Abstract

This study was designed to assess and analyze customer satisfaction with service delivery of
mobile telecommunication service within Ethiopia. The main problem of this study is rotates on
customers are satisfied or dissatisfied with service delivery of ethio-telecom with regarding on
mobile telecommunication service.

The study is basically a survey those both qualitative and quantitative approaches. A structured
questionnaire was developed, pre-test and personally administered to the target population of
individual mobile subscribers. In this study, self administered and structured questionnaire used
to collect data from respondents. The questions assessed respondents' feelings about overall
customer satisfactions, satisfactions for dimensions service quality and importance of
dimensions of service quality. The questionnaire survey is planning to circulate among
consumers for data collection and results can extract accordingly. Further, conclusions and
recommendations possessed based on the findings.

Since this thesis is about the study of customer satisfaction with service delivery of ethio-
telecom, to describe or portray a reality regarding customer satisfaction with service quality to
better understanding those service quality dimensions that customers are satisfied or dissatisfied
with, so this has necessitated a descriptive research design has undertaken for a research.

This thesis used convenience/specimen sampling from non-probability sampling techniques. The
target population for this study was comprised 18 million subscribers or customers. Out of the
18 million subscribers in Ethiopia, a sample size of 300 respondents was selected from the
capital city Addis Ababa including all sub cities. Using a large sample and different cities in this
survey requires financial resources and time, which was not afford.

After the information and row data gathered from different sources, analysis and processing of
data was performed in a simplest and meaningful manner. The descriptive statistics: frequencies
statistics, mean, standard deviation and one sample t-test was applied to assess the level of
customer satisfaction with the relationship between the mobile services attributes and customer
satisfaction, and also Statistical Package for Social Science (SPSS)version 20 was used.

Generally, customers are not satisfied with service quality delivered by ethio-telecom in Ethiopia
regarding on mobile service or that their satisfaction is considered too low, but customer
satisfaction is better than expected and at least equal to expectation on some service quality
dimension items.

1
 Acknowledgement
First of all, I express my deepest gratitude to our Father God Almighty and Our Lord and Saviour Jesus
Christ without whose grace and mercy I could not have come this far, even in starting and successfully
completing this master’s program.

Secondly, I would like to thank my advisor Mulugeta Negash who giving me such valuable suggestion
and guidance during the thesis.

Thirdly, to the ethio-telecom customers, I express my appreciation for being used as the unit of analysis
in this study.

Finally I would like to thanks my family and all my friends who always with me to support and
encourage me to finish this thesis paper on time.

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 TABLE OF CONTENT

CONTENTS PAGE

Abstract …………………………………………………………………………….……...I

Acknowledgement………………………………………………………………………... II

Table of contents……………………………………………………………………...….. III

List of tables………………………………………………………………………………..VI

List of figures………………...…………………………………………………..……..…VII

Acronyms ………………………………………………………………………….……....VIII

CHAPTER ONE: INTRODUCTION

1.1 Background of the study……………………………………………………….……..….1

1.2 Problem statement………………………………………………………………….……4
1.3 Research questions…………………………………………………………………........6
1.4 Objectives of the study…………………………………………………………………..7
1.4.1 General objective……………………………………………………..………..…..7

1.4.2 Specific objectives……………….…………………………………………..….......7

1.5 Significance of the study…...………….…………………………………………….....7

1.6 Delimitation of the study…………………………………………………..……………8

1.7 Limitation of the study……………………………………………………..……………8

1.8 Structure of thesis……………..………………….…….…………………………….…9

CHAPTER TWO: LITERATURE REVIEW

2.1 Development in mobile telecommunication………………………………………........9

2.1.1 Definition and brief historical perspective………………………………................9

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2.1.2 Players and role of mobile telecommunication…………………………………....10

2.1.3 Some of the roles played by mobile telecommunication are……………….…...11

2.2 State of mobile telecommunication in Africa ……………………………………….11

2.3 State of mobile telecommunication in Ethiopia…………………………………….13

2.3.1 Important facts about Ethiopia…………………………………………………..13
2.3.2 Historical overview of ethio-telecom……………………………………..……..14

2.3.2.1 Regulatory Environment……………………………………….………..…...16

2.4 Concept/ Definitions of customer satisfactions………………………………….…..16

2.4.1 Clear understanding of customer needs and expectations…………………….…..19

2.4.2 Perceived value…………………………………………………………………....21

2.4.3 Customer satisfaction measurement model………………………………...……..22

2.4.4 Disconfirmation models…………………………………………………………..22

2.4.5 Customer satisfaction measurement scales……………………………………......22

2.4.6 Service……………………………………………………….…………………....23

2.4.6.1 Services classification……………………………………..………………..…24

2.4.6.2 Customer services………………………………………………………..……25

2.4.7 Service quality……………………………………………………………...…….26

2.4.7.1 Significance and drivers of service quality………………………….………..29

2.4.7.2 Service quality models…………………………………………….…………..29

2.4.7.2.1 Technical and Functional Quality Model……………………….………..30

2.4.7.2.2 GAP Model……………………………………………………….……....31

2.4.7.2.3. Model of Perceived Service Quality and Satisfaction ……………........33

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 2.4.7.2.4 Retail Service Quality and Perceived Value Model……………………..34

2.4.8 Prioritizing Service Quality Dimensions…..…………………….....……………35

CHAPTER THREE: RESEARCH METHODOLOGY

3.1 Research design………………………………………………………..………….36

3.2 Research strategy………………………………………………….………………37

3.3 Time horizon……………………………………………………………...………37

3.4 Research/Study area..............................................................................…...37
3.5 Method of data collection……………………………………………..………….38

3.6 Population and sample…………………………………...………………….……38

3.7 Sampling technique ……………………………………………………………39

3.8 Data collection procedures…………………………………………………….....39

3.8.1 In depth focus group interview………………………………………….…...39

3.8.2 Structure of questionnaire……………………………………………….…...40

3.8.3 Pilot Testing and Final Administration……………………………………....40

3.8.4 Response Rate …………………………………………………………........41
3.9 Credibility of the Research……………………………………………………….41
3.9.1 Validity………………………………………………………………………41
3.9.2 Reliability……………………………………………………………….…….42
3.10 Tools……………………………………………………………………………..43

3.11 Research Instrument……………………………………………………………..44

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CHAPTER FOUR: DATA ANALYSIS AND PRESENTATION…………………..45

4.1 Respondent's Characteristics………………………………………………………45

4.2 Measuring customer satisfaction is service quality……………………………….48

4.2.1 Results of disconfirmation measures and overall customer

satisfaction measures………………………………………………………..48

4.3………………………………………………………………………………………50

4.4 Importance of SERVQUAL Dimensions………………………….......................55

4.5 Discussion…………………………………………………………………………..58

4.5.1 Summary of respondents' characteristics…………………………………………58

4.5.2 Research question one…………………………………………………………….58

4.5.3 Research question two…………………………………………………………….59

4.5.4 Research question three…………………………………………………………...59

CHAPTER FIVE: SUMMARY, CONCLUSION AND IMPLICATION

5.1 Summary of findings and conclusion……………………………………………....63

5.2 Implication of the findings………………………………………………………….64

5.2.1 To regulators and policy makers……………………………………………......64

5.3 Final Conclusion…………………………………………………………………....66

5.4 Recommendation for further research………………………………………….......66

Reference……………………………………………………………………………......67

Appendix-1………………………………………………………………………….......73

Appendix-2………………………………………………………………………….......74

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List of Tables

Table 4.1.1 Respondent’s Gender………………………………………………………..45

Table 4.1.2 Age of Respondents…………………………………………………………46

Table 4.1.3 Respondent’s occupation…………………………………………………....46

Table 4.1.4 Income level of Respondents………………………………………………..47

Table 4.1.5 Respondents Education……………………………………………………...47

Table 4.2.1 Descriptive statistics of customer satisfaction measures………………..…….48

Table 4.3.1 One sample T-test for SERVQUAL dimensions………………………..……50

Table 4.4.1 Summary descriptive statistics of important SERVQUAL dimensions…..….55

Table 4.4.2 One sample test for importance of SERVQUAL dimensions…………….….56

Table 4.4.3 prioritized dimensions of SERVQUAL……………………………………....57

Table 4.4.4 SERVQUAL dimensions priority-satisfaction matrix………………………..58

List of Figures

Figure 2.4.7.2.1 Gronroos model of service quality………………………………..........30

Figure 2.4.7.2.2 The Gap Model of service quality……………………………………….32

Figure 2.4.7.2.3 Model of perceived service quality and satisfaction…………..…..........33

Figure 2.4.7.2.4 Retail service quality and perceived value model……………………….34

Figure 4.2.2 Satisfaction rating regarding on DD, ED, and OCS…………………..…….49

Figure 4.3.2 Customer satisfaction with SERVQUAL dimensions……………….………54

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Acronyms

AU- African Union

COMESA- Common Market for Economic Southern Africa

CPQ- Consumer Perceived Quality

ETA- Ethiopian Telecommunication Agency

ETC- Ethiopia telecommunications Corporation

GSM- Global System Mobile communication

ICT- Information and Communication Technology

IGAD- Inter-Governmental Authority on Development

MMS- Multimedia Message Service

MTN- Mobile Telecommunication Network

PTO- Public Telecommunication Operator

SMS- Short Message Service

SPC- Service-Profit Chain

SPSS- Statistical Package for Social Science

SQ- Service Quality

SSA- Sub-Saharan Africa

VANS- Value-Added Network System

VSAT- Very Small Aperture Terminal

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 CHAPTER ONE
1. INTRODUCTION
1.1 Background of the study

The Global System of Mobile Communications (GSM) is a digital technology with a worldwide
acceptance and plays an important role in the socioeconomic development of countries (Samuel.
E., 2006). Thus, several management experts have paid research attention to this industry (this
study mainly concerns on the customer satisfaction). Customer satisfaction is the assessment of
the performance of a product or service by customers and this construct is important for
successful business performance. African countries are actively involved in the establishment of
the mobile services and specifically, Ethiopia is the focus of this study.

According to ICT indicators, 2008 when the first mobile networks were launched in Africa two
decades ago, few imagined that mobile phones would become Africa’s communications device
of choice. In 1990, only six countries had networks and there were less than 15’000 subscribers.
It took six years to surpass one million mobile subscribers. The 100 million barriers was
shattered nine years later in 2005 and at the beginning of 2008, there were over a quarter of a
billion mobile subscribers on the continent. Mobile penetration has raised over a fourth of the
population today.

In Ethiopia mobile phone service introduced in 1991 E.C by 36,000 lines, but now has shown
dramatic change on coverage and in subscribers’ number has scored 18 million lines. And also,
currently ethio-telecom has the potential to provide 23 million lines (ethiotelecom, 2012).

Mobile phone operators provide voice service and value added services including SMS (short
message service), MMS (multimedia message service), ringtone, games, electronic transaction,
and web browsing etc. The improvement of service quality is the key source of success in the
business and competitive advantage. Besides, voice services proving value added services are
becoming great prospect for mobile phone service providers (Kim.H, 2000).

9
Studies conducted to explore factors affecting satisfaction, loyalty and retention in mobile
telecommunications industry include: Gerpott et al. (2001) investigated customer satisfaction,
loyalty and retention in the German mobile telecommunications among 684 respondents and
reported that customer retention cannot be equated with customer loyalty and/or customer
satisfaction, rather a two-stage causal link can be assumed in which customer satisfaction drives
customer loyalty which in turn has impacts on customer retention. However, these three factors
are important for superior economic success among telecommunication service providers.

Kim et al. (2004) investigated the effects of customer satisfaction and switching barrier on
customer loyalty among 350 respondents in Korea and reported that call quality, value-added
services and customer support have significant impact on customer satisfaction. Thus, to
maximize customer satisfaction, focus should be on service quality and customer-oriented
services. Switching barrier on the other hand is affected by switching costs (e.g. loss cost, move-
in cost, and interpersonal relationships) and was revealed to have an adjustment effect on
customer satisfaction and customer loyalty.

Serenko and Turel (2006) investigated customer satisfaction with mobiles services in Canada
and reported that perceived quality and perceived value are the key factors influencing
satisfaction with mobile services. Customer care is reported to be negatively related to customer
satisfaction, which means that a more satisfied customer is less prone to complain. Hence, they
concluded that customer satisfaction is the only single measure that better capture the range of
services, prices and quality and more so, this measure is an important performance indicator
useful for both regulators and mobile service providers.

Organizations, both private and public, in today's dynamic market place and market space are
increasingly leaving very old marketing philosophies and strategies to the adoption of more
customer-driven initiatives that seek to understand, attract, retain and build intimate long term
relationship with profitable customers (kotler, 2006; Gronroos, C 1994). This pattern shift has
optimistically led to the growing interest in customer relationship management initiatives that
aim at ensuring customer identification and interaction, customization and personalization that
completely lead to customer satisfaction retention, and profitability (Gronroos et al., 1996).

10
Customer satisfaction is an evaluation by the customers, after buying their goods and service
(Oliver 1997). Customer satisfaction can result from any dimension (whether or not its quality
related) and its judgment may arise from non quality issues (needs, wants, perceptions, price
fairness and require experience with the service or provider (Al-hashashl.K, 2008).

To ensure customers are satisfied, staff members can be selected to walk around the service area
checking that all needs are being properly met. This ensures that customers can voice their
dissatisfaction in an environment where the situation may be considered and rectified. It is here
that a professional and efficient service recovery process operates. Successful service recovery
strategies can restore customer satisfaction and can also influence other important organizational
outcomes including loyalty, positive and negative word of mouth behavior, and profitability.
Poorly executed service recovery tends to aggravate customer dissatisfaction, may drive
customers to competing firms and, at the very least, encourages customers to badmouth the
organization (Potluri.R. M, 2010).

In today's highly competitive, increasingly consolidated world, offer personalized and

differentiating services, price fairness, can be critical and imperative to success. Currently the
only mobile telecommunication network service provider, ethio-telecom is providing various
services; however, it is not sufficient and better than the other African countries. The country is
recorded a total of 18 million subscribers by 2012.

In Ethiopia, Still there is no any kind of competition in the industry, due to the market monopoly
system of the country. This single organization is continually improving up the quality of its
service delivery, but variety and personalized services to customers’ are under question.

Satisfied customers are the source of all profits and shareholders' value. Customer can choose
from whom they buy, and unless the firm satisfies them at least as well as competitors, sales and
profits will quickly erode. Customer satisfaction should therefore be a prime objective and
measure of the performance of managers (Wilson.R and Colin,G 2005).

Many organizations no longer use only customer complains; rather they adopt rigorous
qualitative and quantitative mechanisms to measure customer satisfaction. In this regard,
measuring customer satisfaction provides the feedback how successful an organization is at
providing products and/or services to the satisfaction of customers at the market place and

11
market space. This makes it important for organizations to take pragmatic/practical and reliable
step towards improving the quality of service delivery, managing customer value and satisfaction
more effectively (Rust and Oliver, 1994).

Previous studies on mobile telecommunication services measured services quality by call quality,
pricing structure, mobile devices, value-added services, convenience in procedures, and customer
support (Gerpott et al., 2001). Customers determine satisfaction level of any purchased service
by the perceptions of quality received. Customer satisfaction assessment captures service quality
and in this study, to measure service quality of mobile telecommunication services, different
mobile service attributes used to assess customer satisfaction.

Therefore, the researcher is motivated to know and understand the level of customer satisfaction
because currently mobile phone is one of the critical instrument and issue to everyone and it is
known that telecommunication sector is one of the pillars to country development to possess
different services, but if it is free from government hand. so that the researcher have great
ambition to see the breakdown of the market monopoly system of the country in order to bring
fundamental/dramatic change to the economy through getting/providing variety services by
mobile phone from different network providers in Ethiopia to accelerate the current development
of the country. Consequently, many organizations attempt to adopt measures to ascertain
customer satisfaction/dissatisfaction. The shift toward the recognition effective customer
satisfaction and its measurement has led companies to change about satisfying customers
(Nimako.,S.,G and Azumah.,F.K, 2009).

1.2 Problem statement

Customer satisfaction and customer services are found having positive relationship. Now a day’s
relational marketing is considered very important on the realization of the fact that customer
satisfaction is quite essential for the lasting relationship between service organization and
customer. As in telecommunication service industry a special care should take place to develop
good relationship (Tse and Wilton, 1988, Oliver, 1999). Customer service is a system of
activities that comprises customer support systems, complaint processing, speed of complaint
processing, ease of reporting complaint and friendliness when reporting complaint (Hanif.M.,
2010).

12
The telecommunication services in Ethiopia have made rapid stride both in quality and quantity.
However, the user at large are found question with quality of the services made available to
them. The process of technological sophistication has gained the momentum but the users are yet
to get the quality of service (Tele Negarit, 2007). The poor sector management coupled with the
lack of capital has resulted in Ethiopia having one of the lowest teledensities in the sub-Saharan
region of a 0.5%.

There are many complaints from customers about the service delivery of the mobile
telecommunication network provider, in Ethiopia. Evidently, the growth trend in the mobile
telecom industry in Ethiopia does not provide empirical support for the claim that customers are
satisfied with the service delivery of the mobile telecommunication network in Ethiopia. The
market is feeling that customers are not treated fairly and far away for adequate justice. This kind
of belief in the market is more dangerous for any business in the present day‘s highly cut-throat
competitive business world (Potluri.R. M, 2010).

According to Serenko and Turel (2006) investigated customer satisfaction with mobiles services
is that perceived quality and perceived value are the key factors influencing satisfaction with
mobile services. Customer care is reported to be negatively related to customer satisfaction,
which means that a more satisfied customer is less prone to complain. Hence, they concluded
that customer satisfaction is the only single measure that better capture the range of services,
prices and quality and more so, this measure is an important performance indicator useful for
both regulators and mobile service providers.

According to ICT indicators, 2008; the goal of the government of Ethiopia is on the development
and investments of mobile telecommunication network in Ethiopia have only partly been met-
especially with respect to the development in rural areas and the quality still low has deteriorated
on some indicators. Since the past years, the industry has shown some kind of improvement or
increase in subscribers' growth rate. This trend could not attribute to quality service and customer
satisfaction, but seems a success story to the industry.

However, the literature indicates that quality is a major determinant of satisfaction and has a
positive relationship with satisfaction in both the short and long run (Oliver, 1997). Quality

13
judgments should be based on consumer feedback and not on manufacturers’ beliefs about
product/service quality (Almossawi,M. M, 2012).

Most of the organizations in these days have treated customer handling procedure as a strategic
marketing tool. Service providers are frequently exhorted to strive towards a zero defects service;
the ability to get it right first time is thought to offer significant benefits to organizations in terms
of both customer evaluations and costs of delivery (Potluri.R. M, 2010).

Increasing customer satisfaction has been found to lead organization to higher future
profitability. Therefore, Customer services are the opportunities for telecom service providers
that are added to mobile network other than voice services in which contents are either self
produced by service provider or provided through strategic compliance with service provider in
order to create satisfied customers with quality service (Hanif. M, 2010).

In view of the above, the main issue of this study rotated or revolved on; Are customers
satisfied/dissatisfied with the service quality delivered by ethio-telecom.

1.3 Research questions

From the above problem, the study seeks to answer the following specific research questions;

1. How can customer satisfaction with service quality be described in Ethiopia customer's
mobile telecom service?
2. Which dimensions of service quality are customers satisfied or dissatisfied with in
Ethiopia's mobile telecommunication service?
3. Which dimensions of service quality are important to customers of mobile
telecommunication service in Ethiopia?

14
 1.4 Objectives of the study
1.4.1 General objective
The general objective of this study is tried to assess and analyze the level of customer
satisfaction with service delivered by ethio-telecom.
1.4.2 Specific objectives
 To measure and describe customer satisfaction with dimensions of service quality in mobile
telecommunication service in Ethiopia.
 To identify and prioritize dimensions of service quality in the context of mobile
telecommunication service with in Ethiopia.

1.5 Significance of the study

The study has immensely significant in diverse ways to business/marketing practitioner, policy
makers, customers and others.

To the management of ethio-telecom, that will report in this study will provide a more reliable
scientific measures and perspective for describing and evaluating the level of its customer
satisfaction with the services delivery and particularly those in service industry provides the
feedback of how successful an organization is at providing product and/or service to the
satisfaction of customers at the market place and market space.

This will provide empirical support for management strategic decision in several critical areas of
operation, and above all, provide a justifiably valid and reliable guide to designing workable
service delivery improvement strategies for creating and delivering customer value; achieving
customer satisfaction and loyalty, building long-term mutually beneficial relationship with
profitable customers to achieve sustainable business growth.

To policy makers like government agencies such as ministry of communication, the finding and
results of this will provide clear way to solve problems and thoroughly think with regard to the
market monopoly system of the country.

15
1.6 Delimitation of the study

The study was delimited to only Ethiopian mobile telecommunication network provider: ethio-
telecom and its operation with in Ethiopia. Moreover customers/respondents in this study was
limited to only individuals/subscribers in Addis Ababa, was not include institutional customers.
Finally, the sample for this study delimited to a sizable 300 respondents or customers.

1.7 Limitation of the study

The main limitation of this study was constraints of resources, time and access. The financial
and material resources needed for a large sample size for this study was inadequate. Language
was another access limitation as it was difficult to translating.

1.8 Structure of thesis

This study is organized in to five chapters. Chapter one discussed about the introductory part,
which covers the background to the study, problem statement, and purpose of the study, research
questions, and significance of the study, delimitation and structure of thesis.

Chapter two is try to review of relevant literature. It covers mobile telecommunication and its
role, state of telecommunication in Ethiopia, mobile telecommunication, concepts and theoretical
framework; customer, customer satisfaction, significance of customer satisfaction, customer
satisfaction models, service and service model.

Chapter three is discussed about methodology selection. It is focuses on the research

perspectives, data collection; population, sampling, research instruments, data collection, access
strategies and credibility of the study.

Chapter four revolved on presentation of data and analysis of results and finding. And also, the
last chapter addressed the summary, conclusion and implications part.

16
 CHAPTER TWO

LITERATURE REVIEW

2.1 Development in mobile telecommunication

2.1.1 Definition and brief historical perspective

Mobile telecommunication refers to the exchange of information ideas and thoughts through the
medium of a mobile phone, telephone or wireless network. According to the world international
property organization, a mobile communication system/network refers generally to any
telecommunications system which enables wireless communications when users are moving
within the service area of the system. Until the invention of modern technology, the use of
semaphore, flags, heliograph, relay runners; riders and criers, smoke signals, drum, and light
signals; message- carrying pigeons, and even the postal system were the traditional long-distance
communication media.

According to Balasuramanian et al, (2002), '' the first transmission involving a single mobile
platform occurred in June 1998, when Marconi transmitted a radio signal over 42 miles between
a French naval vessel and the wimereux shore station. The first transmission between a mobile
transmitter and a mobile receiver occurred in July 1898 when abroad the Royal Navy warship
Juno, Marconi received messages from the warships Alexandra and Europe at ranges of up to 45
miles. The first mobile phone call occurred in June 1946, when a truck driver in St. Louis,
Missouri placed a telephone call using a handset from under his vehicle's dashboard. Utilities,
truckers, and news reporters rapidly adopted this technology and nearly 100 cities and high way
corridors and access to mobile telephone service by 1948. The technology was very expensive
the cellular phone concept that currently supports the bulk of mobile communication was
developed in 1947 at Bell Laboratories.

Today there are many different types and kinds of mobile phones that are used with supporting
network communication. These mobiles have different features and powerful capabilities. Apart
from the basic use of marketing and receiving calls and messages; some can be used to play

17
music, video, games, store considerable amount of personal data, access banking services with
internet capabilities (e-mail, e-order/procurement etc), among mobile communications systems
have been developed because of the increasing need to free users to move away from fixed
telephone terminals without impairing availability of users. Mobile technology has rapidly
developed from first generation (1G), second generation (2G), third generation (3G) to beyond
third generation (3.5G and 4G) mobile technology that uses digital wireless technology that
supports faster display of multimedia and global roaming.

2.1.2 Players and role of mobile telecommunication

Mobile communication providers, in delivering service to customers, operate in an environment

that involves purposeful relationships and interactions between several actors in many activities
and with different resources. Some of the players in mobile telecom industry providing services
to the customers at their various locations are; the mobile operator who provides the locations
positioning infrastructure that tells where the customer is; the content provider that delivers the
information; the supplier that combines the information with the location information and makes
it location relevant; and the platforms through which the customers can access the services
(Harter, 2000). Therefore it appears that any mobile telecom network needs to have several key
players along its value chain in delivering services to its customers.

Mobile telecommunication plays a major role in today's information technology- driven world of
business. Nigel Scott et al, 2004 observe that '' one might expect most calls to be related to
economic issues; research confirms that at present in Africa, it is social uses tat drive phone use
amongst the poor. '' Chatting'' and ''keeping in touch'' are the most common use of phones. This
is of value because it strengthens social capital through improved networking with friends and
family. Together this means that phones have a positive impact on improved incomes, reduced
risk, and an improved sense of well- being.

18
2.1.3 SOME OF THE ROLES PLAYED BY MOBILE TELECOMMUNICATION ARE;

It is an enabler of mobile commerce and promotes dissemination of useful information to

entrepreneurs and enhancing business creation (Adji; Boadi R and Grause Shaik A, 2006).

It is a source of employment for many people whose jobs are created and/or facilitated directly or
indirectly by the existence of mobile telecommunication (Adji; Boadi R and Grause Shaik A,
2006).

It is a significant source of revenue not only for its business operators but also to governments
through taxes paid by income earners in the mobile telecom industry (Adji; Boadi R and Grause
Shaik A, 2006).

It is a cheap means of communication and therefore cost-effective since it reduces the cost of
travel (Nodh and Nodh 2007).

Some of the arguments raised against the use of mobile phones are that;

There is a potential cost of a mobile phone for business, and the cost will be so high as to
damage their business. This is a potential danger, particularly when employees are using
business mobiles, as there is a risk that some employees could misuse the phone raising bills
massively.

It is hazardous to the human health in that it causes difficulty in the concentration when driving,
fatigue, and headache; cancer, increase reaction time in a time- dependent manner, infertility in
man, and many other diseases. The use of mobile increases the risk of road accident that could
have never happened without phones (http;// www.controlyourimpact.com disadvantage of
mobile-phones, 2012).

2.2 State of mobile telecommunication in Africa

According to ICT indicators 2008 report, when the first mobile networks were launched in
Africa two decades ago, few imagined that mobile phones would become Africa’s
communications device of choice. In 1990, only six countries had networks and there were less
than 15’000 subscribers. It took six years to surpass one million mobile subscribers. The 100
million barriers was shattered nine years later in 2005 and at the beginning of 2008, there were

19
over a quarter of a billion mobile subscribers on the continent. Mobile penetration has risen from
two in 2000 to over a fourth of the population today. Mobile subscribers are also now more evenly
distributed. In 2000, South Africa accounted for over half of all Africa’s mobile subscribers, but by
2007, only
16 percent of mobile subscribers were located in South Africa. Nevertheless, today there is still
considerable variation in mobile penetration among African countries. While the average number of
mobile subscribers per 100 inhabitants was 27 in 2007, this ranges from close to 90 in Gabon, the
Seychelles and South Africa to less than two in Eritrea and Ethiopia. Although wealth is one key
explanatory factor, the degree of competition in the mobile sector also impacts mobile penetration.
Most countries where mobile performance is poor relative to per capita income have limited
competition. For example, Eritrea and Ethiopia have the lowest mobile penetration on the continent
and only one mobile operator each. This is in sharp contrast with Liberia, which is emerging from
civil war and has a lower per capita income than Eritrea or Ethiopia. With four mobile operators,
Liberia has a mobile penetration more than six times greater than that of Eritrea or Ethiopia. Other
similar examples exist, across a range of countries of different income levels. Take Equatorial
Guinea, whose petroleum-based economy results in the second-highest per capita income in the
region. Yet Equatorial Guinea has only one mobile operator and its penetration is half that of South
Africa, where per capita income is one third less, but three facilities-based mobile operators are
active.
There are significant differences among Sub-Saharan African (SSA) countries in penetration of key
telecom services. Five countries, for example, including Mauritius,
Botswana, South Africa, Gabon, and Seychelles had the biggest penetration rates (in the range of 74
to 89 per 100 inhabitants) in terms of mobile subscription in 2007. In
Contrast, about 13 countries had less than 10 mobile subscribers per 100 inhabitants for the same
year, For example, Eritrea and Ethiopia have the lowest mobile penetration on the continent and only
one mobile operator each. This is in sharp contrast with Liberia, which is emerging from civil war
and has a lower per capita income than Eritrea or Ethiopia. With four mobile operators, Liberia has a
mobile penetration more than six times greater than that of Eritrea or Ethiopia (African
telecommunication/ICT indicators, 2008). Therefore, Customer services are the opportunities for
telecom service providers that are added to mobile network other than voice services in which
contents are either self produced by service provider or provided through strategic compliance with
service provider in order to create satisfied customers with quality service (Hanif. M, 2010).

20
2.3 State of mobile telecommunication in Ethiopia

2.3.1 Important facts about Ethiopia

ETHIOPIA TODAY
Country Facts

Area: 1.13millionsqkm (437,794sqmiles)

Population:  84,734,262  (2011 est.)
Capital City: Addis Ababa
People: Oromo 34.49%, Amhara 26.89%, Southern peoples and nationalities (Gurage
Sidama/Walaita/Others) 8.85%, Somali 6.20%, Tigray 6.07%, Others (combined smaller ethnic
groups) 17.5% (based on the 2007 census)
Language(s): Amharic, Tigrinya, Afan Oromo, Southern languages (eg Guragigna, Sidaminga),
Somali, Arabic, other local dialects and English (the major foreign language taught in schools)
Religion(s): Orthodox Christianity 40.5%, Protestant 19.6%, Islam 35.4%, traditional 3.1%;
Catholic 0.8%; others 0.7% (based on the 2007 census)
Currency: Ethiopian Birr, exchange rate 27 birr to £1
Major political parties: The government is run by the Ethiopian Peoples’ Revolutionary

21
Democratic Front (EPRDF), an alliance between four parties – the Tigray People’s Liberation
Front (TPLF), the Amhara National Democratic Movement (ANDM), the Oromo People’s
Democratic Organisation (OPDO) and the Southern Ethiopian Peoples’ Democratic Movement
(SEPDM) – along with six other smaller affiliated ethnic parties.
The largest opposition movement is the coalition known as the Ethiopian Federal Democratic
Unity Front (Medrek in Amharic) which comprises the Social Democracy Southern Peoples
Unity Party, the Oromo People’s Congress, the Oromo Federalist Democratic movement, Arena
Tigray and Unity for Democracy and Justice. Other major opposition parties include the
Ethiopian Democratic Party and the All Ethiopian Unity Party.
Head of State: (President) Girma WoldeGiorgis (with little formal power)
Prime Minister: Hailemariam Dessalegn (with full executive powers)
Membership of international groupings/organisations: United Nations, African Union (AU),
Inter-Governmental Authority on Development (IGAD), Common Market for Eastern and
Southern Africa (COMESA).
Source: World Fact Book, Ethiopia; 2012/13
http://www.wikipedia.com

2.3.2 HISTORICAL OVERVIEW OF ETHIO-TELECOM

The introduction of telecommunication services in Ethiopia dates back to 1884, seventeen years
after the invention of telephone technology in the world. It was Minilik II, the King of Ethiopia,
who introduced telephone technology to the country around 1884, with the installation of 477km.
long telephone and telegram lines from Harar to Addis Ababa. Ethiopian Telecommunications
Corporation (ETC) is the oldest public telecommunications operator (PTO) in Africa. In Ethiopia
mobile phone service introduced in 1991 E.C by 36,000 lines, but now has shown dramatic
change on coverage and in subscribers’ number has scored 18 million lines. And also, currently
ethio-telecom has the potential to provide 23 million lines (ethiotelecom, 2012).

It is a state owned enterprise and the sole telecom service provider in the country. The
telecommunication services in Ethiopia have made rapid stride both in quality and quantity.
However, the users at large are on question with quality and quantity of the services made
available to them. The process of technological sophistication has gained the momentum but the
users are yet to get the quality and quantity of service (Tele Negarit, 2007). The poor sector

22
management coupled with the lack of capital has resulted in Ethopia having one of the lowest
teledensities in the sub-Saharan region of a mere 0.5%. This is expected to increase to 1% of the
population when the seventh development program is finished. Distribution of
telecommunication services is highly skewed with 90% of telephones found in the urban areas
and 50% in Addis Ababa alone. Addis Ababa has 4% of the population.

In terms of institutional development, only one operator, state-owned Ethiopia

Telecommunications Corporation (ETC), which was formed in October 1996 through
Proclamation 10/1996, still serves the market. ETC holds monopolies across all major services
including fixed line, mobile cellular, data, VSAT, VANS and internet. Although the government
has taken a liberalizing stance in principle since 1996, no new operators have established
themselves in Ethiopia since then. Recently the government launched a crackdown on alleged
‘illegal’ cyber café operators citing that only the incumbent ETC may operate such a service.
However, the government was considering licensing another cellular operator in 2000.
Privatization of ETC is also not planned. Digitization of switches stands at 12%, much lower
than most countries in the region (ethiotelecom, 2012).

ETC provides national and international telecommunications services, using communication

media of satellite, optical fiber, microwave, multiple access radius, very small aperture, ultra
high frequency and very high frequency. Currently, it provides the following major types of
service packages such as landline and wireless fixed, mobile, internet and data services for its
government, business, and private and other non-government organizations which are locally and
internationally.

This is an exciting time for telecommunications development, since new technologies are
revolutionizing the services worldwide. These fundamental and rapid changes being experienced
by telecommunication markets throughout the world are brought about among other factors
primarily by the technological developments and by competition oriented reform policies. This
creates different expectation on customers' perception towards the product or service of the
company. In these days globalize and borderless market, responsiveness, quality and productivity
are essential for the survival and growth of any organization. These factors depend mainly on the
attraction and retention of customers. Customer satisfaction significantly affects company

23
performance and survival. Thus customer orientation is the main focus for any successful
business organization to be successful in the market place (Samuel.E ,2006).

Through Proclamation 49/96 and 47/99, the government established a regulator, Ethiopia
Telecommunications Agency (ETA) to manage the sector.

2.3.2.1 Regulatory environment

Telecommunications services were separated from posts and became an autonomous entity under
the Ministry of Transport and Communications by the enactment of Telecommunication
Proclamation No. 131 of 1952. Through this proclamation, a telecommunication entity that
regulates and operates telecommunication services, called the Ethiopian Telecommunication
Board, was established.

The name “Ethiopian Telecommunication Board” was later changed to Ethiopian

Telecommunication Authority, without any change to the entities functions. The Ethiopian
Telecommunication Authority was working as an operator and regulator until the promulgation
of Proclamation No. 49/1996 that established a separate federal telecommunication regulatory
entity called Ethiopian Telecommunication Agency (ETA).

2.4. Concept/ Definitions of Customer Satisfaction

Parker and Mathew (2001) expressed that there are two basic definitional approaches of the
concept of customer satisfaction. The first approach defines satisfaction as a process and the
second approach defines satisfaction as an outcome of a consumption experience. These two
approaches are complementary, as often one depends on the other.
Customer satisfaction as a process is defined as an evaluation between what was received and
what was expected (Tse and Wilton, 1988), emphasizing the perceptual, evaluative and
psychological processes that contributes to customer satisfaction.

Parker and Mathews (2001) however noted that the process of satisfaction definitions
concentrates on the antecedents to satisfaction rather than satisfaction itself.

24
Satisfaction as a process is the most widely adopted description of customer satisfaction and a lot
of research efforts have been directed at understanding the process approach of satisfaction
evaluations (Parker and Mathews, 2001). This approach has its origin in the discrepancy theory
(Porter, 1961), which argued that satisfaction is determined by the perception of a difference
between some standard and actual performance.
Olshavsky and Miller (1972); and Olson and Dover (1979) developed the assimilation theory,
which means that perceived quality is directly increasing with expectations. Assimilation effects
occur when the difference between expectations and quality is too small to be perceived.

Anderson (1973) further developed this theory into assimilation-contrast theory, which means if
the discrepancy is too large to be assimilated then the contrast effects occur. The assimilation-
contrast effects occurs when the difference between expectations and quality is too large to be
perceived and this difference is exaggerated by consumers.

According to Parker and Mathews (2001), the most popular descendant of the discrepancy
theories is the expectation disconfirmation theory (Oliver, 1977, 1981), which stated that the
result of customers’ perceptions of the difference between their perceptions of performance and
their expectations of performance. Positive disconfirmation leads to increased satisfaction, with
negative disconfirmation having the opposite effect.(Oliver) expressed that customers buy
products or services with pre-purchase expectations about anticipated performance, once the
bought product or service has been used, outcomes are compared against expectations. If the
outcome matches expectations, the result is confirmation. When there are differences between
expectations and outcomes, disconfirmation occurs. Positive disconfirmation occurs when
product or service performance exceeds expectations. Therefore, satisfaction is caused by
positive disconfirmation or confirmation of customer expectations, and dissatisfaction is the
negative disconfirmation of customer expectations (Oliver, 1977, 1981).

Weiner (1980, and 1985); and Folkes (1984) proposed the attribution theory, which stated that
when a customer purchases a product or service, if the consumption is below expectation, the
customer is convinced that the supplier causes the dissatisfaction. The complaining customer is
focused on restoring justice and the satisfaction outcome is driven by perceived fairness of the
outcome of complaining.

25
Westbrook and Reilly (1983) proposed the value-percept theory, which defines satisfaction as an
emotional response caused by a cognitive-evaluative process, which is the comparison of the
product or service to one's values rather than an expectation. So, satisfaction is a discrepancy
between the observed and the desired.

Fisk and Young (1985); Swan and Oliver (1985) proposed the equity theory, which stated that
individuals compare their input and output ratios with those of others and feel equitable treated.
Equity judgement is based on two steps; first, the customer compares the outcome to the input
and secondly, performs a relative comparison of the outcome to the other party.
Pizam and Ellis (1999) reported that there are two additional distinct theories of customer
satisfaction apart from the seven aforementioned ones and these include:
1. Comparison-level

2. Generalized negativity; and

The outcome approach of the customer satisfaction is defined as the end-state satisfaction
resulting from the experience of consumption. This post- consumption state can be an outcome
that occurs without comparing expectations (Oliver, 1996); or may be a cognitive state of
reward, an emotional response that may occur as the result of comparing expected and actual
performance or a comparison of rewards and costs to the anticipated consequences.

Furthermore, Parker and Mathews (2001) expressed that attention has been focused on the nature
of satisfaction of the outcome approach which include:

1. Emotion - Satisfaction is viewed as the surprise element of product or service purchase and or
consumption experiences or is an effective response to a specific consumption experience. This
acknowledges the input of comparative cognitive processes but goes further by stating that these
may be just one of the determinants of the affective “state” satisfaction (Park and Mathews,
2001).

2. Fulfillment –The theories of motivation state that people are driven by the desire to satisfy
their needs (Maslow, 1943) or by their behavior aimed at achieving the relevant goals. However,
satisfaction can be either way viewed as the end-point in the motivational process.Thus

26
“consumer satisfaction can be seen as the consumer's fulfillment response” (Rust and Oliver,
1994).

3. State – Oliver (1989) expressed that there are four framework of satisfaction, which relates to
reinforcement and arousal. “Satisfaction-as-pleasure” results from positive reinforcement, where
the product or service is adding to an aroused resting state and “satisfaction-as-relief” results
from negative reinforcement .In relation to arousal, low arousal fulfillment is defined as
“satisfaction-as contentment”, a result of the product or service performing adequately in an
ongoing passive sense. High arousal satisfaction is defined as “satisfaction as either positive
(delight) or negative surprise” which could be a shock (Rust and Oliver, 1994).

For this study, customer satisfaction definition used is that of Homburg.C and Giering, A (1998)
which is “an experience-based assessment made by the customer of how far his own
expectations about the individual characteristics or the overall functionality of the services
obtained from the provider have been fulfilled”.

The relevance of this definition to this study is that it indicates that customers assess the mobile
services based on experience of use and the rating is done in accordance with the mobile services
attributes. In this study, focused on the evaluation/assessing of the customer satisfaction with
regarding to the Ethiopia mobile services based on service quality dimension items.

2.4.1 CLEAR UNDERSTANDING OF CUSTOMER NEEDS AND EXPECTATIONS

The achievement of a strong customer satisfaction is closely related to the understanding

customer needs and expectations (William and Bertsch, 1992). According to the Kano Model
(2001), customer needs can be divided into:

 Basic needs – obvious needs of customers and if not met, he is dissatisfied, however
meeting this needs may not be enough for customer satisfaction. Its satisfaction results in
“must be quality”.
 Expected needs – these are important needs that customers are fully aware of and
satisfaction is expected in every purchase; their satisfaction creates “expected quality”.

27
  Excitement needs – these are unconscious and unspoken needs of customers. By
identifying and satisfying such needs, companies have added large value to customers
and can win loyal customers. This satisfaction creates “attractive quality”.
Studies that supported the notion that expectations precede satisfaction include: Anderson,
Fornell and Lehmann (1994), who conducted investigation on Swedish firms and reported that
there is a positive and significant relationship between expectations and customer satisfaction.
They describe expectation as an accumulation of information about quality from the outside
sources (e.g. advertising, word of mouth and general media) and past experiences. Cadotte,
Woodruff, and Jenkins (1987) conducted investigation on food restaurant and reported that
expectation is significantly correlated with satisfaction. Additionally, expectation is a pre-
purchase choice process and form a part of evaluation standards of conceptualizing satisfaction
process. Churchill and Suprenant (1982) conducted investigation on durable good (video disc
player) and non-durable goods (hybrid plant). For the hybrid plant study, expectation is reported
to have a direct impact on satisfaction. Oliver (1981) conducted investigation on retail stores and
reported that expectation has direct influence on satisfaction. However, there are other research
works that disagree with this finding, examples include: Churchill and Suprenant (1982) in their
investigation on video disc player, reported expectation to have no impact on satisfaction. Spreng
and Olvshavsky (1993) conducted investigation on cameras and reported that there is no
significant relationship between these two variables.

With this aforementioned literature, it is noted that customers purchase services based on their
needs and have expectations that the purchased services will meet their needs. Customers in turn
assess the service performance in accordance to how well it meets their expectations. Although,
customer expectation is not a focus of this study, however satisfaction measurement is useful to
understand customer expectations (since most times assessment is done by customers based on
past experiences and future beliefs of service performance).

28
2.4.2 PERCEIVED VALUE

Perceived value is defined as “the results or benefits customers receive in relation to total costs
(which include the price paid plus other costs associated with the purchase) or the consumers'
overall assessment of what is received relative to what is given” (Eniola Samuel, 2006).

Additionally, Zeithaml (1988) found out that customers who perceive that they receive value for
money are more satisfied than customers who do not perceive they receive value for money.

Several studies have shown that perceived value is significant determinant of customer
satisfaction, Turel and Serenko (2006) in their investigation of mobile services in Canada
suggested that the degree of perceived value is a key factor affecting customer satisfaction.

Past research studies suggested that there are four features, which are key drivers of the customer
value of cellular services: network quality, price, customer care, and personal benefits (Booz,
Allen & Hamilton, 1995; Gerpott, 1998).

 The network quality refers to excellent indoor and outdoor coverage, voice clarity, and no
connection breakdowns.
 Price refers to what is paid to obtain access to use the network.
 Customer care refers to the quality of the information exchanged between customer and
supplier or network provider in response to enquiries and other activities initiated by the
network provider, for example presentation of invoices.
 Personal benefits refer to the level of perception of the benefits of mobile
communications services by individual customers.
It is apparent from this review that one of the factors customers use to determine satisfaction
level is the benefits received from a product or service in comparison with what is spent.
Perceived value is not a focus of this study; however customer satisfaction evaluation captures
perceived value.

29
2.4.3 Customer satisfaction measurement model

Many measurement models have been developed and applied to measure customer satisfaction
though not all have been empirically validated. Simon Gyasi and Foresight Kofi (2006)
identified nine methods for measuring CS, which are; expectancy disconfirmation, assimilation-
contrast, equity, attribution, comparison-level, generalized negativity and value precept. Out of
these the most widely used in the disconfirmation theories and customer satisfaction index.

2.4.4 Disconfirmation models

Disconfirmation models are models that suggest that customer satisfaction/dissatisfaction is the
disparity that exist between the performance of a product/service and cognitive or emotional
standards of the consumer. Oliver (1980) was the first to propose and developed the expectancy
disconfirmation theory. This theory has been tasted and confirmed in several studies. According
to expectation disconfirmation theory, customers after consuming a product/service performance
against their expectation before the service encounter. When outcome or perceived performance
is equal to expectations, confirmation occurs. Negative disconfirmation occurs when
product/service performance is less than expected. Positive disconfirmation occurs when
product/service performance is better than expected. Customer satisfaction occurs by
confirmation or positive disconfirmation of consumer expectation, and dissatisfaction is caused
by negative disconfirmation of consumer expectations.

2.4.5 Customer satisfaction measurement scales

In measuring customer satisfaction, which measurement scale is appropriate and how many
items should such a scale have? According to Danaher and Haddrell (1996); there are three broad
categories of measurement scales used in customer satisfaction measurement. They are
performance scales, disconfirmation scales and satisfaction scales. Performance scales are those
that use scales such as poor, fair, good, and excellent; disconfirmation scales are those that use
scales such as worse than expected to better than expected; and satisfaction scales are those that
use scales such as very dissatisfied to very satisfied.

The disconfirmation scale is preferred method in measuring customer satisfaction because of the
following reasons;

30
First in one disconfirmation-based single question, it captures succinctly Parasuraman et al
(1980) two-stage SERVQUAL measurement, i.e. much worse than expected to much better than
expected. Second, it is shown mathematically that comparison with expectations will correlate
higher with customer retention than either a quality question or a satisfaction question. Lastly,
using disconfirmation scale is better because a customer rating service quality highly, for
example as good or excellent, may not perceive it as 'better than expected'.

For the above reasons, in this study, theoretical framework for measuring customer satisfaction
with service quality used five-point disconfirmation scales; from much better expected or desired
to much worse than expected or desired.

2.4.6 Service

Service has been variously defined by many authors including the following;

 '' A service is the non-material equivalent of a goods. A service provision is an economic

activity that does not result in ownership, and this is what differentiates it form providing
physical goods. It is claimed to be a process that creates benefits by facilitating either a
changes in customers, a change in their physical possessions, materials/services''
Wikipedia, the free encyclopedia Retrieved on 25th December 2012;
 '' Services- broadly defined as acts, deeds, performances, of efforts- have different
characteristics' from goods defined as articles, devices, materials, objects of the things''
( C.Lovelock 2005).
 Services refer to '' economic activities offered by one party to another, most commonly
employing time-based performances to bring about desired results in recipients
themselves or in objects or other assets for which purchasers have responsibility''
( Lovelock and Wirtz 2007).
 ''A service is any act or performance that one party can offer to another that is essentially
intangible and does not result in the ownership of anything. Its production may or may
not be tied to a physical product'' Kotler and keller (2006).

31
 2.4.6.1 Services Classification

Based on the benefit without ownership perspective, Lovelock and Wirtz (2007) identified five
broad categories within the non-ownership framework:

 Rented goods services: these services enable customers to obtain temporary right to
exclusive use of physical goods that they prefer not to own. Example include boats,
power tools, combine harvesters, wedding gowns, etc.
 Defined space and place rentals: this kind of services are customers use of a defined
portion of a large space in a large space in a building, vehicle, or other area, sharing its
use with other customers under varying levels of privacy.
 Labor and experience rentals: customers hire other people to perform work that they
either choose not to do for themselves or are unable to do because of lack of the
necessary expertise, tools, or skills.
 Access to shared physical environments: these environments may be located indoors or
outdoors or a combination of both. Examples include museums, theme parks, tradeshows,
gyms, zoos, ski resorts, golf courses, and toll roads.
 System and networks: access and usage, here customers rent the right to participate in a
specified network such as telecommunications, utilities, banking, insurances, or
specialize information services.

In this study, the focus is on mobile telecommunication network services which fall in the
system and networks group proposed in Lovelock and Wirtz classification.

 Core and supplementary services: Lovelock and Wirtz (2007) further described a firm's
markets offering as being divided into core service products and supplementary service.
In which a service itself is a core product and marketing through services i.e.
supplementary or customer services which may include logistics services, advice,
installation and upgrades. The core service is the basic reason for a firm to be in the
market. It represents a complex set of benefits which may be difficult to analyze because
some are physical, some are psychological and others are emotional. It relates to the
primary benefits that the customer receives from the service. Additionally, supplementary
or peripheral services divided into enabling/facilitating and enhancing/supporting

32
 services. Facilitating services are those which are necessary for the core service to take
place. Supporting services/goods do not facilitate the delivery of core service but create
added value for the client.
Several scholars also postulate there is the augmented service offering which consists of
various features, such as the accessibility of the service that is made possible through
such things as skilled employees, suitable office hour's etc. the quality of customers
interaction with the organization and its workers and customers involved in the service or
value creation service process.

2.4.6.2 CUSTOMER SERVICES

Customer service is a system of activities that comprises customer support systems, complaint
processing, speed of complaint processing, ease of reporting complaint and friendliness when
reporting complaint (Hanif. M et,.al 2010). Customer services are the opportunities for telecom
service providers that are added to mobile network other than voice services in which contents
are either self produced by service provider or provided through strategic compliance with
service provider. The improved customer services are the focal point of the telecom service
providers for social as well as for economic reasons. From a social point of view, services should
be available to the customers on reasonable terms. As far as economic factor is concerned,
services should satisfy the needs of the customers (Turel and Serenko, 2006). For developing
satisfaction among customers, the telecom service providers need to be extra careful for the
customer services they provide. The study of Ahn Han and Lee (2006) shows that when the
customers, do not get their complaints considered properly, they start looking for other brands. It
happens because either the customer service centers do not handle the complaints or the
customers are not able to address them properly. Sometimes, telecom service providers take
considerably longer time to resolve the problems like network coverage or call quality, the
customers do not wait for long and hence they lose satisfaction with that particular brand (Ahn,
Han and Lee, 2006). Furthermore, the friendly attitude and courteous behavior of the service
workers at service firms leaves a positive impression on the customer which lead towards
customer satisfaction. On the other hand, if a telecom service provider lacks in providing
services (call drops) to its customers it experiences customer churn. Many scholars argued that

33
service provider should provide customer oriented services in order to heighten up customer
satisfaction.

2.4.7 SERVICE QUALITY

In measuring customer satisfaction with service quality, it is significant to examine the service
quality concept, service quality has been a difficult to define concept that has aroused
considerable interest and debate in the research literature. This is because the meaning of quality
can be referred to in many attributes such as the experience of the service encounters, or '
moments of truth', the evidence of service, image, price, and so on. These form the customers
over all perceptions of quality, satisfaction and value. There are a number of different definitions
as to what is meant by service quality. Since service quality is basically defined from customer
perspective and not the manufacturers, it is usually referred to as customer perceived quality. The
concept of consumer perceived quality (CPQ) was first defined by Gronroos in 1982 as the
confirmation/disconfirmation of a consumer expectations of service compared with the
customers' perception of the service actually received.

The concept of service quality from the consumer perspective, thus perceived service quality, is
not a mistake because in the word of the guru '' the consumer of course, perceives what he or she
receives at the outcomes of the process in which the resources are used, i.e. the technical or
outcome quality of the process. But he or she also, often more importantly, perceives how the
process itself functions, i.e. the functional or process quality dimension. Thus, the technical
quality and functional quality dimensions of perceived service quality emerge'' (Gronroos.C,
2001).

Service quality is defined as “the difference between customer expectations and perceptions of
service” or “as the customers’ satisfaction or dissatisfaction formed by their experience of
purchase and use of the service” (Samuel. E,2006; Gronroos, 1984 and Parasuraman et
al.1988).

There are various classifications of the components of service quality in marketing science. Gronroos
(1984) stated that “in service environments, customer satisfaction will be built on a combination of
two kinds of quality aspects; technical and functional”. Technical quality or quality of the output

34
corresponds to traditional quality of control in manufacturing. It is a matter of properly producing the
core benefit of the service. Functional quality or process quality is the way the service is delivered. It
is the process in which a customer is a participant and co-producer, and in which the relationship
between service provider and customer plays an important role.

Technical quality is related to what customer gets (transaction satisfaction); functional quality is
related to how the customer gets the result of the interaction (relationship satisfaction).

Lewis (1987) suggested that service quality can be classified as essential and subsidiary.
Essential refers to the service offered and subsidiary includes factors such as accessibility,
convenience of location, availability, timing and flexibility, as well as interactions with the
service provider and other customers.

Parasuraman et al. (1988) identified five dimensions of service quality (SERVQUAL) that must
be present in any service delivery. SERVQUAL helps to identify clearly the impact of quality
dimensions on the development of customer perceptions and the resulting customer satisfaction.
SERVQUAL include:

 Reliability - the ability to perform the promised services dependably and accurately.
 Responsiveness - the willingness to help customers and provide prompt service.
 Assurance - the knowledge and courtesy of employees as well as their ability to convey
trust and confidence.
 Empathy - the provision of caring, individualized attention to customers, and
 Tangibles - the appearance of physical facilities, equipment, personnel and
communication materials.
The model conceptualizes service quality as a gap between customer's expectations (E) and the
perception of the service providers' performance (P). According to Parasuraman et al. (1985),
“service quality should be measured by subtracting customer's perception scores from customer
expectation scores (Q = P - E)”. The greater the positive score mark means the greater the
positive amount of service quality or the greater the negative score mark, the greater the negative
amount of the service quality.

35
Service quality = perceived – experience
SQ: Service Quality, P: Customers’ Perception, E: Customers’ Expectation. So, (P – E = SQ), is
a scale to examine the expectation or perception of a customer about the quality of specific
product or service (SQ).
1. Negative Q indicates that there is a gap in service quality.
2. Positive Q indicates that the satisfaction level of consumers is higher than their expectation.
Zeithaml et al. (1990) proposed a comprehensive perception of quality assessment and claimed
that they are other factors apart from the dimensions of Parasuraman et al. (1988):

 Access – how easy it is to come into contact with the supplier. This is where position,
opening hours, supplier availability, and other technical facilities belong.
 Communication – the ability to communicate in an understandable way that is natural to
customer.
 Credibility – referring to being able to trust the supplier
 Courtesy – refers to the supplier’s behavior, e.g. politeness and kindness
Parasuraman et al. (1988), assurance dimension is a combination of the credibility and courtesy
dimensions of Zeithaml et al. (1990).

Pizam and Ellis (1999) stated that the gap that may exist between the customers' expected and
perceived service quality is a vital determinant of customer satisfaction

Customers determine satisfaction level of any purchased service by the perceptions of quality
received. Therefore, customer satisfaction assessment captures service quality and in this study
to measure service delivery of ethio-telecom with regarding on mobile service different service
quality dimensions has used to assess customer satisfaction.

36
2.4.7.1 Significance and drivers of service quality

Delivering excellent service quality is widely recognized as a critical business requirement.

Which is essential to corporate dynamic marketplace and marketspace, organization no longer
compete only on cost but more importantly on service quality. In a competitive marketplace
where businesses compete for customers, delivering quality service is seen as a key differentiator
and has increasingly become a key element of business strategy (Kotler, 2006).

On the drivers of service quality, the most widely used model is the service-profit chain (SPC),
first proposed by Heskett et al. (1994). It provides one of the most powerful and widely
supported perspectives on the issues overall, the SPC sees organizational internal features as
driver of employee satisfaction, which drivers service quality which is also identified as an
antecedent of customer satisfaction which in turn drives customer loyalty and retention that
eventually leads to profitability and growth.

2.4.7.2 Service quality models

Many different models have been developed to explain and measure service quality in different
setting of business operation. The focus of this thesis is not measuring service quality, but the
need to review literature on service quality models since customer satisfaction has strong relation
from the dimensions of service quality.

37
2.4.7.2.1 Technical and functional quality model (Gronroos 1994)

Christian Gronroos developed a service quality model that has three components of service
quality, namely; technical quality; functional quality; and image. He maintains that the customer
evaluations of perceived performance of service against his/her perceived service quality result
in a measure of service quality.

Expected service Perceived Perceived

service quality service

Image

Technical quality
Functional quality

What? How?

Source; Gronroos (1984)

Figure 2.4.7.2.1 Gronroos model of service quality.

1. Technical quality is the quality of what a consumer actually receives as a result of his/her
interaction with the service firm and is important to his/her evaluation of the quality of
service.

38
 2. Functional quality is how he/she gets the technical outcome. This is important to his/her
views of service he/she received.
3. Image, which could be referred to as reputational quality, is very important to service
firms and this can be expected to build up mainly by technical and functional quality of
service including the other factors (tradition, ideology, word-of-mouth, pricing and public
relation).

2.4.7.2.2 GAP model (Parasuraman et al 1985)

The GAP model was proposed by Parasuraman, kotler and keller, 2006. The model presupposes that
service quality is the differences between expectation and performance relating to quality
dimensions. These differences are referred to as gaps.

The gaps model conceptualizes five gaps which are;

1. Gap between consumer expectation and management perception -Management does not
always correctly perceive what customers want (not identifying what customers expect).
Example, Hospital administrators may think that patients want better food, but patients may
be more concerned with nurse responsiveness.
2. Gap between management perception and service-quality specification - Management might
correctly perceive customers' wants but not set a performance standard (inappropriate service
quality standard). Example, Hospital administrators may tell the nurses to give "fast" service
without specifying it in minutes.
3. Gap between service-quality specifications and service delivery - Personnel might be poorly
trained, or incapable of or unwilling to meet the standard; or they may be held to conflicting
standards (poor delivery of service quality) such as taking time to listen to customers and
serving them fast.
4. Gap between service delivery and external communications - Consumer expectations are
affected by statements made by company representatives and ads (promises mismatch
delivery). Example, if a hospital brochure shows a beautiful room, but the patient arrives and
finds the room to be cheap and tacky looking, external communications have distorted the
customer's expectations.
5. Gap between perceived service and expected service - This gap occurs when the consumer
misperceives the service quality. Example, the physician may keep visiting the patient to
show care, but the patient may interpret this as an indication that something really is wrong.

39
 This gap depends on size and direction of the four gaps associated with the delivery of
service quality on the marketer's side.

Based on this, the SERVQUAL instrument was developed; it initially consisted of ten dimensions
(Parasuraman et al 1988). The ten were later refined into five dimensions; reliability, responsiveness,
tangibles, assurance (communication, competence, credibility, courtesy, and security) and empathy
which capture access and understanding or knowing the customers.

Word of mouth Personal needs Past experience

communication

Expected service

GAP 5

CONSUMER Perceived service

MARKETER GAP 4
Service delivery (including pre External
GAP 1 and post contacts) communicatio
ns to the
GAP 3 consumer

Translation of perceptions into

service quality specifications

GAP 2

Management perceptions of the

consumer expectations

Source; Parasuraman et al. (1985)

Figure 2.4.7.2.2 The Gap Model of service quality

40
2.4.7.2.3.Model of perceived service quality and satisfaction (Spreng and Mackoy 1996)

This model seeks to enhance understanding of the antecedents of perceived service quality and
customer satisfaction. This model is a modification of Oliver's (1993) model. The model explains
in detail the effect of expectation, perceived performance desires, desired congruency, and
expectation disconfirmation on over all service quality and customer satisfaction. These are
measured by using a set of ten attributes relating to advising in customer service, which are;
convenience in making an appointment, friendliness of the staff, advisor listened to my
questions, the advisor provided accurate information, the knowledge of the advisor, the advise
was consistent, advisor helped in long range planning, the advisor helped in choosing the right
courses for career, advisor was interested in personal life, and the offices were professional.

Desires

Desire Overall service

congruency quality

Perceived
performance

Overall
Expectations
satisfaction
disconfirmation
Expectations

Source; Spreng and Mackoy (1996)

Figure 2.4.7.2.3 Model of perceived service quality and satisfaction

41
2.4.7.2.4 Retail service quality and perceived value model (Sweeney et al. 1997)

The model maintains that service quality influences value and willingness to buy in a specific
service encounters through two alternative models. The models consider value to be ''value for
money'' and define values in terms of a comparison between what the consumers get and what
they give, or a comparison of benefits and scarifies.

Functional
service

+ Plus

Technical
service Plus
+ Plus
Value Willingness
Plus to buy

Product
quality Minus
---___

Minus
+

Relative price

Source; Sweeney et al, (1997)

Figure 2.4.7.2.4 Retail service quality and perceived value model

The whole model is divided in to two models. Model one depicts that functional service quality
and technical service quality perceptions significantly influence service quality perceptions in
addition to product/service quality and price.

42
In model two, the authors postulate that customer's willingness to purchase is directly influenced
by customers' perceptions of functional service quality. Functional service quality perceptions
also influence technical service quality perceptions, which in turn influence product quality
perceptions. However, either of the two directly influences value perceptions. It is possible from
an analysis of the model to allow technical service quality to influence perceived value directly
since model two appears to exert much influence on model one.

2.4.8 Prioritizing service quality dimensions

One of the marketing values that measuring customer satisfaction can provide practioners stems
from prioritizing the dimensions. Prioritizing the dimensions offers organizations the value of
identifying which dimensions of service quality customers are satisfied with and which ones they
are dissatisfied with. This allows practioners to effectively redirect their focus and re-allocate
resources toward improving service quality with customer dissatisfied dimensions, while
maintaining or increasing attention and resources on dimensions those customers are satisfied
with. In the empirical work of Chowdhary N. and Prakash M., (2007, p.506) on prioritizing
dimension of service quality, they found out that '' no simple generalization of relative
importance of determinants of service quality is possible. Thus, it must be noted that importance
of determinants of quality for customers would vary across different service types.'' In view of
this, the researcher was explored the relative importance of dimensions of service quality from
customer perspective in Ethiopia's the case of Addis Ababa mobile telecom industry as one of
the objective of the study.

43
 CHAPTER THREE

3. Research Methodology
3.1 Research Design

According to Hair.J.F. , Bush.R.P. and Ortinau.D.J (2002) most research objectives can be met
by using one of three types of research designs; exploratory, descriptive, and causal.
Exploratory research focuses on collecting either secondary or primary data and using an
unstructured formal or informal procedure to interpret them. An Exploratory research is a study
that is conducted to '' find out what is happening; to seek new insight; to ask questions and to
assess phenomena in a new light''. It is mainly used when a researcher want to have a clear
understanding of the situation or a problem, where the area of study is so new or vague,
important variable maybe known or defined.
Descriptive research uses a set of scientific methods and procedures to collect raw data and
create data structures that describe the existing characteristics (e.g., attitudes, intentions,
preferences, purchase behaviors, evaluations of current marketing mix strategies) of a defined
target population or market structure. Descriptive research designs are appropriate when the
research objectives include determination of the degree to which marketing (or decision)
variables are related to actual market phenomena. Here, the researcher looks for answers to the
how, who, what, when, and where questions concerning different components of a market
structure.
Causal/explanatory research is designed to collect raw data and create data structures and
information that will allow the decision maker or researcher to model cause-and-effect
relationships between two or more market (or decision) variables. Causal research is most
appropriate when the research objectives include the need to understand the reasons why certain
market phenomena happen as they do.
This study has significant combination of descriptive and exploratory design. Firstly, since this
thesis is about the study of customer satisfaction with service delivery of ethio-telecom regarding
on mobile service, to describe or portray a reality regarding customer satisfaction with service
quality to better understanding those service quality dimensions that customers are satisfied or

44
dissatisfied with, so this has necessitated a descriptive research design was undertake for a
research and Secondly, this study is to explore the relative importance of service quality
dimensions in Ethiopia's mobile telecom market, therefore it is exploratory . And also has used
survey design techniques. As a part of research method, both quantitative and qualitative method
was possessed with an intention to gather enormous consumer’s responses towards service delivery
of ethio-telecom regarding on mobile phone service.
3.2 Research strategy
In general, a research is conduct to discover solution to a research problem. To attain this goal, a
research plan must be design which is termed as research strategy Singh.Y.K (2006). It guides
necessary steps and tools to follow for collection of required research materials. Later on, the
collected data was analyzed and examined to draw a scientific and valid answer to a research
question. As a foremost research strategy in this thesis, substantial information was gathered on
the basis of background study regarding on customer satisfaction. Thereafter, a questionnaire
designed on the foundation of customer satisfaction with service delivery of ethio-telecom
through assessing service quality dimensions, to explore/assess the status of customer
satisfaction. In this study has used basically survey strategy because it sought the opinion of
customers about a specific subject matter and it combined the use of both quantitative and
qualitative techniques. The questionnaire survey is planning to circulate among consumers for
data collection and results can extract accordingly. Further, conclusions and recommendations
has possessed based on the findings.
3.3 Time Horizon

According to time horizon, research design can be longitudinal or cross-sectional. This study is a
single cross-sectional study because data was collected from a single section of customers of ethio-
telecom and not for different period of time.

3.4 Study Area

The target population for this study has comprised 18 million subscribers or customers. Out of the
18 million subscribers in Ethiopia, The sample frame for this study was selected only the present
Ethiopian telecom customers which are living in and around the country‘s capital Addis Ababa.
The sample size 300 customers selected based on the issues like willingness and the time allotted

45
by the respondents for the collection of information. Data was collected at various areas of Addis
Ababa City including all ten sub cities. Using a large sample and different cities in this survey
required financial resources and time, which was not afford.

3.5 Method of data collection

The data obtained from two sources, it has collected from primary and secondary data sources, the
primary data collection is in order to get first hand information from the respondents and it helps to
gather information for the specific purpose of addressing the problem at hand (Singh.Y.K 2006). In
this study the primary data collected from focus group discussion and the questionnaire. The
questionnaire type which the researcher used structured questionnaire, this types of questionnaire
selected to involve a high number of close ended questions and less number of open ended
questions. The questionnaire was constructed entirely in Amharic.

And secondary data are collected for some purpose other than the problem at hand. In this study
secondary data was collected from the directories of companies used for the study, online articles,
journals and books.

3.6 Population and Sample

In research methodology, defining a sample is a sort of efficiency which shown the accuracy of
data collection. Therefore, being a precise for sample and population is an integral part of
research design. Population is defined as audience aim for the collection of information sought
by the researcher for the particular problem, ( Nguyen.D and Maiya. J, 2011; Malhotra & Birks,
2007). However due to their vague nature individual data collection is impossible to done with
all of them so on the base of target population, a sample size is extracted to represent the
population. Thus, a sample is selected as to exemplify the whole population in a small and
limited number making sure that right respondents has selected depending upon age group,
demographics, gender or many others for accuracy of survey. Therefore the target population for
this study is comprised 18 million subscribers or customers who are individual users. Out of the
18 million subscribers in Ethiopia, a sample size of 300 respondents selected from Addis Ababa
city including all sub cities based on researchers' judgment because of finance and time
constraints. Using a large sample in this survey requires sufficient financial resources and time
which was not afford.

46
 3.7 Sampling Technique

Bryman & Bell (2007) offer two kinds of approaches in business studies: Probability approach
and non-probability. Firstly, in probability approach, a sample can be chosen randomly, i.e.,
each person in the population has the equivalent opportunity of being chosen. Simple random
sample, systematic sample, stratified random sampling and multi-stage cluster samplings are four
types of probability sample. Secondly, non-probability sampling in which, a sample is not
chosen randomly, thus the specimens have not been representative and it is impossible to carry
out a legitimate inference about population. The non-probability includes convenience sampling,
snowball sampling and quota sampling. In this study, it is not possible to recognize every people
in Ethiopia, thus the thesis was applying convenience/specimen sampling from non-probability
sampling techniques. The reasons behind selecting such techniques were;
 Convenient to use.
 Less time consuming.
 Bears low cost.

3.8 Data collection procedures

3.8.1 In-depth focus group interview

In this study a preliminary focus group interview was conducted to clarify service quality
dimensions in the context mobile telecommunication service in Ethiopia. The focus group was
used to discuss dimensions of service quality that matter to Ethiopian customers/subscribers.
According to Cooper and Schindler 2006; Malhotra and Briks 2007, the appropriate number of a
focus group should be between five and twelve people; the people should be purposefully selected,
and the discussion or interview last for usually an hour or two hours. In view of this, eight
participants were selected by using purposive sampling technique.

47
 3.8.2 Structure of questionnaire

In the use of survey strategy, the main instruments used are self- administered/ interviewer
administered or structured/unstructured interviews and questionnaires or a combination of both
(Hair.J.F, Bush.R.P, and Ortinau.D.J, 2002 ) Generally, the questionnaire can be used for
descriptive or explanatory study, so that, this study is the descriptive one. In this study the
questionnaire must have a good lay out, unambiguous questions, complete items, non-offensive
but relevant items, and the ability to elicit willingness to answer in respondents. In this study,
self administered and structured questionnaire was used to collect data from respondents. The
questions sought respondents' feelings about overall customer satisfactions, satisfactions for
dimensions service quality and importance of dimensions of service quality.
The questionnaire designed on the basis of the study of researchers such as (Parasuraman et al.,
1985; Zeithaml & Bitner, 1996) who identified five dimensions of service quality: tangible
(equipment, written material, personnel, and appearance of physical facilities), reliability (ability
to deliver promised service and accurately), responsiveness (willingness to help customers and
providing prompt services), assurance (Knowledge and ability of employees to inspire trust and
confidence), and empathy (Caring and providing individual attention to each customer), and also
the others dimension items are economy (giving customer value for services received), technical
quality (having good network clarity and coverage for call completion/services) and image
(having a good reputation of company and image).
3.8.3 Pilot Testing and Final Administration
Saunders at 2000; cooper and schindler 2006; and malhotra N.K and D.F. 2007 agree that in any
research, it is expedient as a matter of reliability and validity check that the questionnaire should
be pre-tested before final administration. A preliminary draft of the questionnaire was given to
focus group members to test the clarity and meaningfulness of the questions. After that the final
questionnaire was first given to three master’s students in marketing to assess its content and
construction, and then it was pre-tested to a sample of fifteen (15) subscribers. Finally, after
adjustments were made to get more effective instruments, the questionnaire was administered to
the target population through personal contact by researcher. They were first informed of the
purpose, and confidentiality of responses. The questionnaire was administered to respondents in
all of ten (10) sub cities in Addis Ababa due to financial and time scarcity other cities did not
include in this study.

48
 3.8.4 Response Rate
Out of the three hundred questionnaires that were administered, totally 300 questionnaires were
collected, so that it shows more than adequate for statistical analysis. In all 53 % were females
and 47 % were males, this indicating a fairly balanced gender distribution.
3.9 Credibility of the Research
Scientific methodology needs to possess the characteristics of credibility. In this study efforts
were made to ensure credibility in terms of validity and reliability, which are important at every
stage of the research work.
3.9.1 Validity
Validity refers to whether the statistical instrument what it is intended to measure, i.e. accuracy
of measurement (Sullivan T.J. 2001; Saunders et al., 2007). Validity can be internal or external.

:The following are the relevant forms of internal validity ensured in this study

 Face validity: Involves assessing whether a logical relationship exist between the
variables and the proposed measure. This type of validity is highly subjective, and
does not provide enough proof of validity. For face validity in this study, it was
logical to measure customer satisfaction with service quality using a questionnaire-
based survey.
 Content validity: Content validity or sampling validity refers to whether a
measurement instrument has adequate and representative coverage of the concepts in
the variables being measured. It is usually achieved by seeking opinion of other
investigators or experts. The questionnaire for this study was given to three master’s
students in marketing to review its content validity.
 Criterion validity: This refers to ensuring validity by showing a correlation between
the measurement instrument and some other criterion or standard that is believed to
accurately measure the variable being considered. If the instrument is measured some
other similar instrument that has been developed and tested to be valid, then such
comparison is termed con-current validity. Thus in this study, the questionnaire
developed was compared with other similar validated SERVQUAL instruments that
have been developed and used in several studies. This was to ensure that the item in
the questionnaire match up with the validated ones.
49
  Construct validity: This has to do with measuring an instrument to an overall
theoretical framework in order to determine whether the device confirms a series of
hypothesis derived from an existing theory. Thus, the instrument must have existing
conceptual or theoretical bases in the literature. In this work, this construct validity
was ensured by deriving the determinants of customer satisfaction and service quality
from existing disconfirmation theory and Gronroos SERVQUAL model.

External validity: this refers to the extent to which the result of a study could be generalized. In
this work, to ensure external validity, the findings and results will be generalized to the settings
.and specifically to the ethio-telecom regarding on mobile service used in this study

Reliability 3.9.2

Reliability refers to whether a measurement instrument is able to yield consistent results each
time it is applied. It is the property of a measurement device that causes it to yield similar
outcome or result for similar inputs. Statistically, reliability is defined as the percentage of the
inconsistency in the responses to the survey that is the result of differences in the respondents.
This implies that responses to a reliable survey will vary because respondents have different
.opinions, not because the questionnaire items are confusing or ambiguous

It could be estimated using stability or equivalence approaches. In this study I did pilot test the
questionnaire to strengthen its reliability. Cronbach’s alpha was also used to test it. This ratio
assumes that the item variances are all equal; it specifies to the average inter-item correlation,
and the result is known as the standardized item alpha (or Spearman-Brown steeped-up
:reliability coefficient)

50
The result of the Cronbach’s alpha retrieved from the SPSS output for all dimensions are
summarized in figure 3.9.2

Overall Reliability Statistics for all Items

Dimensions Cronbach’s Alpha Number of Items
Overall, DD, and ED 0.717 3
Tangible 0.822 4
Reliability 0.805 5
Responsiveness 0.776 4
Empathy 0.871 7
Assurance 0.838 4
Economy 0.725 2
Technical quality 0.862 5
Image 0.850 3
Importance of Dimensions 0.914 8

All items (excluding Bio data) 0.855 45

Table 3.9.2 Cronbach’s Alpha Reliability Test

Source: Data from SPSS output

.The reliability test table on the above indicates that all the items for each dimension are high

3.10 Tools

SPSS Version 20 was used to tabulate and analyze the valid responses. At the beginning, a
comprehensive data file has created, then, variables and their labels were defined. The
descriptive statistics (frequencies statistics) was applied to assess the level of customer
satisfaction with the relationship between the mobile services attributes and customer
satisfaction.

51
3.11 Research Instrument
Data analysis involves examining, categorizing, tabulating or otherwise recombining the collected
data. Every investigation should have a general analytical strategy in order to determine what to
analyze and why (Singh.Y.K (2006). A total of 300 questionnaires administered and collected in
the capital city of Ethiopia, Addis Ababa. After the information and row data gathered from
different sources, analysis and processing of data was possessed in a simplest and meaningful
manner. Thus descriptive data analysis was used including by using percentage distribution,
tabulation, figure (pie chart, histograms). And the collected data analyzed through the Statistical
Package for Social Science (SPSS) by latest version 20.

One sample T-Test: this is a statistical procedure that tests weather a single variable deviates from
a specified constant or a cutoff point. The cutoff point may be a known population mean. This
chosen procedure was deemed appropriate because I wanted to find out customers who said they
were satisfied with the services quality received or at least the service quality was equal to their
desire or expectation. Again I needed to specify a constant or cut off point to determined
dimension considered by customers as important and those not important. One sample T-Test was
used to answer research questions.

52
CHAPTER FOUR

4. DATA ANALYSIS AND PRESENTATION

This chapter consists of two parts; Data presentation and Discussion. Data presentation covers
data on respondents’ characteristics, customer satisfaction with service quality dimensions, and
relative importance of service quality dimensions. The discussion is an analysis of results and
findings to answer the research questions.

4.1 Respondent’s Characteristics

Since the characteristics of the respondents influence the results, presentation of descriptive data
of respondents.

Gender of the respondents’

Gender Frequency Percent

Male 141 47

Female 159 53

Total 300 100

Table 4.1.1 Respondents’ Gender

The respondents’ gender as displayed in 4.1.1 indicates that the female 53% were slightly more
than the male 47%. This further implies that there was a good representation of both genders in
the sample.

53
Age of the Respondents

Age Frequency Percentage

19-28 161 53.7

29-40 113 37.7

41-50 6 2.0

51-60 20 6.7

Total 300 100.0

Table 4.1.2 Age of Respondents

Table 4.1.2 indicates the respondents’ age. It is obvious that most of them were in the young
adult age and economically active group, between the ages of 19-40 constituting 91% (54 % and
37 %), while the rest constitute 9% made up of respondents above, 40 years.

Occupation of the Respondents’

Occupation Frequency Percentage

Civil servant 128 42.7

Business person 83 27.7

Student 89 29.7

Total 300 100.0

Table 4.1.3 Respondent’s occupation

54
Table 4.1.3 depicts respondents’ occupation, most of the respondents were civil servants
representing 45% and students and business presents mere 30% and 27% respectively.

Income level of the Respondents’

Income Level Frequency Percentage

below 1000 birr 38 12.7

1000-1500 birr 10 3.3

1500-2000 birr 57 19.0

above 2000 birr 118 39.3

dependant on family 77 25.7

Total 300 100.0

Table 4.1.4 Income level of respondents

Table 4.1.4 displays the respondents’ income levels. It indicates that generally, a relatively larger
number of respondents 39% were in above 2000 birr, no income group or dependent on family
constitute 26% and 19% were between 1500-2000 birr and also below 1000 birr and 1000-1500
birr constitute 12% and 4% respectively.

55
Education of the Respondents’

Education Level Frequency Percentage

Below TEVET 23 7.7

TEVET/Preparatory 31 10.3

Diploma 63 21.0

Bachelor degree 138 46.0

Master's degree 26 8.7

PhD 19 6.3

Total 300 100.0

Table 4.1.5 Respondents’ Education.

Table 4.1.5 depicts respondents’ level of education. They indicate the education levels were
normally distributed. All the respondents were educated, 46% were Bachelor’s degree, 21% were
Diploma holder TEVET/Preparatory 10% and 9% and 6% were Master’s and PhD holder and the
least one is 8% constitutes below TEVTE.

4.2 Measuring customer satisfaction is service quality

In measuring customer satisfaction with service quality, desire and expectation disconfirmations
and overall satisfaction was measured.

4.2.1 Results of disconfirmation measures and overall customer satisfaction measure.

Customers were asked to rate their satisfaction with service quality using desire disconfirmation
(DD), expectation disconfirmation (ED) measures and overall satisfaction (OCS) measures. The
ED measure had a five-point likert scale: “much worse than expected”, “worse than expected”,
“equal to expectation”, “better than expected”, and “much better than expected”. The scale for
DD measure was also five-point likert scale from” much worse than desired” to “much better

56
than desired”. OCS measure used a five-point likert scale; “very dissatisfied”, “dissatisfied”,
“neutral”, “satisfied”, and “very satisfied".

The following table 4.2.1 shows a descriptive statistics of the three measures; ED, DD and OCS.

N Mean Std. Deviation Variance

Desire 300 2.38 .756 .571

Expectation 300 2.23 1.027 1.056

Overall 300 2.26 .780 .608

Valid N (list
300
wise)

Table 4.2.1 Descriptive Statistic of Satisfaction Measures.

Table 4.2.1 indicates that the mean rating of customer satisfaction using DD measure is 2.38 with
standard deviation of 0.756 while using ED measure, the mean is 2.23 with standard deviation of
1.027 being the highest. Using OCS, the mean rating was 2.26 with standard deviation of 0.780.
This means that the mean rating of customers using ED, DD and OCS were all below their desire
cut of point of three (3), and but ED has a wider deviation than the other DD and OCS measures.

A summary of the results of customer satisfaction rating regarding on DD, ED and OCS is
presented in Figure 4.2.2 below.

57
 70

60

50

40

30

20 DD
ED
10
OCS
0
d d n d d
sfie sfie atio sfie sfie
ati ati ct sa
ti ati
iss iss x pe r/ ys
ry
d /d /e tte er
se ie re Be /v
/ve or er
rs
e W to
d
b ett
wo ual uc
h
h Eq
uc M
M

Figure 4.2.2 Satisfaction rating regarding on DD, ED and OCS

It indicates that using DD measure, 62 % of the respondents rated their satisfaction as worse than
desired, 29 % of the respondents rated their satisfaction as equal to their desire, 4 % of the
respondents rated as much worse than desired and much better than desired for each, and the
least one is 1% of the respondents rated their satisfaction as better than desired.

Then using ED while 24 % and 44 % of the respondents rated their satisfaction as much worse
than expected and worse than expected respectively, 20 % of the respondents rated their
satisfaction as equal to expected, and 9 % ( 4% and 5 %) of respondents rated their satisfaction
as better and much better than expected. Finally, using OCS measure, 65 % and 9 % of the
respondents rated that overall they were dissatisfied and very dissatisfied respectively, 18 % of
the respondents as neither and 6 % and 2 % representing 8% rated their satisfaction as satisfied
and very satisfied respectively.

4.3 customer satisfaction with service quality dimensions

58
A detailed descriptive statistics of the result of customer rating of their satisfaction with service
quality dimensions. So that in order to verify whether the mean differences are significant or not,
a one sample T test was conducted.

One-Sample Test

Test Value = 3

95%
Confidence
Interval of the
Difference
Sig. (2- Mean
Service Quality Dimensions t df tailed) Difference Lower Upper

Tan.1 Network ability to give you access to

information reload cards 6.922 299 .000 .457 .33 .59

Tan.2 Provision of visually attractive offices

equipments and materials like starter 1.335 299 .183 .103 -.05 .26
packs and reload cards

Tan.3 Networks ability to provide variety of

entertainment facilities etc -18.073 299 .000 -1.073 -1.19 -.96

Tan.4 How appealing one the appearance

uniforms of employees 1.193 299 .234 .093 -.06 .25

Rel.1 How timely is the delivery of SMS and

other services? 15.961 299 .000 1.180 1.03 1.33

Rel.2 How truthful (keeping promising) is

ethio- telecom? -1.724 299 .086 -.073 -.16 .01

Rel.3 How dependable and consistent is

ethio-telecom in solving customer’s .499 299 .618 .033 -.10 .16
complaints?

Rel.4 How able is your network to perform

services right the first time? 2.208 299 .028 .127 .01 .24

59
Rel.5 How able is your network to insist on
error free records? 8.643 299 .000 .477 .37 .59

How able is your network to some

prompt customer services and attend to 7.035 299 .000 .343 .25 .44
Res.1 customer needs/problems?

Res.2 How are employees willing to help

customers in emergency situations? 13.616 299 .000 .553 .47 .63

Res.3 How are the employees approachable

and easy to contact? 6.950 299 .000 .367 .26 .47

Res.4 How are the employees’ ability to

communicate clearly in you? 3.500 299 .001 .147 .06 .23

Emp.1 Having convenient periods and terms

for activation, recharge, and accounts -22.477 299 .000 -1.400 -1.52 -1.28
suspension, free call times.

Emp.2 Having operating hours convenient to

all customers -1.637 299 .103 -.113 -.25 .02

Emp.3 Having sound loyalty program to

recognize you as a frequent customer -12.519 299 .000 -.917 -1.06 -.77

Emp.4 Having the customers best interest at

heart -14.030 299 .000 -.917 -1.05 -.79

Emp.5 Giving individual customer attention

by employees -16.029 299 .000 -.850 -.95 -.75

Emp.6 Efforts to understand specific customer

needs -15.619 299 .000 -.987 -1.11 -.86

Emp.7 Apologizing to inconvenience caused

to customers 9.722 299 .000 .740 .59 .89

Ass.1 Ability to provide variety of value

added services music access to -8.384 298 .000 -.532 -.66 -.41
internet, SMS, etc

60
Ass.2 Sincerity and patience in resolving
customer’s complaints/problems. 15.679 299 .000 1.073 .94 1.21

Ass.3 The behavior of employees in instilling

confidence in customers. -13.356 299 .000 -.543 -.62 -.46

Ass.4 Employees use of required skill and

knowledge to answer customers 3.739 299 .000 .187 .09 .28
questions

Eco.1 Reloading cards and there

denominations? -22.491 299 .000 -1.423 -1.55 -1.30

Eco.2 The calls charge per minute /second? -35.962 299 .000 -1.667 -1.76 -1.58

Tec.1 Successful in completion of calls,

SMS, line activation, credit reloading, -21.245 299 .000 -1.070 -1.17 -.97
etc.

Tec.2 Employees have technological

knowledge and skills in solving .087 299 .931 .003 -.07 .08
customer’s problems.

Tec.3 Network clarity and speed for call and

other services -14.723 299 .000 -1.047 -1.19 -.91

Tec.4 Network innovativeness ability to use

current technology to improve services. -12.907 299 .000 -.643 -.74 -.55

Tec.5 Providing adequate network coverage -12.438 299 .000 -.697 -.81 -.59

Img.1 How successful is ethio-telecom? -1.456 299 .146 -.090 -.21 .03

Img.2 How is the reputation of ethio-

telecom? -1.243 299 .215 -.073 -.19 .04

Img.3 How socially responsible is ethio-

telecom? -5.722 299 .000 -.360 -.48 -.24

Table 4.3.1 One Sample T- Test for SERVQUAL Dimensions

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In table 4.3.1 the mean differences, whether negative or positive are tested to really know
whether it is significant or not in order to identify which dimension of service quality customers
are satisfied with or not. Remember that in this study, using the significance of the mean
difference and the confidence intervals. The mean satisfaction difference is significant where the
corresponding significant value (p-value) is less than the chosen significant value of 0.05
(p<0.05). On the other hand the mean difference is not significant where it is more than or equal
to the chosen significant value (p≥0.05). A significantly positive mean difference with positive
confidence intervals means that customer satisfaction is significantly better or much better than
expected, while on significantly negative mean difference with negative confidence interval
means that customer satisfaction is worse or much worse than expected. Then, a confidence
intervals with a positive and negative values means that customer satisfaction is at least equal to
expectation.

The result is the table 4.3.1 show that fifteen (15) dimension items, all confidence intervals are
negative; this implies that customer satisfaction is worse or much worse than expected for the
following 15 dimensions; Tan3, Emp1, Emp3, Emp4, Emp5, Emp6, Ass1, Ass3, Eco1, Eco2,
Tec1, Tec3, Tec4, Tec5, and Img3.

Again, since their confidence intervals have a positive value of include zero, it means that
customer satisfaction is at least equal to expectation for the following eight (8) dimensions;
Tan2, Tan4, Rel2, Rel3, Emp2, Tec2, Img1, and Img2.

Finally, for eleven (11) dimension items, since their confidence intervals are all positive values,
it implies that customer satisfaction is better or much better than expected for the following 11
dimensions; Tan1, Rel1, Rel4, Rel5, Res1, Res2, Res3, Res4, Emp7, Ass2, and Ass 4.

As summary of the customer satisfaction with dimensions of service quality based on the results
in table 4.3.1 is displayed in figure 4.3.2.

62
 Series 1
16

14

12

10

Series 1
8

0
Better and Much better Equal to expectation Worse and Much worse
than expected than expected

Figure 4.3.2 Customer Satisfaction with SERVQUAL Dimensions

Precisely, eleven of the dimensions are related better than expected with means significantly
equal to the cut of value of three (3), eight (8) dimension items were rated significantly rated as
equal to expectation, and fifteen (15) dimension items were significantly rated below the cut of
value of 3. In all nineteen (19) dimensions were significantly rated by customers as at least equal
to or better than expectation while 15 were worse and much worse than expected.

4.4 Importance of SERVQUAL Dimensions

Customers were asked to rate the importance of service quality dimensions on the five-point
likert scale: “not- at- all- important”,” unimportant”, “and important”, and “very important”. A
summary of descriptive statistics is present in table 4.4.1. It indicates that six (6) dimensions had
a mean above 4 while two (2) had below 4.

63
 N Mean Std. Deviation Variance

Dimensions
Statistics Statistics Statistics Statistics

Tangibles 300 3.18 1.053 1.109

Reliability 300 4.11 .761 .580

Assurance 300 4.03 .964 .929

Responsiveness 300 4.06 .914 .835

Empathy 300 4.42 .938 .880

Economy 300 4.66 .920 .846

Technical quality 300 4.74 .920 .847

Image 300 3.24 .976 .952

Valid N (listwise) 300

Table 4.4.1 summary descriptive statistics of important SERVQUAL dimensions.

In order to identify the important and unimportant dimensions, a one sample T- test was used to
test the significance of the mean importance rating at 0.05 significance level and with a specified
constant or cut of values of (4) to split service quality dimensions that are important from those
that are not important to customers, the result are summarized in table 4.4.2.

One-Sample Test

Test Value = 4

64
 95% Remarks
Confidence
Interval of the
Difference
Sig. (2-
Dimensions t df tailed) Mean Difference Lower Upper

Tangibles -13.541 299 .000 -.823 -.94 -.70 Not important

Reliability 2.502 299 .013 .110 .02 .20 Important

Assurance .599 299 .550 .033 -.08 .14 Important

Responsiveness 1.200 299 .231 .063 -.04 .17 Important

Empathy 7.815 299 .000 .423 .32 .53 Important

Economy 12.490 299 .000 .663 .56 .77 Important

Technical quality 13.990 299 .000 .743 .64 .85 Important

Image -13.490 299 .000 -.760 -.87 -.65 Not important

Table 4.4.2 one sample test for importance of SERVQUAL dimensions.

Table 4.4.2 indicates that, all the dimensions are significant (p < 0.05). Notably, tangibles” and
image are significantly unimportant to customers in receiving or using the services of a mobile
network in Ethiopia, it had negative mean difference and confidence intervals. Conversely, the
following six dimensions of service quality had positive mean difference and confidence
intervals, and so were rated as important to customers; Assurance, Responsible, Empathy,
Reliability, Economy, Technical quality, and Image.

As to which dimensions are perceived by customers as more important than others, Table 4.4.3
shows ranking of service quality dimensions in order of customers’ priority.

Dimensions Rankings (In ascending orders)

65
 Technical quality 1
Economy 2
Empathy 3
Reliability 4
Responsiveness 5
Assurance 6
Image 7
Tangibles 8
Table 4.4.3 a prioritized dimensions of SERVQUAL.

Table 4.4.3 indicates that the most important service quality dimension to the customers is
technical quality, followed by economy empathy, reliability, responsiveness, assurance, being
least important. “Image” and “Tangibles” dimensions, as earlier indicated in table 4.4.2 are
unimportant to the customers.

CUSTOMER SATISFACTION

Better or Much better At least equal Worse or Much worse

than expected to expectation than expected
PRIORITY OF DIMENSIONS

Technical Tec2 Tec1, Tec3, Tec4, Tec5

quality
Economy Eco1, Eco2
Empathy Emp7 Emp2 Emp1, Emp3, Emp4, Emp5,
Emp6
Reliability Rel1, Rel4, Rel5 Rel2, Rel3
Responsiveness Res1, Res2, Res3 ,Res4
Assurance Ass2, Ass4 Ass1, Ass3
Table 4.4.4 SERVQUAL dimension priority-satisfaction matrix

The dimension priority-satisfaction matrix (Table 4.4.4.) shows customer satisfaction for each of
the prioritized dimension of service quality. The table indicates that for the very satisfied
dimension item one is more important to customers: Emp7; nine are less important: Rel1, Rel4,

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Rel5, Res1, Res2, Res3, Res4, Ass2, and Ass4; while one item are unimportant to customers;
Tan1.

Then, for the least satisfied dimension items, two are very important: Tec2 and Emp2: two are
less important Rel2 and Rel3, while four are unimportant: Tan2, Tan4, Img1, and img2.

Finally, for the dissatisfied dimension items, eleven of them are very important to customers:
Tec1, Tec3, Tec4, Tec5, Eco1, Eco2, Emp1, Emp3, Emp4, Emp5, Emp6; while two are less
important: Ass1 and Ass3; two are unimportant: Tan3 and Img3.

4.5 Discussion

4.5.1 Summary of respondents’ characteristics

As indicated in tables 4.1.1, 4.1.2, 4.1.3, 4.1.4 and 4.1.5, out of the sample 300 respondents, 53
% were females and 47 % males indicating a fairly balanced gender distribution. Most of them
43 % were public servants, 30 % were students and 27 % were business persons. 91 % of the
respondents were within the ages of 19-40 and the rest 9 % made up of above 40years, signifying
that majority of them were in the economically active population. 39 % of respondents earned
above 2000birr, 26 % were no income group or they are dependent on family, 19 % were
between 1500-2000birr and also below 1000birr and 1000-1500birr constitute 12 % and 4 %
respectively. 82 % of the respondents had Diploma and above Diploma, this indicates that all the
respondents were educated and 18 % constitutes TEVET/ Preparatory students and below.

4.5.2 Research question one

How can customer satisfaction with service quality be described in Ethiopia customer’s
mobile telecom service?

Using desire and expectation disconfirmation measures (table 4.4.3 and 4.4.4) show that only 5
% and 9 % of respondents rated their satisfaction better than their desire and expectation
respectively, with mean rating of 2.38 and 2.23 respectively, which were a little below the
required mean of 3. Again, overall satisfaction measure showed that only 8 % of customer
indicated that they were satisfied and very satisfied, with mean rating of 2.26 which was a little

67
below the cut-off value of 3. Finally, the customers are not satisfied with service quality
delivered by ethio-telecom in Ethiopia.

4.5.3 Research question two

Which dimensions of service quality are customers satisfied or dissatisfied with in

Ethiopia’s mobile telecommunication service?

A significant test of the mean rating for satisfaction with service quality (Table 4.3.1) implying
that customers are significantly not satisfied in the following fifteen (15) SERVQUAL
dimension items: Tan3, Emp1, Emp3, Emp4, Emp5, Emp6, Ass1, Ass3, Eco1, Eco2, Tec1, Tec3,
Tec4, Tec5, and Img3. Thus, in all, customer satisfaction is worse or much worse than expected
for these fifteen dimensions. Again, the analysis also provides adequate evidence about customer
satisfaction is at least equal to expectation for these eight (8) dimensions: Tan2, Tan4, Rel2,
Rel3, Emp2, Tec2, Img1, and Img2. Then, customer satisfaction is better or much better than
expected for the following eleven (11) dimensions: Tan1, Rel1, Rel4, Rel5, Res1, Res2, Res3,
Res4, Emp4, Ass2, and Ass4.

Thus, it can conclude with 95 % confidence that customers are dissatisfied with fifteen
dimensions (Tan3, Emp1, Emp3, Emp4, Emp5, Emp6, Ass1, Ass3, Eco1, Eco2, Tec1, Tec3,
Tec4, Tec5, and Img3) and at least satisfied with nineteen SERVQUAL dimensions (Tan2, Tan4,
Rel2, Rel3, Emp2, Tec2, Img1, Img2, Tan1, Rel1, Rel4, Rel5, Res1, Res2, Res3, Res4, Emp7,
Ass2, and Ass4).

4.5.4 Research question three

Which dimensions of service quality are important to customers of mobile

telecommunication service in Ethiopia?

The descriptive statistics (Table 4.4.1 and 4.4.2) show that the mean importance rating for all
dimensions were above the required mean value of 4 except “tangibles” and “Image” that had
3.18 and 3.24 respectively. A significant test of the means (Table 4.4.2) at 0.05 significant levels
with a specified constant of 4 indicated that six (6) SERVQUAL dimensions are perceived as
important by customers. These are: assurance, responsiveness, empathy, reliability, economy,
and technical quality; while only two, tangibles and image are considered unimportant service

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quality dimensions. In prioritizing the SERVQUAL dimensions (Table 4.4.3) indicated that
technical quality is the most important dimension, followed by Economy, Empathy, Reliability,
Responsiveness, while assurance was the least important dimension.

A careful analysis of customer satisfied/ dissatisfied dimensions in relation to customer

prioritized dimensions i.e. dimension priority-satisfied matrix (table 4.4.3) provides some
significant findings.

First, out of the eleven (11) dimension items that customer satisfaction is better than expected,
nine (9) of them (Rel1, Rel4, Rel5, Res1, Res2, Res3, Res4, Ass2, and Ass4) relate to the less
important service quality dimensions: Reliability, Responsiveness and Assurance; only one (1) of
them (Emp7) relate to the more important service quality dimensions: Empathy, while one of
them (Tan1) is unimportant to customers.

Second, out of the eight (8) dimensions that customer satisfaction is at least equal to expectation,
two items (Tec2 and Emp2) relate to the more important service quality dimensions: Technical
quality and Empathy; while two (2) of them (Rel2 and Rel3) related to less important
dimensions: Reliability and 4 items are (Tan2, Tan4, Img1, and Img2) unimportant to customers.

Finally, of the fifteen (15) dimension items that customer satisfaction is worse than expected,
eleven (11) of the items (Tec1, Tec3, Tec4, Tec5, and Eco1, Eco2, Emp1, Emp3, Emp4, Emp5,
and Emp6) are rated more important by customers, while only two (Ass1 and Ass3) are rated a
less important service quality items by customers and two items (Tan3, and Img3) are
unimportant to customers.

The data collected through open ended questions summarized under the
following paragraphs:

69
What kinds/types of mobile service should start and include in order to met or satisfy your
needs/desires?

 According to most of the respondents in order to met or satisfy their needs/desires,

expressed their idea to start and include additional important mobile services, like:
 Multimedia Message Services (MMS)
 Fast internet connection
 Credit mobile card reload service
 Video calling service
 Free call time
 Extended and convenient discount call time

How can express your complaints regarding on the current mobile phone services that are
provided by ethio-telecom?

 Regarding on the current mobile service that is provided by ethio-telecom, there are
many complains. Among them:
 Network clarity and speed for call is to bad
 There is no adequate network coverage and also availability of network is not
fair among all cities
 Discount call time is too short and the time is not convenient
 The call charge per minute/second is too expensive
 Repeatedly sending of advertising message is boring

The only provider of telecommunication service in Ethiopia is ethio-telecom this shows that
market monopoly system, so that what do you think about this system and what is your
ambition to the future?

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  Most of respondents suggest their idea about market monopoly system is negative
because of the following reasons:
 Market monopoly system is one of the bottlenecks to one country growth and
development due to lack of competition.
 In order to assure service quality, competition is needed and the critical one,
therefore market monopoly system completely denied/has no competition. As a
result of this with market monopoly system it’s difficult to consider customers
personalized service and quality.

Generally, most respondents have great ambition/feeling to see free market system as many
African countries to get different personalized service and to alleviate the current numberless
mobile service problem in our country.

CHAPTER FIVE

5. summary, Conclusion and Implications

71
This including chapter summaries the purpose and objectives of the study, the major findings and
conclusions, discusses the implications for marketing, and makes recommendation for further
research.

5.1 Summary of findings and conclusions

In this study the purpose was to measure customer satisfaction with service quality delivered by
ethio-telecom with regarding on mobile service. The study examined customer satisfaction with
service quality dimensions, customer prioritized SERVQUAL dimensions.

Based on an objective analysis of data and discussion of results and findings, the following are
the summary of major findings and conclusions of this study:

 Customers were asked to rate their satisfaction with service quality using desire
disconfirmation (DD), expectation disconfirmation (ED), and overall satisfaction (OCS)
measures. Most of the respondent rated that they were dissatisfied and very dissatisfied.
 Regarding satisfaction with service quality dimensions, customer satisfaction is better
than expected for the following eleven (11) SERVQUAL dimension items: Tan1, Rel1,
Rel4, Rel5, Res1, Res2, Res3, Res4, Emp7, Ass2 and Ass4. Customer satisfaction is at
least equal to expectation for these eight SERVQUAL dimension items: Tan2, Tan4,
Rel2, Rel3, Emp2, Tec2, Img1 and Img2. Then customers were dissatisfied with the
following fifteen SERVQUAL dimension items: Tan3, Emp1, Emp3, Emp4, Emp5,
Emp6, Ass1, Ass3, Eco1, Eco2, Tec1, Tec3, Tec4, Tec5 and Img3.
 According to customer priority, technical quality is the most important dimension,
followed by economy, empathy, reliability, responsiveness, while assurance is the least
important dimension. “Image” and “Tangibles” is significantly unimportant to the
customers.
 Most of the customers-satisfied dimension items are less important to customers, while
most of the customer-dissatisfied dimension items are more important.

5.2 Implications of the findings

5.2.1 To Regulators and Policy Makers

72
It has been found in this study that generally customer satisfaction with service quality with
regarding on mobile service is too low or less than expected and desired. This implies that policy
makers and body of regulator/ government/, need to be awakened to this empirical fact and take
pragmatic steps to insure that mobile service in Ethiopia improve their efficiency and
effectiveness in the provision of telecommunication services that meet and exceed customer
need, desire and expectation.

This can be done by sensitizing and encouraging ethio-telecom to focus more attention and
resources on more important service quality dimensions for which customers are not satisfied
and to focus little attention on unimportant and less important dimensions. There is the need for
ethio-telecom to focus on important product/service attributes that are rated important and very
important by customers.

In this regard, first of all, efforts and resources should be focused on improving technical quality,
economy, empathy, reliability, responsiveness, and assurance of the service quality delivered
orderly. Within this SERVQUAL dimensions, more management efforts and intensive strategy
must be geared towards improving up on important dimensions for which customers are least
satisfied, specifically:

 Employees having technological knowledge and skills in solving customer problems.

 Having operating hours convenient to all customers

For important SERVQUAL dimensions customers are totally dissatisfied, strategies management
efforts are need to make significant improvement in the service quality. This would require a
total transformation in operational efficiency of the mobile service to achieve customer
satisfaction in the following SERVQUAL dimension items that the customers’ are totally
dissatisfied, specifically in areas like:

 Success in completion of calls, SMS, activation, card reloading and other services
 Network quality: clarity and speed for calls and other services
 Innovativeness ability to use current technology to improve services
 Providing adequate network coverage
 Having operating hours convenient to all customers
 Having sound loyalty program to recognize frequent customers

73
  Having the customer’s best interest at heart
 Giving individual customers attention by employees
 Effort to understand specific customer needs

Moreover, the service quality should be improved by making the services more economical so
that customers can afford and have better value for their money or sacrifices made for using the
mobile network services. By parking this, the service quality and therefore customer satisfaction
would be the improved in the “Economy” dimension for which generally customers are
significantly dissatisfied in area like:

 How economical the use of services is in terms of ; the call charge per minute/second,
and
 How economical the use of services is in terms of cost of reloading cards and their
denominations.

Also, “Assurance” service quality, management should develop strategies to improve up on the
“ability to provide variety of value added services-music, access to internet, SMS, and” sincerity
and patience in resolving customers’ complaints/problems.

Furthermore, some attention and effort should be given to sustain the responsiveness dimension.
Image and tangibles are unimportant to customers, so that, less strategic effort should be devoted
to them.

Finally, in Ethiopia mobile service, the regulator and ethio-telecom should make marketing
seminar and workshops to seek meeting and exceeding not only the expectations of customers
but also customer desired set of service quality and experiences. This is because it has been
verified in this study that desire and expectation disconfirmation simultaneously and individually
explain customer satisfaction in Ethiopia telecom market.

5.3 Final Conclusion

74
The final conclusion of this study is that generally customers are not satisfied with service
quality delivered by ethio-telecom in Ethiopia regarding on mobile service or that their
satisfaction is considered too low, but customer satisfaction is better than expected and at least
equal to expectation on some service quality dimension items. According to customer priority,
technical quality is the most important dimension, followed by economy, empathy, reliability,
responsiveness, while assurance is the least important dimension. “Image” and “Tangibles” are
significantly unimportant to the customers.

Customer satisfaction and customer services are found having positive relationship. Now a day’s
relational marketing is considered very important on the realization of the fact that customer
satisfaction is quite essential for the lasting relationship between service organization and
customer. As in telecommunication service industry a special care should taken to develop good
relationship.
5.4 Recommendations for further research

This study mainly assessed and analyzed customer satisfaction with service quality in Ethiopia in
case of Addis Ababa. It is recommended that further research should:

 Assess customer satisfaction with specific service areas delivered across mobile
telecom service such as the delivery of SMS, Internet services, and Customer
services.
 Examine customer satisfaction with fixed lines.
 Assess customer satisfaction with prepaid telecom service.

Finally, this study was a questionnaire-based survey and used a mixture of qualitative and
quantitative approaches. It is therefore, recommended that different models and methodology
should be used for a similar study and compares the results.

Appendix-1

75
FOCUS GROUP INTERVIEW GUIDE

Moderator /researcher lead the introduction time of participants and discuss the purpose of the
interview.

Number of participants=8

Activities Times/minutes
1. preliminary test of draft questionnaire
 Tell participants to read silently the 20
questions on the questionnaire and
give their comments on any question
that is not clear in construction and
meaning to them.

2.Servires delivered by ethio telecom regarding

On mobile service 10
 Ask about their knowledge of services
delivered by ethio-telecom.

3.Break time 10
4.Dimensions of service delivery
 Ask questions on what they think 30
makes a service delivered a good
quality.
 Ask their view about whether
“economy’’ or’’ value’’ is an
important part of what makes a quality
service.

Total time has taken 70

The purpose of this FGI is to pre-test and develop the draft questionnaire in an attraction and
proper manner. Here It is not the participant to answer but for their comment on clarity of the
items.

Appendix-2

76
Questionnaire for the customers of ethio-telecom

A dear mobile phone subscriber, this questionnaire is designed to collect information about how
you feel about the service delivery of ethio-telecom in Ethiopia regarding on mobile phone
service at least for the last 12 months. Your responses will be treat confidential and use for only
academic purpose. I am master’s student of the University of Gondar, faculty of business and in
the department of marketing management.

Directions:

Please tick (√) or (X) in appropriate box for your answers.

I. Personal information

1. Sex (Gender) Male Female

2. Age

Below 18 years 19-28 29-40

41-50 51-60 60 and above

3. What is your occupation?

Civil servant student

Businessman/woman other……………………

4. Monthly income?

Below Birr 1000 Birr 1000-1500 Birr 1500-2000

Above Birr 2000 Dependent on family/student

5. Educational level or professional qualifications?

Please select only one:

Below TEVET TEVET/ preparatory Diploma

Bachelor Degree Master’s Degree PhD

II. Questions regarding on customer satisfaction with service delivery

77
1. How well did the services you received from Ethio-telecom with your ideal /desired set of
service?

Much worse Worse than Equal to my Better than Much better than
than desired desired desire desired desired
1 2 3 4 5

2. To what extent have your mobile service provider Ethio-telecom meet your expectations?

Much worse Worse than Equal to my Better than Much better than
than expected expected expected expected expected
1 2 3 4 5

3. Overall, tell how satisfied or dissatisfied you are with service delivery of Ethio-telecom by ticking the face
that best describes your feeling and perceptions?
Very dissatisfied Dissatisfied Neither Satisfied Very satisfied
2
3
1 4

78
III. Questions regarding on customer satisfaction with service quality dimension

In your opinion how does the service quality of Ethio-telecom your expectations in terms of the
dimensions?

Use these responses from 1-5 to answer where

1. Much worse than expected

2. worse than expected

3. Equal to expectation

4. Better than expected

5. Much better than expected

Direction

Circle only one option in 1-5 dimensions

Tangibles
Network ability to give you access to 1 2 3 4 5
Tan 1 information reload cards
Tan 2 Provision of visually attractive offices 1 2 3 4 5
equipments and materials like starter packs
and reload cards
Tan 3 Networks ability to provide variety of 1 2 3 4 5
entertainment facilities etc
Tan 4 How appealing one the appearance uniforms of 1 2 3 4 5
employees
Reliability
Rel 1 How timely is the delivery of SMS and other 1 2 3 4 5
services?
Rel 2 How truthful (keeping promising) is ethio- 1 2 3 4 5
telecom?
Rel 3 How dependable and consistent is ethio- 1 2 3 4 5
telecom in solving customer’s complaints?
Rel 4 How able is your network to perform services 1 2 3 4 5
right the first time?
Rel 5 How able is your network to insist on error free 1 2 3 4 5
records?
Responsiveness
Res 1 How able is your network to some prompt 1 2 3 4 5
customer services and attend to customer
needs/problems?

79
Res 2 How are employees willing to help customers 1 2 3 4 5
in emergency situations?
Res 3 How are the employees approachable and easy 1 2 3 4 5
to contact?
Res 4 How are the employees’ ability to 1 2 3 4 5
communicate clearly in you?
Empathy
Emp 1 Having convenient periods and terms for 1 2 3 4 5
activation, recharge, and accounts suspension,
free call times.
Emp 2 Having operating hours convenient to all 1 2 3 4 5
customers
Emp 3 Having sound loyalty program to recognize 1 2 3 4 5
you as a frequent customer
Emp 4 Having the customers best interest at heart 1 2 3 4 5
Emp 5 Giving individual customer attention by 1 2 3 4 5
employees
Emp 6 Efforts to understand specific customer needs 1 2 3 4 5
Emp 7 Apologizing to inconvenience caused to 1 2 3 4 5
customers
Assurance
Ass 1 Ability to provide variety of value added 1 2 3 4 5
services music access to internet, SMS, etc
Ass 2 Sincerity and patience in resolving customer’s 1 2 3 4 5
complaints/problems.
Ass 3 The behavior of employees in instilling 1 2 3 4 5
confidence in customers.
Ass 4 Employees use of required skill and knowledge 1 2 3 4 5
to answer customers questions
Economy /value/prices
 How economical is the use of mobile
telecom networks services in terms of
Eco 1 Reloading cards and there denominations? 1 2 3 4 5
Eco 2 The calls charge per minute /second? 1 2 3 4 5
Technical clarity
Tec 1 Successful in completion of calls, SMS, line 1 2 3 4 5
activation, credit reloading, etc.
Tec 2 Employees have technological knowledge 1 2 3 4 5
and skills in solving customer’s problems.
Tec 3 Network clarity and speed for call and other 1 2 3 4 5
services
Tec 4 Network innovativeness ability to use current 1 2 3 4 5
technology to improve services.
Tec 5 Providing adequate network coverage 1 2 3 4 5

80
 Image
Img 1 How successful is ethio-telecom? 1 2 3 4 5
Img 2 How is the reputation of ethio-telecom? 1 2 3 4 5
Img 3 How socially responsible is ethio-telecom? 1 2 3 4 5
IV. Importance of dimensions of service quality
In receiving or user services of your network, how important is each of the following dimensions to you?
Use the scale 1-5 to answers where

1. Not- at- all- important

2. Not important

3. Neither important nor unimportant

4. Important

5. Very important

Dimensions Circle only one options 1-5

TAN TANGIBLES (The appealing nature of physical 1 2 3 4 5
environment, reload cards, etc)
REL RELIABLE (competence to give times, reliable services 1 2 3 4 5
and truthful to promises)
ASS ASSURANCE (assurance of security efficient, and 1 2 3 4 5
variety of services)
RES RESPONSIVE (attending to customers’ needs and 1 2 3 4 5
complaints promptly any time)
EMP EMPATHY (shows of respect, care and understanding 1 2 3 4 5
to customers’ needs)
ECO ECONOMY(giving customer value for services 1 2 3 4 5
received)
TEC TECHNICAL QUALITY (having good network clarity 1 2 3 4 5
and coverage for call completion/services)
IMG IMAGE(having a good reputation of company and 1 2 3 4 5
image)
V. Open ended questions regarding on customer satisfaction with service delivery

1. What kinds/types of mobile service should start and include in order satisfying your
needs/desires?

Please state

………..........................................................................................................................................

81
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………

2. How can express your complains regarding on the current mobile phone services that
provided by Ethio-telecom?……………………………………………………………………
………………………………………………………………………………………………………
……………….
………………………………………………………………………………………………………
…………………………………………………………………………………………….
……………………………………………………………………………………………

3. The only provider of telecommunication service in Ethiopia is Ethio-telecom this shows that
market monopoly system, so that what do you think about this system and what is your ambition
to the future?

Please state…………………………………………………………………………………………

………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………

Thank you for taking time to complete this questionnaire!

82