Presents the findings of a study performed on data from a large bank’s retail‐banking operations. Illustrates the relationship of customer satisfaction to customer loyalty, and customer loyalty to profitability, using multiple measures of satisfaction, loyalty, and profitability. An estimate of the effects of increased customer satisfaction on profitability (assuming hypothesized causality) suggests that attainable increases in satisfaction could dramatically improve profitability.

The relationships of customer satisfaction, customer loyalty, and profitability: an empirical study

Measuring service quality of banks: Scale development and validation

Purpose – To measure the service quality perceptions of Greek Cypriot bank customers and to examine the relationship between service quality, customer satisfaction and positive word of mouth, in the light of changing bank market dynamics due to EU accession.Design/methodology/approach – A total of 260 retail bank customers responded to a Greek translated version of SERVQUAL. After descriptive and factor analysis, multivariate regression analysis was used to estimate the impact of service quality dimensions on overall customer satisfaction and the impact of satisfaction on positive word of mouth.Findings – The SERVQUAL scale proved to be of a three‐dimensional structure in this study. Results revealed that the expectations of bank customers were not met where the largest gap was obtained in the responsiveness‐empathy dimension. Reliability items had the highest effect on customer satisfaction, which in turn had a statistically significant impact on the positive word of mouth.Research limitations/implicatio...

Customer service quality in the Greek Cypriot banking industry

Service quality is becoming more critical for banks to maintain their market shares. This paper develops a modified SERVQUAL for measuring service quality in the United Arab Emirates commercial banks. The instrument includes thirty items that belong to the five dimensions of SERVQUAL. The developed instrument was tested for reliability and validity and the results indicated that the instrument had only three dimensions. This paper also investigates the difference in significance between the instrument's dimensions. This is supposed to help managers focus their attention on the service quality dimension that matters most to customers.

Measuring perceived service quality at UAE commercial banks

We describe the development of a new scale designed to measure service quality perceptions of retail bank customers. Empirical studies were performed in two waves. First, qualitative research was undertaken in the form of seven focus groups and 39 one‐to‐one interviews. These produced 963 text items that described customers’ service quality perceptions. These were categorised against the technical and functional service quality schema proposed by Gronroos. Then, a three‐phase, four‐sample, quantitative study was undertaken to derive a quantitative measure of technical and functional service quality. We have developed and validated a new 21‐item scale comprising four dimensions: service system quality, behavioural service quality, service transactional accuracy, and machine service quality. We found that customers evaluate SQ at two levels: organisational and transactional. The parsimony, reliability and validity of the scale suggest this is a measure of high utility to the banking industry.

SYSTRA‐SQ: a new measure of bank service quality

Quality is increasingly being seen as a key strategic differentiator within the financial services sector in the UK, with most major players undertaking some form of quality initiative. Describes work undertaken within TSB Bank plc to determine both retail customer and staff perceptions of those factors which determine service quality. Initially identifies the models developed by Parasuraman et al. as being the most appropriate for modelling the data, but finds that although the service gap model provides an excellent basis for analysis, the SERVQUAL model is of more limited value. Describes an alternative basis for modelling service quality based on the three dimensions of process/outcome, subjective/objective and soft/hard is described and modelled against the experimental data. Describes some conclusions of significance for retail banking in particular, and service providers in general.

R.F. Blanchard

Papers

Quality in Retail Banking