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International Journal of Engineering and Management Research, Vol.

2, Issue-4, August 2012


ISSN No.: 2250-0758
Pages: 1-4
www.ijemr.net

SERVICE QUALITY IMPACT ON CUSTOMER SATISFACTION - A


STUDY OF ICICI BANK IN MYSORE CITY
1

Arun kumar.G, 2Dr.S.J.Manjunath


Research scholar,MBA Department,BIMS, university of Mysore. E-mail2
Associate professor, MBA Department,BIMS, university of Mysore.
1
arunbimsuom@gmail.com, 2sjmanjunath@gmail.com

ABSTRACT
Service quality plays a major role in customer satisfaction
and creating brand loyalty in banking sector. In the
competitive environment in the banking sector, customer
satisfaction and service quality have emerged as one of the
important aspect. The rapid growth and competitive
competition in service sectors, in developing countries, has
made it significantly important for the organizations to
measure and evaluate their service quality this paper
examines the service quality in the banking and identifies
dimensions which contribute to customer satisfaction. In this
study five dimensions are used namely responsiveness,
reliability, assurance, empathy and tangibles. The study is
based on the primary data which has been collected through
a structured questionnaire. The study is confined to the only
ICICI bank. The data has been collected from 152
respondents through the simple random sampling method in
Mysore city. The data were analyzed by one sample t-test and
regression analysis. The result revealed that all the
dimensions which have been used in the study are positively
related to customer satisfaction.

KEYWORDS - Customer satisfaction, ICICI bank, Mysore


city, service quality

I. INTRODUCTION
Service quality can bened
de as the difference
between customers expectations of service and their
perceptions of the actual service performance. Schiffman
highlighted that a consumers evaluation of service quality
is the gap between the customers expectations of service
and the customers assessment (perception) of the service
actually delivered. Service quality is the core concept for
ensuring a successful supply of services in general. This

holds in particular for the private banking sector, which is


a clean service industry in which the service is performed
almost completely in the attendance of the customer.
Private banking involves insubstantial goods requiring the
participation of the customer in the process. In such a
setting, bank services aim to optimize the service quality in
order to attain a superior outcome level. The outcome of
service quality, what firms expand by delivering a highquality service, is the return on quality concept, and
service profit chain. Heskett, establish linkages between
the value of the service, customer loyalty, customer
satisfaction, service quality, and financial results. Service
quality can be defined as the customers satisfaction with
the actual performance of the service.

II. LITERATURE REVIEW


Service quality is about meeting customer needs
adequately by matching to his expectations. Service
quality in banking implies every time anticipating and
satisfying the needs and expectations of customers. The
significance of service quality in Banks has been
emphasized in studies and perceived quality advantage
leads them to higher profit. Parasuraman holds the view
that high quality service gives credibility to field sales
force. Heskett observed that the longer a company keeps a
customer, the more money it stands to make. There is
sufficient evidence that demonstrates the planned benefits
of quality in contributing to income, market share and
returns on investment and reducing cost and improving
productivity. Maximizing customer satisfaction through
quality customer service has been described as the final
weapon by Davidow & Uttal.
The speedy growth and intensified competition in
service industries has made it considerably important for
the companies to calculate and evaluate service quality.
Organizations operating in service sector know that their

consumers service quality is one of key input factors for


victory at local as well as global level. Parasuraman
SERVQUAL model (1988) is widely used to measure
perceived service quality. Consumers evaluation about
service quality depends on size and direction of the gap
between the service the customer expects to receive and
what he or she perceives to have been received. Service
quality is defined as the difference between the consumers
expectation about service and insight of the service
experience. A service quality gap exists when there is a
shortfall in which the service provider would like to close.
Service quality is well-known as a multi-dimensional
construct. Its dimensions often differ from one researcher
to other researcher, but still there is some agreement that
service quality mainly consists of three main features:
outcome quality, interaction quality, and physical
service environment quality. Numerous researchers
elaborated sub aspects of these three extensive dimensions
e.g., the most popular construct of service quality
SERVQUAL have five dimensions: tangibles,
responsiveness,
empathy
reliability,
and
assurance. The tangibles dimension contact with a
physical environment aspect, the reliability dimensions
corresponds with the service outcome aspect and
remaining three signify interaction quality aspect. Weekes
(1996), believed that SERVQUAL main strength, over
other measures of service quality such as SERVPERF is its
capability
to
successfully
taken.
Nevertheless,
SERVQUAL had also some criticisms on both operational
and theoretical issues as well. Asubonteng (1996) did 18
critical reviews on service quality and conclude that
SERVQUAL instrument is industry specific. In the study
of Carman he found eight service quality dimensions.
Thomas, Dan R. E.,(1978) says that service separation is
necessary for the growth of service businesses. Chase,
Richard B ,(1981) holds that the potential competence of a
service system is a function of the degree of customer
contact entailed in the formation of the service product.
Roest explored the appraisal of service quality
expectations and opportunities to manage them in purchase
decision making. Dellande stated that services in which the
customer participated to create while within the service
business and must comply with his role once outside of the
service organization to confirm positive outcomes and
customer satisfaction, have been identified as compliance
dependent services (CDS. Oliva Pue, Rogelio,(1996) stated
that service quality could not be measured and experienced
in as straightforward a manner as quality could be
calculated and experienced in manufacturing. The
difficulty in developing quality metrics had prejudiced
service businesses to focus on controlling measurable
variables-- typically, expenses and work flow while underinvesting in the more intangible factors of service
capability and service quality. In the long-term, this plan
could result in mediocre levels of service quality, high
turnover of service personnel, low customer loyalty, and
poor customer satisfaction. Eventually, this result could
modify the cost structure of service delivery by changing

the major cost component from operating expenses to the


costs of poor quality

III.

OBJECTIVE OF THE STUDY

To study about the satisfaction of the customers of ICICI


bank towards service quality.

IV. METHODOLOGY
The research method used to gather data to be the simple
random sampling method, with a prepared set of questions.
The method was used because it enabled the researcher to
win the respondent cooperation. The data were collected
from 152 respondents of ICICI bank in Mysore city and
the data was analyzed through one sample t test and
regression analysis.

V.

HYPOTHESIS

1) Ho There is no significant positive


2) Influence of reliability on customer satisfaction.
3) Ho - There are no significant effects of empathy on
customer satisfaction.
4) Ho - There is no significant influence of assurance
on customer satisfaction.
5) Ho - There is no significant positive influence of
tangibles on customer satisfaction.
6) Ho - There is no significant effect of tangibles on
customer satisfaction

VI.

DATA ANALYSIS AND


INTERPRETATION

1. Demographic analysis Analysis of demographic information revealed that 23


percent customers were young and aged between 15 years
to 30 years, 59 percent of the respondents were males.
Around 55percent of the sample respondents had
graduation and 66 percent were employed; out of the total
sample 41 percent of the respondents annual income was
in between 2,00,000to 2,50,000 p.a

2. One sample t test


Table 1 One-Sample Statistics

Tangible
Reliability
Assurance
Responsivene
ss
Empathy

Std.
Deviation

Std. Error
Mean

Mean

152
152
152

8.2171
6.8947
6.4079

1.85900
1.12266
1.16434

.15078
.09106
.09444

152

4.9737

1.13317

.09191

152

4.3658

1.23532

.09658

Table 1.1 One-Sample Test


Test Value = 3
95% Confidence
Sig.
Interval of the
(2Mean
Difference
tailed Differenc
df
)
e
Lower Upper

t
Tangible
Reliability
Assurance
Responsive
ness
Empathy

34.600 151 .000 5.21711 4.9192


42.771 151 .000 3.89474 3.7148
36.085 151 .000 3.40789 3.2213

5.5150
4.0747
3.5945

21.474 151 .000 1.97368 1.7921


26.356 151 .000 3.62552 3.3565

2.1553
3.3562

First the one sample t test was conducted the


result showed (table-1) that all the five dimensions were
positively related. Further, the regression analysis was
done to analyze the coefficient of dependent and
independent dimensions on customer satisfaction. The
above results (table2.1) indicate that p value is .000 hence
the regression model was fit. In table (2) R square is .849 it
implies that there is 84.9% variance by five dimensions on
customer satisfaction. The adjusted R square shows the
amount of variance explained by independent variable on
dependent variable. The coefficient table 2.3 shows the
regression analysis of tangible and customer satisfaction.
Beta coefficient is .660 and p<0.05 which shows their relations
is positive. The regression analysis of reliability and customer
satisfaction is shown in table 2.3 Beta coefficient is 0.351 and
p<0.05 which shows their relations is positive. The regression
analysis of Assurance and customer satisfaction reveals that
beta coefficient is 0.472 and p<0.05 which shows their
relations is positive. The regression analysis of
responsiveness and customer satisfaction has a beta
coefficient is 0.450 and p<0.05 which shows there is a
significant relationship. Finally the regression analysis of
empathy towards customers' satisfactions showed a beta
coefficient is 0.456 and p<0.05 which shows their relations
is positive. From the above analysis it is revealed that the all
the five dimensions have a significant positive relationship
towards the customer satisfaction. Therefore we accept the
alternative hypothesis of the all the five dimensions and
reject all null hypothesis.

Regression Table 2 Model Summary

Model

R
.921a

Adjusted R
Square

R Square
.849

Std. Error of
the Estimate

.845

1.14168

Table 2.1 ANOVAb


Model

Sum of
Squares

1Regression

1076.864

191.603

146

1268.467

151

Residual
Total

Mean
Square

df

269.216 206.546

Sig.

VII.

.000a

1.303

The Banking industry is evolving into an exceedingly


competitive scene , with both foreign and local players
fighting for a share in the customers minds. Service
quality has long been accepted as the most basic marketing
tool for bankers to create competitive advantage. Hence
there is a need to monitor and maintain the service quality
from time to time. The study revealed that the all the
dimensions in the ICICI bank positively related to
customer satisfaction.

a. Predictors: (Constant),
Responsiveness, Tangible,
Reliability, Assurance, Empathy
b: Dependent Variable:
Overall
Table2.3 Coefficientsa

Unstandardized
Coefficients
Model

Std. Error

Standa
rdized
Coeffic
ients
Beta

REFERENCES
1.
t

Sig.

1 (Constant)

2.730

1.032

2.645

.009

Tangible

1.029

.052

.660 19.846

.000

Reliability

.905

.086

.351 10.516

.000

Assurance

1.176

.083

.472 14.105

.000

Responsiveness
Empathy

1.152
1.165

.086
.082

.450 13.458
.456 13.632

.000
.000

a. Dependent Variable:
overall

CONCLUSION

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