Assessing The Effect of Service Quality On Customers
Assessing The Effect of Service Quality On Customers
Assessing The Effect of Service Quality On Customers
BY
BAREKE BULTO
ADVISOR
LEMA TESHOME (Asst. prof.)
A Thesis Submitted to Department of Management for Partial Fulfillment of the
JUN, 2023
ADAMA, ETHIOPIA
DECLARATION
I Bareke Bulto declare that the work included in this research thesis is my own work carried
out by me under the guidance of my advisor. The research thesis has not been summated for
any other purpose to any other higher education institutions I also declare that have adhered
to all principles of academic honesty and integrity and not misrepresented source in my
research thesis submission and the source used are daily acknowledged. I understand that
any violation of academic integrity would be cause for displinary action by the university
Signature______________________
Date__________________________
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CERTIFICATION
This is to certify that the thesis entitled ASSESSING THE EFFECT OF SERVICE QUALITY
ON CUSTOMERS SATISFACTION: IN CASE OF Addis Ababa yeka sub-city trade office.”
Submitted to Arsi University, College of Business and Economics, Department of Management
for the award of Masters of Business Administration (MBA) is crried out by Mr. Bareke Bulto,
under my supervision is correct and fulfill all required standard and commensurate with
academic integrity. Hence, I attest the student can submit the MBA thesis to the department for
further evaluation by board of examiners.
Name of Advisor: Lema Teshome (Asst.prof.)
Signature of the Advisor: ______________________
Date__________________________
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APPROVAL SHEET
ARSI UNIVERSITY
COLLEGE OF BUSINESS AND ECONOMICS
DEPARTMENT OF MANAGEMENT
MBA PROGRAM
Submitted By:
_______________________________ ________________ ______________
Name of Student Signature Date
(Chairperson)
(Internal Examiner)
3) ______________________________ ________________ ______________
(External Examiner)
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ACKNOWLEDGEMENTS
A study of this type could not come to completion without the assistance of institutes, groups of
people and individuals. First of all, I would like to thank the glory God, who has been the
ultimate source of my strength. My special gratitude goes to my advisor Lema Teshome
(Asst.prof.) whose work ethic is worth modeling, for his commitment on the thesis at each stage
and for making invaluable comments and suggestions.
I would also like to express my congratulation to my lovely family who were also the building
block of my life their assistance and understanding made me strong in doing this thesis. I was
also really grateful to all the respondents who took their time to respond to my request during
this pandemic period voluntarily
Lastly, I would like to thank all of my families and who encouraged me and provided necessary
materials for the study.
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LISTS OF ABBREVATIONS AND ACRONYMS
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Table of Contents page
DECLARATION ........................................................................................................................................... i
CERTIFICATION .................................................................................................................................... ii
APPROVAL SHEET ................................................................................................................................... iii
ACKNOWLEDGEMENTS ......................................................................................................................... iv
LISTS OF ABBREVATIONS AND ACRONYMS ..................................................................................... v
ABSTRACT............................................................................................................................................... xi
CHAPTER ONE ........................................................................................................................................... 1
1. INTRODUCTION .................................................................................................................................... 1
1.1 Background of the study ..................................................................................................................... 1
1.2 Statement of the Problem .................................................................................................................... 3
1.3 Research questions .............................................................................................................................. 4
1.4 Objective of the study ......................................................................................................................... 4
1.4.1 General objective ......................................................................................................................... 4
1.4.2 Specific objective ......................................................................................................................... 4
1.5. Definition of key Terms ..................................................................................................................... 4
1.6. Significance of the study .................................................................................................................... 5
1.7. Scope (delimitation) of the study ....................................................................................................... 5
1.8. Organization of the study ................................................................................................................... 5
2. REVIEW OF THE RELATED LITERATURE ....................................................................................... 6
Introduction ............................................................................................................................................... 6
2.1 Theoretical Review ............................................................................................................................. 6
2.1.1 Service concept and its unique characteristics ............................................................................. 6
2.1.2 Service Quality............................................................................................................................. 7
2.1.3 Service Quality, the Gap between Expectations and Performance .............................................. 8
2.1.4 Customer Perceived Service Quality ........................................................................................... 9
2.1.5 Dimensions of Service quality ..................................................................................................... 9
2.1.6 Customer Satisfaction ................................................................................................................ 11
2.1.7 Customer‟s Expectation ............................................................................................................. 12
2.1.8 Customer Perception .................................................................................................................. 12
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2.1.9 Customer Complaint Handling System...................................................................................... 13
2.2. Empirical reviews ............................................................................................................................ 14
2.2.1. Empirical evidences on the Quality of Service delivery practice in Ethiopian Public Sectors
............................................................................................................................................................ 14
2.2.2 Relationship between customer satisfaction and service quality ............................................... 15
2.3 Conceptual frame work ..................................................................................................................... 15
CHAPTER THREE .................................................................................................................................. 17
3. RESEARCH METHODOLOGY ........................................................................................................ 17
This chapter deals with research design and methodology, tools and sources of data collection, data
collection instruments, target population, sample size and sampling techniques and methods of data
processing and analyzing. ....................................................................................................................... 17
3.1 Description of the Study Area ........................................................................................................... 17
Addis Ababa was the capital city of Ethiopia, The study was conducted at yeka sub-city trade office.
yeka sub-city was ones from 11 sub citys which found in Addis Ababa and there are 12 woredas found
under yeka sub-city. ................................................................................................................................ 17
3.2. RESEARCH DESIGN ............................................................................................................... 18
3.3. RESEARCH APPROACH ................................................................................................................. 18
3.3.1 Methods of data collection and data sources.............................................................................. 18
3.3.2 Sources of Data ............................................................................................................................. 18
3.3.3. Primary Sources ............................................................................................................................ 18
3.3.4. Secondary Sources ........................................................................................................................ 19
3.3.5. Tools of Data Collection ............................................................................................................... 19
3.3.6. Data Collection Procedures........................................................................................................... 19
3.4 Population and Sampling .................................................................................................................. 19
3.4.1Target population ............................................................................................................................ 19
3.4.2 Sampling Technique ...................................................................................................................... 20
3.4.3. Sample Size................................................................................................................................... 20
3.5. Methods of Data Analysis ............................................................................................................ 21
3.6. Data Quality Assurance ....................................................................................................................... 21
3.6.1 Reliability....................................................................................................................................... 22
3.6.2 Validity .......................................................................................................................................... 22
3.7. Data analyzing procedure................................................................................................................. 23
3.8. Ethical Consideration ................................................................................................................... 24
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CHAPTER FOUR ............................................................................................................................... 25
4. DATA ANALYSIS AND DISCUSSION ....................................................................................... 25
4.1. Response Rate .................................................................................................................................. 25
4.2. Demographic characteristics ............................................................................................................ 26
4.3 Descriptive Statistics ......................................................................................................................... 27
4.3.1 Service Quality Assessment ....................................................................................................... 28
4.3.2 Customer Satisfaction ................................................................................................................ 32
4.4. Correlation analysis ......................................................................................................................... 38
4.4.1. Relationship between service quality dimension ...................................................................... 38
4.5 Effects of Quality service on customer satisfaction .......................................................................... 39
4.5.1 Assumptions ............................................................................................................................... 39
4.5.2. Normality Test .......................................................................................................................... 39
4.5.3. Linearity Test ............................................................................................................................ 40
4.5.4. Multicollinearity Test ................................................................................................................ 40
4.5.5. Independent of Error Test ......................................................................................................... 41
4.5.6 Homoscedasticity of variance Test ............................................................................................ 41
4.6 Regression Analysis .......................................................................................................................... 41
4.7. Predicting role of each variables ...................................................................................................... 43
CHAPTER FIVE ........................................................................................................................................ 46
5. CONCLUSIONS AND RECOMMENDATIONS ................................................................................. 46
5.1. Summary .............................................................................................................................................. 46
5.2 Conclusion ........................................................................................................................................ 47
5.3 Recommendations ............................................................................................................................ 48
5.4. Limitation and Future research implication ..................................................................................... 49
5.4.1. Limitation of the Study ............................................................................................................. 49
5.4. 2. Future research implication ...................................................................................................... 49
REFERENCES ................................................................................................................................................ 50
APPENDIXES ................................................................................................................................................ 55
Appendix : Questionnaire ........................................................................................................................... 60
Appendix 2 .............................................................................................................................................. 68
Normality assumption test ...................................................................................................................... 68
Appendix 3 .................................................................................................................................................. 69
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Normality assumption test ...................................................................................................................... 69
Appendix 4 .................................................................................................................................................. 69
Appendixes 5........................................................................................................................................... 70
Linearity assumption test ............................................................................................................................ 70
APPENDIXES ...............................................................................Error! Bookmark not defined.
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LIST OF TABLES PAGE
LIST OF FIGURES
Figure 2.1. Figure 1:Conceptual frame work of the study Source: Adopted from literature
(Parasuraman et al.,1988) ............................................................................................................. 16
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ABSTRACT
The main objective of study is to assess the effect of service quality on customer’s satisfaction in
the case of Yeka sub-city Trade office. Regarding to research methodology, this study was used
both quantitative and qualitative research design and both primary and secondary data was
employed. From the target population of 2843 customers and 62 employees 350 and 18 samples
was drawn respectively. Simple random sampling and purposive sampling techniques were
employed for selecting samples of customers and employee’s respectively. The data analysis was
conducted through statistical techniques such as descriptive statistics, Bivariate correlations and
multiple linear regressions by using SPSS software version 20. In order to test the reliability of
the instrument, the Crobanch alpha test was used .person correlation and multiple linear
regression analysis was employed to estimate the causal relationships between service quality
and customer satisfaction.
The findings indicate that the service quality of the organization is good based on the result of
those dimensions. All service quality dimensions are positively related to customer satisfaction.
The data also shown that all the independent variables (tangibility, reliability, responsiveness,
assurance and empathy) had statistically positive and significant effect on dependent variable
(customer satisfaction). From the data collected and result of the analysis, the study indicates
that the five dimensions of service quality were positively correlated with the customer
satisfaction. The overall finding of this study suggested that all employees and officials in the
office had to be committed and involved in service quality improvement in order to meet
customers’ expectation. The study recommended that the office had to give significant
consideration for all service quality dimensions that positively effect on customer satisfaction
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CHAPTER ONE
1. INTRODUCTION
This chapter presents the general idea of the whole research thesis. It covers the background of the
study, statement of the problem, research questions, objectives of the study, significance of the study,
scope of the study and organization of the study.
In simple terms “Services are deeds, processes, and performances” (Munusamy et al., 2010). on the
other hand, in a more broader definition, (Angelova&Zekiri, 2011; N. F. Taylor et al., 2012) indicate
that "services contain all economic activities whose output is not a physical product, and is in general
consumed at the time of production, and provides added value in forms such as convenience,
amusement, timeliness, comfort, or health which are essentially intangible in nature". (Ahmad M.
Zamil& Marwan M. Shammot, 2011),
Service quality is the set of aspects and characteristics of a product that relate to its ability to satisfy
expressed or latent needs, i.e., measuring the degree of a customer's satisfaction with the product or
service provided by organizations (Castro and Paccha 2018). Similarly, quality is defined as a form of
attitude that is related to satisfaction and originates from making comparisons of expectations with
perceptions of quality when a customer has a service experience (Monroy and Urcádiz 2020).
Ahmad (2011), on the other hand, defines services as "any act or performance that one party can offer
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to another that is essentially intangible and does not result in the ownership of anything". He affirms
the view that "services are intangible, inseparable, variable and perishable and also added that
services normally require more quality control, supplier- credibility, and adaptability”.
According to Gronroos (2004), services are "activities or series of activities of more or less intangible
nature that normally, but not necessarily, take place in interactions between customer and service
employees or physical resources or goods and systems of the service provider, which are provided as
solutions to customer problems." Customer satisfaction is becoming one of the most essential
objectives which any firm seeking for long-term relationship with customer considers as the top
priority.
One of the main elements determining customer satisfaction is the customer‟s perception of service
quality. Customer satisfaction is described as the result of a comparison of the customers‟
expectations and his or her subsequent perceived performance of service quality (Herington
&Weaven, 2009). According to this conceptualization, perceived service quality is one of the
antecedents to overall customer satisfaction.
According to Juwaheer and Kandampully (2009), the relationship between service quality and
customer satisfaction has proven its role and importance, in satisfaction, can be the result of high
quality services when management implements service quality concepts and metrics properly.
Today, quality of service plays a crucial role in the success of the organization in creating competitive
advantage and increase competitive power. Quality of service meets two dimensions of Technical
(outcome) and operational (process-oriented). Technical dimension of service is what the customer
gets from service and is measurable so as objective, because it is what customers sees in the end of
serving process. On the other hand, the functional quality associated with how to get service and is
not easily measured and also understood by the client mentally. In other words, the technical quality
is the practical result of the service while the operational dimension quality shows process how
service provided.
Customer satisfaction so that improve service quality increases also the likelihood of customer
satisfaction. Increasing customer satisfaction leads to behavioral outcomes such as commitment, a
desire to remain a two-way link between the service provider and the customer, increasing customer‟s
tolerance to failures in service delivery and positive oral advertising about organization (Hosseini& et
al, 2010).
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1.2 Statement of the Problem
One of the most significant challenges facing services organizations today is to provide consistently
high-quality services. The delivery of consistent service quality is arguably the most vital factors that
contribute to the establishment of credibility and reputation of the organizations in the eyes of the
public. It is well recognized that providing high quality services has a beneficial effect on the bottom-
line performance for the organization.
Many authors agree that service quality leads to customer satisfaction. Although; the need to satisfy
customer is something that goes without saying this is precisely the problem with many
organizations, assumptions are made about what customers really want and even if customers have
been consulted, it may be such a long time in the past that this information is at best irrelevant and
often positively dangerous. The service quality dimensions that affect customer satisfaction are
Tangibility, Responsiveness, Assurance, Empathy, and Reliability. Professional services in a
particular sector frequently suffer from an attitude of thinking that they know best, because they are
the experts. This may be true but this attitude can create blind spots in dealing with customers
(Johnson and Clark, 2002).
According to Hussein, (2009), though public organizations are supposed to give quality service in a
way that is efficient, effective, fair, transparent, reliable, and responsive that meets customer
satisfaction, service delivery quality lack these qualities which in turn affected the level of customer
satisfaction. According to the existing experiences and reports, this is currently experienced yeka sub-
city trade office and also some of the bottle necks in commercial registration and licensing services.
Currently, citizens expect variety of service from the government that requires seamless and flexible
organization that is effective and efficient in delivering services. To avoid some of the bottle necks in
commercial registration and licensing services, address maladministration and improve the services
supported by technology.
Trade office has been established to provide quality service to its customers in the giving trade
license. According to the government policy, rules and regulation any government organization has to
Give quality of service to satisfy its customers. Many studies have been done on service quality and
customer satisfaction. Only few studies were done on trade office service quality. However, to cross
check whether it is delivering quality service to satisfy its customers there is no any research
conducted in yeka sub-city trade office. To this effect the researcher is, therefore, motivated to carry
out and assess service quality on customer satisfaction the case of yeka sub-city Trade office.
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Services to assess the effect of service quality on the customer satisfaction and to identify the most
important service quality dimensions that influence overall customer satisfaction of trade offices.
How does service quality relate to customer satisfaction in the trade office?
The general objective of the study is to Assessing the effect of service quality on customers‟
satisfaction in Addis Ababa yeka sub – city trade office.
On the basis of general objective; the specific objectives of this study are the following:
To assess the relationship between service quality dimensions and customer satisfaction
towards trade office
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1.6. Significance of the study
The research is important to the office to identify the level of its customer‟s satisfaction and to
enhance & improve the mechanism of its service delivery.
Specifically, it has the following significances:
This enables the office to identify the gap between what customer hope to get and what they
perceived from actual service delivery of the office.
It may help the office to apply new strategies to offer efficient services for the community of
commerce in the sub-city.
The management may use it as an opportunity to improve their organizational communication
tools.
The results of the findings in this research may help as a benchmark for further studies of
other researchers in the area.
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CHAPTER TWO
2. REVIEW OF THE RELATED LITERATURE
Introduction
In this chapter theoretical and empirical review of existing literatures about the concepts of service
quality and customers‟ satisfaction, service quality dimensions, customers‟ expectation and
perceptions, customer complaint handling mechanisms and conceptual framework of the study are
included.
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2.1.2 Service Quality
Service quality is defined as a comparison of customer expectations with service performance, Good
service quality leads into customer satisfaction and therefore, makes the High service quality can be
achieved by identifying problems in service and defining measures for service performances and
outcomes as well as level of customer satisfaction. Moreover, service quality can be defined by
examining the differences between expected service and perceived service.
According to Agyapong (2011) there was a positive relationship between service quality and
customer satisfaction. Service quality can be accessed with the SERVQUAL scale (Khan &Fasih,
2014). SERVQUAL scale measures the quality of a service before and after the consumption of a
service, with five dimensions. Namely; tangibility (visible elements of a service such as buildings,
sites and tools); responsiveness (how fast service providers respond to customer queries/ the
willingness for service providers to assist customers and provide prompt services); reliability (the
ability for a service provider to assure customers of a reliable and proper service); assurance ( the
level of knowledge displayed by a service provider when delivering its services and their ability to
inspire trust and confidence ); and empathy (ability for a service provider to pay attention to
individual customer demands/ individualization of service).
The Quality of most services has to be difficult than the quality of physical goods, because of the
complexity of their characteristics (Groonroos, 2001). Groonroos grouped the quality of services in to
two categories based on technical quality of the outcome (What) and functional quality of the service
process (How).From his point of view, the quality of services influenced by the way the customer
receives the service and the way technical quality transferred to the customer or service provider was
highly responsible in this process. For example ,A business man visit the trade office with the
purpose of having trade license and commercial registration or he may become to the office to renew
his license and if this is the outcome then the customer has received the satisfaction technical quality.
However ,it is possible to be satisfied with the outcome but dissatisfied with the process or functional
quality received such as ,at the time of annual renewal of business license ,the office could be
overcrowded and suffocated ,the stuffs may not be fast and queue are so long .
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2.1.3 Service Quality, the Gap between Expectations and Performance
Customer perceptions and effective factors on it Perceived service quality by consumer comparing
what they feel that services company must provide (their expectations) with their understanding
comes from the service provider business performance. The primary factors that affect the customer's
perception of service, it show when we speak from customer's perception is assumed; dimensions of
services and practices of assessing customers exposures is similar, whether evaluator be internal or
external customer of the organization. Four main factors affecting customer perceptions from service
include:
1: Service Encounter, or Moments of Truth
The most obvious impact services from consumer point of view occur in service encounters, when
customers interact with services company, in these encounters that customers receive the picture from
services quality in organization and each service encounter help to the satisfaction and overall desire
of people because work with organization again. In term of organization view, each encounter
provides an opportunity to improve its ability as provider of services quality to increase customer
loyalty.
2. The Evidence of service
Another set from factors affecting customer perception of service refers to the evidence of service
because the services are invisible, customers looking for the evidence of service that they have with
an organization in every interaction. Individuals (employees in customer contact, customer, and
customers) Physical evidence (regular communication, technology, and warranty and service space)
and process (the operational process of activities, process steps, flexibility in standards, and
technology versus human) these classification together offer services and provide evidence for
tangible services to customers (Bahadoran, 2008).
3. Image beyond impacts from the service encounters and assessing evidence of service,
customer
Perceptions can be influenced by the organization's image or reputation. Here, the image of an
organization is defined as the perception of organization that is reflected in relationship that there is in
the customer‟s memory.
4. Price
Price can influence on perceptions of quality, satisfaction and value. If the price is too high,
customers are likely to expect high quality. Actual perceptions are influenced based on these
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expectations and conversely, if the price is too low, customers may doubt the company's ability to
provide quality services.
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3. Assurance
The assurance dimension of service quality addresses the competence of the organization, the
Courtesy it extends to its customers and the security of its operations. Assurance as employees‟
knowledge and courtesy, and the ability of the organization and its employees to inspire trust and
confidence. This is especially important with services that a customer might perceive as being above
their ability to understand and properly evaluate; meaning that there has to be a certain element of
trust in the servicing organization's ability to deliver. Assurance is the degree of trust and confident of
customers to feel that the services providers are competent to provide the services (Siddiqi, 2011).
Naidoo (2014) argues that not all customers have the expertise to understand the quality of service
and values they received, and as such may require effective communication or personal explanations
to understand the value they receive. This service quality dimension is performed through the people
aspect of service quality (Kaura, et al., 2012).
4. Empathy
Khan &Fasih (2014, after, Blery, et. al., 2009) state that empathy is the ability for service delivery
firms to pay attention to individual customer problems and demands, then address these issues
effectively. It involves giving ears to their problems and effectively addressing their concerns and
demands. Thus, it is the Dimension of a business relationship that enables two parties to see a
situation from the other‟s perspective.
The essence of empathy is conveying, through personalized or customized service, that the customers
are unique and special and that their needs are understood. Empathetic firms have not lost touch with
what it is like to be a customer of their own organization. On the other hand, it is referred as sign of
Caring; individualized attention, approachability, easiness of contact; effort in understanding the
customers‟ needs is signs of empathy.
5. Reliability
Reliability has an impact on trust and the overall impression left in the mind of a customer after
service consumption (Abd-El-Salam, et al., 2013).Customers want trustable services on which they
can rely. Reliability is the extent to which the service is delivered to the standards expected and
promised (Siddiqi, 2011).
Relationship between Tangibility with customer satisfactions
Tangibility: It encompasses physical facilities, equipment, appearance of personnel and
communication materials. In other words, the tangible dimension is about creating first hand
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impressions. An organization should want all their customers to get a unique positive and
unforgettable first hand impression; this would make them more likely to return in the future.
Relationship between Reliability with customer satisfactions
Reliability: It is the most important determinant of perceptions of service quality. It is the ability to
perform the promised service dependably and accurately. The promise may include service Delivery,
problem resolution and pricing.
Relationship between Responsiveness with customer satisfactions
Responsiveness: Is the willingness to help customers and provide prompt service. This dimension
emphasizes attentiveness and promptness in dealing with customer request, questions, complaints and
problems. It is all about length of time they have to wait for assistance, answers to questions or
attention to problems. To truly distinguish themselves on responsiveness organizations, need well-
staffed customer service department as well as responsive frontline people in all contact positions.
Relationship between Empathy with customer satisfactions
Empathy: caring individualized attention the firm provides to its customers. It is an employee‟s
„commitment to deliver quality and efficient services, skillfully handling of conflicts which
eventually resulted in satisfied customers for long term benefit.
Relationship between Assurances with customer satisfactions
Assurance: knowledge and courtesy of employees and their ability to inspire trust and confidence.
This dimension is likely to be particularly important for services that customers perceives high risk or
uncertain about their ability to evaluate outcomes. Trust and confidence are embodied in the contact
employee and the organization itself.
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Customer satisfaction can lead to customer loyalty because people tend to be rational and risk-adverse
so that they might have a tendency to reduce risk and stay with the service providers which they
already had good experience with. Actually, customer satisfaction has been suggested to be an
antecedent of loyalty in service context in previous studies (Belas&Gabcova, 2016).
Customer satisfaction is something beyond a positive Impact on efforts done in the organization.
Customer satisfaction is defined as “the number of customers or percentage of total customers, whose
reported experience with a firm, its products, or its services (ratings) exceeds specified satisfaction
goals. Understanding customer satisfaction in the organization should be considered as a major issue.
As part of this strategy, service and the needs of customer, prepare a list of data, customer complaints,
the selection of process is important. Basic questions include: What do we provide service? Who are
our customers? What do they want and need? Is it measurable? What is needed to improve the
process? By answers to these questions will have a better understanding of customer continuously?
The diversity of expectation definitions can be concluded that expectation is uncontrollable factors
which including past experience, advertising, customers perception at the time of purchase,
background, attitude and product‟s image. Furthermore, the influences of customer‟s expectation are
pre-purchase beliefs, word of mouth communications, individual needs, customers‟ experiences, and
other personal attitudes. Different customers have different expectation based on the customer‟s
knowledge of a product or service. Studies supported that expectations precede satisfaction for
instance: Turel and Serenko (2004) found that perceived expectations are positively correlated with
customer satisfaction.
Complaint handling is to terminate the dissatisfaction and to take remedy and /or give compensation
to enhance customers‟ satisfactory levels. The emotional direction includes apology and explanation.
The physical direction is to do the economic compensation to the disgruntled customer (Charles et al,
2010).
Therefore, credible and functioning complaint mechanisms constitute a key tool for public institutions
like yeka sub-city trade office and other organization established not for-profit organizations to
manage corruption risk and potential reputational damage.
The following are the major complaint handling processes listed in the guide
Channels to report complaints: These should allow all potential complainants to report their
grievances. They include email addresses, online and offline reporting tools help lines, personal
conversations, SMS reporting and mobile applications.
Publicizing complaint handling procedures: In line with the principles of transparency and
accountability and in order to build trust in the mechanism, the complaint handling procedure should
be publicized.
Handling incoming complaints: Incoming complaints handling should be done with care, in line
with processes established, in time and should be well recorded in order for the responsible staff to be
able to follow up appropriately.
Processing complaints: analysis and fact-finding Complaints; that are in-scope with the complaint
mechanism require a detailed review and analysis, including fact-finding, to have a sound basis for
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the decision on how to proceed with the complaint. This review should be independent, objective and
impartial.
Developing a resolution: Complaints either handled by the organization itself or referred to the
other body. When possible and appropriate, the complaint should be handled directly by the receiving
organization which has the duty to find the best possible approach towards solving the complaint.
According to Thomas, 2018 interpretation public service is a service provided by the government to
the citizens, either directly (through the public sector) or indirectly by financing the private provision
of the service.
In April 2001, the Government of the Federal Democratic Republic of Ethiopia published a service
delivery policy of the Ethiopian civil service realizing that the existing system requires reforms or
adjustment to improve public service delivery. Which referred service delivery as systematic
arrangement of activities in service giving institutions with the aim of fulfilling needs and
expectations of service users and other stakeholders with the optimum use of resources?
The policy came up with the assumption that effective implementation of the policy requires that all
civil servants, service users and other concerned bodies have sufficient understanding of the
objectives, contents, concepts and principles that enables civil service initiations to carry out what is
expected of them and makes service users (customers) aware of their rights to receive services and
benefit thereafter.
The fact that civil service in many cases has not been able to properly address the rights of service
users to get public service in equitable manner have contributed to the prevailing negative perception
among the public about the efficiency of government institutions and civil servants (Thomas,2018).
According to Tewodros ( 2015) the reason behind this is mainly because of strong bureaucratic delays
Such as; the organizations unresponsiveness to their customers‟ requests, clear procedures and
predetermined service standards were not in place and not posted officially; absence of
communication to customers, no consultation process and feedback collection; no training for
developing skills of service delivery and absence of strict controlling mechanisms to control the
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service delivery of the institutions. All these and other supporting reasons may incur customers for
additional costs.
Ahmed et.al, 2010 has conducted a research on the association between service quality and customer
satisfaction. They found that all dimensions of service quality have a significant correlation with
customer satisfaction. In particular,. Research also shows that the five dimensions have positive
association related to customer satisfaction.
Aman (2008) in his research conducted there were problems with provision of service delivery
process and quality service indicating it was below the average customer expectations. Similarly,
conducted a research with a topic of “service delivery and satisfaction” in the same organization. The
poor quality service and performance of the organization, the needs and expectations of customers
were not met at the level that it had to be. Finally he recommended that public services often require
high levels of training and education and as well as they can attract people with a public service who
wishes to give something to the wider public or community through their work.
Croner and Gungor (2002), finds out the higher quality of services was lead to more loyal customers.
Liu, chang –yung(2000), also found there is a positive correlation among service qualities scopes
such as tangibles , empathy, reliability, responsiveness and assurance in one side to customer
satisfaction . It further sets up a positive connection between customer satisfaction and the aim of the
use or retention among the satisfied customers.
Responsiveness
Assurance
Empathy
Figure 2.1. Conceptual frame work of the study Source: Adopted from literature (Parasuraman
et al.,1988)
Responsiveness: reflects the willingness to help customers and provide prompt service.
Assurance: involves knowledge and courtesy of employees and their ability to inspire trust and
Confidence
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CHAPTER THREE
3. RESEARCH METHODOLOGY
Introduction
This chapter deals with research design and methodology, tools and sources of data collection, data
collection instruments, target population, sample size and sampling techniques and methods of data
processing and analyzing.
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3.2. RESEARCH DESIGN
Research design is the conceptual structure with in which research is conduct it constitutes the blue
print for the data, for the collection, measurement and analysis of the data .However the study was
used both descriptive and explanatory research designs. Explanatory research type; in order to assess
the effect of Service Quality on customers‟ satisfaction in the office. This is because; explanatory
research design helps the researcher to identify any causal relationships between the factors or
variables that pertain to the research problem. Explanatory research design is not limited to one
specific paradigm, but may use either qualitative or quantitative approaches. Descriptive types of
study under take in order to ascertain and able to describe the characteristic of variables of interest in
situation in order to understand of dimensions; such as; Tangibility, Reliability, Responsiveness,
Assurance and Empathy.
3.4.1Target population
Target population consists of all trade office customers within the territory of Yeka sub-city and the
key informants such as the head of the office, team leaders and front line employees of the office
who have direct contact with customers. There are about 2843 individual business persons‟; who are
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commercial business owners in different business types registered & got a license certificate at this
office selected as target study population.
In addition, front line employees & team leaders who were expected to provide better information
about the service rendering & customer feedback was taking as the populations from which the
sample of the study was drawn. From the total of 62 employees in the office, purposely 13 front line
employees,4 team leaders and head of the office were selected as a sample because of their daily
contact with customers than the others. From the total population of 2843 by considering Confidence
level of 95% and 5% margin of error 350 customers are selected by using sample size determination
formula of (Taro Yemane, 1967).
n = ___N___
1+N (e2)
n= 2843/1+2843* (0.05)2
n = 2843/8.1075= 350
Therefore, n= 350 are the sample size.
The samples of the study was selected through calculating the sample size by substituting the
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numbers into the Yamane‟s formula, therefore, the total sample size of the study was 350
Table 3.1: Proportional sample
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3.6.1 Reliability
Reliability is the consistency of a set of measurements or measuring instrument, often were used
To describe a test. Reliability is inversely related to a random error the researcher was used
Cronbach‟s Alpha test. Cronbach‟s Alpha is based on the average correlation of items within a test if
the items are standardized. Cronbach‟s alpha reliability analysis was conducted on the independent
variables in order to determine the reliability of the instrument used. Even though various methods
exist to evaluate the internal consistency of the instrument, the researcher used Cronbach‟s Alpha test
(Dawson & Trapp, 2004) for ensuring reliability and internal consistency. The value of Cronbach
Alpha above .70 are considered to represent acceptable reliability and the values of 0.60 to 0.70 are at
the lower limit of acceptability and values greater than 0.80 and 0.90 are considered good and
excellent respectively as suggested in the literature (Pallant, 2007). A low Cronbach‟s Alpha
coefficient indicates that variables may be too heterogeneous, thus perform poorly in representing the
measure.
Table3. 1: Cronbach’s Alpha coefficient for internal consistency of Scale
The value of Cronbach Alpha showed on the above table 0.679, these was near to 0.70 and
considered to represent acceptable reliability. The reliability statics test results indicates that the
Cronbach‟s Alpha value for the items were concluded that all the items in the construct were reliable.
3.6.2 Validity
Validity refers to the extent to which it correlates with some criterion external to the instrument itself
(Hair, Black, Babin, Anderson &Tatham, 2006).Validity is the degree to which an instrument
succeeds in measuring what it has set out to measure. Content validity is use for ensuring the validity
of the questionnaire of the study. Validity is concerned with whether the findings are really about what
they appear to be about and Data was collected from the reliable sources. The items of questionnaires
were adopted from (Parasuraman et al.,1988) called Parasurman‟s modified SERVQUAL dimensions
of tangibility, reliability, responsiveness, assurance and empathy.
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3.7. Data analyzing procedure
After the data were collected, it was edited, coded, classified and tabulated following the variables in
the study. This coded data was then classified and tabulated for efficient analysis. Data editing
entailed examining the collected new data to detect errors and omissions for correction to ensure
accuracy and consistency. In data coding symbols were assigned to answers and classify responses.
Data classification reduces data into homogeneous attributes that enables the researcher to get
meaningful relationships.
Based on the nature of data collected, they can be categorized. Questionnaires data are mainly
quantitative data, while secondary data are both quantitative and qualitative. A major challenge faced
by researchers in dealing with quantitative data is to determine the correct statistical test for each
question. In this study, two statistical methods; descriptive and correctional expletory inferential
analysis were applied to measured and determined the relationship that exists among the collected
data by using the statistical package for social sciences (SPSS version 20.0). Descriptive analysis
used frequency, percentages and mean were used to help to understand and interpret variables and
correctional expletory inferential statistics such as correlation analysis was used to show the degree of
the relationship between independents and dependent variables and regression analysis were used to
show the role of independent variables on dependent variable. The above method was used, because it
was the best instrument to identified, compared, described and reached a conclusion.
Model specification
Multiple regression attempts to model the relationship between two or more explanatory variables
and a response variable by fitting a linear equation to observed data. Every value of the independent
variable x is associated with a value of the dependent variable y.
The multiple regression formula we adopted for this study which was built around the independent
variables and dependent variable as below.
Yi = β0 +β 1X1 + β2X2 + β3 X3 + β 4X4 + β 5X5 +e
Where:
Y1= was the response of dependent variables customer satisfaction
X1= Tangibility X2=Reliability X3= Responsiveness X4= Assurance; X5= Empathy
β0, β1, β2, β3, β4, β5= the coefficients of the variables
e= the error term
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β0 was a constant while was the error term in the function. The error term was computed when
checking for reliability of research questionnaires prior to the actual study. Accordingly, this
statistical technique was applied to explain Customer Satisfaction (as dependent variables) on the
selected linear combination of the independent variables using multiple regressions.
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CHAPTER FOUR
4. DATA ANALYSIS AND DISCUSSION
Under this chapter, the study focuses on the effects of service quality dimensions on customer
satisfaction of Addis Ababa yeka sub-city trade offices. For this survey, analysis of data and
discussion on the findings has been made. The findings of the study are analyzed based on the
specific objectives. Particularly, in this chapter respondent‟s general information, reliability test,
descriptive statistics, correlation; and regression analysis were discussed.
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Table 4.1.: Response Rate for Questionnaire distributed
26
Table 4.3. Presented the results of the respondent‟s in terms of age. It was clear that the majority of
respondents, 95(34.4%) were in the age range of less than & equal 30 years, this was followed by 72
(26.1%) in the age range of 31-40 years were as 64(23.2%) in the age range of 41-50 years and the
remaining 45 (16.3%) were above age range of 50 years.
According to table 4.4 presented below the first item shows educational status of the respondents.
From the total 34(12.3)% of the respondents were categorized under primary education, 35(12.7)% of
them were high school complete, 62(22.5)% diploma holders, 126(45.7)% degree holders,
16(5.8)%master holder and the remaining 3(1.1)% were PhD and above. In general, the table shown
the majority of the respondents were degree holders with 45.7% from the total.
Table 4.4.:Education information of the Reponses
Reliability refers to the ability to perform the promised service dependably and accurately. It was
regarded as the most important determinant of perceptions of service quality. According to the below
table, reliability with 3.72 values from the descriptive statistics indicate that customers Perceive that
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quality of service being offered by the organization was good, according to Poonlar Btawee: 1987, the
mean score of 3.51-4.50 was under good service quality range.
From the variables the higher contribution to the mean had come from the five items that means when
the office promise to do something by certain time it does so, the office provides the service at the
time it promises to do so and tread office insists on error-free records with the mean value of 3.85,
3.81, and 3.76 respectively. However lower contribution was that means when you have a problem the
offices show a sincere interest in solving it and the office performances the service right the first time
with the mean value of 3.58 and 3.62 respectively. In addition the standard deviation shown indicates
how closer or far each observation was from the average. In general reliability takes a dominant
position compared with the other independent variables at Yeka trade office in the measuring the
quality of service delivery.
Table 4.6: Service Reliability
The responsiveness dimensions involves provision of prompt services and willingness to help
Customers. The below table shown interrelated items that measure responsiveness. Responsiveness
with 3.82 values from the descriptive statistics analysis according to PoonlarBtawee: 1987, indicates
that customers perceive that quality of service being offered by the organization was good hence the
mean score that has the value from 3.51-4.50 shows good level of quality service delivery.
The higher contribution of the mean had come from the four variables that means employees in the
office give you prompt service; employees in the office tell you exactly when the services were
29
performed and employees in the office are always willing to help you with the mean value of 3.97,
3.88 and 3.83, respectively. However lower contribution was by the last predictor that means employees
in the office are never too busy to respond to your request with the mean value of 3.60. From this
inference, we can conclude that customers had good perception towards the responsiveness of the
aspects of the organization.
Table: 4.7: Responsiveness Dimensions
Item N Mean Std.
Deviation
Employees in the office give your prompt service. 276 3.97 .781
Employees in the office are always willing to help you. 276 3.83 1.002
The assurance dimension refers to the knowledge of employees and their ability to inspire trust,
confidence and security. Based on data analysis according to Poonlar Btawee: 1987, the below table
shown us the mean scores of customers perceived assurance quality yeka trade office range from
3.51-4.50 indicate that customers‟ perceived that the assurance aspects of the organization were good.
The mean score of assurance was 3.85, which suggests that the customers find the services assurance
of the yeka trade office was good.
The higher contribution from the three variables that means Employees in the office have the
knowledge to answer your questions with the mean value of 3.90 and followed by the behavior of
employees of tread office instills confidence in customers there are adequate and necessary personnel
for good customer services with the mean value of 3.85. However lower contribution was by variables
that means employees in the office are consistently courteous with you with the mean value of 3.79
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.Finally, this shown that the value of assurance was a good indicator of the Organization service
quality
Table: 4.8: Service Assurance
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Table: 4.10: Customer Satisfaction
N Mean Std. Deviation
I am satisfaction with the quick service
276 3.69 1.081
of the office
I am satisfied with the office accessibility
276 3.62 .917
of information for its customer
I am satisfied with the office employees
276 3.80 .941
professional competence
I am satisfied with the respectful
276 3.73 1.021
behavior of employees
I am satisfied with the performance of
276 3.75 1.015
the employees of the office
overall how do you rate your level of
satisfaction with the service quality of the 276 3.65 1.050
office
TCust.Satifcation 276 3.7065 .48951
Valid N (listwise) 276
Table: 4.11 : customer satisfaction with the quick service of the office
Frequenc Percent Valid Percent Cumulative Percent
y
Strongly disagree 20 7.2 7.2 7.2
Disagree 14 5.1 5.1 12.3
Neutral 55 19.9 19.9 32.2
Valid
Agree 130 47.1 47.1 79.3
Strongly agree 57 20.7 20.7 100.0
Total 276 100.0 100.0
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20.7 percent of the respondents are Strongly satisfied with the quick service of the office. With this
aspect, the office should also improve speed of the services to address those who were not satisfied.
Table: 4.12: I am satisfied with the office accessibility of information for its customer
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Table: 4.14. Customer satisfied with the respectful behavior of employees
Table: 4.15.: customer satisfied with the performance of the employees of the office
Frequency Percent Valid Percent Cumulative
Percent
Strongly disagree 10 3.6 3.6 3.6
Disagree 21 7.6 7.6 11.2
Neutral 61 22.1 22.1 33.3
Valid
Agree 119 43.1 43.1 76.4
Strongly agree 65 23.6 23.6 100.0
Total 276 100.0 100.0
Source: Researcher Survey data, April, 2023
Regarding to the performance of the employees in the office, the least(3.6%) of the respondents were
strongly dissatisfied,(7.6%) of the respondents were dissatisfied,22.1%) of the respondents were
neutral the majority,(43.1%) of the respondents were satisfied and 23.6% of the respondents were
strongly satisfied with the performance of the employers.
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Table: 4.16.: Customer Satisfaction in percent
over, all how do you rate your level of satisfaction with the service quality of the office
36
the gap employees were asked to rate their knowledge based on the standards of the service delivery.
All the asked employees agree that their customers have high expectation of service delivery from
them.
The majority of employees responded that, the office does not give an opportunity for them to
participate in decision making on issue related with service delivery and they do not had good
relationship with their bosses, this was meaning that they are not satisfied with them. Employees
stated that the reasons why the office does not give a chance to participate in decision-making mainly
because of lack of information flow and always decisions made at the top-level officials of the sub-
city and employee forced to do whatever it might be.
It was obvious that to improve the service delivery practice in the office training of employees plays a
vital role, specifically for those who have contact with customers. To see the reality employees were
asked to tell any training they had taken and the reason why for those do not take any training with
regard to service delivery. The majority of the employees were not provided with any training on
customer service delivery. The reason there was problem of selection for training beyond financial
problems why they did not get training was that, these facts were also confirmed by the officials‟
interview responses.
As the same time the data obtained from officials‟ interview assured that even if their office was
striving to improve the quality of service delivery, there were many draw back factors, both from
internally and externally which unable the office to provide its service effectively. Inconvenience
poor resource allocation compared with other sectors in the sub-city, scarcity of resource to serve
customers effectively, absence of clear manuals and procedures for employees, officials and system
failure are the challenges, Thus, they believed that there might be dissatisfied customers on service
delivery.
Regarding with employees training the officials agreed with the employee's response, they said that
the office has training plan for its employees, but there was budget deficiency for training and it used
poor budget with other sectors. Therefore, the office had no power to approve the budget. Even if
trainings prepared by the Human Resource (HR) office of the sub-city, there were problems of
selection. Only employees get technical trainings from the Addis Ababa Trade bureau and MOT. This
indicates that the sub-city HR gives less priority for employee training, but it had its own influence on
employee motivation and their professional competency.
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4.4. Correlation analysis
38
Pearson correlation analysis was used to provide evidence of convergent validity. As per the general
principle suggested by Field (2005), correlation values less than 0.3 were considered weak,
correlations between 0.3 and 0.7 were considered moderate, and correlations greater than 0.7 were
considered strong as the closer it gets to 1 the stronger it becomes and the closer it gets to zero the
weaker it was. Based on the above assumption, bivariate correlation was computed to analyze the
proposed relationship between variables.
The Pearson‟s correlation coefficients illustrated above on table 4.17 confirmed significant positive
relationship between all the predictors and the dependent variables at P-value 0.01 level.
The lowest correlation in this study was between service quality and customer satisfaction (r=0.215
p<0.01). The highest correlation were between reliability and Responsiveness and empathy, (r=0.311
p<0.01) and between tangibility and assurance (r=0.311, p<0.01).
The results indicate that all coefficients are positive, thus demonstrating that the associations among
service quality and customer satisfaction were positive.
The results provide the sufficient empirical evidence to say that, service quality had a positive and
statistically significant relationship with the customer satisfaction. The results of the present study
created a harmony with the results of prior studies that service quality dimension had a positive and
significant relationship with the customer satisfaction.
4.5.1 Assumptions
Testing the assumptions was an important task for the researcher utilizing multiple regression
techniques (Cohen, Cohen, West &Aiker, 2003). Serious assumption violations could result in biased
estimates of relationships, over or under confident estimate of precision of the regression coefficients.
This study performed several tests of assumptions.
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Table 4.18. Regression model summary of service quality
b
Model Summary
Mode R R Square Adjusted R Std. Error of Durbin-
l Square the Estimate Watson
1 .398a .159 .143 .45311 2.034
a. Predictors: (Constant), Total Empathy, Total Tangibility, Total
Assurance, Total Responsiveness, Total Reliability
b. Dependent Variable: T Customer Satisfaction
Source: Survey data, April, 2023
We observed in the model summary from the analysis in the above table R (0.398) and R Square
(0.159). indicates correlation of the five independent variables with the dependent variable customer
satisfaction and the weighted combination of the predictor variables ( SERVQUAL dimensions)
explained or affect approximately 39.8%(R) of the variance of customer satisfaction and the
remaining 60.2% is by extraneous variables. This result also indicates that there may be other
variables that could have been neglected by the current study in predicting satisfaction.
Table4. 19.: ANOVA result
ANOVAa
Model Sum of Df Mean Square F Sig.
Squares
Regression 10.463 5 2.093 10.192 .000b
1 Residual 55.432 270 .205
Total 65.895 275
a. Dependent Variable: Customer Satisfaction
b. Predictors: (Constant), Empathy, Tangibility, Assurance, Responsiveness,
Reliability
Source: Survey data, April, 2023
Furthermore, the ANOVA table 4.19 above had shown the overall significance / acceptability of the
model from a statistical perspective. As the significance value of F statistics shown a value .000,
which was less than p<0.01, implies the model was significant. This indicates that the variation
explained by the model was not due to chance.
The results of Analysis Of Variance indicated that the variance of the variables, F ratio was the test
42
Statistic used to decide whether the model as a whole has statistically significant predictive
capability, considering the number of variables needed to achieve it. The researcher established, the F
ratio F (5, 270) =10.192 p=0.000) was statistically significant at p<0.05 level of significance. This
can be said that 10.19% improvement in predicting the outcome can be achieved by fitting the model.
According to the table above, we can see that the Mean Square of Regressions is more than Mean
Square of Residual and the sig(p) = 0.000. These shown that service quality dimensions of
tangibility, reliability, responsiveness, assurance and empathy statistically significantly effect on
customer satisfaction. Thus for this research Regressions was significant at a confidence level of
99%.
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Table 4.20: Estimated Unstandardized and Standardized Regression Coefficient
a
Coefficients
Model Unstandardized Standardized t Sig. Collinearity
Coefficients Coefficients Statistics
All the components of service quality practice (Tangibility Reliability Responsiveness Assurance and
Empathy) do have significant effects on Customer satisfaction at P<.05 significance level. The results
of multiple regressions, as presented in Table 4.20 above, revealed that Empathy of service quality
had a positive and significant effect on customer satisfaction with values (β=0.166,t = 2.83, p = 0
.005). This indicates the unstandardized coefficient value of each independent variable shown that, a
unit change in empathy (i.e. if respondents change their mind for instance from strongly disagree to
disagree or neutral to agree) by keeping the other variables constant, its customer satisfaction would
increase by 17.5%. Therefore, empathy components of quality service had a positive and significant
effect on customer satisfaction at 95% confidence level.
The results of multiple regressions, as presented in Table 4.20 above, also shown that tangibility
service quality had a positive and significant effect on customer satisfaction with values (β=0.192,t =
2.883, p = 0.004). This indicates the unstandardized coefficient value of each independent variable
shown that, a unit change in(i.e. if respondents change their mind for instance from strongly disagree
to disagree or neutral to agree) by keeping the other variables constant, its customer satisfaction
44
would increase by 16.8%. Therefore, tangibility components of quality service had a positive and
significant effect on customer satisfaction at 95% confidence level.
The regression finding also showed the positive and significant effect of responsiveness on customer
satisfaction with values (β=0.145,t = 2.220, p = 0 .027). This indicates the unstandardized coefficient
value of each independent variable shown that, a unit change in(i.e. if respondents change their mind
for instance from strongly disagree to disagree or neutral to agree) by keeping the other variables
constant, its customer satisfaction would increase by 13.6%. Therefore, responsiveness components
of quality service had a positive and significant effect on customer satisfaction at 95% confidence
level.
The results of multiple regressions, as presented in Table 4.20 above, also shown that assurance
service quality had a positive and significant effect on customer satisfaction with values (β=0.093,t =
1.614, p = 0.008). This indicates the unstandardized coefficient value of each independent variable
shown that, a unit change in(i.e. if respondents change their mind for instance from strongly disagree
to disagree or neutral to agree) by keeping the other variables constant, its customer satisfaction
would increase by 8.8%. Therefore, assurance components of quality service had a positive and
significant effect on customer satisfaction at 95% confidence level.
The results of multiple regressions, as presented in Table 4.20 above, also shown that reliability
service quality had a positive and significant effect on customer satisfaction with values (β=0.085,t =
1.267, p = 0.006). This indicates the unstandardized coefficient value of each independent variable
shown that, a unit change in (i.e. if respondents change their mind for instance from strongly disagree
to disagree or neutral to agree) by keeping the other variables constant, its customer satisfaction
would increase by 8.1%. Therefore, reliability components of quality service had a positive and
significant effect on customer satisfaction at 95% confidence level.
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CHAPTER FIVE
5.1. Summary
The Pearson‟s correlation coefficient of the study signifies that all predictor variables and criterion
variable have positive relationship with each other. Based on the study result empathy, assurance,
responsiveness, tangibility and reliability have strong association with customer and their level of
significance was varying among dimensions in the sector.
The computed values of the criterion variable shown that the level of customer satisfaction was good
based on the research finding, those shown that most of the customers were satisfied and there were
customers that were dissatisfied with some aspects of the organization‟s services.
The demographic profile of total respondents shows the majority of the respondents are males. The office
doesn't give a chance for its employees to participate in decision making and to have professional training.
Inadequacy of front line employees, inconvenience, poor resource allocation, absence of clear manuals
and procedures for employees and officials, are the challenges of the office for the service delivery.
As the finding indicated that, there was positive and significant relationship with all service quality
dimensions and customer satisfaction.
The paper adopted quantitative research strategy questionnaire to collect data from the customers.
Descriptive statistics like frequency mean and Pearson correlation analysis techniques were applied to
analyze general information of respondents, respondents‟ perception on service quality and
satisfaction as well as relationship between service quality dimensions and customers‟ satisfaction. In
addition, regression analysis technique was applied to investigate effects of service quality
dimensions on customers‟ satisfaction.
The service quality was measured using the five service quality dimensions (tangibles, reliability,
responsiveness, assurance and empathy) and the satisfaction level of respondents was measured using
a five point Likert scale ranging from strongly agrees to strongly dis –agree.
46
For the survey, 350 questionnaires were distributed to Customers, 54 questionnaires were not
returned among these 296 were returned, of which 20 responses were invalid. Thus, 276
questionnaires are analyzed using a statistical package for social science (SPSS version 20).
Through the process of research analysis, descriptive statistics, correlation analysis and simple
Regression analyses were used. The descriptive finding of the survey shows that all the five attributes
of service quality have a Positive relationship with overall service quality and customer satisfaction.
The descriptive finding of the survey shown that all the five attributes of service quality have a
Positive relationship with overall service quality and customer satisfaction, but tangibility and
Reliability has a low mean value. Assurance has the highest mean value among the other Dimensions.
A simple linear regression model measured the impact of service quality dimensions on customer
Satisfaction. The results show that there is a positive (p<0.01) relationship between service Quality
dimensions and customer satisfaction.
5.2 Conclusion
Customer satisfaction had become an important issue for commercial and public service
organizations. Establishing and achieving customer satisfaction was a main goal of business
nowadays, because there were very clear and strong relationship between the quality of product,
customer satisfaction and profitability.
The study examined the effect of service quality on customers‟ satisfaction. The results of the study
shown that the working environment in the office was not comfortable for employees‟ .Because of
the absence of good relationship between employees and their bosses , the office gives less priority
for its employees empowerment and it‟s not facilitate professional training opportunities for them.
In addition to these deficient budget and scarcity of materials are among the reasons for the
uncomfortable working environment. Continuation of this type of work environment could result in
the organization, high employees turnover rate and customer complaints.
The findings indicate that customers‟ perceptions vary according to the nature of service. The
Computed mean scores of SERVQUAL dimensions help to measure the perceived service quality of
the organization and the result shown that the service quality of the organization was good. The
higher confirmed dimension by the customers was assurance, responsiveness, tangibility, and
empathy however; lower perceived quality dimensions by the customer were reliability.
47
As a general, the result t of the study shown that the customers had good attitudes towards the
service quality of the organization.
The computed values of the criterion variable shown that the level of customer satisfaction was good
based on the research finding, this shown that most of the customers were satisfied and there were
customers that are dissatisfied with some aspects of the organization‟s services. The Pearson‟s
correlation coefficient of the study signifies that all predictor variables and criterion variable had
positive relationship with each other. Based on the study result empathy, assurance, responsiveness,
tangibility and reliability had association with customer and their level of significance was varying
among dimensions in the sector.
5.3 Recommendations
All employees have to know that service quality in its true sense for improved customer
Service. Create an environment for each and every employee to consider customers service as
part of his/her job .this is done by giving continuous training and capacity building programs
on how to solve the problems raised from customers, how to address complaints sincerely,
maintain accurate customers‟ record and improve communication among them.
The office has to get experience sharing with best customer service performing institutions.
Getting experience sharing and adopt the suitable ones towards service excellence was help to
enhance the service level.
Predetermined service standard is vital to control service quality and performance of
employees. the office has to establish a clear and precise service standards and working
procedures to measure each service standards, working procedures to measure each service
encounter quality and its performance to take corrective action in its weak performance, and
to satisfy its customers as well as to reward its employees based on predetermined standards.
There has to be continuous professional training and motivation for all employees; better to
serve customers Staff training is one of the most important factors for delivering better
customer service. Therefore, the officials of the office have to solve the budget and training
selection problems with the sub-city.
Promote employee involvement in decision making is one of the management strategies to
improve their motivation. Involved employees are more likely to generate new ideas and
achieve a higher quality of work life in addition to this, employee involvement have benefits
48
to reduce the workload of team leaders and head offices. Therefore, the office should
empower and give a chance for its employees to participate in decision-making.
The office has to give significant consideration for all service quality dimensions that
positively effect on customer satisfaction
If there is lateral or horizontal information flow among colleagues in the office, it helps to
save time and to create smooth relationship between staffs and officials. Both of them have to
use supportive communications, not defensive communication through which they can
understand and appreciate each other‟s views.
49
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the customers‟ expectations and his or her subsequent perceived performance of service
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53
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54
APPENDIXES
Appendix 1. Questionnaire
ARSI UNIVERSITY
COLLEGE OF BUSINESS AND ECONOMICS
DEPARTMENT OF MANAGEMENT
MBA PROGRAM
Dear Respondents,
I am apostgraduate student currently attending my MBAat Arsi University College of Business and
Economics Department of Management. Now I am working on research thesis. The purpose of this
questioner is toconducting a research study on “Assess service quality and its effect on customer
satisfaction in case of Trade office. The study is purely for academic purpose and thus do not
affect you any case. So, your genuine, frank and timely response is vital for s uccessfulness of
the study. Therefore, I kindly request you to respond to each items of the question very
carefully.
Yours faithfully,
………………
Researcher
Note:
1. No need of writing your name.
55
3. Level of education
1. Primary 4. Degree
2. High school 5.Master
3. Diploma 6. PhD and above
Please indicate the extent to which you agree or disagree with each of the following statements
By putting “X” in the appropriate place to choose the number from 1-5 that best represents your
Level of agreement with the statement
1= Strongly Disagree
2.
When you have a
problem, the office
56
shows a sincere interest
in solving it.
4.
The office provides its
service at the time it
promises to do so.
5.
The office insists on
error free records.
1. Responsive
Employees in the
ness
office tell you exactly
when the services will
be performed.
2.
Employees in the office
give you prompt
service.
3.
Employees in the office
are always willing to
help you.
2.
Employees in the office
are consistently
57
courteous with you.
3.
Employees in the office
have the knowledge to
answer your questions.
1. Empathy
The office gives you
individual attention.
3.
The office has
employees who give
you personal attention.
4.
The office has your
best interests at heart.
5.
The employees of the
office understand your
specific needs.
58
Part III
CUSTOMER SATISFACTION QUESTIONNAIRE (CSQ)
NB: Please Put “√” only to the number that best fits your opinion and feelings for the below
tabulated questions.
Key: 5= Strongly Agree 4= Agree 3=Neutral 2= Disagree
1= Strongly Disagree
Que.no statements satisfaction level
5 4 3 2 1
I am satisfied with the quick
1. service of the office
I am satisfied with the office
accessibility of information for its
2. customers
I am satisfied with the office
employees‟ professional
3. Competence
I am satisfied with the respectful
4. behavior of Employees.
I am satisfied with the
performance of the employees of
5. the office.
Overall, how do you rate your
level of satisfaction with the
6. service quality of the office
59
Appendix : Questionnaire
ARSI UNIVERSITY
COLLEGE OF BUSINESS AND ECONOMICS
DEPARTMENT OF MANAGEMENT
MBA PROGRAM
Researcher
3 .Work Experiences
1. 2-4 years 4. 16-20years
2. 5-10 years 5. Above 20 years
3. 11-15 years
4. Level of education
1. Primary 2. . High school 3. Diploma
11. If your answer for question number 10 is “No” what do you think is the reason for that?
Yes No May be
13. Are you given chance to actively participate in meetings without your request?
61
አባሪ 1
በአርሲዩኒቨርሲቲ
የድህረምረቃፕሮግራም
የስራ አመራር ትምህርት ክፍሌ
በደንበኞች የሚሞሊ መጠይቅ፣
ውድ ይህንን መጠይቅ ሇመሙሊት ፈቃዳችሁን የገሇፃችሁሌኝ ሁሇ፡-
የዚህ መጠይቅ ዋና አሊማ የአገላግሌት አሰጣጥ ጥራት በደንበኞች እርካታ ሇይ ያሇዉ ተጽዕኖ
በየካ ከፍሇ ከተማ ንግድ ጽ/ቤት በሚሌ ርዕስ መረጃ ሇመሰብሰብ ነዉ፡፡ ጥናቱ የሚደረገዉ
ሙለ በሙለ ሇትምህርት አሊማ ስሇሆነ በየትኛዉም መሌኩ እርስዎን የማይነካና የማይጎዳ
ነዉ፡፡ እርስዎም የሚሰጡት መረጃ የሊቀ፣ እዉነተኛ፣ ተኣማኝነት ያሇዉና ትክክሌኛ ምሊሽ
ሇጥናቱ መሳካት እጅግ ጠቃሚ ነዉ፡፡ በመሆኑም እያንዳንዱን ጥያቄ በጥንቃቄና በትክክሌ
እንዱመሌሱ በአክብሮት እጠይቆታሇሁ፡፡
ማስታወሻ፡
ስም መጥቀስ አያስፈሌግም
መሌሱንይህን ’’x ” ምሌክትበማድረግይመሌሱ
እባክዎን የተሟሊ መጠይቅ በሰዓቱ ይመሌሱ
62
ክፍሌሁሇት
የሚጠብቁት፡- ይህ ማሊት እርስዎ የሚፈሌጉት፣ ሊማግኘት ተስፋ የሚያደርጉት ወይም
ማግኘት ያሊብዎት ማሊትነው፡፡
እሳብ፡- ይህ ማሊትየእርስዎ ትዝብት፣አስተያየት፣አመሊካከት ወይም ሀሳብ ማሊት ነው፡፡
5 ማሊት = በጣም እስማማሇሁ፣ 4 = እስማማሊሁ፣ 3 = በሁሊቱም ማሊትም በጣም እስማማሊሁ
እና እሌስማማሁ የሚሇውን አሌቀበሌም ማሊት ሲሆን፣ 2 = አሌስማማም፣እና በስተመጨረሻ 1
ደግሞ በጣም አሌስማማም ማሊት ነው፡፡
ተ የግምገ የሚጠብቁት
ቁ ማመዉ የሚጠብቁት በጣምእስ እስማማሇሁ ገሇሌተኛ አሌስማማ በጣምአሌስ
ማማሇሁ
ጫ (4) (3) ም ማማም
5
(2) (1)
1. ተጨባ ጽ/ቤቱ ዘመናዊ
ጭነት የሆኑ መሳሪያዎች
አለት
2. የጽ/ቤቱ ቁሳዊ
አገሌግልት
መስጫዎች
መስህብነት
አሊቸው
3. በጽ/ቤቱ አንግዳ
መቀበያ ዴስክ
የሚሰሩ ሰራተኞች
ጽዱ ናቸው
4. በጽ/ቤቱ
ከአገሌግልት ጋር
ተያያዥ የሆኑ
የጽሁፍውጤቶች
(እንደበራሪወረቀቶ
ችወይምመግሊጫዎ
ችየመሳሰለት )
63
ሊአይንመስህብነትአ
ሊቸው
1. ሌተማ ጽ/ቤቱ በተወሰነ
መኑበት ጊዜ አንድ ነገርን
መቻሌ አደርጋሇሁ ብል
ቃሌ ከገባ ይህንኑ
ያደርጋሌ
2. ችግር
በሚያጋጥምዎ ጊዜ
ችግሩን ሇመፍታት
እውነተኛ
የሆነፍሊጎት ያሳያሌ
3. ጽ/ቤቱሇመጀመሪያ
ጊዜየሚያቀርበውን
አገሌግሌትበትክክ
ሌያከናውናሌ
4. ጽ/ቤቱ አደርጋሇሁ
ብልቃሌ በገባበት
ጊዜ አገሌግሌቱን
ያቀርባሌ
5. ጽ/ቤቱ ከስህተት
ነጻ የሆነ የመዝገብ
አያያዝ በጥብቅ
ይከተሊሌ
1. ምሉሽ በጽ/ቤቱየሚገኙሰራ
ሰጪነት ተኞችአገሌግሌቶቹ
በትክክሌመቼእንደ
ሚሰጡሇደንበኞችይ
ናገራሇ፡፡
64
2. በጽ/ቤቱየ ሚገኙ
ሰራተኞች ቀሌጣፋ
አገሌግሌትይሰጣሇ፡
፡
3. በጽ/ቤቱ የሚገኙ
ሰራተኞች ዘወትር
እርስዎን
ሇመርዳት ፍቃደኛ
ናቸው፡፡
4. በጽ/ቤቱ የሚገኙ
ሰራተኞች
የእርስዎን ጥያቄ
ሇመመሇስ በፍጹም
ስራ በዛብን
አይሇም፡፡
1.. ዋስትና በጽ/ቤቱ የሚገኙ
ሰራተኞች ባህሪ
በእርስዎ ሊይ
የመተማመን
ስሜትን
ይፈጥርብዎታሌ
2. በጽ/ቤቱ የሚገኙ
ሰራተኞች
በሚሰጡት
አገሌግልት
በትህትና
ያከናዉናለ
3. ሰራተኞች ሇዕርሶ
ጥያቄ በቂ የሆነ
65
እዉቃት አሊቸዉ
1. የሰውን ሰራተኞች
ችግርመ የእርስዎን የተሇያዩ
ረዲት ፍሊጎቶች
ይገነዘባለ፡፡
2. በጽ/ቤቱ የሚገኙ
ሰራተኞች
በመደበኛነት
ሇእርስዎ ትሁት
የሆነ ባህሪያሳያለ
3. በጽ/ቤቱ የሚገኙ
ሰራተኞች ሇእርሶ
ጥሩ የሆነ ትኩረት
ይሰጣለ
4. ጽ/ቤቱ በእርሶ
ፍሊጎት መሰረት
አገሌግልት
ይሰጦታሌ፡፡
5. በጽ/ቤቱ የሚገኙ
ሰራተኞች የእርሶን
የግሌ ፍሊጎት
ይገነዘባለ፡፡
66
5 4 3 2 1
በጽ/ቤቱ ፈጣን አገሌግልት
1. እረክቻሇው
Appendix I
Interview Questions for team leaders and head of the office
1. As a leader and as a responsible person how can you suggest about your organization‟s
service delivery Practice?
2. What are the major challenges /problems in service provision in your office?
3. Has your organization training plan for employees of your office? Is it for relevant
employees?
4. What mechanism is usually used by your office to improve performance and delivery of
service? And how do you think about its effectiveness? Any other issues you can raise
regarding the quality of service and customer satisfaction of your office?
67
Appendix 2
68
Appendix 3
Appendix 4
Homoscedasticity of variance
69
Appendixes 5
70
71
72