A TERM PAPER ON

CUSTOMER SATISFACTION AT PUNJAB NATIONAL BANK

Submitted in partial fulfillment for the award of Degree of Master of Business Administration

Department of Management Studies Jai Narain Vyas University, Jodhpur (2011-2012)

Under the supervision of: Dr. Meeta Nihalani (Head of Department) Dept. Of Management Studies

Submitted by: AMARJEET KAUR MBA II Semester

ACKNOWLEDGEMENT

With regard to my term paper with Customer Satisfaction at Punjab National Bank I would like to thank each and every one who offered help, guideline and support whenever required. I am extremely grateful to my supervisor, Dr. (Mrs.)Meeta Nihalani, Head of Department for their valuable guidance and timely suggestions and for providing me this opportunity, and all faculty members of DEPARTMENT OF MANAGEMENT STUDIES, JODHPUR for the valuable guidance& support. I would also like to extend my thanks to all the respondents who invested their valuable time in my study and my family and friends for their support.

Amarjeet Kaur

CERTIFICATE

DEPARTMENT OF MANAGEMENT STUDIES JAI NARAIN VYAS UNIVERSITY, JODHPUR

This is to certify of that Miss. Amarjeet Studies, kaur student of has

Department

Management

Jodhpur,

completed project work on CUSTOMER SATISFACTION AT PUNJAB NATIONAL BANK IN JODHPUR under my guidance and supervision. I certify that this is an original work and has not been copied from any source.

Signature of Supervisor Dr. (Mrs.) Meeta Nihalani

INTRODUCTION
Punjab National Bank of India, the first Indian bank started only with Indian capital, was nationalized in July 1969 and currently the bank has become a front-line banking institution in India with 4525 Offices including 432 Extension Counters. The corporate office of the bank is at New Delhi. Punjab National Bank of India has set up representative offices at Almaty (Kazakhistan), Shanghai (China) and in London and a full fledged Branch in Kabul (Afghanistan). Punjab National Bank with 4497 offices and the largest nationalized bank is serving its 3.5 crore customers with the following wide variety of banking services:

Corporate banking Personal banking Industrial finance Agricultural finance Financing of trade International banking

Punjab National Bank has been ranked 38th amongst top 500 companies by The Economic Times. PNB has earned 9th position among top 50 trusted brands in India. Punjab National Bank India maintains relationship with more than 200 leading international banks world wide. PNB India has Rupee Drawing Arrangements with 15 exchange companies in UAE and 1 in Singapore. 1.1 HISTORY OF THE BANK Punjab National Bank (PNB) was registered on May 19, 1894 under the Indian Companies Act with its office in Anarkali Bazaar Lahore. The Bank is the second largest government-owned commercial bank in India with about 4,500 branches across 764 cities. It serves over 37 million customers. The bank has been ranked 248th biggest bank in the world by Bankers

Almanac, London. The bank's total assets for financial year 2007 were about US$60 billion. PNB has a banking subsidiary in the UK, as well as branches in Hong Kong and Kabul, and representative offices in Almaty, Dubai, Oslo, and Shanghai.

1895: PNB commenced its operations in Lahore. PNB has the distinction of being the first Indian bank to have been started solely with Indian capital that has survived to the present. (The first entirely Indian bank, the Ouch Commercial Bank, was established in 1881 in Faizabad, but failed in 1958.) PNB's founders included several leaders of the Swadeshi movement such as Dyal Singh Majithia and Lala HarKishen Lal,[1] Lala Lalchand, Shri Kali Prosanna Roy, Shri E.C. Jessawala, Shri Prabhu Dayal, Bakshi Jaishi Ram, and Lala Dholan Dass. Lala Lajpat Rai was actively associated with the management of the Bank in its early years. 1904: PNB established branches in Karachi and Peshawar. 1940: PNB absorbed Bhagwan Dass Bank, a scheduled bank located in Delhi circle. 1947: Partition of India and Pakistan at Independence. PNB lost its premises in Lahore, but continued to operate in Pakistan. 1951: PNB acquired the 39 branches of Bharat Bank (est. 1942); Bharat Bank became Bharat Nidhi Ltd. 1961: PNB acquired Universal Bank of India. 1963: The Government of Burma nationalized PNB's branch in Rangoon (Yangon). September 1965: After the Indo-Pak war the government of Pakistan seized all the offices in Pakistan of Indian banks, including PNB's head office, which may have moved to Karachi. PNB also had one or more branches in East Pakistan (Bangladesh). 1960s: PNB amalgamated Indo Commercial Bank (est. 1933) in a rescue. 1969: The Government of India (GOI) nationalized PNB and 13 other major commercial banks, on July 19, 1969. 1976 or 1978: PNB opened a branch in London. 1986 The Reserve Bank of India required PNB to transfer its London branch to State Bank of India after the branch was involved in a fraud scandal. 1986: PNB acquired Hindustan Commercial Bank (est. 1943) in a rescue. The acquisition added Hindustan's 142 branches to PNB's network.

1993: PNB acquired New Bank of India, which the GOI had nationalized in 1980. 1998: PNB set up a representative office in Almaty, Kazakhstan. 2003: PNB took over Nedungadi Bank, the oldest private sector bank in Kerala. Rao Bahadur T.M. Appu Nedungadi, author of Kundalatha, one of the earliest novels in Malayalam, had established the bank in 1899. It was incorporated in 1913, and in 1965 had acquired selected assets and deposits of the Coimbatore National Bank. At the time of the merger with PNB, Nedungadi Bank's shares had zero value, with the result that its shareholders received no payment for their shares. PNB also opened a representative office in London.

2004: PNB established a branch in Kabul, Afghanistan. PNB also opened a representative office in Shanghai. PNB established an alliance with Everest Bank in Nepal that permits migrants to transfer funds easily between India and Everest Bank's 12 branches in Nepal.

2005: PNB opened a representative office in Dubai. 2007: PNB established PNBIL - Punjab National Bank (International) - in the UK, with two offices, one in London, and one in South Hall. Since then it has opened a third branch in Leicester, and is planning a fourth in Birmingham. Gatin Gupta became Chairmen of Punjab National Bank. 2008: PNB opened a branch in Hong Kong. 2009: PNB opened a representative office in Oslo, Norway.

1.2 ACHIEVEMENTS
Punjab National Bank announced its Q1FY2010 results on 29 July 2009, delivering 62% y-o-y growth in net profits to Rs832 crore (Rs512cr), substantially ahead of expectations on account of large treasury gains, apart from healthy operating performance. While the banks deposit growth was reasonably robust at 4.4% sequentially and 26.5% y-o-y, unlike the peers its growth in advances also remained strong at 38% y-o-y. In spite of being at the forefront of PLR cuts, the bank posted a healthy growth in Net Interest Income (NII) of 29% y-o-y. Other Income surged 113% y-o-y, driven by strong treasury gains of Rs355 crore during the quarter in line with industry trends, even as Fee income was also robust at 45% y-o-y, on the back of strong balance sheet growth. Operating expenses were higher than expected on account of Rs150 crore of provisions for imminent wage hikes. Gross and Net NPA ratios remained stable sequentially at 1.8% and 0.2%, with the bank not adopting the guidelines of treating floating provisions as part of tier 2 capital instead of adjusting against NPAs on express permission from the RBI.

1.3 VISION AND MISSION

Vision To evolve and position the bank as a world class, progressive, cost effective and customer friendly institution providing comprehensive financial and related services.

Integrating frontiers of technology and serving various segments of society especially weaker section.

Commited to excellence in serving the public and also excelling in corporate values

Mission To provide excellent professional services and improve its position as a leader in financial and related services.

Build and maintain a team of motivated workforce with high work ethos.

Use latest technology aimed at customer satisfaction and act as an effective catalyst for socio economic development.

VALUES AND ETHICS

Bonding and Integrity

Ethical conduct

Periodic disclosure

Confidentiality and fair dealing

Compliance with rules and regulations

SWOT ANALYSIS STRENGTH

Wide network Large number of customers Fast adaptability to technology Brand image

WEAKNESS

Casual behaviour Corruption and red tapism Slow decision making due to large hierarchy High gross NPA

OPPORTUNITIES

Home to home banking services Diversification towards other fields Globalization

THREATS

Stiff competition from SBI and other private players.

What Do Customers Want? Before we begin to create tools to measure the level of satisfaction, it is important to develop a clear understanding of what exactly the customer wants. We need to know what our customers expect from the products and services we provide. Customer expectations have two types Expressed Implied Expressed Customer Expectations are those requirements that are written down n the contract and agreed upon by both parties for example, product specifications and delivery requirements. Suppliers performance against these requirements is most of the items directly measurable. Implied Customer Expectations are not written or spoken but are the ones the customer would expect the supplier to meet nevertheless. For example, a customer would expect the service representative who calls on him to be knowledgeable and competent to solve a problem on the spot. There are many reasons why customer expectations are likely to change overtime. Process improvements, advent of new technology, changes in customers priorities, improved quality of service provided by competitors are just a few examples.

The customer is always right. Suppliers job is to provide the customer what he/she wants, when he/she wants it. Customer satisfaction is customers perception that a supplier has met or exceeded their expectations. Major Attributes of customer satisfaction in banking industry can be summarized as: Product quality Premium Outflow Return on Investment Services Responsiveness and ability to resolve complaints and reject reports. Overall communication, accessibility and attitude. WHAT ARE THE TOOLS? Customer expectations can be identified using various methods such as: Periodic contract reviews Market research Telephonic interviews Personal visits Warranty records Informal discussions Satisfaction surveys

Depending upon the customer base and available resources, we can choose a method that is most effective in measuring the customers perceptions. The purpose of the exercise is to identify priorities for improvements. We must develop a method or combination of methods that helps to continually improve service. CUSTOMER SATISFACTION SURVEYS Formal survey has emerged as by far the best method of periodically the customer satisfaction. The survey are not marketing tools but an information gaining tool. Enough homework needs to be before embarking on the actual survey. This includes: Defining Objectives of the Survey Design Survey approach Develop questionnaires and forms Administer Survey (Email, Telephone or Post) Method of compiling data and analyzing the findings Format of the report to present the findings There is no point in asking irrelevant questions on a customer satisfaction questionnaire. The basic purpose is to find out what we are doing right or wrong. Where is the scope for improvement, where do we stand vis--vis other suppliers. How we can serve the customer better? A customer satisfaction measurement survey should at least identify the following objectives:

 Importance to customers (Customers priorities) Customers perception of suppliers performance Your performance relative to customers priorities. Priorities for improvement Survey forms should be easy to fill out with minimum amount of time and efforts on customers part. They should be designed to actively encourage the customer to complete the questions. Yet they must provide accurate data should also be sufficiently reliable for management decision making. This can be achieved by incorporating objective type questions where customer has to rate on scale of say 1 to 10. For repeated surveys, you could provide the rating that was previously accorded by the customer. This works like a reference point for the customer.

SCOPE OF THE STUDY

This study is limited to the consumers with in Jodhpur city. The study will be able to reveal the preferences, needs, satisfaction of the customers regarding the banking services, It also help banks to know whether the existing products or services the are offering are really satisfying the customers needs.

OBJECTIVE OF THE STUDY

 To have an insight into the attitudes and behaviors of customers. To find out the differences among perceived service and expected service. To produce an executive service report to upgrade service characteristics. To understand consumers preferences. To access the degree of satisfaction of the consumers

RESEARCH METHODOLOGY To know the response, the researcher used questionnaire method. It has been designed as a primary research instrument. Questionnaires were distributed to respondents and they were asked to answer the questions given in the questionnaire. The questionnaires were used as an instrumentation technique, because it is an important method of data collection. The success of the questionnaire method in collecting the information depends largely on proper drafting. So in the present study questions were arranged and interconnected logically. The structured questionnaire will reduce both interviewers and interpreters bias.

Research Design

Demographically classified BANK Research design Age Sex Education

Variables related
LEVEL OF SATISFACTION

To Customer satisfaction

Sampling Area - The study is conducted on the respondents i.e. the customers using the banking facilities of the Jodhpur city Population All the customers using the banking facilities of the Jodhpur city. Sample size The research focused on the participants who willingly wanted to complete the instruments in their entirety. Total 100 respondents filled the questionnaire. Sampling Design The sample was designed by the convenience based random sampling method Primary Data - Most of the data collected by the researcher was primary data through a structured questionnaire, which was operated on the samples of the tourist visiting the destination of Jodhpur
a.)

Demographic Characteristics- gender, age and education of the respondents.

b.) Dimension of customer satisfaction for service facilities

Secondary data- The secondary information was collected from the published Sources such as Journals, Newspapers and Magazines and websites... Two types of secondary data were collected for the preparation of the project work: Internal Data was generated from companys brochures, manuals and annual reports External Data, on the other hand, was generated from magazines, research books, intranet and internet (websites). Research instruments - A summated rating scale format was used, with five choices per item ranging from "highly dissatisfied to "highly satisfied. In this all the questions were positively framed to study the impact of independent variable like age, gender and education on the dependent variable which is student development through knowledge. Analysis of Data - All the data collected from the respondents was feeded and tabulated and the analysis was done through the software of SPSS version 16... Research period - The research period of the study has from April 28, 2011 to May 25, 2011

Hypothesis Null hypothesis H101: There is no significant difference about facilities provided by the banks and customer satisfaction amongst customers classified by age coming to the banks of Jodhpur. H1a1: There is significant difference about the facilities provided by the banks and customer satisfaction amongst customers classified by age coming to the banks of Jodhpur H102: There is no significant difference about facilities provided by the bank and customer satisfaction amongst customers classified by gender coming to the banks of Jodhpur. H1a2: There is significant difference about the facilities provided by the bank and the and customer satisfaction amongst customers classified by gender coming to the banks of Jodhpur

H103: There is no significant difference about facilities provided by the banks and customer satisfaction amongst customers classified by occupation coming to the banks of Jodhpur.

H1a3: There is significant difference about the facilities provided by the bank and the and customer satisfaction amongst customers classified by occupation coming to the banks of Jodhpur

Data analysis
1. Anova Linearity and Non-Linearity Test:-

Aim here is to find how Total Satisfaction varies in accordance to change in each dimension, linearly or non-linearly, here both are scale variables dependent and independent variable. The test for linearity if has a significance value smaller than 0.05, indicates that there is a linear relationship. The test for deviation from linearity if has a significance value smaller than 0.05, indicates that there is a non-linear relationship.
If both relationships are present and if R2<ETA2 it means non-linear

relationship exists.

2. One way Robust analysis of Variance: In the test for homogeneity of variance, if the significance value is less than 0.05 than Welch and Brown-Forsythe is to be checked for group difference, if significant value there is less than 0.05 then Tamhane Post-hoc comparison for individual group difference will be checked if it show significant value less than 0.05 than the individual groups differs.

 Now, if in the test for homogeneity of variance, if the significance value is more than 0.05 than simply One way anova table will be checked, if there the significant value is less than 0.05 then Tukey HSD Post-hoc comparison for individual group difference will be checked if it show significant value less than 0.05 than the individual group differs. It is mandatory to look for test for homogeneity of variance only when the group is of nearly equal size. Welch test is more accurate than Brown-Forsythe test hence it would be given priority during analysis. For all those independent variables where homogeneity constraints was satisfied Tukey table for Post hoc comparison is shown and where robust estimates of Welch and Brown-Forsythe are looked, there Tamhane table for Post hoc comparison is shown (Monday, Klein, Lee, 2005).

(A) Descriptive statistics:

Age Frequency Percent Valid Percent Cumulative Percent Valid 20 to 30 30 to 40 above 40 Total 54 36 10 100 Frequency 54.0 36.0 10.0 100.0 Gender Percent 54.0 36.0 10.0 100.0 Valid Percent 54.0 90.0 100.0

Cumulative Percent

Valid

male female Total

50 50 100

50.0 50.0 100.0 Qualification Percent

50.0 50.0 100.0 Valid Percent

50.0 100.0

Frequency

Cumulative Percent

Valid

under graduate graduate post graduate Total

35 53 12 100

35.0 53.0 12.0 100.0

35.0 53.0 12.0 100.0

35.0 88.0 100.0

Provide_service_immediately Cumulative Valid Strongly Dissatisfied Dissatisfied Neutral Agree Strongly Agree Total Frequency Percent Valid Percent 8 8.0 8.0 24 24.0 24.0 27 27.0 27.0 33 33.0 33.0 8 8.0 8.0 100 100.0 100.0 Percent 8.0 32.0 59.0 92.0 100.0

Avail_with_zero_bal Frequency Percent Valid Percent Cumulative Percent Valid Strongly Dissatisfied 4 4.0 4.0 4.0

Dissatisfied Neutral Agree Strongly Agree total

16 46 24 10 100

16.0 46.0 24.0 10.0 100.0

16.0 46.0 24.0 10.0 100.0

20.0 66.0 90.0 100.0

Easily_approachable Frequency Percent Valid Percent Valid Strongly Dissatisfied Dissatisfied Neutral Agree Strongly Agree Total 6 18 27 29 20 100 6.0 18.0 27.0 29.0 20.0 100.0 6.0 18.0 27.0 29.0 20.0 100.0

Cumulative Percent 6.0 24.0 51.0 80.0 100.0

Continue_with_this_bank Cumulative Valid Strongly Dissatisfied Dissatisfied Neutral Agree Strongly Agree
Total

Frequency Percent Valid Percent 16 16.0 16.0 18 18.0 18.0 28 28.0 28.0 31 31.0 31.0 7 7.0 7.0
100 100.0 100.0

Percent 16.0 34.0 62.0 93.0 100.0

satisfied_with_facilities_and_services Frequency Percent Valid Percent Valid Strongly Dissatisfied Dissatisfied Neutral Agree Strongly Agree Total 8 14 36 32 10 100 8.0 14.0 36.0 32.0 10.0 100.0 8.0 14.0 36.0 32.0 10.0 100.0 Cumulative Percent 8.0 22.0 58.0 90.0 100.0

(B) Inferential statistics

Part -1: One Way Anova of total satisfaction by age Test of Homogeneity of Variances Total satisfaction Levene Statistic 1.540 df1 2 df2 97 Sig. .220

ANOVA Total satisfaction Sum of Squares Between Groups Within Groups Total 148.745 1380.415 1529.160 2 97 99 74.373 14.231 5.226 .007 df Mean Square F Sig.

Robust Tests of Equality of Means Total satisfaction Statistica Welch Brown-Forsythe 7.223 a. Asymptotically F distributed. Post Hoc Tests 2 75.389 .001 9.947 df1 2 df2 31.679 Sig. .000

Multiple Comparisons Dependent Variable: Total satisfaction 95% Confidence Mean Difference (I) Age (J) Age Tamhan 20 to 30 to e 30 40 above 40 20 to 30 above (I-J) 1.481 -2.763* -1.481 -4.244* 2.763* 4.244* Std. Error .809 .931 .809 .943 .931 Sig. .197 .022 .197 .001 .022 .001 Interval Lower Bound -.49 -5.18 -3.45 -6.69 .35 1.80 Upper Bound 3.45 -.35 .49 -1.80 5.18 6.69

30 to 40

40 above 20 to 40 30 30 to

.943 40 *. The mean difference is significant at the 0.05 level.

Analysis: Groups are of nearly equal sizes (from descriptive), Homogeneity of variance shows non-significant value, with anova table showing significant value, hence Tamhane Post Hoc test is requested. 20-30 age groups have significant lower satisfaction level than 30-40 & 40 and above age groups.

Part -2 One Way ANOVA of total satisfaction by gender Test of Homogeneity of Variances Total satisfaction Levene Statistic 4.958 df1 1 df2 98 Sig. .028

ANOVA Total satisfaction Sum of Squares Between Groups Within Groups Total 29.160 1500.000 1529.160 df 1 98 99 Mean Square 29.160 15.306 F 1.905 Sig. .171

Robust Tests of Equality of Means Total satisfaction Welch Brown-Forsythe Statistica 1.905 1.905 df1 1 1 df2 88.121 88.121 Sig. .171 .171

Analysis: Groups are of unequal sizes (from descriptive), we therefore directly look at Welch and Brown-Forsythe test, and it shows significant

value hence satisfaction differs in gender group. Male is having high satisfaction than female (from descriptive). Part -3 One Way ANOVA of total satisfaction by education

Toal_satisfaction Levene Statistic 2.290

df1 2

df2 97

Sig. .107

ANOVA Total satisfaction Sum of Squares Between Groups Within Groups Total 115.727 1413.433 1529.160 df 2 97 99 Mean Square 57.864 14.571 F 3.971 Sig. .022

Robust Tests of Equality of Means Total satisfaction Statistica Welch 3.563 Brown-Forsythe 5.372 a. Asymptotically F distributed. df1 2 2 df2 43.198 83.972 Sig. .037 .006

Post Hoc Tests Multiple Comparisons Dependent Variable: Total_satisfaction (I) (J) Mean Qualificati Qualificati Differenc Std. Lower Upper on on e (I-J) Error Sig. Bound Bound Tamhan under graduate -2.336* .874 .028 -4.47 -.20 e graduate post -1.657 .897 .201 -3.89 .58 graduate graduate under 2.336* .874 .028 .20 4.47 graduate post .679 .792 .781 -1.31 2.67 graduate post under 1.657 .897 .201 -.58 3.89 graduate graduate graduate -.679 .792 .781 -2.67 1.31 *. The mean difference is significant at the 0.05 level. Analysis: Groups are of unequal size, we therefore directly look at Welch and Brown-Forsythe test, and it shows significant value, hence Tamhane Post Hoc test is requested. Graduate education group has significant lower satisfaction level than post graduate and above post graduate education group. 95% Confidence Interval

Part 4 T-Test

One-Sample Statistics N Provide_service_immedi ately Avail_with_zero_bal Easily_approachable Continue_with_this_ban k satisfied_with_facilities_ and_services Responsible_for_tasks__ services_its_customers Proper_records_of_all_tr ansactions Treat_u_politely Employees_perform_the ir_duty_on_time fulfil_ur_reqirement Communication_skill_ar e_important Toal_satisfaction 100 100 100 100 100 100 100 100 100 100 100 100 Mean 3.09 3.20 3.39 2.95 3.22 3.41 3.54 2.86 3.27 3.13 3.72 35.78 Std. Deviation 1.102 .964 1.171 1.192 1.069 1.240 1.123 1.137 1.109 1.089 .965 3.930 Std. Error Mean .110 .096 .117 .119 .107 .124 .112 .114 .111 .109 .096 .393

One-Sample Test Test Value = 2.75 Mean Sig. (2- Differenc tailed) e 95% Confidence Interval of the Difference Lower Upper

df

Provide_service_ 3.086 99 .003 .340 .12 .56 immediately Avail_with_zero 4.668 99 .000 .450 .26 .64 _bal Easily_approacha 5.465 99 .000 .640 .41 .87 ble Continue_with_t 1.677 99 .097 .200 -.04 .44 his_bank satisfied_with_fa cilities_and_servi 4.396 99 .000 .470 .26 .68 ces Responsible_for_ tasks__services_i 5.323 99 .000 .660 .41 .91 ts_customers Proper_records_o 7.035 99 .000 .790 .57 1.01 f_all_transactions Treat_u_politely -.967 99 .336 .110 -.12 .34 Employees_perfo rm_their_duty_o 4.690 99 .000 .520 .30 .74 n_time fulfil_ur_reqirem 3.491 99 .001 .380 .16 .60 ent Communication_ skill_are_importa 10.054 99 .000 .970 .78 1.16 nt Toal_satisfaction 84.043 99 .000 33.030 32.25 33.81 Analysis: Factors number 8 having negative significant value that is bank must be treat politely to customers so that they satisfied to this bank.

CONCLUSION:
The project entitled A STUDY TO UNDERSTAND THE

CUSTOMER SATISFACTION AT PNB has helped me in studying satisfaction about services and products offered to consumers.

Since the opening up of the banking sector, private banks are in the fray each one trying to cover more market share than the other.

Yet, PNB is far behind SBI. PNB must also be alert what with Private Banks (ICICI, HDFC) breathing down its neck. I am sure the bank will find my findings relevant and I sincerely hope it uses my suggestions enlisted, which I hope will take them miles ahead of competition. In short, I would like to say that the very act of the concerned management at PNB in giving me the job of critically examining consumer satisfaction towards financial products and services of the company is a step in their continual mission of making all round improvements as a means of progress. I am sure the bank has a very bright future to look forward to and will be a trailblazer in its own right.

References: 1. Reference by: Times of India

2.

www.pnb.com