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Research Proposal
The concept of customer care is concern with customer satisfaction putting the customer
first, anticipating needs and problems, tailoring the product and services to meet needs
and being nice to customers it also includes service to the customer, delivery operation,
employee relationship with customer and internal relationship between employee and
management. In developing customer care strategies and programs, financial services
organizations are managing products and services, delivery systems, environment and
people so as to provide an efficient and caring service, getting things right the first time
and maintaining standards.
Customer satisfaction is an ambiguous and abstract concept and the actual manifestation
of the state of satisfaction will vary from person to person and product/service to
product/service. The state of satisfaction depends on a number of both psychological and
physical variables which correlate with satisfaction behaviors such as return and
recommend rate. The level of satisfaction can also vary depending on other options the
customer may have and other products against which the customer can compare the
organization's products.
Because satisfaction is basically a psychological state, care should be taken in the effort
of quantitative measurement, although a large quantity of research in this area has
recently been developed. Work done by Berry, Brodeur between 1990 and 1998.defined
To explore, study, and analyze critically services being provided by the BANKS to their
customer.
In the product arena, by far the most important issues surround the checking account. Of
importance to consumers is not only the account itself, but the format of the monthly
statements which they receive. They expect more from their accounts and want this
increased functionality presented in an understandable way. Also, consumers are more
sensitive to the pricing of this product, as the "gap" between the importance of the
pricing of a checking account and customer’s satisfaction is comparatively high.
While banks have had the checking product pretty much to themselves in the past, the
emergence of internet based banks, and the "creep" of large non-banks into the checking
business should be an alarm bell for banks who want to improve customer satisfaction.
Other "alarm bells" emerging from the study are such attributes as: Rates on
Savings/CDs; Fees and Service Charges; ATMs; and Hours of Operation.
These are among the attributes where banks score the lowest or where the gap between
"importance" and "satisfaction" is the highest. Additional charts tables showing this
detail may be seen on the site...clientsatisfaction.com
"Loyalty" measures the strength of a customer's satisfaction. But it goes beyond, and
also indicates the "action ability" of that loyalty. The ABA Financial Client Satisfaction
Index measures loyalty in three areas.... Deposit Services... Loans... and Investments.
This is done by asking clients whether they would consider the bank for their next
service in these three areas. Of course, results will vary by both bank and customer, but
it is interesting to note that on an overall industry basis, clients are more likely to
consider their bank for their next deposit account than for either their next loan of their
next investment. And in the case of investments, the score is much lower (3.33 on a 5.00
In a way, there is some probability that the loyalty score also measures the degree of
competition (or alternative choices, from a customer's perspective) in that particular
product marketplace. The key with this measure is that it be improving over time
It has been observed by such experts in customer satisfaction as J.D. Power &
Associates that "consumer expectations are growing faster than industries can meet
them". And the explosive growth of the Internet is shifting the power of information to
the consumer.
Since customer service expectations are growing and are influenced by customer
experience with others, The ABA Financial Client Satisfaction Index measures a
customer's overall satisfaction with his/her bank as compared with other financial
providers they use, and with other companies, in general. The idea here is for a bank's
overall satisfaction scores to keep up with, or exceed, those in other areas. Power, J.D
and Associates, 1999.
Fredrick Reichheld (1996) expanded the loyalty business model beyond customers and
employees. He looked at the benefits of obtaining the loyalty of suppliers, employees,
bankers, customers, distributors, shareholders, and the board of directors.
A model by Kay Storbacka, Tore Strandvik, and Christian Gronroos (1994), the service
quality model, is more detailed than the basic loyalty business model but arrives at the
same conclusion. In it, customer satisfaction is first based on a recent experience of the
product or service. This assessment depends on prior expectations of overall quality
compared to the actual performance received. If the recent experience exceeds prior
expectations, customer satisfaction is likely to be high. Customer satisfaction can also be
high even with mediocre performance quality if the customer's expectations are low, or if
the performance provides value (that is, it is priced low to reflect the mediocre quality).
Likewise, a customer can be dissatisfied with the service encounter and still perceive the
The final link in the model is the effect of customer loyalty on profitability. The
fundamental assumption of all the loyalty models is that keeping existing customers is
less expensive than acquiring new ones. It is claimed by Reichheld and Sasser (1990) that
a 5% improvement in customer retention can cause an increase in profitability between
25% and 85% (in terms of net present value) depending upon the industry. However,
Carrol and Reichheld (1992) dispute these calculations, claiming that they result from
faulty cross-sectional analysis. Schlesinger and Heskett , 1991.
THEORATICAL FRAMEWORK________________________________
Variables:
Dependent Variable:
Customer Satisfaction
Independent Variable:
Service quality
Competence
Credibility
Responsiveness
Communication
Security
Online banking
In relation to the above, the variables are identified on a general basis. There are
severalother variables that affect the Customer Satisfaction level, but only a few are
considered for this in order to avoid complexity.
Justification is that the internet banking is itself a very vast topic which is not possible to
cover it in our objective, it has its own security issues etc. We will ask from the
customers that they are satisfied with the ATM cards DEBIT cards etc or not. This is the
hypothesis which we will test.
METHODOLGY______________________________________________
Now the question comes that by which method we sill conduct the research?
OR
SCALE
Scale is the very first thing in methodology that which type of scale is suitable for us. So
by the consent of all the group members and literature review we have decided that we
will use the LIKERT SCALE. We will may be able to reduce the biasness by using this
scale.
Hypothesis to be tested
The key questions being posed or hypothesis tested in the research. In this study we are
going to frame the following hypothesis:
H1: It is expected that Customers are satisfied with the competency of bank.
H2: It is expected that Customers are satisfied with the credibility of bank.
H3: It is expected that Customers are satisfied with the responsiveness of bank
H5: It is expected that Customers are satisfied with the security of bank.
H6: It is expected that Customers are satisfied with the online banking (ATM cards,
DEBIT cards, CREDIT cards etc).
Research Design
The primary data will be used to examine relationship between bankers and customers
satisfaction. It will also examine the impact of customer satisfaction towards the Banks.
The study will be conducted in two phases.
Phase-1 will consist of try out study in which we will screen out the potential
respondents of this study, while Phase-2 will constitute the main study and consist of
hypothesis testing.
Instrument
The questionnaire will be used and administered to the respondents directly. The
available instruments concerning related variables will be explored for proper reliability
and validity. This will help us to know the facts that where the banks are going down in
their services and at a result their customers are getting unsatisfied from them. And in
what way they will be getting maximum satisfaction. A total sample size of 300 to 500
customers will survey randomly.
Data Analysis
After data collection and coding, the appropriate data analytic techniques including
descriptive and multivariate analysis will be carried out keeping in view the objective of
the study by using latest available version of SPSS or as per our instructor’s advice
(Kashif saeed).
J.D. Power & Associates 1999 Investors Business Daily, July 9, 1999
Berry, Brodeur 1998 ten domains of satisfaction,1990 to 1998
Buchanan, R. and Gilles, C. 1990 Value managed relationship: The key to
customer retention and profitability", European Management Journal, vol 8, no 4,
1990.
Buckinx W., Geert Verstraeten, and Dirk Van den Poel 2007 Predicting customer
loyalty using the internal transactional database," Expert Systems with Applications,
32 (1).
Carrol, P. and Reichheld, F. 1992 The fallacy of customer retention", Journal of
Retail Banking, vol 13, no 4, 1992.
Dawkins, P. and Reichheld, F 1990 "Customer retention as a competitive
weapon", Directors and Boards, vol 14, no 4, 1990.
Fornell, C. and Wernerfet, B. 1987 "Defensive marketing strategy by customer
complaint management : a theoretical analysis", Journal of Marketing
Moloney, Chris X. 2006 "Winning Your Customer’s Loyalty: The Best
Tools, Techniques and Practices" AMA Workshop Event(s). Misc. materials
distributed related to event(s). San Diego, 2006. Chris X. Moloney
Reichheld, F. 1996 The Loyalty Effect, Harvard Business School Press,
Boston, 1996.
Reichheld, F. and Sasser, W. 1990 Zero defects: quality comes to services",
Harvard Business Review, Sept-Oct, 1990, pp 105-111
Schlesinger, L. and Heskett, J. 1991 "Breaking the cycle of failure in service",
Sloan Management Review, spring, 1991, pp. 17-28.
Stieb, James A 2006 "Clearing Up the Egoist Difficulty with Loyalty", Journal
of Business Ethics, vol 63, no 1Storbacka, K. Strandvik, T. and Gronroos, C 1994
"Managing customer relationships for profit", International Journal of Service
Industry Management, vol 5, no 5, 1994, pp 21-28.