THE IMPACT OF SERVICE QUALITY ON CUSTOMER

SATISFACTION

By

NAME: FARHAN KHAN (2267135)

MANSHA NASIR (2267112)
ANAS JAVERI (2267142)
YASIR ILYAS (2167131)

PROGRAM: MSPM 1A

SUBJECT: QUALITY MANAGEMENT

FINAL RESEARCH PROJECT SUBMISSION

Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology

2023
 The Impact of Service Quality on Customer Satisfaction
Anas Javeri – 2267142
Farhan Khan – 2267135
Mansha Nasir – 2267112
MSPM – Quality Management Yasir Ilyas – 2167131

ACKNOWLEDGEMENTS

It was a great opportunity for us to do research on this topic. We highly appreciate &

thank to our beloved teacher Mr. FAIZ AHMED, to offer us the opportunity to

conduct research also to find out the problems & grounded aspects of this research.

Here, we would also like to thank those people who participate & worked with us in

this topic as well as those who were the recipients for us on this topic. It has been a

great experience & educational phase that we spend in this course

Title of research:
The impact of Service Quality on Customer Satisfaction.
 The Impact of Service Quality on Customer Satisfaction
Anas Javeri – 2267142
Farhan Khan – 2267135
Mansha Nasir – 2267112
MSPM – Quality Management Yasir Ilyas – 2167131

Objectives:
 To identify key factors that influence the customer’s satisfaction for any service.
 To check the impact of managerial ability on customer’s acceptance to the service
provider.

Research Design/ Methodology/ Approach:

Quantitative research will be used. In contrast to divergent thinking, quantitative research
emphasizes precise, convergent reasoning based on numerical, static data. The goal of
quantitative research is to quantify the process of gathering and analyzing data. It is
derived from a logical method influenced by positivist and empiricist ideologies that
emphasizes testing theories.

Research Variables:
In this research, the Service Quality plays a role of independent variable while Customer’s
Satisfaction acts as dependent variable. However, Managerial Ability plays a role of
moderating variable.

Purpose of the study:

 To forecast upcoming situations with focusing service quality and customer satisfaction.
 To make a comparison among industries like Information technology, Construction and
Health Care sectors.
 To develop an analysis among variables managerial ability, service quality and customer
satisfaction.
Assumptions:
The main purpose of the study is to focus on the factors that needs to be maintained
among managerial ability.
 For this, targeted sectors are IT, Health Care and Construction.
 The appropriate variables we used as an independent, moderating and dependent
variables as a measurement tool for effective and consistent results
 The Impact of Service Quality on Customer Satisfaction
Anas Javeri – 2267142
Farhan Khan – 2267135
Mansha Nasir – 2267112
MSPM – Quality Management Yasir Ilyas – 2167131

Literature Review
Introduction:
The relationship between service quality and customer satisfaction has been a focal point
of research in the field of business and management. In an era where customer experience
is considered a critical factor for business success, understanding the impact of service
quality on customer satisfaction becomes imperative. This literature review aims to
provide insights into the key factors influencing customer satisfaction, with a specific focus
on the moderating role of managerial ability.

Customer service is the most important factor that should be built and delivered to the
customers. For that reason, service has to be qualified. This is due to the fact that with
qualified service, the customers will also be satisfied and then they will not the business. A
qualified service is marked by the number of consumers who were satisfied totally with the
service. So, every business must focus on it. PT. TIKI Branch of Kedung Sari Surabaya was
the object of the research because service quality was critical. Theoretically, there are five
dimensions of service quality such as assurance, tangibles, reliability, responsiveness, and
empathy that may influence customer satisfaction. The objective of this study was, to
determine the effect of service quality to customer satisfaction. Structural Equation
Modeling (SEM) was used to analyze the primer and secondary data during the research.
With the probability of > 0.10, it was found that assurance dimension could establish
unidimensionality of service quality, while tangibles, reliability, responsiveness, and
empathy dimensions could not. Therefore, it could be concluded that assurance was the
prominent factor that caused customers satisfaction. (GS, Mahjudin, & Hufron, 2012)

Key Factors Influencing Customer Satisfaction:

Tangibles:
The physical appearance of service facilities, equipment, personnel, and communication
materials can significantly influence customers' perceptions. Parasuraman et al. (1988)
introduced the SERVQUAL model, emphasizing tangibles as a crucial dimension of service
quality.

The study of service quality includes the dimensions of tangibles, empathy, reliability,
responsiveness, assurance, and satisfaction in this case, the satisfaction of parents of
students who purchase services at the Nabila's House tutoring institution. The research
method used in this study includes the correlation coefficient test, the determination
 The Impact of Service Quality on Customer Satisfaction
Anas Javeri – 2267142
Farhan Khan – 2267135
Mansha Nasir – 2267112
MSPM – Quality Management Yasir Ilyas – 2167131

coefficient, regression analysis with path analysis, and the sample used is a population of
142 parents of students. Service quality is crucial for service companies to compete in the
service industry. The study's findings demonstrate that responsiveness, dependability, and
tangibles all have a major impact on how satisfied parents of students are. At the same
time, the quality of service in this study accounted for 80.60% of the explanation for
parents of students' contentment. (1)

Responsiveness:
Quick and helpful responses to customer inquiries, requests, and complaints contribute to
overall satisfaction. Responsiveness is identified as a key determinant of service quality
(Parasuraman et al., 1988).

This study looked at how commuter satisfaction across road transport companies in the
state of Anambra is impacted by response to service quality and dependability. The study
looked at how commuter satisfaction was impacted by the responsiveness and
dependability characteristics of service quality. The core data for the study were gathered
using a survey instrument called a questionnaire. The servqual model, which applies the
Gap theory of service quality, serves as the study's foundation. Three hundred and twenty-
seven (327) respondents who travel for the five (5) chosen transport firms in the state of
Anambra make up the study's population. To ascertain the degree of connection between
the study's variables, Pearson's correlation was utilized. Furthermore, using the statistical
package for social sciences (SPSS) version 21, linear regressions were performed to assess
the hypotheses. The study's findings demonstrated the strong positive effect that service
quality factors, such as responsiveness and dependability, have on commuter satisfaction.
The study suggests that in order to enhance the quality of services provided to commuters,
the transport sector apply the servqual model of service quality as an adapted model. To
improve their customer service and customer management abilities, transport company
personnel need to receive further training. In order to reward responsive, dependable
commuters and boost passenger satisfaction and retention, it is advised that current
transport management computer software be used for ticketing. (3)

Empathy:
 The Impact of Service Quality on Customer Satisfaction
Anas Javeri – 2267142
Farhan Khan – 2267135
Mansha Nasir – 2267112
MSPM – Quality Management Yasir Ilyas – 2167131

Understanding and addressing customers' individual needs and concerns demonstrate

empathy. The ability to provide personalized services enhances customer satisfaction
(Parasuraman et al., 1988).

The purpose of this study is to determine how brand trust is affected by linguistic
realizations of employee empathy (LREE) in email answers to customer complaints. We
investigate the potential moderating impacts of compensation (Study 1) or the customer's
acceptance of blame (Study 2), as well as the potential mediating effects of perceived
empathy and reported complaint handling quality. Our goal is to determine if partial
refunds caused by LREE have a favorable or unfavorable effect on the consumer, either as
a result of LREE's perceived sincerity or honest statements of concern. According to the
findings of two trials, LREE increases perceived empathy and complaint handling quality,
which both favorably impact brand trust. Since LREE are more effective in low
compensation conditions as opposed to high compensation conditions, the anticipated
negative effect is not observed. When a partial refund is granted, the accepting of
culpability has no bearing on the efficacy itself. (4)

Managerial Ability as a Moderating Variable:

Leadership and Strategy:
Effective leadership and strategic management contribute to the development and
implementation of service quality initiatives. A study by Choi and Chu (2001) found that
strategic management positively influences service quality.

Employee Training and Development:

Managerial ability in organizing training programs for employees directly impacts their
ability to deliver high-quality services. Employee competence, as facilitated by managerial
efforts, influences service quality (Heskett et al., 1994).

Organizational Culture:
The organizational culture fostered by effective management influences how employees
prioritize service quality. A positive and customer-centric culture contributes to enhanced
service delivery (Cameron & Quinn, 2006).

Customer Satisfaction:
Information Technology:
 The Impact of Service Quality on Customer Satisfaction
Anas Javeri – 2267142
Farhan Khan – 2267135
Mansha Nasir – 2267112
MSPM – Quality Management Yasir Ilyas – 2167131

In the IT sector, service quality is often measured by the reliability and responsiveness of
software solutions. Customer satisfaction is closely tied to the performance and
functionality of IT services (Parasuraman et al., 2005).

Construction:
In the construction industry, tangible aspects such as project timelines, quality of
materials, and effective communication play crucial roles. Managerial ability in project
planning and execution significantly influences customer satisfaction (Chan & Chan, 2004).

Health Care:
Health care services place a premium on empathy, reliability, and assurance. Effective
management in healthcare organizations ensures the delivery of compassionate and
reliable services, impacting patient satisfaction (Andaleeb, 2001).

Conclusion:
Understanding the impact of service quality on customer satisfaction requires a
comprehensive examination of various factors. The literature suggests that managerial
ability plays a crucial moderating role in ensuring consistent service quality across different
industries. Future research should continue to explore the evolving dynamics of service
quality, taking into account the changing landscape of customer expectations and
managerial practices.
 The Impact of Service Quality on Customer Satisfaction
Anas Javeri – 2267142
Farhan Khan – 2267135
Mansha Nasir – 2267112
MSPM – Quality Management Yasir Ilyas – 2167131

Conceptual Framework:

Service Quality

Tangibles

Customer
Satisfaction
Responsiveness

Empathy

Managerial
Ability
 The Impact of Service Quality on Customer Satisfaction
Anas Javeri – 2267142
Farhan Khan – 2267135
Mansha Nasir – 2267112
MSPM – Quality Management Yasir Ilyas – 2167131

Hypotheses:

Ha1: Tangibles has significant relationship with customer satisfaction.

Ha2: Responsiveness has significant relationship with customer satisfaction.

Ha3: Empathy has significant relationship with customer satisfaction.

Ha4: Managerial Ability positively influences the relationship of tangibles and

customer satisfaction.

Ha5: Managerial Ability positively influences the relationship of

Responsiveness and customer satisfaction

Ha6: Managerial Ability positively influences the relationship of empathy and

customer satisfaction
 The Impact of Service Quality on Customer Satisfaction
Anas Javeri – 2267142
Farhan Khan – 2267135
Mansha Nasir – 2267112
MSPM – Quality Management Yasir Ilyas – 2167131

References:
 Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1988). SERVQUAL: A multiple-item scale for
measuring consumer perceptions of service quality. Journal of Retailing, 64(1), 12-40.
 Zeithaml, V. A., Parasuraman, A., & Berry, L. L. (1990). Delivering quality service: Balancing
customer perceptions and expectations. Free Press.
 Choi, T. Y., & Chu, R. (2001). Determinants of hotel guests' satisfaction and repeat patronage in
the Hong Kong hotel industry. Hospitality Management, 20(3), 277-297.
 Heskett, J. L., Sasser, W. E., & Hart, C. W. (1994). Service breakthroughs: Changing the rules of the
game. Free Press.
 Cameron, K. S., & Quinn, R. E. (2006). Diagnosing and changing organizational culture. John Wiley
& Sons.
 Parasuraman, A., Berry, L. L., & Zeithaml, V. A. (2005). A Conceptual Model of Service Quality and
Its Implications for Future Research. Journal of Marketing, 49-61.
 Chan, A. P., & Chan, A. P. (2004). Key performance indicators for measuring construction success.
Benchmarking: An International Journal, 11(2), 203-221.
 Andaleeb, S. S. (2001). Service quality perceptions and patient satisfaction: A study of hospitals in
a developing country. Social Science & Medicine, 52(9), 1359-1370.
 GS, A. D., Mahjudin, & Hufron, M. (2012). INCREASING THE SERVICE QUALITY FOR CUSTOMER
SATISFACTION. Journal of Economics, Business, and Accountancy Ventura, 15(3), 423 – 442.
 APPENDIX
Dear Sir/ Madam

I need your kind participation in my research by sparing a few minutes to fill the
questionnaire. I will assure you that your provided information will only be used for
analysis purpose and will be kept highly confidential.

Please tick ( ) on appropriate choice

Respondent Income
Gender: Age: level Education
25 years or less
Male (1) (1) Less than 50,000 (1) Undergraduate (1)
Female 26 to 30 years
(2) (2) 50,001 to 60,000 (2) Graduate (2)
31 to 35 years
(3) 60,001 to 70,000 (3) Post graduate (3)
36 to 40 years Post Graduate and above
(4) 70,001 to 80,000 (4) (4)

Marital
Status:
Single (1)
Married (2)
Not disclosed
Neither Agree nor
Strongly Disagree

Please circle your desired response: For

Disagree

Disagree

Agree

example, if your response is 4 (Agree) than make

circle around 4 like this
4

Tangibles (Zulfikar.A. N, & Singgih. M. L, 2022)

TA1 Planning information is proper and correct media 1 2 3 4
and format 5
TA2 Availability of resources 1 2 3 4
5
TA3 The components/parts provided are of good 1 2 3 4
quality 5
TA4 Work equipment according to company 1 2 3 4
standards 5
TA5 Planning, Reports and recommendations 1 2 3 4
information are easily accessible 5
Responsiveness (Zulfikar.A. N, & Singgih. M. L, 2022)
RE1 Ability to request additional request 1 2 3 4
5
RE2 Delivery of plans and recommendation on time and 1 2 3 4
regularly 5
RE3 Planning information, cost estimates, preparations 1 2 3 4
and reports are quickly 5
RE4 Maintained activities according to the work plan 1 2 3 4
(time and results) 5
RE5 Able to provide solutions to findings/non- 1 2 3 4
conformities. 5
Empathy (Zulfikar.A. N, & Singgih. M. L, 2022)
EM1 Planning is suitable according to operational 1 2 3 4
conditions 5
EM2 Provide solution to administrative problems 1 2 3 4
5
EM3 Cost estimation refers to costs, time and 1 2 3 4
quality 5
EM4 Inform the status and progress of work 1 2 3 4
clearly 5
EM5 Have concern for company assets 1 2 3 4
5
Customer Satisfaction (Rousan, et al. 2011)
CS1 I am satisfied with the modern looking 1 2 3 4
equipment 5
CS2 I am satisfied with the appearance of the 1 2 3 4
personnel 5
CS3 I feel the employee have the ability to 1 2 3 4
dependably perform the expected service 5
CS4 I am pleased with the courtesy and 1 2 3 4
knowledge of staff 5
CS5 I am pleased with the care provided to 1 2 3 4
customers 5
Managerial Ability (Gotinga, T; 2016)
MA My supervisor manager are good in 1 2 3 4
1 delegating task. 5
MA I am fortunate to have supervisor/manager
1 2 3 4
2 who know how to take value of their
5
employee.
MA Base on my personal observation, my 1 2 3 4
3 manager have positive attitude. 5
MA My manager knows how to deal properly to 1 2 3 4
4 their failure, mistake a setback in the 5
operation and take full responsibility their
 full potentials.
MA I am happier that my manager help their 1 2 3 4
5 employee to develop their full potential. 5

Thanks