Service Quality and Customer Satisfaction

  • Posted on:  Monday, 07 December 2015 00:00

Customer satisfaction is increasingly being viewed as an important indicator of corporate competitiveness, since it has a positive link with customer loyalty and profitability (Lien 2008, p.522). An enhanced understanding of the satisfaction formation process can allow organizations to improve their customer satisfaction and loyalty more effectively. In tandem with this direction, many researches have been devoted to identifying the determinants of customer satisfaction. Of all the factors that have been identified as antecedents of customer satisfaction, service quality has received significant attention.

 

Service quality and customer satisfaction have been recognized as playing a crucial role for success and survival in today's competitive market. In order to protect or gain market shares, organizations need to outperform competitors by offering high quality products or services to ensure satisfaction of customers.

But what exactly is service quality? For Shahin (2006, p.3), service quality is the extent to which a service meets customers’ needs or expectations. Similarly, Shahin & Janatyan (2011, p.100) assert that service quality can be defined as the difference between customer expectations of service and perceived service. Service quality can therefore be defined as the difference between customer expectations of service and perceived service. Due to intense competition and the hostility of environmental factors, service quality has become a major marketing strategy for organisations and is now considered as an important tool for enabling an organisation to differentiate itself from its competitors. Service quality is not only assessed as the end result but also on how it is delivered during the service process and its ultimate effect on consumers’ perceptions. Service quality has a strong correlation with customer satisfaction, financial performance, customer retention, customer loyalty, as well as the success of marketing strategy. By means of service quality an organisation can reach a higher level of customer satisfaction, and can maintain constant competitive advantage.

What is customer satisfaction, one may as well ask? According to Kotler and Armstrong, cited in Karim and Chowdhury (2014, p.3), customer satisfaction is a person’s feelings of pleasure or disappointment resulting from the comparison of a product’s perceived performance in reference to expectations. As Naik, Gantasala and Prabakar (2010, p.234) point out, satisfying customers is one of the main objectives of every organization since keeping current customers is more profitable than having to win new ones to replace those lost. Customer satisfaction results ultimately in trust, price tolerance and customer loyalty (Angelovah & Zekiri, 2011, p.28). Building customer relationship is, therefore, the backbone for all organizations in general, and companies in the service industries in particular. The starting point in developing quality in services is analysis and measurement, hence the need for the development of appropriate instruments for measuring service quality and customer satisfaction as well as for conducting rigorous service quality and customer satisfaction surveys. Cognizant of this imperative, Impact Supply Chain Group offers its valued customers robust service quality and customer satisfaction surveys as well as comprehensive and through training to equip and empower them to conduct such surveys own their own.

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