Service quality and customer service performance the case of vietnam joint stock commercial bank for private enterprises

vietnam national university, HANOI school of business Nguyen Quynh Trang Service quality and customer service performance – The case of vietnam joint stock commercial bank for private enterprises Major: Business Administration Code: 60 34 05 Master of business administration thesis Supervisors: Dr.PHAM THI NHUAN DANG NGOC SU, MBA Hanoi – 2007 TABLE OF CON ACKNOWLEDGEMENTS ABSTRACT TÓM TẮT TABLE OF CONTENTS LIST OF ABBREVIATIONS LIST OF FIGURES LIST OF TABLES INTRODUCTION Rationale Objectives & aims Hypotheses Scope of work Data resource & processing Methods & approaches Significance Limitations Expected results 10 Follow –up (potential) 11 Thesis structure PART 1: LITERATURE REVIEW AND RESEARCH METHODOLOGY CHAPTER 1: LITERATURE REVIEW 1.1 The nature of services and Characteristics of services 1.1.1Why study services? 1.1.2What is service? 1.1.3Characteristics of se 1.2 Managing service quality 1.2.1Service quality 1.2.2Dimensions of servic 1.2.2.1 Reliability 1.2.2.2 Empathy 1.2.2.3 Assurance 1.2.2.4 Responsiveness 1.2.2.5 Tangibles 1.2.3Results of previous r 1.2.4The effect of employ 1.3 Measure of customer service performance CHAPTER 2: RESEARCH METHODOLOGY 2.1 Study Design 2.2 Measures 2.3 Sampling 2.4 Data collection 2.4.1Method of data colle 2.4.2Questionnaire design 2.4.3Questionnaire pretes 2.4.4Respond rate 2.4.5Procedure of Purific 2.4.5.1 Procedure of purification and validation 2.4.5.2 Procedure of reliability 2.5 Summary PART STATUS OF VPBANK AND DATA ANALYSIS CHAPTER 3: STATUS OF VPBANK 3.1 General overview of VPBank 3.1.1Vision and Mission 3.1.2Core value and Bus 3.2 Foundation and development process 3.3 Organization structure 3.4 Employees and Training Programs 3.5 Products & Services 3.6 Business operation results in 2006 3.7 Achievements 3.8 Orientation of business activities for 2007 CHAPTER 4: DATA ANALYSIS 4.1 Descriptive statistics 4.1.1Demographics of th 4.1.2Descriptive statistic 4.1.2.1 Descriptive statistics for five dimensions 4.1.2.2 Descriptive statistics of customer satisfaction 4.2 Reliability Test 4.3 Factor analysis 4.3.1Factor analysis for 4.3.2Factor analysis for 4.3.3Factor analysis for 4.3.4Factor analysis for 4.3.5Factor analysis for 4.4 Analysis of Relationships 4.4.1Scatter grams 4.4.2Collinearity problem 4.4.3Multiple regression 4.4.4Hypotheses Test 4.5 Summary PART 3: CONCLUSION AND RECOMMENDATIONS CONCLUSION RECOMMENDATIONS REFERENCES APPENDICES LIST OF ABBREVIATIONS VPBank: Vietnam Joint Stock Commercial Bank for Private Enterprises CJS Bank: Commercial Joint- Stock Bank CA's: Cronbach's Alpha VIF: Variance inflation factor CS: Customer satisfaction LIST OF FIGURES Figure 1.1 Customer Perceptions of Quality and Customer Satisfaction ………… 12 Figure 3.1 VPBank's Organization Chart 25 Figure 3.2 Safety assurance ratios 27 Figure 3.3 mobilized Capital source 27 Figure 3.4 Structure of outstanding loans 28 Figure 4.1 Scree Plot of Reliability 40 Figure 4.2 Scree Plot of Empathy 42 Figure 4.3 Scree Plot of Tangible 44 Figure 4.4 Scree Plot of Responsiveness 46 Figure 4.5 Scree Plot of Assurance 48 LIST OF TABLES Table: 2.1 Measurement of five dimensions of service quality Table 2.2 Measurement of Bank's Performance Table 4.1 Demographic Descriptive Statistics Table 4.2 Descriptive Statistics for Reliability Table 4.3 Descriptive Statistics for Empathy Table 4.4 Descriptive Statistics for Tangible Table 4.5 Descriptive Statistics for Responsiveness Table 4.6 Descriptive Statistics for Assurance Table 4.7 Description Statistics of Customers' Satisfaction Table 4.8 Reliability Statistics Table 4.9 Total Variance Explained - Reliability Table 4.10 Factor solution for Reliability Table 4.11The Total Variance Explained - Empathy Table 4.12 Factor solution for Empathy Table 4.13 Total Variance Explained - Tangible Table 4.14 Factor solution for Tangible Table 4.15 Total Variance Explained - Responsiveness Table 4.16 Factor solution for Responsiveness Table 4.17 Total Variance Explained - Assurance Table 4.18 Factor solution for Assurance Table 4.19 Collinearity Statistics Table 4.20 Results of Multiple Regressions Table 4.21 Ranking the importance of dimensions APPENDIX Appendix A: QUESTIONNAIRE 58 Appendix B: RESULTS OF DATA ANALYSIS 61 INTRODUCTION Rationale Joining the WTO, the Vietnam banking system has been heavily influenced by the international financial market in terms of exchange rates, interest rates and foreign currency reserves, while they must simultaneously carry out international obligations and commitments Competition will probably become much stronger when foreign banks expand their scale and scope of operations in the Vietnamese market Vietnamese commercial banks will need to cope with many difficulties in expanding their banking activities in the world and competing with foreign banks whose strength of capital, technology, services and global operational scale provide them with potential advantages Before these challenges, Vietnamese commercial banks, especially Joint Stock Commercial Banks have been giving out many strategies such as widening branches, interest competitiveness, or promotion campaigns, and so on However, all of them recognized that service quality was critical element to attract customers and necessary for effective competition Conscious of this fact, in recent year VPBank has placed great importance on improving service quality, thus all dimensions of service quality were concerned but the contribution level of each dimension of service quality has not identified yet Therefore, its needs to identify the relative importance of each quality dimension which impact to customer service performance of VPBank Objectives & aims Objectives of study The objective of this research is to investigate the relationship between five dimensions of service quality and Customer Service Performance of VPBank Aims of study VPBank's managers can use this instrument as a baseline for a longitudinal benchmarking program that is a means of comparing its performance from branch to branch or from year to year Hypotheses In this study, five dimensions of service quality including reliability, empathy, tangible, responsiveness and assurance were employed to evaluate the impacts of those dimensions on customer service performance of VPBank A below research model shows five relationships converted into five hypotheses Reliability Empathy Tangible Responsiveness Assurance Hypotheses 1: A positive relationship exits between Reliability and Customer Service Performance of VPBank - Hanoi branch Hypotheses 2: A positive relationship exits between Empathy and Customer Service Performance of VPBank- Hanoi branch Hypotheses 3: A positive relationship exits between Tangible and Customer Service Performance of VPBank- Hanoi branch Hypotheses 4: A positive relationship exits between Responsiveness and Customer Service Performance of VPBank- Hanoi branch Hypotheses 5: A positive relationship exits between Assurance and Customer Service Performance of VPBank- Hanoi branch Scope of work This study focuses only on identifying the relative importance of five dimensions of service quality on customer service performance of VPBank Hanoi branch The target customers are retail customers of VPBank Because of the time and resources limitation to survey, this research surveys at VPBank Hanoi branch Second, please, give your overall satisfaction with the services that they receive from the bank Based on experience Bank, have you been delivery services? THANK FOR YOUR COOPERATION! APPENDIX B RESULTS OF DATA ANALYSIS Factor Analysis of Reliability Component Matrix Communalities Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q5 Extraction Method: Principal Component Analysis Q5 Extraction Method: Principal Component Anal a components extracted Total Variance Explained Component Extraction Method: Principal Component Analysis Rotated Component Matrix Scree Plot a Only one component was extracted Eigenvalue The solution cannot be rotated Component Number Factor analysis of Empathy Com Initial Q6 1.000 Q7 1.000 Q8 1.000 Q9 1.000 Extraction Method: Principal Component Analysis Total Variance Explained Component Extraction Method: Principal Component Analysis Eigenvalue 2.5 2.0 1.0 1.5 0.5 0.0 Factor analysis of Tangible Communalities Component Matrix a Q10 Q11 Q12 Extraction Method: Principal Component Analysis Q10 Q11 Q12 Extraction Method: Principal Component Analysis a components extracted Total Variance Explained Component Extraction Method: Principal Component Analysis Rotated Component Matrix a Only one component was extracted The solution cannot be rotated Eigenvalue Scree Plot 0.5 0.0 Component Number Factor Analysis of Responsiveness Initial Q13 Q14 Q15 Q16 Extraction Method: Principal Component Analysis Component Extraction Method: Principal Component Analysis Rotated Component Matrix Scree Plot a 2.5 2.0 Eigenvalue Only one component was extracted The solution cannot be rotated 3.0 1.5 1.0 0.5 0.0 Component Number Factor Analysis of Assurance Communalities Component Matrix Q17 Q18 Q19 Q17 Q18 Q20 Extraction Method: Principal Component Analysis Q19 Q20 Extraction Method: Principal Component Analysis a Total Variance Explained Component Extraction Method: Principal Component Analysis Scree Plot 2.5 Eigenvalue a 2.0 1.5 1.0 0.5 Component Number components extracted SCATTERGRAMS Legend Total SCATTERGRAMS OF RELIABILITY Fit line for Total CS 4 3 Legend Total SCATTERGRAMS OF ASSURANCE Fit line for Total CS 3 SCATTERGRAMS OF RESPONSIVENESS CS 4 3 Legend Fit line for Total CS SCATTERGRAMS OF EMPATHY Total Total CS SCATTERGRAMS OF TANGIBLE Fit line for Total Multiple Linear Regression Analysis Model a A b D Model a b Predictors: (Constant), Responsiveness, Reliability Dependent Variable: CS Model Regression Residual Total a b Predictors: (Constant), Assurance, Tangible, Empathy, Responsiveness, Reliability Dependent Variable: CS Coefficients Model a (Constant) Reliability Empathy Tangible Responsiveness a Assurance Dependent Variable: CS ... VPBank: Vietnam Joint Stock Commercial Bank for Private Enterprises CJS Bank: Commercial Joint- Stock Bank CA's: Cronbach's Alpha VIF: Variance inflation factor CS: Customer satisfaction LIST OF. .. Reliability and Customer Service Performance of VPBank - Hanoi branch Hypotheses 2: A positive relationship exits between Empathy and Customer Service Performance of VPBank- Hanoi branch Hypotheses... Tangible and Customer Service Performance of VPBank- Hanoi branch Hypotheses 4: A positive relationship exits between Responsiveness and Customer Service Performance of VPBank- Hanoi branch Hypotheses