Chapter II

REVIEW OF RELATED LITERATURE AND STUDIES

This chapter presents of related literatures and studies and related

readings. On service quality and student satisfaction.

Demographic Profile

According to Firdaus (2005), have been conducted that college

performance or educational attainment are influenced by various demographic

factors such as gender, ethnicity, socioeconomic status, and birth order.

According to Chen (2016), service quality determined a number of

students enrolled in a university or college each year. This adds to the

importance of measuring and evaluating service quality provided by the

institutions.

According to Schwantz (2006) research considered only the age factor,

dividing it into two categories, below 25 years old (“traditional” students) and

above 25 years old (“non-traditional” students), as the aim was to explore the

differences in service experiences between the regular, traditional students and

working, adult students.

According to Ilias et. al., (2008) studying bachelor degree students in

private higher education institutions could not find any significant differences in

demographic variables in the perception of service quality of higher education.

According to Elliot & Shin (2007), as reported more female students

graduated, compared to male student. Furthermore, female students tended

to score higher for academic adjustment. Parental education level is also relevant

to be studied as the predictor of academic outcome.

 According to Soutar and McNeil (2005) found that there was a significant

relationship between gender and satisfaction with service quality.

Service Quality

Ahmed & Nawaz (2010) mentioned that service quality is a key

performance measure in educational excellence and is a main strategic variable

for universities to create a strong perception in consumer’s mind. According to

Oliver (2009), customer satisfaction is fairness due to its value paid. This is in

line with the ideas of Parasuraman, Zeithaml, & Berry (2005) that consumers can

feel both satisfaction and dissatisfaction due to the service provided and the

money paid. Customers are satisfied whenever services provided are more than

the price paid, and they are dissatisfied whenever services provided are less

than the price paid.

(Kitapci & Taylan, 2009) customer satisfaction does not always relate to

complaints meaning that consumers who never complain do not necessarily

mean that they are satisfied. Service Quality A definition of quality revolves

around the idea that quality has to be judged on the assessment of the user or

consumer of the service. The construct of quality as conceptualized in the

services literature is based on the perceived quality. Perceived quality is defined

as the consumer’s judgment about an entity’s overall experience or superiority

(Zeithaml, 2007; Zammuto et. al. 2006). Similarly, Parasuraman, Zeithaml and

Berry (2005) also concluded that consumer perceptions of service quality result

from comparing expectations prior to receiving the service, and their actual

experience of the service. Perceived quality is also seen as a form of attitude,

13
related to, but not the same as satisfaction, and resulting from a comparison of

expectations with perceptions of performance (Rowley, 2006).

(Marzo Navarro, Pedraja Iglesias, & Rivera Torres, 2005). In higher

education, the studies on student satisfaction are few due to its complexity.

Kotler and Clarke (2006) define satisfaction as a state felt by a person who has

experience performance or an outcome that fulfill his or her expectation.

Satisfaction is a function of relative level of expectations and perceives

performance. The expectation may go as far as before the students even enter

the higher education, suggesting that it is important to the researchers to

determine first what the students expect before entering the university (Palacio,

Meneses and Perez, 2007).

In contrary, Carey, Cambiano and De Vore (2007), believe that

satisfaction actually covers issues of students’ perception and experiences

during the college years. According to Lassar, Manolis and Winsor (2008), two

most prevalent and widely accepted perspectives on service quality include the

SERVQUAL model and the Technical/Functional Quality framework. Gronroos

(2007) held that service quality is made up of three dimensions "the technical

quality of the outcome", "the functional quality of the encounter" and “the

company corporate image”. He argued that in examining the determinants of

quality, it is necessary to differentiate between quality associated with the

process of service delivery and quality associated with the outcome of service,

judged by the consumer after the service is performed.

14
 According to Lassar, Manolis and Winsor (2006), two most prevalent and

widely accepted perspectives on service quality include the SERVQUAL model

and the Technical/Functional Quality framework. Gronroos (2005) held that

service quality is made up of three dimensions "the technical quality of the

outcome", "the functional quality of the encounter" and “the company corporate

image”. He argued that in examining the determinants of quality, it is necessary

to differentiate between quality associated with the process of service delivery

and quality associated with the outcome of service, judged by the consumer after

the service is performed.

Tangibility

According to Johnston (2005) The tangible elements of a company

product can be assessed, measured and submitted to certain standards.

Beamish & Ashford (2008) use the term ‘tangibility’ in the SERQUAL model as

one of the dimensions in service quality assessment. The tangible elements of a

company product can be assessed, measured and submitted to certain

standards. Johnston (2005) classifies tangibility to cleanliness or neat

appearance of the tangible components and the physical comfort of the

environment where services are provided. Albayrak, Caber and Aksoy (2010)

argue that the tangible elements of hotel products are more influential on the

overall satisfaction, as they can be modified or renewed more easily in

comparison with the intangible.

The SERVQUAL scale should be applied carefully, and the determinants

and attributes of the instruments should always be reassessed in any situation

15
before the instrument is used. Aswell as markets and cultural environments,

service is different, so it may be necessary to add new aspects of the service to

be studied to the original set of determinants and attributes, and sometimes to

exclude some from measurement instrument used. Intangibility is one of the key

characteristics of services. (Wolak, Kalafatis, Harris, 2008). Johnston (2005)

argues that the intangible aspects of the staffclient relationship have a significant

effect, both positive and negative, on quality service. Bebko (2006) proposes that

the significance of tangible components is lowest for services with the lowest

share of tangibility, and highest for services with the highest share tangibility.

Shostack (2005) proposed a molecular model, among others, for hotel

companies as well. Service quality in hotel business has both a tangible and

intangible basis, so that the hotel product is a mixture of elements not necessarily

of the same type (Jones, Lockwood, 2009). The molecular model can be

changed successfully in the case of a hotel product, given that it comprises a

range of separate, but mutually linked elements, such hotel and room design,

food and drink supply, employees’ service, the overall ambience and

atmosphere. An overview of literature shows that hotel guests most frequently

tend to consider the following attributes when deciding on the choice of hotel:

cleanliness, location, price, safety, quality of service and reputation of the hotel

itself or the hotel itself. Atkinson (2008) found that the cleanliness of

accommodation, security and helpful staff are hotels’ most important attributes.

Rivers, Toh and Alou (2006) point out that the members of patrons programmed

are most influenced by the convenience of location and overall service.

16
 The tangibles dimension is described as the physical quality such as

facilities, equipment and personnel appearance. According to Yator (2012),

facilities like well-furnished reception desk or trained personnel can influence

customer perceptions about tangibles service qualities. Meanwhile, Alsaqre

(2011) in his study recommended that great attention must be given to all

tangible factors of service quality because such factors have their influence on

customers’ loyalty and can bring more profits to the organization. This is also

highlighted by Abdullah, Razak, Marzuki. (2013), measuring five satisfaction

assessments such as comfort, safety, cleanliness, sufficiency and functionality

towards the facilities provided at Langkawi Island jetty terminals. They find that

the operators of tourism products and services should have precise plan and

using a specific approach to conduct the maintenance activities of their facilities

so that the tourist activities may be carried out without unnecessary hindrances

and to maintain satisfaction level.

Reliability

According to Buttle (2006) reliability is the ability to execute the promised

service accurately and without fail. Reliable service performance is a customer

expectation and means that the service is accomplished on time, every time, in

the same manner, and without errors. Dabholkar et. Al., (2006). Reliable service

performance must meet customers’ expectation. Service must be accomplished

on time, every time, in the same manner and without errors. Based on Glynn

(2008) conceptualization of service quality, the original SERVQUAL instrument

included 22 items. The data on the 22 attributes were grouped into five

17
dimensions: tangibles, reliability, responsiveness, assurance, and empathy. This

instrument has been made to measure service quality in a variety of services

such as hospitals (Babakus & Glynn 2007), hotels (Saleh & Rylan 2005), travel

and tourism (Fick & Ritchie 2005), a telephone company, two insurance

companies and two banks. In this study, the researcher uses SERVQUAL

approach as an instrument to explore customers’ expectations and perceptions

levels of service quality towards the front office staff at the hotel.

Service quality has widely been discussed since 20th century and its idea

are still relevant to help today organizations in creating differentiation and gaining

competitive advantage in an era of borderless world and globalization [Ali 2016,

Fotaki 2015, (Karatepe 2016]. In a quality management literature, service quality

is often seen as a multi-dimensional construct. For example, Nordic school of

thought suggests that effective service quality should have two important

dimensions, namely technical quality (i.e., what customers received from

services provided by an organization) and functional quality (i.e., how an

organization delivers services to customers) (Brady & Cronin 2006, Gronroos

2007). Later, the service quality construct has been modified and simplified by

US school of thought where it proposes that effective service quality should have

five specific dimensions, namely tangible (physical facilities, equipment, and

appearance of workers), reliability (ability to perform the promised service

dependably and accurately), responsiveness (willingness to help customer and

provide prompt service), assurance (knowledge and courtesy of workers and

their abilities to inspire trust and confidence), and empathy (caring, individualized

18
attention the organization provides its customers) (Ismail, Rose & Foboy, 2016,

Baldwin & Sohal 2008, Berry & Zeithaml 2006, Wan Edura & Jusoff 2009).

However, these quality school of thoughts have different perspectives, the source

of their ideas are developed based on individual attitudes and perceptions

(Sriram, Chintagunta & Machanda 2015, Yuen & Thai 2015).

Responsiveness

According to Bahia and Nantel (2005), responsiveness is the ability to

execute the promised service accurately and without fail. Reliable service

performance is a customer expectation and means that the service is

accomplished on time, every time, in the same manner, and without errors. The

desire and willingness to assist customers and deliver prompt service makes up

the dimension of responsiveness. Parasuraman, (2006) include such elements

in responsiveness as telling the customer the exact time frame within which

services will be performed, promptness of service, willingness to be of

assistance, and never too busy to respond to customer requests. Bahia and

Nantel (2008) disregarded responsiveness in their research, claiming a lack of

reliability even though they recognized SERVQUAL and all of its dimensions as

the best known, most universally accepted scale to measure perceived service

quality. Responsiveness was also one of the original dimensions not modified by

Zeithaml, et. al., (2008).

According to Douglas & Connor, (2008), Parasuraman et al., (2005), and

Ladhari, (2008), the intangible elements of a service (inseparability,

heterogeneity and perishability) are the critical determinants influencing service

19
quality perceived by a consumer. This means that a service must be well defined

by the provider in terms of its characteristics to understand how service quality is

perceived by consumers. According to Johns, (2009), a service could mean an

industry, a performance, an output, an offering or a process and it is defined

differently in various service industries. The differences in service industries are

based on the characteristics of service which include; intangibility, heterogeneity,

perishability and inseparability. Intangibility means there is no physical product,

nothing to be touched, tasted, smelled or heard before being purchased and this

therefore means that it is difficult for consumer to understand the nature of what

they receive. An example would be a telecommunication company offering

mobile services to consumers; here the consumer makes just calls and does not

receive any physical product. In grocery stores, it is very difficult to evaluate

intangibility because their activities are centered on the physical products. This

means that service providers must try to determine the level of intangibility of

services and try to include tangible elements that could aid understanding of

expectation from the consumer’s perspective (Beamish & Ashford, 2007).

Heterogeneity means that, difference which comes in at the level of delivery of

service due the difference in human behavior of those offering services and the

consumer. Example occurs when a salesperson offers assistance to one

customer at the counter, that same person cannot offer exactly the same thing to

the next customer because of differences in behaviors. This is why it is difficult

to determine the quality and level of service provided since consumers and

service providers are different, the same consumer could act differently with the

20
same service provider (Beamish & Ashford, 2007). Perishability means that,

since services are produced and consumed at the same time implying, they

cannot be stored for later usage. If the service is not used then, it cannot be used

again. This does not however hold in every service industry (Beamish & Ashford,

2007). An example occurs when a person books a hotel room for a night and

does not use it, no other person can use at that same time. Inseparability means

services are consumed as they are purchased. An example is seen when a

consumer is making a telephone call, he/she consumes the service while paying

the charges. This implies that the consumer is involved in the production and

delivery of the service meaning he/she takes special note of what is produced by

the service provider (Beamish & Ashford, 2007).

Empathy

According to Razalli & Rizal, (2008), empathy is more than simple

sympathy, it is understanding and supporting others’ needs with compassion or

sensitivity for the purpose of developing customer relationship. Empathy shows

the magnitude of caring and individual attention given to the customers. The

employees’ commitment to deliver quality and efficient services will greatly satisfy

customers (Razalli & Rizal, 2008). In the workplace, empathy shows a deep

respect and care for co-workers as opposed to just doing something by rules and

regulations. An empathic leadership style motivates every personnel to feel like a

team with one common direction. When this happens, productivity, morale and

loyalty will increase. Empathy service dimension is a powerful tool to achieve

organizational objectives (Carev, 2008). The provision of caring demonstrated by

21
the customer service staff and individualized attention provided to customers.

Empathy includes approachability, sense of security, and the effort to understand

customer's needs. In order to operationalise the service quality construct, had

made use of qualitative and quantitative research, following generally accepted

psychometric procedures. Their research had resulted in the progression of the

original 22-item SERVQUAL instrument, which is one of the most widely used

operationalisations of service quality. The contention by the developers of

SERVQUAL that the instrument can be applied to determine the service quality

offering of any service firm has led to its extensive adoption (Dabholkar et al.,

2006). The SERVQUAL scale is based on the difference in scores between

customer expectations of service and their perceptions after receiving the

service. Initially, Ritchie (2008) focused on the ten determinants of service

quality. However, after two stages of scale purification, they reduced the ten

determinants to five dimensions of service quality: tangibles, reliability,

responsiveness, assurance, and empathy (Saleh & Rylan, 2008).

Empathy is the provision of caring demonstrated by the customer service

staff and individualized attention provided to customers. Empathy includes

approachability, sense of security, and the effort to understand customer's needs.

In order to operationalise the service quality construct, Parasuraman et al. (1996)

had made use of qualitative and quantitative research, following generally

accepted psychometric procedures. Their research had resulted in the

progression of the original 22-item SERVQUAL instrument, which is one of the

most widely used operationalization’s of service quality. The contention by the

22
developers of SERVQUAL that the instrument can be applied to determine the

service quality offering of any service firm has led to its extensive adoption

(Dabholkar et al., 1996). The SERVQUAL scale is based on the difference in

scores between customer expectations of service and their perceptions after

receiving the service. Initially, Parasuraman et. al., (2005) focused on the ten

determinants of service quality. However, after two stages of scale purification,

they reduced the ten determinants to five dimensions of service quality:

tangibles, reliability, responsiveness, assurance, and empathy (Parasuraman

2005).

However, few prior literatures have raised criticisms on the SERVQUAL

model (Churchill Jr., Brown and Peter, 2006; Cronin Jr. and Taylor, 2007 and

Buttle, 2006). Firstly, there was little evidence that customers assessed service

quality through the disconfirmation paradigm (i.e. measuring the gap between

service expectations and actual service performance). Secondly, they also

argued that SERVQUAL had been inaptly based on an expectations-

disconfirmation model rather than an attitudinal model of service quality. Cronin

Jr. and Taylor (2005) pointed SERVQUAL out as “hesitance to call perceived

service quality an attitude”. Thirdly, according to Buttle (2006), SERVQUAL

instrument failed to capture the dynamics of changing expectation. Therefore,

performance-minus expectations were deemed as an unsuitable basis to

measure service quality (Cronin Jr. and Taylor, 2005). Teas (2008) further

argued that because the service quality expectations concept might have

discriminant validity shortcoming (i.e. expectations does not measure service

23
quality as well as it is expected to), the perceptions-minus-expectations service

quality measurement framework could be a misleading indicator of service quality

through customer perception. Thus, he recommended by eliminating the

expectations measure, the SERVQUAL model could be improved, by relying

solely on the perception component.

Assurance

According to Zeithaml et. al., (2006), defined as “the employees’

knowledge and courtesy and the service provider’s ability to inspire trust and

confidence”. According to Andaleeb and Conway (2006), assurance may not be

so important relative to other industries where the risk is higher and the outcome

of using the service is uncertain. Thus, for the medical and healthcare industry,

assurance is an important dimension that customers look at in assessing a

hospital or a surgeon for an operation. The trust and confidence may be

represented in the personnel who links the customer to the organization

(Zeithaml 2006). Assurance service quality refers to the employee’s

knowledge, competence, credibility, courtesy, security, skill and ability to inspire

trust and confidence. Assurance should emphasize well on the work

performance because customers want attention and prompt services. Poor

services can result in discouragement and it can ruin the company’s image.

Customers will not buy the product or avail again of the services offered due to a

failure to comply the precise promised service delivery and thereby causing a

decline of the hotel sales performance (Mok et. al., 2011).

24
 Assurance will indicate the employees’ knowledge, courtesy and ability to

incorporate trust and instill confidence that the customers feel safe in their

transaction. This principle involves every touch point within the organization; from

people that answer the phone to the people that interact with the customer every

day, assurance must be a priority to sustain long term profitability and success of

the organization. Assurance quality service will increase company credibility to

have a better competitive edge against its competitors. It is the amount of

confidence that a business establishment instills in their respective clients to

make them trust the company (Mok et. al., 2011). Quality assurance literature

(Ho & Wearn, 2006; Quinn et. al., 2009; Yeo, 2008; Yeo & Li, 2012) and higher

education management literature (Soutar & McNeil, 2006; Duarte et. al., 2012; Li

& Kaye, 2008; Woodall 2014). Since the conceptualization of the quality of

service model (SERVQUAL) by Parasumaran et al. (2005), the extant literature

on quality of service has been replete with discussions on the dimensions and

measurement of quality of service (O’Neill & Palmar, 2005; Sultan & Wong,

2011) for service performance improvement, stemming from a neo-liberal

perspective. From the mid-1980s, several researchers (Abdullah, 2006a;

Abdullah, 2006b; Bojanic, 2006; Cronin & Taylor, 2007; Min 2012; O’Neill &

Palmar, 2005; Reynoso & Moores, 2005; Shank 2005; Soutar et. al., 2006;

Smith et. al., 2007; Stodnick & Rogers, 2008; Sumaedi et. al., 2012; Yeo & Li,

2012) used work done by Parasumaran et. al., (2005) as the basis of studies on

quality of service in higher education. However, most of the research on quality

of service is still related to consumer services, focusing on issues of service

25
delivery, while research on quality of service related to professional services,

particularly in higher education, remains scant (Shank et. al., 2005; Schneider &

White, 2007; Sultan & Wong, 2011). Research on quality of service in HEIs in the

Singaporean context (Tan & Kek, 2004; Yeo, 2008; Yeo, 2009), although limited,

has also explored the service delivery and performance perspective.

Students Satisfaction

According to Walker-Marshall & Hudson (2009) students satisfaction is a

multidimensional process which is influenced by different factors. Grate Point

Average (GPA) is the most influential factor on student satisfaction. Marzo-

Navarro, et al., Appleton-Knapp & Krentler, identified two groups of influences on

student satisfaction in higher education as personal and institutional factors.

Personal factors cover age, gender, employment, preferred learning style,

student’s GPA and institutional factors cover quality of instructions, promptness

of the instructor’s feedback, clarity of expectation, teaching style. Wilkins &

Balakrishnan 64 identified quality of lecturers, quality of physical facilities and

effective use of technology as key determinant factors of student satisfaction. As

well as, student satisfaction in universities is greatly influenced by quality of class

room, quality of feedback, lecturer-student relationship, interaction with fellow

students, course content, available learning equipment, library facilities and

learning materials. In addition to that, teaching ability, flexible curriculum,

university status and prestige, independence, caring of faculty, student growth

and development, student centeredness, campus climate, institutional

26
effectiveness and social conditions have been identified as major determinants of

student satisfaction in higher education.

In the higher education sector, Carney (2005) proposed nineteen variables

that can be used to evaluate the image of a college. These variables include

variety of courses, academic reputation, class size, student qualification

(academic), student qualities (personal), faculty – student interaction, quality

instruction (faculty), career preparation, athletic programs, student activities

(social life) , community service, location, physical appearance (campus), on –

campus residence, facilities and equipment, friendly, caring atmosphere,

religious atmosphere, safe campus and cost (financial aid they posit that though

the nineteen variables were developed to evaluate college image, they are also

highly relevant to the measurement of service quality. Most of empirical studies in

education institutions have produced evidence that service quality leads to

students‟ satisfaction (Long et. al., 2014) but review of literature highlights that

there is lack of consensus on the definition of satisfaction as a concept with

service quality and generally there are no clear accepted instrument for customer

satisfaction in higher education institution (Alnaser & Al-Alak, 2012). A literature

review implies that higher education service quality is the key antecedent of

students’ satisfaction, suggesting that elevated level of perceived higher

education service quality tends to increase students’ satisfaction. Consequently,

in a competitive higher education market, higher education institutions must

strive to continuously improve the services they deliver to its students in order to

meet their expectations and demands (Lee, 2013).

27
 According to Bergamo, et. al., (2012) retention of customer is the key

factor in business and it is defined as a particular firm’s capability to provide a

customer not only a buying product, but together with a relationship pattern in a

specific period of time. As competition increases in the current turbulent

education business environment and with the emergence of knowledge as a

driver of economic development higher education institutions and business

industry worldwide encounter slower growth rate, price pressures which has

brought serious attention on customer satisfaction and retention (Danjuma &

Rasli, 2012). Satisfaction is the key building block which will be able to retain the

firm’s customers or students in reference to education institutions (Rahman et al.,

2012). Retention of customers will have strong effect on the particular education

institution’s profitability (Lee, 2013). In this context Danjuma and Rasli (2012)

posits that satisfaction is an essential element for customer attachment which will

lead to continuity of the student in the education institution which refers to

student retention.

The Relationship between Service Quality and Student Satisfaction

Understanding student satisfaction was highly related to service quality.

Satisfaction is a customer response to the service provided (Tse & Wilton, 2008).

According to Oliver (2005), customer satisfaction is fairness due to its value paid.

This is in line with the ideas of Parasuraman, Zeithaml, & Berry (2005) that

consumers can feel both satisfaction and dissatisfaction due to the service

provided and the money paid. Customers are satisfied whenever services

provided are more than the price paid, and they are dissatisfied whenever

28
services provided are less than the price paid. Additionally, customer satisfaction

does not always relate to complaints meaning that consumers who never

complain do not necessarily mean that they are satisfied (Kitapci & Taylan,

2009). In higher education, the studies on student satisfaction are few due to its

complexity (Marzo Navarro, Pedraja Iglesias, & Rivera Torres, 2005).

Theoretically, the relationship between service quality and student

satisfaction remains unclear (Anderson et. al., 2007). The study conducted in

India found a positive relationship between service quality and student

satisfaction (Annamdevula & Bellamkonda, 2016, 2016), indicating that the

increase in service quality was the increase in the student satisfaction. This is

supported by Alves & Raposo (2009) and Duarte et. al., (2012) who conducted

studies in Portugal. Similarly, Khoo, Ha., and McGregor (2015) conducted a

study in Singapore which found the strong relationship between service quality

provided by private tertiary education sector and student satisfaction. A study on

Malaysian private education institutions found a positive relationship between

tangibility which is one of the dimensions of service quality and student

satisfaction (Mansori, Vaz, & Ismail, 2014). They discovered that tangible

facilities in the private campus determine student satisfaction. However, a study

conducted on higher education institution in Syria did not find any evidence about

service quality influence on student satisfaction (Dib & Mokhles, 2013).

Zeithaml et. al., (1996) mentioned that a good perception of service quality

influences student behavior. Teaching quality and students’ emotion of their

commitment to institution increase student loyalty (Henning-Thurau, Langer, &

29
Hansen, 2006). In addition to those studies, positive relationship between service

quality and student loyalty was found in a study conducted in India

(Annamdevula & Bellamkonda, 2016, 2016). They concluded that a loyal student

was helpful for institution staff in determining the right promotion, and

development as well as maintaining a long-term success (Annamdevula &

Bellamkonda, 2016). The opposite result was found by Dib & Mokhles (2013) in

their study in Syria which found that there was no relationship between service

quality and student loyalty.

30