctors are honest. Positive

They explain clearly about the treatment. Positive

My doctor gave me worst advice. Negative

Sometimes I feel caring is a curse; I just asked about my diethere nobody is

Nurses are always helpful and supportive. Positive

Nurses communicate with the doctors very well. Positive

Nurses communicate with supportive staff very well. Positive

They communicate with doctors very well. Positive

Admission process is simple. Positive

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