Customer Satisfaction in Hotel Industry of Karachi-Aservperf Analysis

CUSTOMER SATISFACTION IN HOTEL INDUSTRY OF KARACHI-
ASERVPERF ANALYSIS
by
MUSAIDULLAH MUHAMMAD
A thesis
submitted in partial fulfillment of the requirements
for the degree of Master of Business Administration
to Office of Research, Innovation & Commercialization
(formerly IQRA University Research Centre - IURC)
at Iqra University
main campus, Karachi
Karachi, Pakistan
JUNE, 2016
Acknowledgments
Allah the Most Gracious and the Most Merciful, Alhamdulillah, all praises to Allah for
the strengths and His blessing in carrying out this thesis having title “Customer
Satisfaction in Hotel Industry of Karachi- A SERVPERF Analysis”, Special admiration
goes to my thesis supervisor, Dr. Masood Subzwari, for his direction, mentorship and
persistent support. Under his professional supervision, I found the passion of conducting
the academic research and developed the needed skills. His precious support and
productive comments and suggestions all through the thesis work had added the
achievement of my thesis. Also, I like to specially thank ORIC (Office of the Research,
Innovation and Commercialization) for their valuable support and information.
My genuine gratitude goes to my beloved parents for their love, prayers and
encouragement, without which it was not possible to reach the current position in life.
I am also thankful to all those who directly or indirectly contributed in this thesis with
their worthy information, all their support means a lot to me.
ii
Abstract
For a service sector company, having a satisfied or even delighted customer is key to the
success of a supply chain. In highly service oriented such as hospitality customer
satisfaction is crucial as it leads to repeat customer and word of mouth recommendations
that bring new customers. Measuring customer satisfaction has been a constant effort by
service providers. The model was first comprehensive effort measuring service quality
through what is known as SERVQUAL model. In this model Parasuraman et.al (1985)
initially explored service and quality with ten different angles classifying them into five
categories such as, responsiveness, reliability, tangibility, empathy and assurance. Cronin
and Taylor (1994) argued that customer expectation varies a great deal and the gap
between expectation and service provided could be misleading. The study proposed using
the actual performance component of the model and called that SERVPERF model. This
model was the subject of this thesis. A questionnaire developed for the survey using
SERVPERF model was used to assess the performance of hotel industry. The thesis
shows that SERVPERF model is simpler, avoids the unknown or even absolute customer
expectations and can be used to directly access the service customer received.
iii
Table of Contents
S.NO. DESCRIPTION PAGE
NO.
1. Acknowledgements…………………………………………….. Ii
2. Abstract…………………………………………………………. Iii
3. List of Tables…………………………………………………..... V
4. List of Figures…………………………………………………… Vi
5. Chapter 1: Introduction…………………………………………. 1
1.1 Overview…….…………………………....................
1.2 Problem Statement………………………………………
1.3 Background, Objectives and Significance of the Study.
1.4 Outline of the Study……………………………...
1.5 Definitions…..………………………………………
6. Chapter 2: Literature review……………………………………. 5

7. Chapter 3: Research Methods…………………………………… 12
3.1 Method of Data Collection…………………………
3.2 Sampling Technique…………………………………
3.3 Sample size…………………………………………
3.4 Instrument of Data Collection……………...…………
3.4.1 Validity and Reliability test………………….
3.5 Research Model developed …………………………
3.6 Statistical Technique…………………………………
8. Chapter 4: Results………………………………………………. 15
4.1 Findings and Interpretation of the results………………….
4.2 Hypotheses Assessment Summary…………………............
9. Chapter 5: Discussions, Conclusion, Policy Implications and 19

Future Research…………………………………………
5.1 Discussions .……………………………………………
5.2 Conclusion …………………………...…………………
5.3 Policy Implications……………..………….………….
5.4 Future Research…………………………………………
10. References…….................................................................................... 21
11. Appendix.............................................................................................. 24
iv
List of Tables
S.NO. TABLES Page
Number
1. 3.1 Case Processing Summary 13
2. 3.2 Reliability Statistics 13
3. 4.1 Model Summary 15
4. 4.2 ANOVA 15
5. 4.3 Coefficients 16
6. 4.4 Hypothesis Assessment Summary 18
v
List of Figures
S.NO. FIGURE Page

Number
1. 3.1 SERVPERF Model (Cronin and Taylor, 1992) 14
vi
Customer Satisfaction in Hotel Industry- A SERVPERF Analysis 1
Chapter 1: Introduction
1.1 Overview
Customer satisfaction is considered as important for supply chains specifically in
service. Delivering quality services increases the satisfaction level and wins repeat
customers as well as new customers. Evaluation of service quality is essential for
determining not only customer satisfaction but also to identify areas for improvement.
The service supply chain provides a variety of services to satisfy customer expectation. In
order to assess the degree to which the SC is meeting customer expectation
questionnaires are used to invite customer opinion on the existing services and
suggestions for further improvements. Karimi, Sanayei and Moshrefjavadi (2011) also
conducted a research particularly on customer satisfaction about quality of service in
hospitality sector including hotel industry through SERVPERF model (Cronin & Taylor,
1994).
The key elements of supply chain had been studied under hospitality sector to look at
customers perception and their satisfaction. Generally, hotel or hospitality sector largly
depend on service and quality offered to win future clients. Routine customer surveys are
conducted as customer leave after staying in the hotels. In order to have a more
comprehensive assessment several models such as SERVQUAL, SERVPERF have been
developed to assess service quality. This resaerch projects proposes to use SERVPERF
model for hotel industry.
In Pakistan, there is a lack of such type of research. The purpose of this thesis was
evaluating that how customers are satisfied in hotel industry by using SERVPERF model.
This thesis project particularly proposes to examine that how the service and quality
affect customers to make them satisfy using SERVPERF model to analyze the service
hotels in Karachi.
1.2 Problem Statement
Customer satisfaction is considered as an essential factor of supply chain. The
hotel industry has to depend of the quality of service offered to win future customers.
Routine customer surveys are conducted as customer leave after staying in the hotels. In
order to have a more comprehensive assessment several models such as SERVQUAL,
SERVPERF have been developed to assess service quality. This thesis project proposes
to use SERVPERF model for the local hotel industry in Karachi.
1.3 Background, Objectives and Significance of the study
This thesis aimed at examining correlation between services provided and the
outcome that services whether satisfied or dissatisfied customer in hotel sector of
Karachi, Pakistan. The replica created by Parasuraman, Zeithaml and Berry (1985) for
observing quality of services in four different service businesses to investigate the service
quality which was not covered before and is still undefined to some extent. This model
can be used to develop propositions for future to improve quality performance in service
management.
The SERVPERF range is really a far more convergent, in addition to be able to
discriminate well in the assistance construct; which offers larger capacity to explain
different versions. The objective of this thesis is analyzing an effects of service provided
in the hotel industry on satisfaction level of the consumers using SERVPERF analysis.
1.4 Outline of the Study

This study had comprised of five chapters where chapter number one contains
introduction of the study. An introduction chapter also contains overview of the study,
statement of the problem, background, significant and objective of the study. At the end
of the chapter number one, definitions of the study variables had also been given to make
easier for reader to understand.
The literature review of the thesis in discussed in chapter number two which was written
from more than fifteen research papers to make clear understanding of the topic under
study. As of the literature review chapter end, possible hypotheses of this thesis had been
discussed. The purpose of this chapter was to differentiate this study from previous work.
The research method had been discussed in chapter number three. This chapter contains
method of data collection, technique of sampling to collect data from population, total
sample size i.e. number of observations to be analyzed, data collection instrument such in
this study a comprehensive questionnaire had been developed and statistical technique
applied for the purpose of testing research hypotheses. This had been also divided into
validity and reliability test. The next issue was how research model to be developed.
The results, findings and interpretations of the study had been discussed in chapter
number four. At the end of the chapter number four, hypotheses assessment summary had
been shown to see which hypothesis had been accepted or rejected.
In final chapter of the study, discussions, conclusion, implication and future research had
been discussed.
1.5 Definitions
Customer satisfaction: It means the frequency of customer to attain the same
service.
Service Quality: It means the food, rooms and the environment provided by the hotel to
the customers.
Chapter 2: Literature Review
In a global economy, service excellence is essential for endurance of the firm
(Wisniewski, 2001). Firms are focusing on customer-focused approach rather than
production-led philosophy. Wisniewski (2001) further illustrated that service excellence
is the approach that has animated noteworthy consideration and open deliberation in the
research literature.
Oliver (1980) demonstrates that service quality is gained through customer satisfaction.
Oliver (1980) further described that customer’s expectations may establish the service
quality. Hence foundation of the service quality serves as customer’s expectation.
Kodadah and Issa (2008) concluded that satisfaction of the client after obtaining the
service can be seen in the emotions of joy or disdain resulting from the difference
between the expected and actual execution of the client. According to Gitomer (1998),
customer contentment had effect on almost each industry. When clients, for instance,
recognize excellent services in the hotel, everyone may encourage almost ten individuals.
That has been estimated that “word-of-mouth” contribute about 50% in American
business. Griffin (1995) concluded that profits can raise 25 percent or more if
development in customer retention increases by few percentages. However, customer
dissatisfaction has a much bigger impact on the end result. Unsatisfied customers who get
inadequate service may tell their poor experience to more ten or twenty people due to
which average American organizations loses ten to twenty proportion of its clients every
year. The expense of picking up another client was almost 10 times more liability of
retaining fulfilled customer.

Anderson and Zemke (1998) argued that satisfied clients upgrade business and
disappointed clients debilitate business. Client’s contentment is an asset that ought to be
verified and treated at par with tangibility. As a result organizations which would like to
grow may understand significance of this factor (McColl-Kennedy & Schneider, 2000).
For the purpose of evaluating quality service Parasuraman, Zeithaml and Berry (1985)
initiated SERVQUAL model. SERVQUAL serves as a tool for examining the quality
gaps and determines the factors that may affect consumer satisfaction in hotel sector.
Parasuraman et.al (1985) originally explored service quality with ten dimensions
classifying them into five categories as below:
Tangibility: Appearance of workers, organization’s physical facilities and
appearance of their physical equipment

Reliability: Conveying and delivering the promised services
Responsiveness The response speed, immediate service and help to clients
:
Assurance: To rouse confidence and trust in organization by information,
reliability of the representatives and politeness.

Empathy Eagerness and competence to give individual attention regarding a
customer
Parasuraman et.al (1985) subsequently surveyed these five dimensions and evaluated
them on the basis of input to two declarations that assess:
1) The common desires of clients involving a service
2) Observations of clients in regards to service level actually offered by company.
The score for gap is computed as the variation between Perception (P) and expectation
(E). Pursuing this estimation, higher the P-E score, better is the service superiority
Many research scholars illustrated some weakness of SERVQUAL.

Cronin and Taylor (1992) concluded that five dimensions don’t appear to be totally
generic and generally depend upon the nature of the business. Nevertheless, apart from
these weaknesses, the model remains a valuable and effective tool for service-quality
(Ladhari, 2009). According to Ladhari (2009), service managers can exploit SERVQUAL
to assess their own particular service attributes and correlate with their adversaries.
SERVQUAL might be used to fragment customers on the premise of their evaluation
scores. Ladhari (2009) further explained that is additionally practical to explore
perceptions and customer’s desires on the basis of geographical and demographic.
Additionally to examine the association's execution on the premise of service extents, a
qualitative study could be grasped through talks and meetings with their customers to
gain data about their desires.
A few specialists like Parasuraman et al. (2005) have additionally created specific e-
service quality scales, for example, improving E-S-Qual, for reviewing electronic
examination excellence. E-S-QUAL comprising of twenty two items isolated in four
dimensions:
1) "Proficiency" (which depicted as pace of monitoring and using the site)
2) "Contentment" (the intensity to which the site guarantees about request
conveyance and items accessibility is satisfied)
3) "System accessibility" (the right specialized working of the site)
4) "Protection" (the extent to which the site is sheltered and secures client data)
Zeithaml, Parasuraman and Berry (1996) created a SERVQUAL questionnaire contains
two sections. Customer’s expectations are measured in the first section and customer’s
perceptions are measured in the second section of the questionnaire. Cronin and Taylor
(1994) concluded that by utilizing the second section of SERVQUAL instruments, a
more reliable outcome can be acquired which is commonly named as performance based
measurement; SERVPERF.
SERVPERF Model
The SERVQUAL model provided by Parasuraman et al. (1985 & 1988) used actual
performance with customer expectation for comparison. Cronin and Taylor (1992) argued
that only performance component of the model provides superior representation for
quality service. The difference between SERVPERF and SERVQUAL is that
SERVPERF only considers the actual performance only and not a high undefined
perceived quality (based on expectations).
Another problem encountered with rating expectation often introduces different types of
expectation and respondent of SERVQUAL model are unsure on the expectation score
(Teas, 1993)
Customer Satisfaction
To satisfy the customer is a core objective of supply chain; whether service or
manufacturing. If the customer derives the required service or when services exceed
customers’ expectations, the customer may be delighted and consequently satisfied.
Customer satisfaction may come from five factors (Parasuraman et al. 1985),
If customer is satisfied with the physical facilities, equipment availability appearance of
facilities and employees then this factor is described as satisfaction from tangibles.
If the service is consistently of required specifications and as per customer order then the
customer is satisfied with the reliability of service.

If the customer receives prompt service and customer can feel the desire of the company
and employees to be responsive then customer is satisfied with the responsiveness of
service. Customer trust in the firm and vice versa is described as assurance while an
understanding of customer needs and treating them as important clients is described as
empathy.
Service Quality
The satisfaction and non satisfaction of customer hinges on quality of service received.
Service quality measurement is therefore critical to gauge customer satisfaction. A
satisfied customer may promote the firm through word of mouth communication and
repeat orders (Tripathi, 2013). Service quality is strongly associated with the satisfaction
of the consumers (Vanpariya & Ganguly, 2010).
Ostrom and Iacobucci, (1995) pointed out several studies in which quality services had
been correlated with the customer satisfaction. Service quality could be measured from
five different directions of the quality identified above; empathy, responsiveness,
reliability, assurance, and tangibility and their impact on customer satisfaction can then
be monitored on customer satisfaction (Ngan, 2013).
Figure 2.1 demonstrate link between different aspects of quality service offered and
consumer satisfaction.
Figure 2.1
Service Quality & Customer Satisfaction (Cronin & Taylor, 1992)

Quality Service and Consumer Satisfaction in Hotel Sector
Hotel industry is highly competitive and gaining new customers and retaining the
previous ones is crucial for the hotels. As hotels enhance their quality of serving
customers, the consumers are delighted and promoted that hotel through word of mouth
which boosts sales of hotels (Dominici & Guzzo, 2010). The hotel industry must
recognize customer needs and its impact on customer satisfaction. The hotels must
provide the environment and services that meets service quality requirements of the
customers.
The management must provide product and services that meet or exceed customers need,
creates a brand image in customer eyes and creates loyal customers (Dominici & Guzzo,
2010).
The customers are demanding increasingly high quality of services and the hotel industry
is creating the desired services to have a competitive advantage over the other players in
the field. Providing high quality and high level of services is what creates customer
satisfaction (Lam & Zhang, 1999).
2.5 Research Hypotheses
The hypotheses of the study are as under:
H1: Tangibility significantly affects consumer satisfaction in hotel industry.
H2: Reliability significantly affects consumer satisfaction in hotel industry.
H3: Responsiveness significantly affects consumer satisfaction in hotel industry.
H4: Assurance significantly affects consumer satisfaction in hotel industry.
H5: Empathy significantly affects consumer satisfaction in hotel industry.

Chapter 3: Research Methods
The chapter covers the detailed information regarding sources of data collection,
sampling, size of the sample and theoretical and research model developed.
3.1 Method of Data Collection
Because of the qualitative nature of the study, the primary source for Data
collection had been used. To achieve this objective a comprehensive survey questionnaire
had been prepared to ask relevant respondents to provide rational answers to the
questions in accordance with the SERVPERF model.
3.2 Sampling Technique
Unrestricted non probability technique had been chosen to collect data from
relevant sample.
3.3 Sample Size
As for as the size of sample is concern, this study comprised of 300 respondents.
The respondents included employees of the different organization, Supply Chain
Managers, students specializing in Supply Chain Management, and owners of the
business.
3.4 Instrument of Data Collection
A well-furnished research questionnaire was prepared to receive possible
responses from the selected sample size for the purpose of collecting data. The
questionnaire included 12 questions prepared at Likert Scale containing 5 options such as
strongly agree, agree, Neutral, Disagree, Strongly Disagree.
3.4.1 Validity and Reliability Test

The validity test is run to verify whether data collected through particular
questionnaire is truly reliable for the analysis or not. The criteria were that if reliability
test value was larger than 0.50, then it was be considered that the data is truly reliable.
But on the other hand, if the value was less than 0.50, then it was considered that the data
is not reliable for the analysis. When the test was applied through SPSS software, the
following results were generated.
Table 3.1
Case Processing Summary
N %
Cases Valid 299 99.7
Excludeda 1 .3
Total 300 100.0
a. List wise deletion based on all variables in the procedure.
The above table 3.1 shows the case processing summary about how many observations
had been used as sample for the analysis of the study and how many cases are valid and
excluded. The N in the above table shows the total number of observations included in
this study was 300 and one observation was excluded from the analysis due to particular
reason.
Table 3.2
Reliability Statistics
Cronbach's Alpha N of Items

.823 12
The Cronbach’s Alpha value was (0.823) which was greater than 0.5 that suggested that
categorical data used in the study was reliable for analysis. On the strength of Reliability
test, now Regression analysis may be applied to examine customer satisfaction in hotel
industry of Karachi by using SERVPERF model.

3.5 Research Model Developed
Following Research model was developed for the study
Figure 3.1
SERVPERF Model (Cronin and Taylor, 1992)
Tangibility
Assurance
Responsiveness Customer Satisfaction
Reliability
3.6 Statistical Technique
Empathy
Multiple Linear Regression test had been run for investigating customer
satisfaction in hotel in industry of Karachi by using SERVPERF model.

Chapter 4: Results
This chapter of results contains thesis findings and interpretation of the data
analysis.
4.1 Finding and Interpretations of the Results
In this study five independent variables such as, Responsiveness, Tangibility,
Assurance, Empathy and Reliability, and one dependent variable such as customer
satisfaction were proposed for analyzing customer satisfaction. The independent variables
are taken from Cronin and Taylor (1992) model of SERVPERF model. The results that
was generated through SPSS software is illustrated below.
Table 4.1
Model Summary
Adjusted R Std. Error of the

Model R R Square
Square Estimate
1 .653a .426 .417 .5009
a. Predictors: (Constant), Empathy, Tangibility, Responsiveness, Assurance, Reliability
b. Dependent Variable: Customer Satisfaction
Table 4.1 indicate model summary of study. R in the above table was coefficient of
correlation between the variables which was 65.3% which was greater than 50% that
means the correlation was statistically significant among study variables. The R Square in
above table is coefficient of determination. The R square value (0.426) specifies that
42.6% of variation in dependent variable such as customer satisfaction was elucidated by
above mentioned five predictors. As value of R Square (0.426) was approaching to 0.50;
therefore, it indicated that study model was fit for the analysis as per data provided.
Table 4.2
ANOVA
Model Sum of Squares df Mean Square F Sig.

Regression 54.100 5 10.820 43.127 .000a
1 Residual 72.757 290 .251
Total 126.857 295
Table 4.2 demonstrates matrix for Analysis of Variances (ANOVA). The sig value
(0.000) in above table 4.2 was less than 0.05 (α=0.05), thus, the study rejected the null
hypothesis and accepted the alternate hypothesis that customers are highly satisfied if the
hotel industry of Karachi use SERVPERF model.
Also, the value of F statistics is greater than 3.8 (i.e. 43.127>3.8), therefore, F value also
proved that customer are satisfied if the hotels followed SERVPERF model factors
Table 4.3
Coefficients
Un-standardized Standardized Co-linearity

Coefficients Coefficients Statistics
Std. Toleranc
Model B Error Beta t Sig. e VIF
(Constant) .944 .204 4.637 .000
Tangibility .188 .042 .226 4.425 .000 .758 1.319
Reliability .025 .051 .027 .501 .617 .672 1.488
1
Responsiveness .133 .047 .152 2.857 .005 .699 1.430
Assurance .145 .046 .166 3.119 .002 .698 1.432
Empathy .286 .047 .327 6.048 .000 .676 1.480
a. Dependent Variable: Customer Satisfaction
H1: Tangibility significantly affects consumer satisfaction in hotel industry.
The sig value for Tangibility in the above table 4.3 was 0.000, which was less than level
of significant (α=0.05), therefore, study rejected null hypothesis and accepted alternate
hypothesis that tangibility significantly affect consumer satisfaction in hotel industry.
Thus this thesis found that if management of the hotel sector in Karachi takes care of
decoration and physical appearance of the hotels, then the customers may be highly
satisfied and can visit the hotel again and again and finally can become loyal.
H2: Reliability of customer service significantly affects consumer satisfaction
The table 4.3 also shows the sig value (0.617) for 2nd independent variable (i.e.
Reliability) which was greater than level of significant (α=0.05), (0617>0.05), therefore,
study rejected the alternate hypothesis that reliability has significant impact on customer
satisfaction in hotel industry and failed to reject suggested null hypothesis.
In table 4.3, the sig value for 3rd independent variable (i.e. Responsiveness) was 0.005
which was less than level of significant (α=0.05), (0.005<0.05) therefore, the suggested
that null hypothesis of the study was rejected and the alternate hypothesis was accepted
that responsiveness has significant impact on customer satisfaction in hotel industry.
Finally, the study found that employees in hotels were responsive in providing quality
services.
H4: Assurance significantly affects consumer satisfaction
The sig value for 4th independent variable in above table 4.3 (i.e. Tangibility) was 0.002,
that was less than 0.05. Therefore, study rejected the suggested null hypothesis and
accepted alternate hypothesis that Assurance had significant impact on customer
satisfaction in hotel industry. Thus the study found that employees were well versed with
the special knowledge to serve at the best which instilled confidence in customers that
whatever told by employees is right and perfect to serve.
H5: Empathy has significant impact on customer satisfaction in hotel industry.
The table 4.3 also shows the sig value (0.000) for 5th independent variable (i.e. Empathy)
which was less than 0.05, therefore, study rejected null hypothesis and accepted alternate
hypothesis that empathy has significant impact on customer satisfaction in hotel industry.
Thus, the study found that staffs of the hotels provide customers with exclusive attention
and understand specific needs to solve problem. The overall results of the study
suggested that customers were delight with the services of the hotels in the Karachi when
hotels were able to deliver quality service to the customers. SERVPERF helps hotels in
assessing customer satisfaction.
4.2 Hypotheses Assessment Summary
Following was the hypotheses assessment summary for acceptance and rejection
of the study hypotheses.
Table 4.4
Hypotheses Assessment Summary
Test Specification
Empirical
S. No Hypothesis Beta Sig Conclusion
Coefficient Value
H1: Tangibility significantly affects
1 consumer satisfaction in hotel industry. .188 .000 Accepted
H2: Reliability significantly affects

2 consumer satisfaction in hotel industry. .025 .617 Rejected
H3: Responsiveness significantly affects

3 consumer satisfaction in hotel industry. .133 .005 Accepted
H4: Assurance significantly affects
4 .145 .002 Accepted
consumer satisfaction in hotel industry.
H5: Empathy significantly affects
5 .286 .000 Accepted
consumer satisfaction in hotel industry.
Chapter 5: Discussions, Conclusion, Policy Implications and

Future Research
5.1 Discussions
For a service sector company, having a satisfied or even delighted customer is key
to the success of a supply chain. In highly service oriented such as hospitality customer
satisfaction is crucial as it leads to repeat customer and word of mouth recommendations
that bring new customers. Measuring customer satisfaction has been a constant effort on
made by service providers in hotel sector. Parasuraman et al, (1985) model was first
comprehensive effort measuring service quality through what is known as SERVQUAL
model. In this model Parasuraman et.al (1985) initially explored service quality with ten
dimensions classifying them into five categories such as tangibility, responsiveness,
reliability, empathy and assurance. The model considered consumer expectations and
actual performance information was collected in the above five categories and the gap
between the two provided the information on areas of improvement. Cronin & Taylor
(1994) argued that customer expectation varies a great deal and the gap between
expectation and service provided could be misleading. The study proposed using the
actual performance component of the model and called the SERVPERF model. This
model was the subject of this thesis. A questionnaire developed for the survey using
SERVPERF model was used to assess the performance of hotel industry. The thesis
shows that SERVPERF model is simpler, avoids the unknown or even absolute customer
expectations and can be used to directly assess the service customer received.
The thesis shows that this model is simpler, requires less customer time for the survey
and is probably an improvement on SERVQUAL model.

5.2 Conclusion
The analysis of collected data shows that SERVPERF model provides a good tool
for checking service performance. The hypotheses selected were accepted with the
exception of hypothesis on service reliability. This is unexpected as reliability of service
is also important, additional data may be required to recheck this hypothesis.
SERVPERF model is easier to implement, which reduces the data requirement and is
likely to be a more effective tool in performance measurement
5.3 Policy Implications
This study focused on different aspects of service quality in hotel sector of
Karachi by using SERVPERF model prototyped by Cronin & Taylor (1992) to provide
customers with quality services to make customers satisfied. The study shows that
SERVPERF would be an easier tool to implement; the information is more useful as
which gives a direct assessment of service provided and is not affected by some exalted
expectation.
5.4 Future Research
This study was confined to hotelsserving only in Karachi, future studies can be
extended to Pakistan. SERVPERF application on other service sector can also be
researched.
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Wisniewski, M. (2001) “Using SERVQUAL to assess customer satisfaction with public
sector services,” Managing Service Quality, vol. 11(6), p. 380-388
Zeithaml, V. A., Berry, L. L. & Parasuraman, A., (1996). The behavioral consequences of
service quality. Journal of Marketing, 60(4), pp. 31-46.

Appendix
SPSS Data View

SPSS Variable View

SPSS Output
Case Processing Summary
N %
Valid 299 99.7
Cases Excludeda 1 .3
Total 300 100.0
a. Listwise deletion based on all variables in the

procedure.
Reliability Statistics
Cronbach's Alpha N of Items
.823 12
Model Summaryb
Std. Error of the

Model R R Square Adjusted R Square Estimate
1 .653a .426 .417 .5009
a. Predictors: (Constant), Empathy, Tangibility, Responsiveness, Assurance,

Reliability
ANOVAb
Model Sum of Squares df Mean Square F Sig.
Regression 54.100 5 10.820 43.127 .000a
1 Residual 72.757 290 .251
Total 126.857 295

Coefficientsa
Unstandardized Standardized Collinearity

Coefficients Coefficients Statistics
Model B Std. Error Beta t Sig. Tolerance VIF
(Constant) .944 .204 4.637 .000
Tangibility .188 .042 .226 4.425 .000 .758 1.319
Reliability .025 .051 .027 .501 .617 .672 1.488

1 Responsivenes
.133 .047 .152 2.857 .005 .699 1.430
s
Assurance .145 .046 .166 3.119 .002 .698 1.432
Empathy .286 .047 .327 6.048 .000 .676 1.480
a. Dependent Variable: Customer Satisfaction

Questionnaire
As a part of my MBA course, I am working on a thesis project on ‘Customer

Satisfaction in Hotel Industry of Karachi- A SERVPERF Analysis’. The information
provided may be exclusively used for the thesis project. It would be very much
appreciated if you would spend a few minutes of your precious time to answer the
questions and statements given below. Thank you for your cooperation.
About The Respondent
Name: __________________________________________________________
Contact #. _______________________________________
Email ID._______________________________________
Gender: Male Female
Age:
1. Less than 21
2. 21 to 30
3. 31 to 40
4. 41 to 50
5. Above 50
Education:
1. Undergraduate
2. Graduate
3. Post Graduate
Occupation:
Please Specify:__________________
Thank you for your cooperation.

Please select ( ) the appropriate box

Thesis Topic: “Customer Satisfaction in the Hotel Industry of Karachi: A
SERVPERF Analysis”
Strongly Disagree Neutral Agree Strongly
Tangibility
Disagree Agree
1 This HOTEL has modern looking equipment.
Materials associated with the service are visually
2
appealing at this HOTEL
Reliability
Disagree Agree
When the HOTEL’s staff promises to do something
3
by a certain time, it does so.
When you have a problem, the HOTEL’s employees
4
show a sincere interest in solving it.
Responsiveness
Disagree Agree
Employees in this HOTEL tell you exactly when the
5
services may be performed.
Employees in this HOTEL are always Responsive to
6
help you.
Assurance
Disagree Agree
The behavior of staff in this HOTEL instills
7
confidence in you.
Employees in this HOTEL have the full knowledge to
8
answer your every question.
Empathy
Disagree Agree
The staff of this HOTEL gives you individual or
9
exclusive attention to solve your problem.
The employees of this HOTEL understand your
10
specific needs.
Customer Satisfaction
Disagree Agree
Overall, I am satisfied with the service quality of this
11
HOTEL.
I intend to continue being a loyal customer of this
12
HOTEL for a long time to come.
Filled Questionnaire

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CUSTOMER SATISFACTION IN HOTEL INDUSTRY OF KARACHI-

Satisfaction in Hotel Industry of Karachi- A SERVPERF Analysis”, Special admiration

Innovation and Commercialization) for their valuable support and information.

their worthy information, all their support means a lot to me.

success of a supply chain. In highly service oriented such as hospitality customer

satisfaction is crucial as it leads to repeat customer and word of mouth recommendations

6. Chapter 2: Literature review……………………………………. 5

9. Chapter 5: Discussions, Conclusion, Policy Implications and 19

S.NO. FIGURE Page

Customer satisfaction is considered as important for supply chains specifically in

customers as well as new customers. Evaluation of service quality is essential for

order to assess the degree to which the SC is meeting customer expectation

conducted a research particularly on customer satisfaction about quality of service in

comprehensive assessment several models such as SERVQUAL, SERVPERF have been

model for hotel industry.

1.2 Problem Statement

Customer satisfaction is considered as an essential factor of supply chain. The

order to have a more comprehensive assessment several models such as SERVQUAL,

to use SERVPERF model for the local hotel industry in Karachi.

1.3 Background, Objectives and Significance of the study

outcome that services whether satisfied or dissatisfied customer in hotel sector of

The SERVPERF range is really a far more convergent, in addition to be able to

1.4 Outline of the Study

easier for reader to understand.

been shown to see which hypothesis had been accepted or rejected.

Customer satisfaction: It means the frequency of customer to attain the same

Chapter 2: Literature Review

In a global economy, service excellence is essential for endurance of the firm

(Wisniewski, 2001). Firms are focusing on customer-focused approach rather than

production-led philosophy. Wisniewski (2001) further illustrated that service excellence

quality. Hence foundation of the service quality serves as customer’s expectation.

development in customer retention increases by few percentages. However, customer

retaining fulfilled customer.

disappointed clients debilitate business. Client’s contentment is an asset that ought to be

classifying them into five categories as below:

Tangibility: Appearance of workers, organization’s physical facilities and

appearance of their physical equipment

reliability of the representatives and politeness.

them on the basis of input to two declarations that assess:

1) The common desires of clients involving a service

2) Observations of clients in regards to service level actually offered by company.

Many research scholars illustrated some weakness of SERVQUAL.

SERVQUAL might be used to fragment customers on the premise of their evaluation

scores. Ladhari (2009) further explained that is additionally practical to explore

perceptions and customer’s desires on the basis of geographical and demographic.

Additionally to examine the association's execution on the premise of service extents, a

gain data about their desires.

examination excellence. E-S-QUAL comprising of twenty two items isolated in four

1) "Proficiency" (which depicted as pace of monitoring and using the site)

2) "Contentment" (the intensity to which the site guarantees about request

conveyance and items accessibility is satisfied)

3) "System accessibility" (the right specialized working of the site)

Zeithaml, Parasuraman and Berry (1996) created a SERVQUAL questionnaire contains

(1994) concluded that by utilizing the second section of SERVQUAL instruments, a

quality service. The difference between SERVPERF and SERVQUAL is that

perceived quality (based on expectations).

To satisfy the customer is a core objective of supply chain; whether service or

customers’ expectations, the customer may be delighted and consequently satisfied.

If customer is satisfied with the physical facilities, equipment availability appearance of

customer is satisfied with the reliability of service.

and employees to be responsive then customer is satisfied with the responsiveness of

understanding of customer needs and treating them as important clients is described as