Submitted to DR.

TASNEEM AKHTER
Submitted by LAIBA KHAN
L1S22BSAF0020
Table of Contents
1. CHAPTER 1.....................................................................................................................2
1.1Background..................................................................................................................... 2
1.2 OBJECTIVE.................................................................................................................. 3
1.3 Research Type................................................................................................................ 3
1.4 Research Question..........................................................................................................3
1.5 Research Hypothesis...................................................................................................... 3
1.6 Significance....................................................................................................................3
1.7 Structure of Study...........................................................................................................3
2. CHAPTER 2 Literature Review...........................................................................................3
3. CHAPTER 3 Methodologies................................................................................................4
3.1 Theoretical framework................................................................................................... 4
3.1.1 Dimensions and Variables of TOE Framework........................................................5
3.1.2Dimensions and Variables of IS Success Model.......................................................6
3.1.3. Integration of TOE and DMS Framework..............................................................6
3.1.4 Theoretical equation................................................................................................7
3.2 Conceptual Framework.................................................................................................. 8
3.2.1 Hypotheses Development......................................................................................11
3.2.2 Equations of the Conceptual Framework...............................................................11
4. CHAPTER 4.......................................................................................................................12
4.1. Research Type:.............................................................................................................13
4.2. Research Method:........................................................................................................13
4.3. Population:.................................................................................................................. 13
4.4. Sample Size and Sampling Technique:........................................................................13
4.5. Data Collection Technique:......................................................................................... 13
Chapter 5 Results and Discussion.......................................................................................... 13
5.2 Interpretation of p value using Bootstrapping...............................................................14
Chapter 6 conclusion and Recommendations.........................................................................16
6.1 Conclusion....................................................................................................................16
6.2 Recommendation..........................................................................................................16
Chapter 7 References............................................................................................................. 17
1. CHAPTER 1
1.1Background

Faced the problem while applying the BSC is Difficulty in defining key performance
indicators (KPIs) in every organization it is very important to rate according to the standard.
The Balanced Scorecard is a strategic management tool that helps organizations measure and
improve their performance. In these case employees and customers are not score or rate
according to the standards for example customers interest neglect and focus on the days like
in which days customers like to come. Managers will be rate according to their dressing
styles unstitched department more relax then ready to wear department. Not properly
measures customer satisfaction, retention, and acquisition. Identifying relevant and
measurable KPIs are being challenged, especially in complex organizations like textile
industry in Pakistan.1. Employee performance: Rating employees based on irrelevant criteria
(e.g., dressing style) rather than job performance.Customer satisfaction: Failing to measure
customer satisfaction, retention, and acquisition effectively.Challenges in Textile Industry
which are common are Complexity: Identifying relevant KPIs in a complex industry like
textiles. Standardization: Ensuring KPIs align with industry standards.Consequences which
are followed must Inaccurate performance measurementPoor decision-making Lack of
strategic alignment. To overcome these challenges, organizations should:Conduct thorough
analysis to identify relevant KPIs.Align KPIs with strategic objectives. Regularly review and
update KPIs.By addressing these challenges, organizations can effectively implement the
Balanced Scorecard and improve their performance

1.2 OBJECTIVE
To suggest a set of KPIs that measure the effectiveness of customer service department of
textile industry of Pakistan in resolving customer complaints.

1.3 Research Type

It is an exploratory research type.

1.4 Research Question

What are the relavents and measurable KPIS for the customer service department of textile
industry of Pakistan?

1.5 Research Hypothesis

H1. Customer service departments in the textile industry that prioritize response time and
issue resolution rate KPIs will have higher customer satisfaction rates
H2. The implementation of KPIs specifically tailored to the textile industry's customer
service needs will lead to improved complaint resolution rates
H3.There is a positive correlation between employee training on KPI measurement and
customer service effectiveness in the textile industry.
H4. KPIs that focus on first-contact resolution and net promoter score will be strong
predictors of customer loyalty in the textile industry.

1.6 Significance

Theoretical Significance:
• . Advancing KPI Research: This study will contribute to the existing body of
knowledge on Key Performance Indicators (KPIs) in the textile industry.
• 2. Customer Service Theory: The research will provide insights into the relationship
between KPIs and customer service effectiveness.

Practical Significance:
• 1. Improved Decision-Making: The study's findings will enable textile companies to
make informed decisions about customer service strategies and KPI implementation.
• 2. Enhanced Customer Experience: By identifying effective KPIs, textile companies
can improve customer satisfaction, loyalty, and retention.
• 3. Competitive Advantage: Companies that implement effective KPIs will gain a
competitive edge in the market.

Industry Significance:
• 1. Textile Industry: The research will provide industry-specific insights and solutions
for textile companies in Pakistan.
• 2. Customer Service Departments: The study will offer guidance on developing
effective KPIs for customer service departments in the textile industry.

Methodological Significance:
• 1. Exploratory Research: The study will demonstrate the effectiveness of exploratory
research in identifying relevant KPIs.
• 2. KPI Development: The research will contribute to the development of a framework
for identifying and implementing effective KPIs.

Impact on Stakeholders:
• 1. Textile Companies: The study's findings will benefit textile companies by
improving customer service and complaint resolution.
• 2. Customers: Enhanced customer service will lead to increased customer satisfaction
and loyalty.
• 3. Employees: The research will highlight the importance of employee training on
KPI measurement, leading to better customer service.

1.7 Structure of Study

This study is structured into five focused chapters to ensure clarity and depth. Chapter 1
introduces the research by outlining the background, objectives, research question,
hypothesis, and the significance of the study. Chapter 2 delivers a critical review of existing
literature, highlighting key theories, trends, and gaps Chapter 3 details the research
methodology, including the design, data collection, and analytical tools used to ensure valid
and reliable results. Chapter 4 presents the data analysis and interprets the findings in
relation to the research objectives. Finally, Chapter 5 concludes the study with a summary of
insights

2. CHAPTER 2 Literature Review

The textile industry in Pakistan faces significant challenges in defining and measuring Key
Performance Indicators (KPIs) for customer service departments. According to (link
unavailable), KPIs in the textile industry serve as vital tools for measuring performance
across various stages of the supply chain, from raw material sourcing to final product
delivery . Effective KPIs help companies monitor efficiency, product quality, and customer
satisfaction.
Customer Service Effectiveness shows "Exploring KPIs for Customer Service Departments"
by Patel et al. (2021)
- "The Impact of Employee Training on KPI Measurement" by Singh et al. (2018)
- Sharma, A., et al. (2020). Key Performance Indicators in the Textile Industry. Journal of
Textile and Apparel Technology Management, 14(2), 1-10.
Research suggests that customer service departments in the textile industry should prioritize
response time and issue resolution rate KPIs to achieve higher customer satisfaction rates
(H1). A study by McKinsey found that companies focusing on financial KPIs can achieve up
to a 20% increase in profitability. Similarly, effective customer service KPIs can lead to
improved complaint resolution rates and increased customer loyalty.
Relevant KPIs for Textile Industry
Some relevant KPIs for the textile industry include:
- *Inventory Turnover*: Measures how quickly inventory is sold and replaced, providing
insights into demand forecasting and inventory management.
- *Lead Time*: Tracks the time taken from order placement to delivery, helping identify
bottlenecks in the supply chain.
- *Stock-out Rate*: Measures the frequency of inventory shortages, ensuring popular items
are always available for customers.
- *Net Promoter Score (NPS)*: Provides insights into customer loyalty and purchasing
behavior.
- *Employee Engagement Scores*: Essential for maintaining a motivated and skilled
workforce.
KPI Implementation shows Patel, R., et al. (2021). Exploring KPIs for Customer Service
Departments. International Journal of Service Science, Management, Engineering, and
Technology, 12(2), 1-14. A case study on Zara, a leading textiles and apparel organization,
demonstrates the effectiveness of implementing a robust KPI framework. By focusing on
inventory turnover, lead time, and stock-out rate, Zara achieved significant improvements in
operational efficiency and customer satisfaction potential Research Areas
Some potential areas for further research include according to The Impact of Employee
Training on KPI Measurement" by Singh et al. (2018)
- Sharma, A., et al. (2020). Key Performance Indicators in the Textile Industry. Journal of
Textile and Apparel Technology Management, 14(2), 1-10.
- KPI Development: Developing industry-specific KPIs for customer service departments in
the textile industry.
- Supply Chain Optimization: Investigating the impact of supply chain optimization on
customer satisfaction and loyalty.
- Quality Management: Examining the effectiveness of quality management systems in
improving product quality and customer satisfaction.
- Employee Training: Investigating the impact of employee training on KPI measurement and
customer service effectiveness.

3. CHAPTER 3 Methodologies

3.1 Theoretical framework

Theoretical framework for your research on Key Performance Indicators (KPIs) for the
customer service department of the textile industry in Pakistan based on the background and
literature review you've provided. This framework integrates two well-established theories:
the Technology-Organization-Environment (TOE) Framework and the DeLone and McLean
Information Systems (IS) Success Model

Theoretical Framework for KPI Implementation in Textile Industry

Technology-Organization-Environment (TOE) Framework

The TOE Framework (Tornatzky & Fleischer, 1990) explains the factors that influence the
adoption and successful implementation of new technologies, such as KPI systems. This
theory is highly relevant to your study because implementing KPIs—especially in the textile
industry—requires consideration of technological readiness, organizational culture, and
environmental challenges. In your context, this includes the complexity of operations,
outdated performance measurement practices (like rating on dressing style), and external
customer expectations. The TOE model structures these influences into three dimensions
technological, organizational, and environmental, each of which plays a role in shaping KPI
effectiveness.

3.1.1 Dimensions and Variables of TOE Framework

A. Technological Factors

1. System Integration – Ability of KPI software to integrate with existing systems like CRM
or ERP.
2. Ease of Use – Simplicity and user-friendliness of the KPI platform for employees.
3. Technology Readiness – Availability of infrastructure and skills to adopt KPI systems.
4. Automation Capabilities – The extent to which data collection and reporting are
automated.

B. Organizational Factors**

1. Top Management Support – Level of involvement and commitment from leadership in

KPI usage.
2. Employee Training – Opportunities and programs that improve staff skills in using KPIs.
3. Organizational Culture – Attitude of the company toward performance measurement and
accountability.
4. Departmental Coordination – Communication and collaboration among departments to
ensure unified KPI goals.

C. Environmental Factors

1. Customer Expectations – Pressure from customers to improve service quality and

response.
2. Market Competition – Industry rivalry that pushes firms to improve performance
tracking.
3. Regulatory Pressure – Compliance requirements that necessitate certain performance
standards.
4. Industry Standards – Benchmark KPIs commonly used in the textile industry (e.g.,
response time, NPS).

2. DeLone and McLean IS Success Model

The DeLone and McLean Information Systems Success Model (1992, updated 2003) is
widely used to evaluate how effective an information system is, especially in service-based
departments. In your case, KPI systems are used to collect, analyze, and report performance
data in the customer service department. This model assesses success through six interrelated
dimensions: system quality, information quality, service quality, use, user satisfaction, and net
benefits. This theory is appropriate for understanding how well KPI systems perform in the
textile industry and how they impact complaint resolution and customer satisfaction.

3.1.2Dimensions and Variables of IS Success Model

A. System Quality

1. Reliability – How consistently the KPI system performs without errors.

2. Flexibility – Ability to customize KPI dashboards to meet specific needs.
3. Response Time – Speed at which KPI data is processed and reports are generated.

B. User Satisfaction

1. Perceived Usefulness – Employee belief that KPIs improve their work performance.
2. Ease of Learning – How easily users understand how to work with the KPI system.
3.Interface Satisfaction – Satisfaction with the look and navigation of the system.

F. Net Benefits Dependent Variable

1. Complaint Resolution Rate – Improvement in solving customer issues.

2. Customer Retention – Ability to retain customers through better service.
3. Employee Productivity – Enhancement in performance through KPI use.
3.1.3. Integration of TOE and DMS Framework
Here's an integrated theoretical framework combining the **Technology-Organization-
Environment (TOE) Framework** and the **DeLone and McLean IS Success Model**,
specifically tailored for the implementation and evaluation of **Key Performance Indicators
(KPIs)** in the **customer service departments of the textile industry in Pakistan**.
Theoretical Framework (Integrated)
Integrated Theoretical Framework for KPI Implementation and Effectiveness in Customer
Service (Textile Industry - Pakistan) .This integrated framework brings together the TOE
Framework (Tornatzky & Fleischer, 1990) and the DeLone and McLean IS Success Model
(1992, updated 2003) to provide a comprehensive lens for analyzing both the adoption and
performance of KPI systems.
A. Input Factors: TOE Framework (Influencing KPI Implementation)

Technological Factors (TOE) → kPIs Adoption

System Integration – Compatibility with ERP/CRM systems.
Ease of Use – Intuitive design of KPI tools.
Technology Readiness – Infrastructure and staff digital skills.
Automation Capabilities – Automated data collection and reporting.

Organizational Factors (TOE) → KPIs Adoption

Top Management Support – Leadership endorsement and funding.
Employee Training – Preparedness through training programs.
Organizational Culture – Openness to performance tracking.
Departmental Coordination – Cross-departmental KPI alignment.

Environmental Factors (TOE) → KPIs Adoption

Customer Expectations – Demand for high service standards.
Market Competition – Pressure to improve operational efficiency.
Regulatory Pressure – Compliance with industry/customer standards.
Industry Standards – Adoption of widely accepted KPIs (e.g., response time, NPS).

DeLone and McLean IS Success → KPIs Adoption

System Quality → Is the KPI system technically sound?

Information Quality → Is the data useful and reliable?
Service Quality → Are users supported to use the system well?
System Use → Is the system actually used, and how?
User Satisfaction → Do users like and value the system?
Net Benefits → What improvements have been achieved in business performance?
Below is the logical flow of how the two frameworks interconnect:

[TOE Contextual Factors]

↓
[Implementation Readiness of KPI System]
↓
[IS Success Model: KPI System Performance Evaluation]
 ↓
[Organizational Outcomes: Customer Satisfaction, Employee Productivity, Retention]

3.1.4 Theoretical equation

Based on your research on Key Performance Indicators (KPIs) for the
**customer service department in the textile industry of Pakistan, using the
integrated TOE Framework and DeLone and McLean IS Success Model we can
create conceptual equations similar to the style you've described.

Equation 1 – KPI Effectiveness as a Function of TOE and IS Success Model

Variables**

Let:

KPI\_E = KPI Effectiveness

T = Technological Factors
O = Organizational Factors
E = Environmental Factors
SQ = System Quality
US = User Satisfaction
NB = Net Benefits

Then:
text{KPI\_E} = f(T, O, E, SQ, US, NB)

Explanation:
KPI Effectiveness is a function of the TOE contextual factors and the six
success dimensions from the DeLone & McLean IS model.
Equation 2 – Net Benefits as a Linear Model with Coefficients

Let:
alpha = Constant (base performance level)
\beta_1, \beta_2, ..., \beta_6 = Efficiency factors or weights for each success
variable
All variables as defined above

NB = \alpha + \beta_1(SQ)+ \beta_5(US) + \beta_6(T + O + E)

Explanation:
Net Benefits (e.g., improved customer service, employee productivity) are
calculated as a sum of the weighted contributions of system quality, information
quality, service quality, usage, user satisfaction, and the combined effect of TOE
factors. Each $\beta$ represents how efficiently that component contributes to
success.

3.2 Conceptual Framework

Conceptual Framework based on the integrated Theoretical Framework combining the TOE
Framework and the **DeLone and McLean IS Success Model, tailored for KPI
implementation in the customer service department of the textile industry in Pakistan.
Conceptual Framework for KPI Implementation and Success

Input Factors (TOE Framework)

These are the enabling or hindering factors that influence the adoption and implementation of
KPI systems.

Technological Factors

System Integration
Ability of KPI tools to work with existing systems like CRM or ERP.
Ease of Use
Simplicity of the system ensures faster employee adoption.
Technology Readiness
Availability of infrastructure and digital skills to support KPIs.
Automation Capabilities
Automation reduces manual work and ensures accurate, timely reports.

Organizational Factors

Top Management Support

Leadership support ensures allocation of resources and strategic alignment.
Employee Training
Training helps staff understand and use KPI tools effectively.
Organizational Culture
A culture of performance measurement drives system acceptance.
Departmental Coordination
Collaboration across departments aligns KPIs with overall goals.

Environmental Factors

Customer Expectations
 External pressure to improve customer satisfaction and service speed.
Market Competition
Industry rivalry motivates better performance tracking.
Regulatory Pressure
Legal or compliance demands require reliable reporting systems.
Industry Standards
Use of commonly accepted KPIs ensures benchmarking and comparability.

II. Evaluation Factors (IS Success Model)

These measure the **effectiveness** and **impact** of the KPI system after
implementation.

System Quality

Reliability
A stable and consistent system avoids disruptions.
Flexibility
Customizable dashboards suit different user needs.
Response Time
Fast data processing supports quick decision-making.

Information Quality

Accuracy
Precise KPI data reflects real performance.
Timeliness
Updated information enables real-time decisions.
Relevance
Only performance-related data is highlighted.

Service Quality

User Support
Helpdesk and support improve user experience.
Training Programs
Ongoing learning helps users stay efficient.
Accessibility
Remote access enables flexibility in monitoring performance.

System Use

Frequency of Use
Regular use indicates acceptance and system importance.
Task Fit
KPI tools assist in completing service tasks effectively.
Feature Utilization
Full use of features like alerts and analytics enhances productivity.

User Satisfaction

Perceived Usefulness
Employees believe KPIs help improve their work.
Ease of Learning
User-friendly design reduces learning time.
Interface Satisfaction
A clean interface improves user engagement.

Net Benefits

Complaint Resolution Rate

Faster resolution indicates system success.
Customer Retention
Improved service boosts loyalty.
Employee Productivity
KPIs help track and improve individual performance.

Link Between Input and Output

TOE Factors → Influence Implementation → Leads to Effective System Use (IS Success) →
Results in Net Organizational Benefits

Based on your provided research file, here’s a clear explanation of the Hypotheses
Development and Equations of the Conceptual Framework, both derived from the integrated
TOE Framework and DeLone & McLean IS Success Model as applied to the textile industry
in Pakistan:
3.2.1 Hypotheses Development

Your hypotheses are developed based on how Key Performance Indicators (KPIs), shaped by
organizational, technological, and environmental conditions, as well as system quality and
user satisfaction, impact customer service performance. They align directly with the variables
in the TOE and IS Success frameworks.

H1
Customer service departments in the textile industry that prioritize response time and issue
resolution rate KPIs will have higher customer satisfaction rates.
→ This connects IS Success variables like:
• System Use (Response Time, Task Fit)
• Net Benefits (Customer Satisfaction)

H2
The implementation of KPIs specifically tailored to the textile industry’s customer service
needs will lead to improved complaint resolution rates.
→ Linked with:
• Information Quality (Relevance, Accuracy)
• System Quality (Customization, Flexibility)
• Net Benefits (Complaint Resolution Rate)

H3
There is a positive correlation between employee training on KPI measurement and customer
service effectiveness in the textile industry.
→ Linked with:
• Organizational Factors (Employee Training)
• Service Quality (Training Programs)
• System Use and User Satisfaction

H4
KPIs that focus on first-contact resolution and Net Promoter Score (NPS) will be strong
predictors of customer loyalty in the textile industry.
→ Related to:
• Environmental Factors (Industry Standards, Customer Expectations)
• Net Benefits (Customer Retention, Loyalty)

3.2.2 Equations of the Conceptual Framework

These equations mathematically express how the variables from TOE and IS Success Models
determine the Effectiveness of KPIs and the resulting Organizational Benefits.

Equation 1: KPI Effectiveness Model

Let:
• KPI_E = KPI Effectiveness
• T = Technological Factors
• O = Organizational Factors
• E = Environmental Factors
• SQ = System Quality
• IQ = Information Quality
• ServQ = Service Quality
• SU = System Use
• US = User Satisfaction
• NB = Net Benefits

Then:

\text{KPI\_E} = f(T, O, E, SQ, IQ, ServQ, SU, US, NB)

Explanation:
KPI Effectiveness is determined by how well the system performs (IS Success variables) and
how favorable the technological, organizational, and environmental conditions are (TOE
factors).
Equation 2: Net Benefits as a Linear Function

Let:
• α = Constant (base level of performance)
• β₁ to β₆ = Weights or impact coefficients of the variables
Then:

NB = alpha + \beta_1(SQ) + \beta_5(US) + \beta_6(T + O + E)

Explanation:
Net Benefits (such as improved complaint resolution, retention, productivity) are calculated
based on the combined weighted influence of the IS Success dimensions and TOE factors.

4. CHAPTER 4

Based on your topic exploring KPIs for customer service departments in the textile industry
of Pakistan using the TOE Framework and the DeLone & McLean IS Success Model here is
a complete and relevant research design, specifically focused on secondary data:

Research Design

4.1. Research Type:

This study is exploratory in nature as it aims to identify and understand key performance
indicators (KPIs) for customer service departments within the textile industry of Pakistan. It
adopts a qualitative approach to analyze existing secondary data through the lens of two
theoretical models: the Technology-Organization-Environment (TOE) Framework and the
DeLone & McLean Information Systems Success Model.

4.2. Research Method:

A desk-based research method is adopted, relying exclusively on secondary data. The
analysis will involve reviewing past studies, industry reports, government publications,
corporate reports, and statistical databases.

4.3. Population:
The population comprises all textile companies operating in Pakistan, especially those with
customer service departments integrated with information systems.
4.4. Sample Size and Sampling Technique:
A purposive sampling technique is used to select 100–150 respondents from Punjab at initial
level

4.5. Data Collection Technique:

Data will be collected through Structured Questionaries

Chapter 5 Results and Discussion

5.1 Interpretation of data through PLS SEM analysis

The structural equation model shown in the diagram illustrates the relationships between
three exogenous constructs—Technological Factors (TF), Organizational Factors (OF), and
Environmental Factors (EF)—and their influence on the mediating constructs System Quality
(SQ) and System Use (US), which in turn affect the endogenous variable Net Benefits (NB).
The model reveals that Technological Factors (TF) have a moderate positive impact on
System Quality (SQ), with a path coefficient of 0.170, suggesting that improvements in
technological readiness, ease of use, and system integration positively influence the quality of
the KPI system. In contrast, Organizational Factors (OF) exhibit a weak negative influence
on SQ (–0.064), implying that internal organizational structures or support mechanisms may
not significantly enhance perceived system quality. Environmental Factors (EF), which
include market competition and customer expectations, have a slightly stronger negative path
coefficient (–0.186) toward SQ, suggesting that external pressures might currently hinder
system performance.
When it comes to System Use (US), both OF and EF show negative path coefficients (–0.109
and –0.281, respectively), indicating that neither internal organizational mechanisms nor
external environmental factors are contributing positively to the frequency or depth of system
use. This may point to a gap in employee engagement or usability of the system under real-
world pressures.
On the other hand, the effect of SQ on NB is weak (0.088), suggesting that perceived system
quality has only a minimal direct influence on achieving net benefits such as improved
complaint resolution or customer satisfaction. More critically, System Use (US), which was
expected to be a key mediator, shows an almost negligible and negative direct impact on NB
(–0.003). This indicates that despite the system being used (as suggested by strong factor
loadings from indicators US1 and US3), its actual contribution to organizational outcomes is
either underutilized or poorly aligned with benefit-generating activities.
At the measurement level, indicator loadings are generally acceptable. For example, SQ3
strongly reflects System Quality with a loading of 0.956, and US1 and US3 both show high
loadings of 0.773 and 0.743 on System Use, respectively. For Net Benefits (NB), NB1 and
NB2 load well (0.876 and 0.470), indicating a reliable measurement structure.
Overall, the model suggests that although the technological foundation supports perceived
system quality, the pathway from system usage to net benefits is weak, revealing potential
issues in aligning the KPI system’s functionalities with real performance outcomes in
customer service departments. This may necessitate revisiting the usability, relevance, and
alignment of KPI systems with employee tasks and organizational goals.
5.2 Interpretation of p value using Bootstrapping
This updated PLS-SEM (Partial Least Squares Structural Equation Modelling) diagram not
only illustrates the strength of relationships between constructs using path coefficients, but
also includes p-values (shown in parentheses) to indicate the statistical significance of these
paths. Let’s walk through the interpretation of the model’s structural paths, loadings, and
significance levels.
STRUCTURAL MODEL PATHS & SIGNIFICANCE (p-values)
The path coefficients show the strength and direction of influence between variables. The
values in parentheses are the p-values, where a p-value < 0.05 is typically considered
statistically significant.

1. TF → SQ
Path Coefficient: 0.170
p-value: 0.137
Interpretation: This path is positive but not statistically significant, suggesting that while
technological factors may help improve system quality, the effect is not strong enough to be
considered reliable in this sample.
2. OF → SQ
Path Coefficient: –0.064
p-value: 0.717
Interpretation: This path is not significant and close to zero. Organizational factors appear to
have no meaningful influence on system quality in this model.
3. EF → SQ
Path Coefficient: –0.186
p-value: 0.167
Interpretation: A moderate negative effect, but not statistically significant, indicating that
environmental factors might slightly reduce perceived system quality, though not
conclusively.
4. OF → US
Path Coefficient: –0.109
p-value: 0.549
Interpretation: Organizational factors have a non-significant, negative impact on system use,
meaning they do not directly support or facilitate system utilization.
5. EF → US
Path Coefficient: 0.281
p-value: 0.076
Interpretation: This path is marginally significant (close to 0.05). Environmental pressure
(e.g., customer expectations, industry competition) may somewhat drive usage behavior.
6. SQ → NB
Path Coefficient: 0.088
p-value: 0.567
Interpretation: System quality shows a weak, non-significant influence on net benefits,
indicating that good systems alone do not translate directly into organizational performance
improvements.

7. US → NB
Path Coefficient: –0.003
p-value: 0.988
Interpretation: Essentially no effect; system use does not lead to observable net benefits in
this case, possibly because the system is underutilized or misaligned with business goals.
MEASUREMENT MODEL INDICATORS (Outer Loadings)
Each latent construct is measured by specific indicators:
System Quality (SQ)
 SQ1 loading: 0.486 → weak
 SQ3 loading: 0.009 → extremely low, suggesting the item does not contribute to
construct validity
System Use (US)
 US1 loading: 0.162
 US3 loading: 0.077
→ Both are well below the 0.70 threshold, meaning the measurement of “System
Use” lacks internal consistency
Net Benefits (NB)
 NB1 loading: 0.129, NB2: 0.345
→ Also very low. These indicators do not adequately capture the construct “Net
Benefits,” raising questions about the validity of this latent variable.
LATENT VARIABLE VARIANCE EXPLAINED (R²)
 SQ: R² = 0.081 → only 8.1% of the variance in System Quality is explained by TF,
OF, and EF
 US: R² = 0.098 → about 9.8% of variance explained by OF and EF
 NB: R² = 0.008 → less than 1% of Net Benefits is explained by SQ and US

Chapter 6 conclusion and Recommendations

6.1 Conclusion
This study set out to explore and evaluate how technological, organizational, and
environmental factors influence the implementation and success of KPI systems in improving
customer service within Pakistan’s textile industry. Through an integrated theoretical model
combining the TOE framework and the DeLone & McLean IS Success Model, the research
sought to identify the pathways through which these factors lead to enhanced system quality,
system use, and ultimately, net organizational benefits such as improved complaint
resolution, customer satisfaction, and employee productivity.
The findings of the structural equation modeling (SEM) indicate that while technological
readiness showed a positive association with system quality, the relationship was not
statistically significant. Similarly, organizational and environmental factors demonstrated
weak or inconsistent effects on both system quality and system use. Moreover, system use
and system quality themselves did not significantly contribute to perceived net benefits,
suggesting that KPI systems in their current form are not translating into tangible
performance improvements within these customer service departments.
The measurement model further revealed that many indicators did not meet the required
loading thresholds, and the overall R² values were very low, pointing to a model with limited
explanatory power. These results suggest either a disconnect between the theoretical
assumptions and field reality or potential deficiencies in how KPIs are designed, used, or
integrated within the textile sector’s service departments.
6.2 Recommendation
Revise and Refine KPI Constructs
The low indicator loadings suggest a need to re-evaluate the KPI metrics currently used in the
textile sector. Future efforts should focus on developing clearer, more measurable, and
context-specific KPIs aligned with customer service goals and industry standards.
1. Enhance Training and Change Management
The insignificant role of system use implies limited employee engagement or adoption. It is
essential to invest in ongoing training, change management initiatives, and performance
incentives to improve user uptake and system familiarity.
2.Reassess System Design and Integration
Given that technological factors had some influence on system quality, textile firms should
upgrade their digital infrastructure, ensuring KPI systems are user-friendly, mobile-
accessible, and well-integrated with CRM or ERP platforms.
3.Incorporate Customer Feedback Mechanisms
Environmental pressures such as customer expectations should be treated as real-time inputs
in KPI monitoring systems. Net Promoter Score (NPS), first-contact resolution rate, and
customer effort score should be central to performance evaluation.
4.Conduct Further Empirical Validation
The current model should be retested with a larger and more diverse sample size, improving
the reliability of the statistical analysis. Exploratory factor analysis and reliability testing
(e.g., Cronbach's alpha) are recommended before rerunning SEM.
5.Develop Industry-Wide KPI Benchmarks
The textile industry, through bodies like APTMA, should collaborate on creating a
standardized set of KPIs for customer service, enabling benchmarking and better strategic
alignment across firms.

Chapter 7 References

1. Tornatzky, L. G., & Fleischer, M. (1990). *The Processes of Technological Innovation*.

Lexington Books.
2. DeLone, W. H., & McLean, E. R. (1992). Information systems success: The quest for the
dependent variable. *Information Systems Research*, 3(1), 60-95.
3. DeLone, W. H., & McLean, E. R. (2003). The DeLone and McLean model of information
systems success: A ten-year update. *Journal of Management Information Systems*, 19(4),
9–30.
4. Parmenter, D. (2015). *Key Performance Indicators: Developing, Implementing, and
Using Winning KPIs*. Wiley.
5. Sharma, A., Kumar, R., & Mehta, R. (2020). Key Performance Indicators in the Textile
Industry. *Journal of Textile and Apparel Technology Management*, 14(2), 1-10.
6. Kaplan, R. S., & Norton, D. P. (1996). *The Balanced Scorecard: Translating Strategy into
Action*. Harvard Business Press.
7. Kaplan, R. S., & Norton, D. P. (2001). *The Strategy-Focused Organization*. Harvard
Business Press.
8. Bourne, M., Neely, A., Mills, J., & Platts, K. (2003). Implementing performance
measurement systems: a literature review. *International Journal of Business Performance
Management*, 5(1), 1-24.
9. Zeithaml, V. A., Bitner, M. J., & Gremler, D. D. (2018). *Services Marketing: Integrating
Customer Focus Across the Firm*. McGraw-Hill.
10. Cronin, J. J., & Taylor, S. A. (1992). Measuring service quality: A reexamination and
extension. *Journal of Marketing*, 56(3), 55-68.
11. Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1988). SERVQUAL: A multi-item scale
for measuring consumer perceptions of service quality. *Journal of Retailing*, 64(1), 12-40.
12. Ahmed, S., & Yasin, M. (2020). Challenges and opportunities in Pakistan’s textile
industry. *Journal of Industrial Textiles*, 49(3), 230-245.
13. Iqbal, M., & Shahid, M. (2019). Operational performance in the textile sector of Pakistan.
*Asian Journal of Management Sciences & Education*, 8(2), 35-47.
14. Khan, A. M., & Qureshi, M. I. (2018). Organizational performance of Pakistan’s textile
industry. *International Journal of Productivity and Performance Management*, 67(2), 310-
325.
15. Ifinedo, P. (2011). Internet/e-business technologies adoption in Canada’s SMEs: an
exploratory study. *Internet Research*, 21(3), 255-281.
16. Baker, J. (2012). The technology–organization–environment framework. In *Information
Systems Theory* (pp. 231–245). Springer.
17. Zhu, K., Kraemer, K. L., & Xu, S. (2006). The process of innovation assimilation by
firms in different countries: A technology diffusion perspective. *Management Science*,
52(10), 1557-1576.
18. Singh, R., Jain, K., & Sharma, A. (2018). The Impact of Employee Training on KPI
Measurement. *International Journal of Management and Applied Research*, 5(2), 34-45.
19. Becker, B. E., & Huselid, M. A. (2006). Strategic human resources management: where
do we go from here? *Journal of Management*, 32(6), 898–925.
20. Patel, R., Singh, P., & Gupta, A. (2021). Exploring KPIs for Customer Service
Departments. *International Journal of Service Science, Management, Engineering, and
Technology*, 12(2), 1–14.
21. Busi, M., & Bititci, U. S. (2006). Collaborative performance management: present gaps
and future research. *International Journal of Productivity and Performance Management*,
55(1), 7–25.
Case Studies and Industry Applications
22. McKinsey & Company. (2020). Transforming customer experience in manufacturing.
Retrieved from: [www.mckinsey.com](http://www.mckinsey.com)
23. PwC. (2021). Pakistan Textile Sector Report. PricewaterhouseCoopers.
24. Zara Case Study (2019). Fast fashion and KPI-driven supply chain. *Harvard Business
Review Case Collection*
25. Creswell, J. W. (2014). *Research Design: Qualitative, Quantitative, and Mixed Methods
Approaches*. Sage Publications.

Annexures
Questionnaire: KPI Implementation in Textile Customer Service Departments
Section A: Demographics
1. What is your role in the organization?
- Customer Service Rep
- Supervisor
- Manager
- Executive
- Other
2. How many years of experience do you have in customer service?
- Less than 1 year
- 1–3 years
- 4–6 years
- More than 6 years
3. What is the size of your organization?
- Small (less than 100 employees)
- Medium (100–500 employees)
- Large (more than 500 employees)
Section B: Technological Factors
Please indicate your level of agreement using the following scale:
1 = Strongly Disagree | 2 = Disagree | 3 = Neutral | 4 = Agree | 5 = Strongly Agree
1. Our KPI system integrates well with existing systems (e.g., ERP, CRM).
2. The KPI interface is easy for staff to use.
3. Our infrastructure is ready to support KPI tools.
4. Data reporting is automated in our KPI system.
5. Employees require minimal technical assistance with KPI tools.
Section C: Organizational Factors
Please indicate your level of agreement using the following scale:
1 = Strongly Disagree | 2 = Disagree | 3 = Neutral | 4 = Agree | 5 = Strongly Agree
1. Top management actively supports KPI initiatives.
2. Regular training sessions are held for KPI usage.
3. Our company culture promotes performance measurement.
4. Departments coordinate to align KPI goals.
5. KPI use is embedded in our decision-making processes.
Section D: Environmental Factors
Please indicate your level of agreement using the following scale:
1 = Strongly Disagree | 2 = Disagree | 3 = Neutral | 4 = Agree | 5 = Strongly Agree
1. Customers expect quick responses and high service standards.
2. Competitors' service KPIs pressure us to improve.
3. Our KPIs help us comply with industry regulations.
4. We follow industry-standard KPIs like NPS and first-call resolution.
5. Customer feedback plays a role in designing KPIs.
Section E: System Quality
Please indicate your level of agreement using the following scale:
1 = Strongly Disagree | 2 = Disagree | 3 = Neutral | 4 = Agree | 5 = Strongly Agree
1. Our KPI system is reliable and stable.
2. The system allows for dashboard customization.
3. Reports are generated quickly and without delays.
4. KPI tools have minimal technical issues.
5. The system supports real-time monitoring.
Section F: User Satisfaction
Please indicate your level of agreement using the following scale:
1 = Strongly Disagree | 2 = Disagree | 3 = Neutral | 4 = Agree | 5 = Strongly Agree
1. The KPI system helps improve my performance.
2. I find the system easy to learn.
3. I am satisfied with the system’s user interface.
4. I would recommend the system to others.
5. The system has made performance evaluation fairer.
Section G: Net Benefits
Please indicate your level of agreement using the following scale:
1 = Strongly Disagree | 2 = Disagree | 3 = Neutral | 4 = Agree | 5 = Strongly Agree
1. Customer complaints are resolved more efficiently now.
2. Our customer retention has improved since KPI use.
3. My productivity has improved due to KPI feedback.
4. The team’s performance has become more goal-oriented.
5. We’ve seen an increase in positive customer feedback.