Chapter 1 – Introduction

1. 1. Background and Setting

People who are join the Army will be provided with various facilities
including food. The food for soldiers were prepared by the military chefs
specifically for officers cadets and recruits under training, soldiers of ranks
corporal and below and lived in military barracks. Other than that, any soldiers’
regardless officers or other ranks who is attending courses at any Army training
institution is also enjoy their food prepared by the military chefs. Preparation of
food at any camp or training institution are following the procedures and guidelines
endorsed by the Army Logistics Command Headquarters involving preparatory
stage, kitchen stage, serving stage as well as food quality, cleanliness of dining
hall and kitchen area. All those stages will be supervised by senior military chef
and inspections will be conducted by an appropriate military staff, normally duty
officers and battalion orderly sergeant. The aim of the supervision is conducted
from early stages are to ensure that the quality of food is not compromised as
well as the state of the preparation area, kitchen area and dining hall area is
always clean. As a control measure, duty officer and battalion orderly sergeant of
the unit is responsible to visit cookhouse every day at every meals time. They are
required to inspect the quantity and quality of food served, inspect the cleanliness
at the kitchen area, dining hall area, and preparation area. The visit will be
recorded in the visiting book and they are compulsory to comment either it is in a
good condition or not. Furthermore, soldiers who is enjoying food at cookhouse is
also encouraged to write any comments with regard to food served to them, dining
hall cleanliness and others. Investigation and action will be taken by the
Commanding Officers if there any complaints from duty officers or soldiers.

However in 2007, food service provided by military chefs has been

outsourced to third parties known as catering. The main purpose of this initiative
is to enable the Malaysian Armed Forces to perform and concentrate on their main
core business, roles and its function to Protect National Sovereignty, Integrity and
National Interest. Moreover, this initiative is also to reduce Malaysian Armed
Forces expenses in maintaining and developing new cookhouse including its
facilities and equipment. Other than that, the privatization of food services is to
mitigate the shortage of military chefs in service which if it is not been resolved

1
immediately, the quality of food will be compromising and eventually will affects
the soldiers. The privatization of food services is involving Malaysian Army and
Royal Malaysian Air Force. According to Military Cookhouse Privatization
Agreement, the selected caterer is responsible to provide new building of
cookhouse including its facilities such as dining hall, kitchen area, equipment and
others or to take over and upgrading existing cookhouse as well as to maintain
the building and equipment . It is also responsible to served quality food for 5
times a day according to menu cycle. In return, the government award the
catering company a contract for 16 years and each soldier enjoy the catering will
be charge for a certain agreed amount. Ref:Malaysia Armed Forces (2007).
‘Perkembangan Perkhidmatan Penswastaan Katering’. Reference
MATM/J4DL/4501JIL 7 - ( 74 ) dated 10 September 2007, pp 1 and 2

In the Army, the outsourcing food was initiated in 2007 in Peninsular

Malaysia including the Army training institutions before it were expanded to Sabah
and Sarawak in 2008. The caterer awarded with the contract is responsible for
preparing meals according to the menu and serve on time. The food should be
sufficient in terms of quantity and quality (Zeithaml,1988). They are also required
to ensure that the existing dining hall is upgraded either through renovation or
build new cookhouse in order to allow military personnel enjoy their food in more
conducive environment. However, the preparation process until serving of food is
no longer responsible to the military representatives. The military representatives
either duty officers or military personnel who is enjoying meals at the serving
complex also known as cookhouse, only have right to write down any complaints
with regard to food quality and quantity, service quality from the third parties as
well as cleanliness and environment in dining hall.

The outsourcing food to third parties has expanded to Lok Kawi Camp, Kota
Kinabalu, Sabah in 2012 when there were 8 cookhouse have been took over by
third party and have been upgraded. The third party has upgraded 2 cookhouses
and became Central Processing Unit (CPU). While the reminder of cookhouses also
have been renovated and became Satellite. The services from third party goes
well until there were complaints on the quantity and quality of food served were
not met the requirements. There were time some military personnel did not get
fruits and the worst case was they got unhealthy and bad condition fruits.
Moreover, there were time the military personnel almost ate smelled and bad

2
conditions of meals. Besides that, there were also complaints with the cleanliness
in dining hall. The tables and floor were not cleaned well caused the ants and other
insects play around during they had meals. Sometimes the food served was not
accordance to the menu or changing the menu without any notification and
consensus from end user. Furthermore, services gave from third party staffs were
not satisfied. Although complaints has been wrote in the complaint book, but it
still happened once in a while.

1.2. Statement of the Problem/Problem Statement

Outsourcing is take place when a specific job has been awarded to a third
party for a certain duration with an agreed price as well as terms and conditions
(Perry, William, & Devinney, 1997). It also transfers ownership of organization to
third party. In outsourcing, the organization don’t have words to instruct third
party how to comply the job but instead only have words what kind of result
required from the third party (Perry et al.,1997). However, outsourcing allows an
organizations focusing on their main jobs whereby all the process of preparation
stage until serving stage is now become responsibility of third party.

Before outsourcing to third party, all the process from preparation stage
until serving stages, it was responsible to military chefs. All the processes were
in accordance with the standards that has been outlined by the Army Logistics
Command Headquarters. Each process will be monitored by qualified supervisors
according to their trades. Any mistakes during preparation process would be
mitigate immediately. On the other hand, when the food preparation was
outsourcing to third party, we do not have an authority to monitor their
preparation process from preparing raw materials stage until the food are served.
Moreover their kitchen area is prohibited to unauthorised person except for their
own staffs.

In terms of food serving by third party at CPU and satellites, there were
complaints on the quantity and quality of food served which is not met the
requirements. Basically the quantity of food should be adequate because strength
of military personnel entitled for food will be delivered to third party every weeks,
but in actual, it still not enough. That is way there were time a few of military
personnel did not have their fruits and dishes even though the serving point was
managed by their own staff. In terms of food quality, the most obvious

3
weaknesses found was the meals smelly and in bad conditions. Although the third
party staff replaced with new meals but it became bad experiences to unlucky
military personnel and organisation. On the other hand, if the food is prepared by
military chefs, it would undergo layer of processes and monitored by skilled and
experienced chefs. Those chefs would take responsibility if something went wrong
to the food. However, it cannot be denial that sometimes even the food
preparation undergo layer of processes, there are still remote cases that quality
of food is not met the expectation.
Service quality also plays an important roles in influencing military
personnel satisfaction especially when they enjoy their food. Never the less,
military personnel perceived in third party service quality also crucial. However,
there were complaints with regard to their service quality specifically on the
cleanliness in dining hall. The tables and floor were not well cleaned caused the
ants and other insects play around the floor and table. Moreover, there were also
complaints about the third party staff did not replace dirty plate and cup
immediately when asked by military personnel.
Other than that, the atmosphere in the dining hall at serving complex also
plays a role in attracting military personnel to enjoy their food. Although the
serving complex has been upgraded or built new, the arrangement of seating and
buffet inside the serving complex is not conducive. In addition, no additional
equipment is prepared such as television or radio which most likely will improve
the mood of them to enjoy the food.
If these problems are not addressed and resolved completely, it is fear the
number of military personnel who entitled meals in the serving complex will be
reduced. They might go to canteen or outside restaurants to have meals.
Furthermore, government have to bear the losses because the food services from
third party is not fully utilised by military personnel. Other than that, if the food
served does not comply with the standards agreed by both parties, it is feared
that military personnel did not get the desired nutrition. Moreover, if there is no
control measures are taken to avoid these problems happen in future, it is fear
that other issues will be arise, for example, third party gain an extra profit by
reducing the quantity of food on the weekends because they aware that military
personnel prefer to go out rather than having food in the serving complex.

1. 3. Purpose/Objective of Study/Research Question/Hypothesis

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1.3.1 The purpose of this study is to determine the Service Quality of
outsourced food at Staff Station Headquarters, Lok Kawi Camp, Kota
Kinabalu, Sabah.

1.3.2 The objectives of this study are outlined as follows:

a. To identify the level of IV1, IV2, IV3 and IV4 with DV at Staff
Station Headquarters, Lok Kawi Camp, Kota Kinabalu, Sabah.

b. To determine the relationship between IV1, IV2, IV3 and IV4

with DV at Staff Station Headquarters, Lok Kawi Camp, Kota
Kinabalu, Sabah.

c. To determine the extent of IV1, IV2, IV3 and IV4 towards DV

at Staff Station Headquarters, Lok Kawi Camp, Kota Kinabalu, Sabah.

d. To propose ….

1.3.3 Research Questions

In order to allow the researcher more focused on the issues that have
been discussed, a few research questions have been established as follows:

a. Is there any differences service quality between insource and

outsourcing?

b. What is the critical factors that contribute to the service quality

in terms of third party staff attitudes, cleanliness of equipment and
dining hall?

c. What is the standard of current food quality prepared by third

party in terms of tastiness of food, food presentation and quantity of
food?

d. What is the level of military personnel satisfactions towards

atmospherics provided by third party.

1.3.4 Hypotheses.

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 H1: The differences of service quality between insource and
outsourcing has significant impact on military personnel satisfaction
towards outsourcing performance.

H2: The critical factors that contribute to the service quality has
significant impact on military personnel satisfaction towards
outsourcing performance.

H3: The food quality prepared by third party has significant impact
on military personnel satisfaction towards outsourcing performance.

H4: The atmospherics provided by third party has significant impact

on military personnel towards outsourcing performance.

1.4. Definition of Terms

1.4.1 Definitions of terms

a. Cookhouse – A place where process of storage raw materials

using freezer and chiller, preparation of food and serving food.

b. Central Processing Unit (CPU) – Also known as cookhouse

before took over by third party. Place where process of storage raw
materials using freezer and chiller, preparation of food, serving food
and delivering food to Satellite.

c. Satellite - Also known as cookhouse before took over by third

party. It function only serving of food which delivered from CPU.

d. Insource – All process of food preparation from earlier stage

until serving stage is implemented by military chef and monitored by
highly skilled staff. It also supervised by duty officer.

e. Outsourcing - All process of food preparation from earlier stage

until serving stage is implemented by third party.

f. Serving complex – A place where military personnel enjoy their

food either at CPU or Satellite.

1.4.2 Define Variables.

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 a. Dependent Variable (DV): Military Personnel Satisfaction
Towards Outsourcing Performance.

b. Independent Variable (IV):

(1) IV1: Service Quality.

(2) IV2: Food Quality.
(3) IV3: Atmospherics.

1.5. Limitations of the study

1.5.1 Limitations on this research are as follows:

a. This study cannot be fully implemented if it does not get access

from third party in terms of viewing their preparation process of food
until deliver and serving the food. In order to get the access,
application must be submitted to Army Logistics Command
Headquarters.

b. This research must get approval from Army Eastern Command

Headquarters before questionnaire survey could be conducted at Lok
Kawi Camp.

c. This research may not get transparent answers from

respondents due to their dissatisfactions towards third party services.
Feeling of anger and revenge will cause the wrong decisions been
made.

1.6. Significance of the Study

The findings of this research could contribute additional knowledge to the

Army Logistics Command Headquarters with regard to the standard of current
third party performance in delivering food services to military personnel. Whether
the service provided by third party is worth for both parties or only benefited to
third party. Did the third party following all the terms and conditions of the
contract? The findings also could be used by the Army Logistics Command
Headquarters to improve terms and conditions of outsourcing contract in future.

Chapter 2 – Review of Literature

7
2.1 Conceptual Definition

2.1.1 Service Quality

Military personnel satisfactions is influenced by one of the most

critical factors which extensively used worldwide namely service quality.
Service quality means the customer judgment from the accomplishment or
distinction service provided from third party (Parasuraman, Zeithaml, &
Berry, 1988). Thus, the evaluation came from customer is very subjective
and based on customer expectation compared to performance delivered
(Parasuraman et al., 1988; Bolton and Drew, 1991). Based on this gap,
SERQUAL developed by Parasuraman et al. (1988) is used to measure third
party service quality. Furthermore, since perceived levels of CPU and
satellite depend on the relationship between military personnel and third
party, evaluation of service quality from military personnel perception may
rely on the third party performance during service delivery (Brady &
Robertson, 2001). Therefore, in this research, service quality is based on
the service performance provided by third party.

2.1.2 Food Quality

The most crucial elements of a dining experience is quality of food

(Namkung & Jang, 2007; Sulek & Hensley, 2004). Food quality is the main
concern of the customer to visit any seating or buffet dining (Susskind &
Chan, 2000). When there were comparison with other components in dining
place, such as service quality and others, food quality is chosen as the most
important components (Sulek & Hensley, 2004). The characteristics of food
quality comprises of menu variety, tastiness of food as well as nutrition and
meet customer satisfaction (Kivela, J., Inbakaran, & Reece, 2000). While
some thought measuring food quality based on variety of food, serving size
and variety of food (Raajpoot, 2002). Moreover, food quality also could be
defined as freshness of food, variety of food, food presentation and
tastiness of food (Namkung & Jang, 2007). Therefore, food prepared by
third party in this research will be evaluated by military personnel using
instrument of food quality.

2.1.2 Atmospherics

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 The atmospherics is defined as an effort implemented by the third
party in providing pleasant environment to customer when their enjoyed
the products or services (Kotler, 1973). Moreover, atmospherics is also a
tool to inspire positive manners of customers in pleasant situations when
consuming products or services (Kotler, 1973). The Dinescape also known
as dining specific atmospherics scale which created by Ryu & Jang (2008)
has proved that emotions of customer plays important role and impacts on
dining environments. Based on various studies, it suggested positive
emotions exist via positive perception of atmospherics which later on build
customer confidence towards services or products delivered by
organisation. Thus customer assumption with regard to quality of services
or products is influence by service environment (Parasuraman et al., 1988;
Wall & Berry, 2007). Furthermore, several studies denoted that costumer
mood is created either positive or negative depending on atmospherics
created to customer (Namasivayam & Mattila, 2007). Thus customer mood
is also depending on atmospherics created before it leads to judge quality
delivered by the organizations either service quality or food quality.

2.2. The relationship between service and food quality with customer
satisfaction

Oliver (1993) advised that quality is the ultimate cognitive respond to the
service or product while satisfaction involved affective respond and cognitive.
Johnson, Gustafsson, Andreassen, & Lervik, (2001) suggested that satisfaction is
more general evaluation while quality is a details evaluation. Thus, it can be
deduce that satisfaction and quality are distinct. Therefore, quality can be used
as a tool to predict customer satisfaction. Sharma & Patterson (1999) mentioned
that service quality is associated with technical service and functional services
quality. Technical service quality is refers to the quality of food while functional
services quality refers to the performance of the workers. According to previous
research, customer satisfaction have a positive relationship with service quality
and food quality (Namkung & Jang, 2007). Therefore, based on the theoretical
studies, this research come out with the following hypotheses:
H1: The service quality has positive relationship with customer (military
personnel) satisfaction towards outsourcing performance.

9
 H2: The food quality has positive relationship with customer (military
personnel) satisfaction towards outsourcing performance.

2.3 The relationship between atmospherics with customer satisfaction

The atmospherics factors can influence customer expectations with regard

to service quality and food quality provided by service provider (Bitner, 1990).
Customers often attracted by tangible elements and influence them in decision
making in term of the level of quality before the actual consumption take place
(Zeithaml et al., 1993). Moreover, several research denoted that mood of
customer either positive or negative is created by physical environment earlier
before other services delivered (Namasivayam & Mattila, 2007). Thus, the physical
environment plays important roles in influencing customer satisfactions towards
actual service quality and food quality. For example if the serving complex provide
conducive and high environment as compared to other outside restaurants, then
the military personnel impression on the serving complex becomes more favorable
even before enjoy the food and other services. Therefore, customer satisfaction
towards food quality and service quality will be improved as compared with low
environment provided by service provider. Hence, in order to define clearly the
role of atmospherics towards customer satisfaction through customer pre-
consumption mood, the following hypotheses is propose as per below:

H3: The atmospherics provided by third party has significant impact on

military personnel towards outsourcing performance.

2.4. Dependent and Independent Variables

There are two major variables used when constructing the theoretical
framework for this study. The military personnel satisfaction towards outsourcing
performance is the dependent variable while service quality, food quality and
atmospherics in serving complex are the independent variables in this study. The
diagram of theoretical framework designed for this study as per Figure 1.

Figure 1: Theoretical Framework

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 Independent Variables (IV) Dependent Variable (DV)

Service quality H1 (+ve)

H2 (+ve) Military personnel

Food quality satisfaction towards
outsourcing performance
H3 (+ve)

Atmospherics

Based on the literature review, service quality, food quality and

atmospherics in serving complex and its relationship between military personnel
satisfaction towards outsourcing performance leads to the hypothesis which
related with research objectives. The hypothesis as follows:

H1: The service quality has positive relationship with military personnel
satisfaction towards outsourcing performance.

H2: The food quality has positive relationship with military personnel
satisfaction towards outsourcing performance.

H3: The atmospherics provided by third party has positive relationship with
military personnel satisfaction towards outsourcing performance.

Chapter 3 – Methodology/Procedures

This chapter will touch on the approach and method gathering of data and
empirical evidence to evaluate the factors of service quality, food quality and
atmospherics that influencing the military personnel satisfaction towards third
party performance at Lok Kawi Camp, Kota Kinabalu, Sabah. The research is aim
to prove the objectives stated in the hypothesis so that it will be successful proven.

11
A field study will be conducted to the selected military personal at Lok Kawi Camp
through cross sectional study using quantitative method. The survey questionnaire
comprises several parts focusing on food quality, service quality, atmospherics as
well as demographic data. The questionnaire survey will take approximately less
than five minutes to be completed by participants.

3. 1. Research Design

This research will be conducted through a cross-sectional design using

quantitative method particularly utilising correlational research method. In a
cross-sectional design also known as ‘one-shot’ (Sekaran & Bougie, 2013), data
is gathered at one time only from targeted sample which will reduce time frame
required for data collection (Sekaran & Bougie, 2013).

3.2. Population and Sampling

In this research, the population involved throughout in this study is only

military personnel who lived in barracks and have their own meals at serving
complex for approximately 30 days continuously onwards will be determined as
population element. According to Staff Station Officer of Lok Kawi Camp, currently
there are 550 population (military personnel) enjoying their meals provided by
third party. Based on this population, a sample size will be identified according to
the relevant sampling technique.

The stratified sampling technique is adapted as the sampling technique

(Sekaran & Bougie, 2013). When using stratified sampling, higher statistical
precision result will be gathered as compared to when using simple random
sampling alone. This is due to the fact that the variability within the subgroups is
lower compared to the variations when dealing with the entire population at large.

According to the population on this research, an appropriate sample size is

decided through the table (Krejie & Morgan, 1970) whereby the sample determine
based on population according to the table. Based on the total of population in

12
this study, the appropriate sample size for this population is 226 sample based on
the Table 1 below:

Table 1: The Sample Size Table (Krejcie & Morgan)

N is the population and S is the sample size.

3.3. Instrument/Measurement

To measure each variables in this research, a focused survey questionnaire

constructed and mix with used by the related research. The questionnaire consists
of numerous sections focused on service quality, food quality, atmospherics and
demographic information. The questions are all of the closed-ended form and will
be written in Englisah and Bahasa Malaysia. The measurement will be adopted
and adapted from other previous research such as Service Quality (SERQUAL)
(Parasuraman et al., 1988), Atmospherics (Baker, 1986) and Food Quality (Kivela
et al.,2000)

13
 To measure the effectiveness of service quality provided from third party,
the 5 dimensions SERQUAL (Parasuraman et al., 1988) such as Tangibles,
Reliability, Responsiveness, Assurance and Empathy will be used. There were 22
questions developed previously and only related questions will be selected and
use in this research.

To measure the effectiveness of atmospherics in serving complex, (Baker,

1986) suggested 2 appropriate dimensions of atmospherics namely design factors
such as layout, display, decoration, facilities and others. Others dimensions is an
ambient factors such as lighting, music and others.

In this research, the quality of features accompanying with food is defined

as food quality. Thus to measure the quality of food provided by third party, this
research borrowed from past studies instrument which have included several
items to access food quality. The items are food portion, taste of food, variety of
menu and presentation of menu (Kivela et al., 2000; Raajpoot, 2002; Namkung
& Jang, 2007).
Therefore, the questions for the purpose of this research will be constructed
based on the above measurements. Only related and connected items and
question will be selected. The targeted respondents will answer the constructed
questionnaire using the 5 point Likert-Scale as shown in Table 2.

Table 2: 5 Point Likert-Scale

Level Score

Strongly Disagree 1

Disagree 2

Neutral 3

Agree 4

Strongly Agree 5

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3.3.1 Instrument Validity
The validity is crucial in every research where it assess the accuracy
of the measurements related to what is planned to be measured (Burns &
Bush, 2000). To increase the validity of this research instrument, the back-
translation technique is used to convert the questions in survey
questionnaire from English to Bahasa Malaysia so that it will be easy to
understand. In this research also, questionnaire is constructed from
measurement tools published in research such as question from SERQUAL,
Food Quality and Atmospherics.

3.3.2 Instrument Reliability

Reliability refers to the level of consistency outcome from the
instrument results (Sekaran & Bougie, 2009). The Cronbach’s alpha is the
popular measurement for realibility and will be used in this research. The
level of instrument reliability is measured according to Cronbach’s alpha
table as per Table 3.

Table 3: Cronbach’s Alpha Table

Cronbach’s Alpha Reliability

<0.6 Weak
0.6 - 0.7 Medium
0.7 – 0.8 Good
0.8 – 0.9 Very good
> 0.9 Best

3.3.3 Pre-Test
In this research, Pre-Test for the survey questionnaire will be carried
out to ensure the effectiveness of the questionnaire. The pre-test is a tool
designed to assisting research to determine whether the questions, format
and wording is acceptable and user-friendly to respondents. The Cronbach’s
Alpha is used to test the reliability of data. The data is classified reliable if
score more than 0.7 and the questionnaire is also classified as reliable.

15
 However, if the result shows lower than 0.7, than the questionnaire is not
reliable to be used in this research.

3.4. Data Collection

The data collected from respondents through questionnaire is known as

primary data. In order to prove the hypotheses created in this research, the
collecting primary data is more suitable as it purpose to determine the research
objective. The constructed questionnaire in this research is disseminated and
collected from respondents at the same time. In this research, group of targeted
respondents will be assembled in multipurpose hall. They will be given a detailed
explanation before responding to all questions in survey questionnaire. The survey
questionnaire will undergo analyzing process once the data has been collected.

While the secondary data is gather from visiting book of duty officers to
serving complex or complaint’s book where the military personnel wrote down
their comments towards third party services.

3.5. Data Analysis

In this research, the Statistical Package for Social Science (SPSS) version
24.0 is used to analyse the data gathered from survey. Results for hypothesis
testing are obtained from analyzing data through descriptive and inferential
statistic.

4. References (APA style)

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Bolton, R.N., Drew, J.H. (1991). A longitudinal analysis of the impact of service
changes on customer attitudes. Journal of Marketing 55 (January), 1–9.

Brady, M.K., Robertson, C.J. (2001). Searching for a consensus on the

antecedent role of service quality and satisfaction: and exploratory cross-
national study. Journal of Business Research 51, 53–60.

Burns, A. C., & Bush, R. F. (2000). Marketing Research. New Jersey: Prentice Hall
International.

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Johnson, M.D., Gustafsson, A., Andreassen, T.W., Lervik, L., Cha, J. (2001). The
evolution and future of national customer satisfaction index models.
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