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Chapter III

RESEARCH DESIGN AND METHODOLOGY

This chapter confers the research methods, techniques and procedures

utilized to empirically examine the customer perception and satisfaction on

banking services. Using a bunch of nationalised commercial banks and a

sample of their customer base, this study examines service quality gaps in a

unique and original manner utilizing SERVQUAL instrument.

Descriptions of how each construct of the empirical model was

established are set out in this chapter. The objective of this chapter is to

determine the objectives of the study based on the statement of the problem

given in the Chapter I. Formulated hypothesis sampling design and description

of the procedures used to measure the constructs and collect data.

3.1 Objectives of the Study

The main objective of the study is to evaluate association among

FXVWRPHUV expectation, perception, perceived service quality and satisfaction

of the select nationalised commercial banks. However the specific objectives

are:

i. To determine the level of expectation, perception, service quality and

satisfaction of the customers on the services offered by the sample banks

confined to this study.


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ii. To establish the degree of association between perceived service quality

and satisfaction of the customers.

iii. To assess the predominant service quality constructs in determining

perceived service quality and customer satisfaction.

iv. To examine the level of expectation and perception on banking services

for dissatisfied and satisfied customers.

v. To expose the predominant service quality constructs perceived that

contributes to the classification of bank customers as dissatisfied and

satisfied.

vi. To assess the importance of service quality as compared to location,

advertising, recommendation of others, and service charges in the

selection of a bank by a customer

vii. To establish the degree of association between frequency in use of bank

and satisfaction of the customers.

viii. To assess the impact of demographic variables on the perceived service

quality and customer satisfaction.

ix. To quantify the degree of association of service quality dimensions,

average weighted perceived service quality and satisfaction with

behavioural intentions.

x. To examine the variation in behavioural intentions among dissatisfied

and satisfied customers.


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3.2 Hypotheses

On the basis of the objectives of the study, the following hypotheses are

framed and tested in the present study.

3.2.1 Difference among Bankers of the Respondents

Every bank is capable of providing an individual with retailing services,

but not every bank manages to treat customers in a way that they are pleased.

Though, customers rely on the services delivered to them by the bank,

customers expect banks to provide the basic banking services, and also expect

different levels of services to maximize the value they can obtain from banks.

From these statements, it is clear that banks can offer similar retailing services,

indeed all the sample banks restrained to this study do as they all are

nationalised banks regulated by RBI. But, not in the way services are delivered,

which is in the hands of the employees responsible for handling issues relating

to them. It means every employee may not be same in personality

characteristics and pleasing enough. Thereby, every bank differentiates

themselves from others the way services are delivered. However, the ever

raising expectations of the customers makes the bankers kindle to strive hard

for its existence. It is obvious that there is a considerable difference between

banks on its services perceived by the customers, but there is a scarcity for

literature with regard to sample banks in view of Indian perspective. As a result

of conceptual and empirical research, an alternative hypothesis is proposed.

This hypothesis states that:


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H1 There will be a difference in expectation and perception on

banking services by the customers, and eventually on perceived

service quality and customer satisfaction among sample banks.

The null hypothesis is, therefore:

H01 There will not be a difference in expectation and perception

on banking services by the customers, and eventually on

perceived service quality and customer satisfaction among

sample banks.

3.2.2 Association between Service Quality and Customer Satisfaction

A focal point of discussion is the casual ordering between service

quality and customer satisfaction. Though, there is considerable debate about

the conceptual distinctness of these two concepts, from empirical studies it is

evident that there is a strong positive association between service quality,

customer satisfaction and loyalty.1,2 However, it was observed that the

literature does not specifically address the unique relationship among service

quality, customer satisfaction and loyalty in view point of banking service.

Hence, the investigator seeks to explore it, and posit that:

H2 There will be a significantly positive relationship between

perceived service quality and satisfaction of the customers.

1
K.A. Venetis, Service Quality and Customer Loyalty in Professional Business Services Relationships:
An empirical investigation into the customer-based service quality concept in the Dutch advertising
industry, Thesis, Maastricht University, Maastricht (1997).
2
9DOHULH $ =HLWKDPO /HRQDUG / %HUU\ DQG $ 3DUDVXUDPDQ The Behavioural Consequences of
6HUYLFH4XDOLW\Journal of Marketing, 60, (1996), 31-46.
109

The null hypothesis is, therefore:

H02 There will not be a significantly positive relationship

between perceived service quality and satisfaction of the

customers.

3.2.3 Factors determining Service Quality and Satisfaction

The predominant view is that quality influences customer satisfaction.1

It was noted from the review of literature that there is a lack of evidence in

confirming the predominance of service quality dimensions apparently focuses

on the banking services. Therefore, in the present study the investigator

postulated to detect the predominant perception constructs in determining the

perceived service quality and satisfaction of the customers, and posit that:

H3 Predominance of service quality dimensions and its constructs

VXEVLVWVLQGHWHUPLQLQJFXVWRPHUVperceived service quality and

satisfaction.

The null hypothesis is, therefore:

H03 Predominance of service quality dimensions and its

constructs ZLOO QRW VXEVLVW LQ GHWHUPLQLQJ FXVWRPHUV perceived

service quality and satisfaction.

1
D. Iacobucci, A.L. Ostrom, B. Baig, and A. Beezjian-Avery, (1996). A canonical model of consumer
evaluations and theoretical bases of expectations. In: Swartz A.T., Bowen D.E., Brown S.W. (Eds.),
Advances in Services Marketing and Management, vol. 5. JAI Press, Greenwich, CT, pp. 1-44.
110

3.2.4 Perception and Expectation of Dissatisfied and Satisfied Customers

7KHFXVWRPHUVSHUFHSWLRQDQG expectation is a constituent of perceived

service quality and indeed customer satisfaction too. The theory on the

disconfirmation of expectation exploited both perception and expectation that

categorized customers as dissatisfied and satisfied on the services offered by

their bankers. As the perception and expectation are the basis for classifying

FXVWRPHUVDVGLVVDWLVILHGDQGVDWLVILHG, the investigator felt the need to explore

it, and posit that:

H4 There will be difference in the level of expectation and

perception on banking services between dissatisfied and satisfied

customers.

The null hypothesis is, therefore:

H04 There will not be difference in the level of expectation and

perception on banking services between dissatisfied and satisfied

customers.

3.2.5 Discriminating the Customers as Dissatisfied and Satisfied

The literature pertaining to the determinants of customer satisfaction

was entrusted upon the service quality dimensions and constructs perceived by

the customer, and ultimately the dissatisfied and satisfied customers would

perceive service quality as low or high. Correspondingly, the customers can be

classified as dissatisfied and satisfied on the basis of their perception of service

quality. In order to examine this assumption, the investigator posits that:


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H5 The perception of selected service quality constructs may

contribute to the classification of bank customers as dissatisfied

and satisfied.

The null hypothesis is, therefore:

H05 The perception of selected service quality constructs may not

contribute to the classification of bank customers as dissatisfied

and satisfied.

3.2.6 Factor of utmost importance in the bank selection process

Though the literature reports numerous studies relating to service

quality, location, and other selection options, the literature review did not

uncover service quality or location as the most important an element in

influencing selection. To provide respondents with an unbiased choice, five

factors including service quality and location were listed alphabetically for

their choosing. Respondents were asked to rank each of the five elements.

Hence, the sixth hypothesis to be examined by the study is addressed as

follows:

H6 Service quality is more important in the selection of a bank by

a customer than other factors, such as location, advertising,

recommendation of others, and service charges.

The corresponding null hypothesis takes the following format:

H06 There is no evidence to indicate that service quality is more

important in the selection of a bank by a customer than other


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factors, such as location, advertising, recommendation of others,

and service charges.

3.2.7 Influences of Service Encounters on Customer Satisfaction

In service organizations, customer satisfaction is often determined by

the quality of individual encounters the service encounter.1 The service

encounter encompasses all elements of the interaction between consumer and

service organization: the intangible as well as the tangible elements. The

customer is mainly interested in the service quality and customer satisfaction

derived from the service encounter. However, it was observed that the literature

does not distinctively deal with the issue related to the influences of service

encounters on customer satisfaction, which this study concentrates on.

H7 There will be a significantly positive relationship between the

number of VHUYLFHHQFRXQWHUVDQGFXVWRPHUVVDWLVIDFWLRQ

The null hypothesis is, therefore:

H07 There will not be a significantly positive relationship

between the number of VHUYLFH HQFRXQWHUV DQG FXVWRPHUV

satisfaction.

3.2.8 Influence of Demographic Characteristics

The literature has no definitive conclusions concerning the impact of

whether demographic data such as age, gender, income, and education will

1
0DU\-R%LWQHU(valuating Service Encounters: The Effects of Physical Surroundings and Employee
5HVSRQVHVJournal of Marketing, 54 (April 1990), pp. 69-82.
113

have on service quality perceptions and expectations in general applications

even though Howcroft1, et al (2002) found variables such as age and other

demographics impact customer selection and satisfaction in specific situations.

This study has included specific questions relating to age, gender, income, and

education in hopes of establishing either a positive or negative impact on

overall service quality outcomes. Therefore, the eighth hypothesis will examine

the likelihood of the following:

H8 Differences on perceived service quality and customer

satisfaction among sample bankers are influenced by the

variation in age, gender, income, and education of the

respondents.

A null hypothesis would be the following:

H08 Differences on perceived service quality and customer

satisfaction among sample bankers are not influenced by the

variation in age, gender, income, and education of the

respondents.

3.2.9 Service Quality and Behavioural Intentions

Although an investigation of overall satisfaction with services provides

relevant insight regarding loyalty, even greater knowledge can be obtained by

distilling satisfaction into its various dimensions, especially in an industry

1
%DUU\ +RZFURIW 5REHUW +DPLOWRQ DQG 3DXO +HZHU &RQVXPHU $WWLWXGH DQG 7KH 8VDJH DQG
Adoption of Home-Based BaQNLQJLQWKH8QLWHG.LQJGRPInternational Journal of Bank Marketing,
20/3, (2002), 111-121.
114

where switching behavior and customer loyalty are paramount.1 Theory

VXJJHVWV WKDW WKH SHRSOH IDFWRU i.e., service quality), in terms of

tangibility,reliability, responsiveness, assurance, and empathy2,3 may be the

most salient in determining overall satisfaction and repeated purchasing in

service industries.4

If the evaluation of service quality and customer satisfaction is positive,

the customer may decide to remain loyal to the service organization. 5, 6 Indeed,

OLWHUDWXUHVGLGQWFRPHWRDFRQVHQVXVWKDWVRPHGLPHQVLRQVRIVDWLVIDFWLRQPD\

be more important antecedents of repeat-purchase behavior and loyalty than

others are. It posits that:

H9 The dimensions of service quality, average weighted

perceived service quality and satisfaction levels may have

significantly positive relationship with the behavioural intentions

of the customers.
1
Roland T. Rust, and A.J. Zahorik, Customer Satisfaction, Customer Retention, and Market Share
Journal of Retailing, vol. 69, (1993), pp. 193215.
2
A. Parasuraman, Valerie A. Zeithaml, and Leonard L. Berry, A Conceptual Model of Service
Quality and its Implications for Future Research, Journal of Marketing, vol.49 (1985), pp.41-50.
3
. Parasuraman, Valerie A. Zeithaml, and Leonard L. Berry, Reassessment of Expectations as a
Comparison Standard in Measuring Service Quality: Implications for Further Research Journal of
Marketing, vol.58 (1994), pp.111-124.
4
Jaishankar Ganesh, Mark J. Arnold, and Kristy E. Reynolds, Understanding the Customer Base; in
Atila Yksel and Fisun Yksel, Measurement of Tourist Satisfaction with Restaurant Services: A
Segment-Based Approach Journal of Vacation Marketing, vol. 9, no. 1, (2002): pp. 52-68
5
-RKQ (* %DWHVRQ   3HUFHLYHG &RQWURO DQG WKH 6HUYLFH (QFRXQWHU ,n Czepiel, John A.;
Solomon, Michael R. and Suprenant, Carol F. (Eds.). The Service Encounter: Managing
Employee/Customer Interaction in Service Businesses. Massachusetts: Lexington Books, pp.67-82.
6
John A. Czepiel, Michael R. Solomon, Carol F. SuprenantDQG(YHO\Q**XWPDQ  6HUYLFH
(QFRXQWHUV$Q2YHUYLHZ,Q&]HSLHO-RKQ$6RORPRQ0LFKDHO5DQG6XSUHQDQW&DURO) (GV 
The Service Encounter: Managing Employee/Customer Interaction in Service Businesses.
Massachusetts: Lexington Books, pp.3-15.
115

The null hypothesis is, therefore:

H09 The dimensions of service quality, average weighted

perceived service quality and satisfaction levels may not have

significantly positive relationship with the behavioural intentions

of the customers.

3.2.10 Behavioural Intentions among Customers with Different Levels of

Satisfaction

Moreover, the literatures uphold the necessity to investigate and provide

a better understanding of the drivers of customer satisfaction that persuades

behavioural intentions of customers. Therefore, there is a niche to evaluate the

role of satisfaction levels on the behaviour and intention of customers. Hence,

the tenth hypothesis purports to establish the significant difference on

EHKDYLRXUDO LQWHQWLRQV DPRQJ FXVWRPHUV ZLWK GLIIHUHQW OHYHOV RI VDWLVIDFWLRn

on the services of bankers based upon the following:

H10 There will be a statistically significant distinction among

customers with different levels of satisfaction on the elements of

behavioural intentions.

A null hypothesis would be the following:

H010 There will not be a statistically significant distinction

among customers with different levels of satisfaction on the

elements of behavioural intentions.


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3.3 Study Design and Sampling Method

In this study, the study design adopted for quantitative data collection

using field based questionnaires is the cross-sectional survey design. The

systematic random sampling technique is considered to select customers from

the branches of sample banks in the geographical location confined to this

study.

The calculation of sample size depends on the sampling design and the

indicator. Thereby, to calculate sample size for systematic random sampling

there is a need to come up with the following two points:

1. Expected prevalence of the indicator that is to be measured.

2. The width of the confidence that have to be achieved to meaningfully

interpret the estimate.

The sample size formula for systematic random sampling is as follows:

n = [Z2 x (p x q) / d2]

Where: n = sample size

z = linked to 95% confidence interval (use 1.96)

p = expected prevalence (as fraction of 1)

q = 1- p (expected non-prevalence)

d = relative desired precision


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3.4 Research Sample

The research sample was restrained to three banks and its branches

totaling 87 (Canara bank-36, Indian overseas bank-28, and Indian bank-23)

spread across seven different taluks and Madurai city in Madurai district,

Tamilnadu state, India. These details were collected from the secondary source

namely: Annual Credit Plan published by the district lead bank Canara bank.

These sample banks were chosen on the basis of their status as nationalised

commercial banks with more number of branches and their geographical

location. The total number of branches of sample banks existing during the

period (2009-2010) of data collection was as shown in Table 3.1.


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Table 3.1: Number of Existing Branches of Sample Banks

Indian
Canara Indian
Overseas Total
Bank Bank
Bank

Madurai City 19 17 14 50

Madurai North 4 5 3 12

Madurai South 1 2 2 5

Melur 1 2 1 4
Madurai
District Vadipatti 2 2 37
Taluks
Usilampatti 3 2 5

Peraiyur 3 1 1 5

Thirumangalam 3 1 4

Total 36 28 23 87

Twenty percent of the sample bank branches (with regard to city and

taluk areas in Madurai district) were systematically selected and taken into

consideration for the purpose of achieving research objectives, which

accounted for a total of 18 sample bank branches in the district of Madurai.

Thereby, the selection of bank branches was randomized. The number of

branches of sample banks chosen from Madurai district was as shown

in table 3.2.
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Table 3.2: Number of Branches Selected from Sample Banks

Indian
Canara Indian
Overseas Total
Bank Bank
Bank

Madurai City 4 3 3 10

Madurai North 1 1 2

Madurai South

Melur 1 1
Madurai
District Vadipatti 08
Taluks
Usilampatti 1 1 2

Peraiyur 1 1 1 3

Thirumangalam

Total 7 6 5 18

In each of these selected bank branches, certain numbers of

questionnaires were distributed to one in every five customer in the lobby of

the bank, on a given day. Providing the sample questionnaire to every fifth

customer at bank premises will provide a randomly selected sample for the

customer portion of the study.

The number of questionnaires circulated to bank customers in the bank

lobby was 1870, however the number of customers responded in answering

questionnaires in all respect were 1428 with the percentage of respondent was
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76. The number and percentage of respondents corresponding to sample

bankers was given in Table 3.3.

Table 3.3: Bankers of Respondents

Indian Overseas
Canara Bank Indian Bank Total
Bank

Number of
580 470 378 1428
Respondents

Percentage of
40.6 32.9 26.5 100
Respondents
Source: Primary Data

3.5 SERVQUAL

The revised SERVQUAL instrument by Parasuraman, et al. (1991)

offers the most reliable device to measure the difference-score

conceptualization and evaluate expectations and perceptions of service quality.

As pointed out in the second chapter of this study, SERVQUAL examines five

dimensions examining the reliability coefficients for the perception-minus-

expectation scoring of gaps. The five factors are tangibles, reliability,

responsiveness, assurance, and empathy.

These five dimensions/factors are addressed across 22 questions that

relate to the various five GLPHQVLRQV 7KH LQVWUXPHQWV GHVLJQ FDXVHV LW WR EH

best suited for use as a diagnostic methodology utilized for determining large

areas of service quality strengths and weaknesses.

However, this study will attempt to further evaluate and refine the

customer study by including such elements as gender, age, education, income,


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frequency of bank use, and items influencing the selection of the bank.

Parasuraman et al. (1991) suggested that items not fitting in the five

dimensions might be useful as long as they are treated separately in analyzing

the survey data since they do not fall under the conceptual domain of service

quality.

3.6 Design and Development of the Customer Questionnaire

The SERVQUAL scale was selected for the customer survey instrument.

To evaluate the five dimensions, the twenty-two statements were modified to

apply to banking. Bank customers were asked to indicate their level of

agreement for two sets of identical twenty-two statements. One set of questions

asked the customer to state theiU H[SHFWDWLRQV DERXW WKH EDQNV VHUYLFHV

Another set of questions asked the customer to state their perceptions about

WKHLU EDQNV VHUYLFHV $ VHYHQ-point Likert scale was used to evaluate the

constructs. The third section of the survey instrument asked the customer to

allocate 100 points among five categories, based upon the importance of each

FDWHJRU\7KRVHFDWHJRULHVDUHWKHDSSHDUDQFHRIWKHEDQNVSK\VLFDOIDFLOLWLHV

HTXLSPHQW SHUVRQQHO DQG FRPPXQLFDWLRQ PDWHULDOV WKH EDQNV DELOLW\ WR

perform thH SURPLVHG VHUYLFH GHSHQGDEO\ DQG DFFXUDWHO\ WKH EDQNV

willingness to help customers and provide prompt service; the knowledge and

FRXUWHV\ RI WKH EDQNV HPSOR\HHV DQG WKHLU DELOLW\ WR FRQYH\ WUXVW DQG

confidence; and the caring, individualized attention the bank provides its

customers.
122

In this study, the behavioural intention too of the customers was studied,

for which a comprehensive, multi-dimensional framework of customer

behavioural and attitudinal intentions for use within a service industry

developed by Zeithaml, Berry and Parasuraman (1996) was utilized. The

framework incorporates 13-items across five-dimensions: loyalty to company

(loyalty) propensity to switch (switch), willingness to pay more (pay more),

external responses to a problem (external responses), and internal responses to

a problem (internal responses). A 7-point likert scale (1 indicating strongly

disagree and 7 indicating strongly agree) was utilised across the 13

behavioural intentions battery items.

The demographic variables considered in the present study were: age,

gender, household monthly income and educational qualification. The study

was also confined to measuring the bank visit frequency and reasons for

selecting the bank.

3.7 Reliability and Validity

Because of the extensive use and testing of SERVQUAL and

behavioural intentions instruments, the researcher is confident that these

instrumentV KLVWRULFDO UHOLDELOLW\ PHDVXUHV ZLOO WUDQVIHU LQWR WKH EDQNLQJ

industry.
123

3.7.1 Reliability

The degree to which measurements may be repeated makes up reliability

(Nunnally, 1978). To accomplish reliability, the two sets of twenty-two

questions concerning perceptions and expectations reduced to five constructs

were tested and retested for the same set of customers. The degree to which

test-retest is associated establishes a reasonable level of reliability.

3.7.2 Validity

Validity is more a matter of judgment than a fixed mathematical formula

of unerring proportions (Nunnally, 1978). Therefore, the utilization of these

instruments, although they are not without their detractors, tends to reduce

some of the issues raised concerning validity. With a thorough review of the

literature, incorporation of data from the appropriate literature, and careful

wording of the questionnaire documents, this researcher felt that there was a

high degree of certainty of validity.

3.8 Translating the Instrument to Tamil Language

It is important to conduct research surveys with native languages apart

from English as the population is more diverse. Thus, nowadays in research,

the translation of questionnaires plays an important role. Then, the

harmonisation of demographic and socio-economic variables is a further

prerequisite to comparability. Functionally equivalent translations require quite

sophisticated techniques for translation, taking into account the semantic,

conceptual and normative levels of the source language questionnaire.


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The expertise of a bilingual and a reviewer is involved in translation of

the questionnaires. The bilingual is a qualified and skilled practitioner who has

received training on translating questionnaires. And, the reviewer is an expert

in questionnaire design principles, the study design and topic, and also familiar

with translation skills. During the actual translation process a bilingual

translated the questionnaire. Besides appropriate translation techniques, the

harmonised demographic variables were used. Context variables that contain

information necessary to define homogeneous subgroups, to establish causal

relations between attitudes and societal facts, and to define differences between

scores on scales were incorporated.

The customer survey instrument SERVQUAL and behavioural intention

battery is thus translated to the native language Tamil with the assistance of

linguisW IRU HQDEOLQJDOOFODVVHV RI FXVWRPHUV WR XQGHUVWDQG EHWWHU RI YDULRXV

constructs in the survey instrument. The survey instrument in both the English

and Tamil versions were tested for its convergent validation and internal

consistency of the survey instrument, by circulating both the language versions

one after other interspersed with a week long, and the data thus obtained were

subjected to Pearson product moment correlation for testing the convergent

validation, and intraclass correlation for testing the internal consistency of the

questionnaires in both the source and native languages. The correlation

coefficient thus established for the SERVQUAL expectation and perception

statements is given in Table 3.4 and for the behavioural intentions is given in
125

Table 3.5. %DVHGRQWKHH[SHUWJURXSVUHVSRQVHVDQGVXJJHVWLRQVFHUWDLQVFDOH

items were modified and items were added to the survey. A copy of the survey

instrument thus prepared in both English and Tamil was attached

as Appendix I.

Table 3.4: Correlation Coefficient for Convergent Validation and Internal


Consistency on Service Quality Expectation and Perception Statements

Expectation Constructs Perception Constructs


Service Quality
Dimensions Pearson Intraclass Pearson Intraclass
Sig. Sig.
Correlation correlation Correlation correlation
Tangibility CE 1 .958 .001 .9644 CP 1 .900 .000 .9362
CE2 .871 .001 .9302 CP2 .711 .021 .7273
CE3 .867 .001 .9256 CP3 .753 .012 .8670
CE4 .820 .004 .9011 CP4 .905 .000 .9316
Reliability CE5 .943 .000 .9573 CP5 .945 .000 .9569
CE6 .918 .000 .9467 CP6 .861 .001 .8889
CE7 .907 .000 .9174 CP7 .913 .000 .9121
CE8 .917 .000 .9497 CP8 .821 .004 .8989
CE9 .904 .000 .9323 CP9 .880 .001 .9368
Responsiveness CE10 .846 .002 .9032 CP10 .737 .015 .8221
CE11 .922 .000 .9448 CP11 .869 .001 .9204
CE12 .816 .004 .8989 CP12 .667 .035 .7805
CE13 .812 .004 .8989 CP13 .812 .004 .8601
Assurance CE14 .769 .009 .8657 CP14 .701 .024 .7652
CE15 .738 .015 .8556 CP15 .870 .001 .9121
CE16 .775 .008 .8421 CP16 .741 .014 .8163
CE17 .746 .013 .7429 CP17 .826 .003 .8811
Empathy CE18 .659 .038 .8058 CP18 .935 .000 .9557
CE19 .689 .028 .7907 CP19 .736 .015 .7857
CE20 .773 .009 .8831 CP20 .905 .000 .8696
CE21 .845 .002 .8989 CP21 .852 .002 .8846
CE22 .783 .007 .8571 CP22 .896 .000 .9121

Table 3.4 displays that the obtained product moment correlation

coefficient on each of the expectation and perception constructs were


126

statistically significant at P < .05, and correspondingly the intraclass correlation

exhibits a high coefficiency for each of the expectation and perception

constructs. These findings imply that the SERVQUAL customer expectation

and perception statements in English version are significantly correlated with

that of the translated Tamil version of the SERVQUAL customer expectation

and perception statements with high internal consistency.

Table 3.5: Correlation Coefficient for Convergent Validation and Internal


Consistency on Behavioural Intention Statements

Behavioural Intention Pearson Intraclass


Sig.
Statements Correlation correlation
Loyalty BI 1 .859 .001 .9091
BI 2 .825 .003 .8916
BI 3 .859 .001 .9091
BI 4 .899 .000 .9204
BI 5 .745 .013 .8163
Switch BI 6 .879 .001 .9184
BI 7 .655 .040 .7692
Pay more BI 8 .930 .000 .9368
BI 9 .896 .000 .9121
External response BI 10 .741 .014 .8163
BI 11 .689 .028 .7907
BI 12 .802 .005 .8889
Internal response BI 13 .655 .040 .7692

Table 3.5 shows that the obtained product moment correlation

coefficients on each of the behavioural intention facets were statistically

significant at P < .05, and evenly the intraclass correlation exhibits a high

coefficiency for each of the behavioural intention facets. These findings imply
127

that the behavioural intention facets in the translated Tamil version assumed no

substantial change in the construct being measured with that of the English

version of the SERVQUAL customer expectation and perception statements

with high internal consistency.

3.9 Data Collection

To obtain data from that of bank customers, the customer survey

instrument along with a postage-paid self-addressed envelope for return

directly to this researcher for tabulation and analysis, were distributed on a

systematic random basis to the bank customer with the assistance of friends and

bankers.

3.10 Data Analysis

The choice of the statistical techniques to use in analyzing the data was a

function of the objective of the research. In this study, the main objectives were

to assess relationships among certain variables and test specific hypotheses

regarding the nature of the relationships. An aspect unique to this study is

discriminating the bank customers as dissatisfied and satisfied. In addition, the

study will attempt to reinforce the concept that elements such as age, gender,

income, education, where they obtain their services, and frequency of use could

have a serious impact on service quality.

The statistical techniques considered for this study are Pearson

correlation for estimating the relationship among variables, multiple regression

analysis to test the statistical significance of the individual parameters and the
128

overall model, univariate and multivariate analysis of variance for the purpose

of evaluating delineation of variables, and discriminant analysis for

determining the proportion and classification of customers with different levels

of satisfaction on the basis of perception. Whenever, the obtained F tests were

found to be statistically significant, the Scheff S post hoc tests were applied to

find the paired mean differences. Furthermore, percentage analysis was carried

out to facilitate the identification and ranking of factors that influence the bank

selection process, and the frequency of transaction on customer satisfaction.

The SERVQUAL questions one through four will produce a composite

score to represent the tangible factor of the perceptions responses and measured

against the tangible factor of the expectation responses for questions one

through four. Likewise, a composite score will be produced to represent

perceptions responses to questions five through nine and will be measured

against the expectation responses for questions five through nine to determine

the difference gaps in the reliability factor. Questions ten through thirteen will

produce a composite score to represent the responsiveness factor and measured

against that same factor in responses to expectations questions ten through

thirteen. Once again, the resultant differences in the gap will result in the

responsiveness factor. Responses to questions fourteen through seventeen will

produce a composite score to represent the assurance factor of the perceptions

responses and measured against the assurance factor of the expectation

responses for questions fourteen through seventeen. Subsequently, the


129

difference gaps will result in the assurance factor. A composite score

representing the perceptions responses to questions eighteen through twenty-

two will be measured against the expectation responses for questions eighteen

through twenty-two to determine the difference gaps in the empathy factor. In

the development of satisfaction, confirmation/disconfirmation model is a

technique allows a weighting of the constructs.

The data collected on expectation, perception and behavioural intention

was subjected to reliability analysis, and the results thus obtained are shown in

Table 3.6.
130

Table 3.6: Reliability Coefficient for the Instruments SERVQUAL


and Behavioural Intentions

N of N of &URQEDFKV N of &URQEDFKV
SQ Dimensions
Cases Items Alpha Items Alpha

Customer 1428 22 .9506 Tangible 4 .7914


Expectation
Reliability 5 .8584

Responsiveness 4 .8335

Assurance 4 .8475

Empathy 5 .8652

Customer 1428 22 .9663 Tangible 4 .8477


Perception
Reliability 5 .8958

Responsiveness 4 .8579

Assurance 4 .8625

Empathy 5 .9054

Behavioural 1428 13 .8798 Loyalty 5 .8783


Intention
Switching 2 .6409

Pay more 2 .6999

External
3 .7850
response

Internal
1
response

From Table 3.6, it is understood that the reliability checks when applied

to all 22-items of expectation and perception provide an excellent overall

&URQEDFKV $OSKD FRHIILFLHQW  DQG  , which indicates the very
131

good scaling of the instrument. Alpha coefficients were calculated for every

one of the original five quality dimensions and the results support that all 22

items present a robust structure with no evident need for deletions or

modifications. Similarly, the reliability checks on all 13-items of behavioural

LQWHQWLRQIDFHWVWRR SURYLGHDQH[FHOOHQWRYHUDOO&URQEDFKV$OSKa coefficient

of 0.8798 indicating the good scaling of the instrument. Alpha coefficients

were calculated for every one of the original five behavioural and intention

facets and the results support that all 13 items present a strong composition

with no apparent need for removal or revision.

3.11 Limitations of the Study

Regardless of a comprehensive investigation that seeks to establish a

method to predict service quality and to discriminate customers as dissatisfied

DQGVDWLVILHGE\H[DPLQLQJFXVWRPHUVperceptions of nationalised commercial

banks in Madurai district, yet, this study has its limitations. There are several

limitations associated with this study.

In spite of the intensive effort, the variables confined to this study may

have been influenced by the interests and the knowledge limitations of the

customers, and it may be considered as the first limitation.

The next limitation is the cost and time constraints that did not allow for

a more extensive data collection. A larger and more representative sample may

give broader representation to the measurement of perceptions versus

expectations gaps. Finally, the study assumed that the respondents were all
132

individual bank customer, and the results obtained thereto cannot be

generalized for joint satisfaction or lack thereof of the joint account holders,

corporate sectors, and so forth.

This chapter outlined the structure of the study, the materials and

methods used. In the next chapter, it confers about the development of banking

in India, and the profiles of the banks selected for this study.