Improving customer services and satisfaction a case study of HSBC, vietnam master project in business administration

TRƯỜNG NG ĐẠII HỌC TR H C MỞ M TP HCM UNIVERSITY LIBRE DE BRUXELLES HO CHI MINH CITY OPEN UNIVERSITY SOLVAY BRUSSEL SCHOOL MBAVB3 LUU CAM HOA IMPROVING CUSTOMER SERVICES SERVICES AND SATISFACTION A CASE STUDY OF HSBC, VIETNAM MASTER PROJECT MASTER MASTER IN BUSINESS ADMINISTRATION (PART – TIME) Tutor: Dr Nguyen Minh Kieu Ho Chi Minh City (2010) STATEMENT ORIGINAL OF AUTHORSHIP I certify that the substance of this thesis has not been already submitted to any degree and is not currently being submitted for any other degree I also certify that to the best of my knowledge any assistance received in preparing this thesis, and all sources used, have been acknowledged and referenced in this thesis Signed: _ LUU CAM HOA i Date: _ ACKNOWLEDGEMENTS I would like to express my gratitude to Dr Nguyen Minh Kieu who has guided and supported me during the time I complete this project My other thanks to all Professors, Tutors and Coaches who spent their great time to teach and inspire me to learn and complete the program Also, my thanks to my classmates, who by different means, have worked, exchanged, supported and shared knowledge and experiences during the past time Finally, I wish to express my gratitude and love to my family for their unreserved love, support and encouragement The love they reserved for me has made my life so wonderful and meaningful ii COMMENTS OF TUTOR February 24 24, 2011 TO WHOM IT MAY CONCERN Dr Nguyen Minh Kieu Date: …… /………./ 2011 iii ABSTRACT Recently banking industry has become severely competitive environment than ever before When the banking products are easy to imitate, then the services quality becomes more important and significant for banks to increase their competitive advantage This research therefore, focused on measuring customer satisfaction level of existing customer in HSBC Vietnam and from result of the findings analysis the recommendation are elaborated to improve the services quality and customer satisfaction level The research was conducted based on data collected from existing SME customers which are considered as the main driven in Vietnam economic in future There are 125 respondents was collected from 200 questionnaires sent out to customers The collected data was analyzed by using SPSS 16.0 with main analyses were reliability with Cronbach’s Alpha, exploratory factors analysis and multiple linear regression The result addressed that the key satisfactions of SME customers in HSBC Vietnam were assurance, reliability, pricing, empathy and tangible dimension The factor of responsiveness was not significant impact to the research model Accordingly, the recommendations have been elaborated for the board of management of HSBC Vietnam to focus on key factors for improving services quality and customer satisfaction level iv Table of Contents ABSTRACT iv LIST OF TABLES V LIST OF FIGURES Vi ABBREVIATION Vii CHAPTER 1: INTRODUCTION TO THE RESEARCH 1.1 GENERAL BACKGROUND 1.2 RATIONALE OF THE RESEARCH 1.3 STATEMENTS OF THE PROBLEM 1.4 RESEARCH QUESTIONS 1.5 RESEARCH OBJECTIVE 1.6 SCOPE OF THE RESEARCH 1.7 ORGANIZATION OF THE RESEARCH CHAPTER 2: LITERATURE REVIEW 2.1 BANKING SERVICES AND PRODUCTS 2.1.1 GENERAL ACTIVITIES OF COMMERCIAL BANKS 2.1.2 HSBC VIETNAM BANKING SERVICES AND PRODUCTS 2.2 CUSTOMER SATISFACTION AND SERVICES QUALITY IN BANKING SECTOR 11 2.2.1 CUSTOMER SATISFACTION IN BANKING SECTOR 11 2.2.2 SERVICES QUALITY DIMENSTION IN BANKING SECTOR 11 2.3 SERVICE QUALITY (SERVQUAL) 13 2.4 THE GAP MODEL 16 2.5 PRICING DIMENSION 19 2.6 CUSTOMER SATISFACTION 19 2.7 PREVIOUS RESEARCH MODEL 21 CHAPTER 3: RESEARCH METHODS 23 3.1 RESEARCH MODEL AND HYPOTHESES STATEMENTS 23 v 3.1.1 THE RELATIONSHIP BETWEEN SERVICE QUALITY AND CUSTOMER SATISFACTION 23 3.1.2 THE RELATIONSHIP BETWEEN PRICING DIMENSION AND CUSTOMER SATISFACTION 24 3.1.3 RESEARCH MODEL 25 3.2 RESEARCH DESIGN 27 3.2.1 PRIMARY AND SECONDARY DATA RESOURCES 27 3.2.2 QUESTIONNAIRES 28 3.2.2.1 QUESTIONNAIRES DESIGN 28 3.2.2.2 SENDING QUESTIONNAIRES 28 3.3 MEASUREMENT SCALE 29 3.4 RESEARCH SAMPLE SIZE AND SCALE 30 CHAPTER 4: DATA ANALYSIS AND FINDINGS 31 4.1 SAMPLE CHARACTERISTICS 31 4.2 DESCRIPTIVE STATISTIC ANALYSIS 33 4.3 DATA ANALYSIS 34 4.3.1 RELIABILITY EVALUATION THROUGH CRONBACH’S ALPHA 34 4.3.2 EXPLORATORY FACTOR ANALYSIS 35 4.4 REGRESSION ANALYSIS 37 CHAPTER 5: CONCLUSION AND RECOMMENDATIONS 42 5.1 CONCLUSION 42 5.2 RECOMMENDATIONS 5.3 RESEARCH LIMITATION 44 46 REFERENCE 48 APPENDIX 52 APPENDIX 59 APPENDIX 60 APPENDIX 65 APPENDIX 72 vi LIST OF TABLES Table 1: Summary of factors and scale 29 Table 2: Overall customer satisfaction and scale 30 Table 3: Likert scale 30 Table 4: Characteristics of the sample 32 Table 5: Descriptive statistics of the sample 33 Table 6: Cronbach's Alpha of the respondents 35 Table 7: Summary results from first step of factors analysis of items (SPSS) 36 Table 8: Model summary 38 Table 9: Anova result 38 Table 10: Multiple regression of the research model 39 vii LIST OF FIGURES Figure 1: Gap model of services quality by Parasuraman et al., 1985 18 Figure 2: Research model on retail banking sector 21 Figure 3: Research model in the Romanian banking sector 22 Figure 4: Proposed Research Model 25 Figure 5: Confirmed research model with Standardized Coefficient 39 viii ABBREVIATION CIEM Central Institution for Economic Management HSBC Hongkong and Shanghai Banking Corporation HCMC Ho Chi Minh City ILLSA Institute Labor Science and Social Affairs ISO International Standardization Organization MME Middle Market Enterprise SBV State Bank of Vietnam SEVQUAL Service Quality SMEs Small and Medium-sized enterprises SPSS Statistical Package for the Social Sciences Techcombank Vietnam Technological and Commercial Joint Stock Bank WFOB Wholly foreign-owned bank WTO World Trade Organization ix APPENDIX 2: DESCRIPTIVE STATISTICS OF RESPONDENTS TA1 TA2 TA3 TA4 RE1 RE2 RE3 RE4 RS1 RS2 RS3 AS1 AS2 AS3 AS4 EM1 EM2 EM3 EM4 PR1 PR2 CS1 CS2 CS3 N 125 125 125 125 125 125 125 125 125 125 125 125 125 125 125 125 125 125 125 125 125 125 125 125 Mean 3.91 3.46 3.94 3.83 3.94 4.06 3.70 3.58 3.70 3.78 3.86 4.06 3.78 4.01 3.78 3.56 3.94 3.71 3.48 3.34 3.47 3.99 3.32 3.78 Std Deviation Minimum Maximum 0.71 0.95 0.66 0.69 0.61 0.47 0.75 0.78 0.73 0.65 0.62 0.90 0.74 0.60 0.97 0.81 0.69 0.77 0.67 0.86 0.72 0.63 0.81 0.67 59 APPENDIX 3: RELIABILITY ANALYSIS (SPSS VERSION 16) Cronbach's Alpha Case Processing Summary N Valid Tangible factor 125 % 100.0 0.0 125 100.0 Excluded(a) Total a Listwise deletion based on all variables in the procedure Reliability Statistics Cronbach's Alpha 0.647 Cronbach's Alpha Based on Standardized Items 0.659 N of Items Item-Total Statistics Scale Mean if Item Deleted 11.2400 11.6880 11.2080 11.3200 TA1 TA2 TA3 TA4 Scale Variance if Item Deleted 3.216 2.329 2.973 2.881 Corrected Item-Total Correlation 0.322 0.443 0.490 0.499 Cronbach's Alpha Case Processing Summary N Valid Reliability factor Excluded(a) Total 125 % 100.0 0.0 125 100.0 a Listwise deletion based on all variables in the procedure Reliability Statistics 60 Squared Multiple Correlation 0.204 0.259 0.390 0.360 Cronbach's Alpha if Item Deleted 0.646 0.585 0.545 0.535 Cronbach's Alpha 0.764 RE1 RE2 RE3 RE4 Cronbach's Alpha Based on Standardized Items 0.781 N of Items Item-Total Statistics Scale Scale Mean Variance Corrected if Item if Item Item-Total Deleted Deleted Correlation 11.34 2.518 0.636 11.22 2.961 0.570 11.58 2.182 0.612 11.70 2.307 0.509 Squared Multiple Correlation 0.489 0.358 0.458 0.304 Cronbach's Alpha if Item Deleted 0.673 0.724 0.682 0.750 Cronbach's Alpha Case Processing Summary N Valid 125 Responsiveness Excluded(a) factor Total 125 a Listwise deletion based on all variables in the procedure Reliability Statistics Cronbach's Alpha Based on Standardized Items Cronbach's Alpha 0.750 0.752 RS1 RS2 RS3 % 100.0 0.0 100.0 N of Items Item-Total Statistics Scale Variance if Corrected Scale Mean if Item Item-Total Deleted Item Deleted Correlation 7.64 1.216 0.583 7.55 1.346 0.604 7.48 1.477 0.554 Cronbach's Alpha 61 Squared Multiple Correlation 0.342 0.365 0.309 Cronbach's Alpha if Item Deleted 0.666 0.636 0.694 Case Processing Summary N Valid 125 Assurance factor Excluded(a) Total 125 a Listwise deletion based on all variables in the procedure % 100.0 0.0 100.0 Reliability Statistics Cronbach's Alpha 0.907 Cronbach's Alpha Based on Standardized Items 0.913 N of Items Item-Total Statistics Scale Mean if Item Deleted 11.57 11.84 11.62 11.85 AS1 AS2 AS3 AS4 Scale Variance if Item Deleted 4.505 4.910 5.916 3.888 Corrected Item-Total Correlation 0.776 0.869 0.685 0.909 Squared Multiple Correlation 0.708 0.797 0.568 0.848 Cronbach's Alpha if Item Deleted 0.888 0.856 0.920 0.838 Cronbach's Alpha Case Processing Summary N Empathy factor Valid Excluded(a) Total 125 125 % 100.0 0.0 100.0 a Listwise deletion based on all variables in the procedure Reliability Statistics Cronbach's Alpha 0.841 Cronbach's Alpha Based on Standardized Items 0.839 N of Items The covariance matrix is calculated and used in the analysis Item-Total Statistics Scale Scale Mean Variance if Corrected Item if Item Item-Total Deleted Deleted Correlation 62 Squared Multiple Correlation Cronbach's Alpha if Item Deleted EM1 EM2 EM3 EM4 11.1360 10.7520 10.9840 11.2160 3.022 3.785 3.274 3.800 0.779 0.599 0.714 0.620 0.610 0.427 0.518 0.440 0.750 0.830 0.781 0.822 Cronbach's Alpha Case Processing Summary N % Valid 125 100.0 Pricing factor Excluded(a) 0.0 Total 125 100.0 a Listwise deletion based on all variables in the procedure Reliability Statistics Cronbach's Alpha 0.834 Cronbach's Alpha Based on Standardized Items 0.841 N of Items Inter-Item Correlation Matrix PR1 PR2 PR1 1.000 0.726 PR2 0.726 1.000 The covariance matrix is calculated and used in the analysis Item-Total Statistics Scale Cronbach's Variance Corrected Squared Alpha if Scale Mean if Item if Item Item-Total Multiple Item Deleted Deleted Correlation Correlation Deleted PR1 3.47 0.525 0.726 0.527 (a) PR2 3.34 0.741 0.726 0.527 (a) a The value is negative due to a negative average covariance among items This violates reliability model assumptions You may want to check item codings 63 Cronbach's Alpha Case Processing Summary N Valid 125 Excluded(a) Overall Customer satisfaction Total 125 factor a Listwise deletion based on all variables in the procedure % 100.0 0.0 100.0 Reliability Statistics Cronbach's Alpha 0.849 Cronbach's Alpha Based on Standardized Items 0.857 N of Items Item-Total Statistics CS1 CS2 CS3 Scale Mean if Item Deleted 7.10 7.78 7.31 Scale Variance if Item Deleted 1.884 1.449 1.603 64 Corrected Item-Total Correlation 0.674 0.687 0.825 Squared Multiple Correlation 0.529 0.529 0.684 Cronbach's Alpha if Item Deleted 0.833 0.841 0.690 APPENDIX 4: EXPLORATORY FACTORS ANALYSIS (SPSS VERSION 16) Factor Analysis KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy Approx ChiSquare Bartlett's Test of Sphericity df 0.531 91.467 Sig 0.000 Communalities Extractio Initial n TA1 1.000 0.305 TA2 1.000 0.498 TA3 1.000 0.586 TA4 1.000 0.607 Extraction Method: Principal Component Analysis Total Variance Explained Initial Eigenvalues Component Total 1.995 0.920 0.734 0.350 % of Variance 49.882 23.009 18.360 8.750 Extraction Method: Principal Component Analysis Component Matrix(a) Component TA1 0.552 TA2 0.705 TA3 0.765 TA4 0.779 Extraction Method: Principal Component Analysis a components extracted Rotated Component Matrix(a) Dummy category a Only one component was extracted 65 Cumulative % 49.882 72.890 91.250 100.000 Extraction Sums of Squared Loadings Total 1.995 % of Variance 49.882 Cumulative % 50.14 The solution cannot be rotated Factor Analysis KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy Approx Chi-Square Bartlett's Test of Sphericity df Sig 0.700 146.624 0.000 Communalities Initial Extraction RE1 1.000 0.676 RE2 1.000 0.581 RE3 1.000 0.643 RE4 1.000 0.517 Extraction Method: Principal Component Analysis Total Variance Explained Initial Eigenvalues % of Cumulati Component Total Variance ve % 2.417 60.427 60.427 0.733 18.317 78.744 0.531 13.279 92.022 0.319 7.978 100.000 Extraction Method: Principal Component Analysis Component Matrix(a) Component RE1 0.822 RE2 0.762 RE3 0.802 RE4 0.719 Extraction Method: Principal Component Analysis a components extracted Rotated Component Matrix(a) Dummy category a Only one component was extracted The solution cannot be rotated 66 Extraction Sums of Squared Loadings Total 2.417 % of Variance 60.427 Cumulative % 60.427 Factor Analysis KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy Approx ChiBartlett's Test of Square Sphericity df Sig 0.690 86.345 0.000 Communalities Initial Extraction RS1 1.000 0.671 RS2 1.000 0.695 RS3 1.000 0.640 Extraction Method: Principal Component Analysis Total Variance Explained Initial Eigenvalues % of Cumulative Component Total Variance % 2.006 66.852 66.852 0.533 17.772 84.625 0.461 15.375 100.000 Extraction Method: Principal Component Analysis Component Matrix(a) Compone nt RES1 0.819 RES2 0.834 RES3 0.800 Extraction Method: Principal Component Analysis a components extracted Rotated Component Matrix(a) Dummy category a Only one component was extracted The solution cannot be rotated 67 Extraction Sums of Squared Loadings % of Cumulative Total Variance % 2.006 66.852 66.852 Factor Analysis KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy Approx ChiBartlett's Test of Square Sphericity df Sig 0.772 416.099 0.000 Communalities Initial Extraction AS1 1.000 0.745 AS2 1.000 0.874 AS3 1.000 0.666 AS4 1.000 0.901 Extraction Method: Principal Component Analysis Total Variance Explained Initial Eigenvalues % of Cumulative Component Total Variance % 3.186 79.646 79.646 0.514 12.839 92.485 0.200 5.007 97.493 0.100 2.507 100.000 Extraction Method: Principal Component Analysis Component Matrix(a) Compon ent AS1 0.863 AS2 0.935 AS3 0.816 AS4 0.949 Extraction Method: Principal Component Analysis a components extracted Rotated Component Matrix(a) Dummy category a Only one component was extracted The solution cannot be rotated 68 Extraction Sums of Squared Loadings Total 3.186 % of Variance 79.646 Cumulati ve % 79.646 Factor Analysis KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy Approx Chi-Square Bartlett's Test of Sphericity df Sig 0.771 208.322 0.000 Communalities Initial 1.000 1.000 1.000 1.000 EM1 EM2 EM3 EM4 Extraction 0.794 0.580 0.724 0.611 Extraction Method: Principal Component Analysis Total Variance Explained Initial Eigenvalues Component Total 2.709 0.638 0.369 0.284 % of Variance 67.737 15.946 9.228 7.089 Cumulative % 67.737 83.683 92.911 100.000 Extraction Method: Principal Component Analysis Component Matrix(a) Component EM1 0.891 EM2 0.762 EM3 0.851 EM4 0.782 Extraction Method: Principal Component Analysis a components extracted Rotated Component Matrix(a) Dummy category a Only one component was extracted The solution cannot be rotated 69 Extraction Sums of Squared Loadings Total 2.709 % of Variance 67.737 Cumulative % 67.737 Factor Analysis KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy Approx ChiBartlett's Test of Square Sphericity df Sig 0.500 91.744 0.000 Communalities Initial Extraction PR1 1.000 0.863 PR2 1.000 0.863 Extraction Method: Principal Component Analysis Total Variance Explained Initial Eigenvalues % of Cumulative Component Total Variance % 1.726 86.302 86.302 0.274 13.698 100.000 Extraction Method: Principal Component Analysis Component Matrix(a) Compon ent PR1 0.929 PR2 0.929 Extraction Method: Principal Component Analysis a components extracted Rotated Component Matrix(a) Dummy category a Only one component was extracted The solution cannot be rotated 70 Extraction Sums of Squared Loadings Total 1.726 % of Variance 86.302 Cumulati ve % 86.302 Factor Analysis KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy Approx ChiBartlett's Test of Square Sphericity df Sig 0.671 183.668 0.000 Communalities Initial Extraction CS1 1.000 0.733 CS2 1.000 0.733 CS3 1.000 0.869 Extraction Method: Principal Component Analysis Total Variance Explained Initial Eigenvalues % of Cumulative Component Total Variance % 2.335 77.842 77.842 0.456 15.195 93.037 0.209 6.963 100.000 Extraction Method: Principal Component Analysis Component Matrix(a) Compon ent CS1 0.856 CS2 0.856 CS3 0.932 Extraction Method: Principal Component Analysis a components extracted Rotated Component Matrix(a) Dummy category a Only one component was extracted The solution cannot be rotated 71 Extraction Sums of Squared Loadings Total 2.335 % of Variance 77.842 Cumulative % 77.842 APPENDIX 5: MULTIPLR REGRESSION ANALYSIS Note Factor Factor Factor Factor Factor Factor Factor Tangible Reliability Responsiveness Assurance Empathy Pricing Customer satisfaction Variables Entered/Removed(b) Model Variables Entered Factor6, Factor4, Factor3, Factor1, Factor5, Factor2(a) Variables Removed Method Enter a All requested variables entered b Dependent Variable: Factor7 Model Summary(b) Model R R Square 0.911 Adjusted R Square Std Error of the Estimate DurbinWatson 0.821 0.26169 1.769 0.830 a Predictors: (Constant), Factor6, Factor4, Factor3, Factor1, Factor5, Factor2 b Dependent Variable: Factor7 ANOVA(b) Sum of Squares df Mean Square F Regression 39.347 6.558 95.761 Residual 8.081 118 0.068 Total 47.428 124 a Predictors: (Constant), Factor6, Factor4, Factor3, Factor1, Factor5, Factor2 b Dependent Variable: Factor7 Model 72 Sig 0.000 Coefficients(a) Unstandardized Coefficients Model B (Constant) 0.053 Tangible 0.159 Reliability 0.543 Responsiveness 0.058 Assurance 0.566 Empathy 0.378 Pricing 0.412 a Dependent Variable: Factor7 Std Error 0.229 0.066 0.092 0.062 0.067 0.072 0.047 Standardized Coefficients Beta 0.137 0.445 0.051 0.659 0.370 0.491 Collinearity Statistics t 0.233 2.432 5.869 0.937 8.437 5.231 8.832 Sig 0.816 0.017 0.000 0.351 0.000 0.000 0.000 Tolerance VIF 0.454 0.252 0.485 0.237 0.289 0.466 2.205 3.973 2.060 4.220 3.458 2.144 Residuals Statistics(a) Maximum 2.2416 4.9497 3.6987 0.56331 125 -0.88602 0.52134 0.00000 0.25528 125 Std Predicted Value -2.587 2.221 0.000 1.000 125 Std Residual -3.386 1.992 0.000 0.976 125 Predicted Value Residual a Dependent Variable: Factor7 73 Mean Std Deviation Minimum N ... trusts and similar financial products as a “financial supermarket” • Cash management and treasury services • Merchant banking and private equity financing • Traditionally, large commercial banks also... SERVQUAL and GAP model, customer satisfaction and other factors affecting customer satisfaction 2.1 2.1 BANKING BANKING SERVICES AND PRODUCTS 2.1.1 GENERAL GENERAL ACTIVITIES OF COMMERCIAL BANKS BANKS... card and debit card services - Automatic teller machinery - Commercial banking services - Trade and supply chain services - Payment and cash management 10 - E-banking services - Global banking