THE EFFECT OF CUSTOMER SERVICE QUALITY ON CUSTOMER SATISFACTION IN SELECTED PRIVATE BANKS (ADDIS ABABA)

Abstract

This research examined the effect of customer service quality on customer satisfaction in selected private banks in Addis Ababa. Service quality has been defined as a degree and direction of discrepancy between customers' service perception and expectations. Customer satisfaction is defined as the customer’s subjective evaluation of a consumption experience, based on some relationship between the customer’s perceptions and objective attributes of the product. The literature review revealed that although quality is an elusive and indistinct construct which may vary from one person to another or even from one situation to another it can be assessed by probing whether perceived service delivery meets, exceeds or fails to meet customer expectations. The SERVQUAL instrument postulated by Parasuraman, Zeithaml was used to measure service quality.To achieve the objectives of this study, data was collected through questionnaire from a sample of 302 bank customer. These respondents were selected using purposive sampling method. The data collected from the questionnaire were analyzed using Statistical tools such as mean, standard deviation, correlation, and multiple regression analysis. The results of this study indicate that, the four service quality dimensions including tangibility, reliability, assurance and responsibility have positive and significant effect on customer satisfaction and emphaty has positive and insignificant relation with customer satisfaction. The finding of the study also indicates that, customers were most satisfied with the assurance dimensions of service quality. However, customers were less satisfied with responsibility dimensions of service quality. Based on the findings and conclusions of the study, the researcher forwards the following recommendations: treating customer with great respect, giving individual attention to customers, serving customers based on their specific needs, treating customers in a friendly manner and providing continuous training for staff members