CHAPTER I INTRODUCTION Bajaj is an automobile company with global presence and take pride in our Indian roots and values. KVR motors (marketing branch) at Calicut deals with the sale and
service of bikes. They always intends to leverage through its strong marketing initiative like brand building, creating strong franchisees, restructuring dealerships, effective after sale service and sale of new brands. This project deals with the study of customer experience after getting the product with regard to service and also examines the service quality gap by comparing customer‟s expectations and their actual perceptions by using the SERVQUAL model. Service quality is a concept that has aroused considerable interest and debate in the research literature because of the difficulties in both defining and measuring it with no overall consensus emerging on either. Customer satisfaction and service quality are often treated together as functions of customer‟s perceptions and expectations and research has shown that high service quality contribute significantly to profitability. Service quality is required to be first measured in order to improve the quality in a service organization. The measurements used were based on the widely accepted SERVQUAL model which is the most common method for measuring service quality. Customer participation in service production process greatly influences service quality. It is related to cost, profitability, customer satisfaction, customer relation, behavioral intention and positive word of mouth. Through this project those factors can be identified that determines the relation between customer satisfaction and service quality.
1
STATEMENT OF PROBLEM
The main focus of KVR Bajaj is on providing high quality service to its customers and the firm usually uses modern technology to provide excellent service. But it‟s the customer who only judges the service quality after using the product. Therefore, it is essential to evaluate the service rendered by KVR, Bajaj. The management wants to know whether the customers are satisfied with the present service which they are rendering. So the research problem is to conduct “a study on service quality and customer satisfaction with reference to the SERVQUAL model” OBJECTIVES OF THE STUDY 1. To determine the different factors influencing the service quality. 2. To ascertain whether there is any actual or perceived gaps between customer expectations and perceptions of the service offered. 3. To ascertain whether there is any gaps between Service quality specifications and actual service delivery. 4. To know the areas where gap exists so that the company can allocate more resources to better service and, 5. To suggest measures to improve the service quality, if found needed.
SCOPE & SIGNIFICANCE OF THE STUDY The study is intended to conduct the existing customers of Bajaj, who owns bikes in the small segment. The project covers the customers of KVR Bajaj in Calicut district. As the competition is increasing day by day in automobile industry, a company like Bajaj should understand whether the customers are valued or not. Since the major players are intended to enter the small segment, to keep its position 2
as now, they have to rethink that their customers are getting much benefits from their product. Apart from these threats, the major fear of the firm is in increasing the demand of the customers and retaining the customers in the market SETTING OF HYPOTHESIS Based on the objectives explained above, the following hypothesis has been set for the study. H0: There is no significance difference between customer expectations and actual perceptions of service H1: there is significance difference between customer expectations and actual perceptions of service H0: There is no significance difference between Service quality specifications and actual service delivery H1: there is significance difference between Service quality specifications and actual service delivery.
RESEARCH DESIGN The type of research design adopted is descriptive research design, since it involves detailed numerical descriptions such as distribution of population of a community by age, sex, geographical locality, cost and education.
3
DATA SOURCES The study is based on both secondary and primary data. Secondary sources: Secondary data were obtained from the articles, journals, official website of Bajaj. Primary source: The primary data were collected from customers of Bajaj with the help of a structured questionnaire and also, individual interview with employees of KVR motors. SAMPLING DESIGN A sample design is a definite plan for obtaining a sample from a given population. Population: All customers of KVR motor at Calicut region. Sample size: For the convenience of study the sample size was fixed at 75 respondents. Effort was taken to include different segments of customers in the sample. SAMPLING TECHNIQUE Simple random sampling is used; the structured questionnaires are given to 75 respondents who visited KVR Bajaj within the time frame of the data collection period. The simple random method is used because each and every population has an equal chance of being selected and also it helps to reduce bias.
4
RESEARCH INSTRUMENT In this study structured questionnaire is used as the research instrument which contains closed ended questions. VARIABLES OF THE STUDY The variable list drawn up for the study included. 1. Reliability 2. Tangibility 3. Responsiveness 4. Assurance 5. Empathy
5
Fig no: 1 conceptual model of service quality
Model of Service Quality Gaps
There are five major gaps in the service quality concept, are Gap 1: The difference between management perceptions of what customers expect and what customers really do expect The reasons for GAP 1 - not knowing what customers expect – lack of a marketing orientation
6
– inadequate
upward
communication
(from
contact
staff
to
management) – too many levels of management
Gap 2: The difference between management perceptions and service quality specifications - the standards gap The reasons for GAP 2 -the wrong service quality standards -inadequate commitment to service quality -lack of perception of feasibility - „it cannot be done‟ -inadequate task standardisation the absence of goal setting Gap 3: The difference between service quality specifications and actual service delivery - are standards consistently met? The reasons for GAP 3 - the service performance gap – role ambiguity and role conflict - unsure of what your remit is and how it fits with others – poor employee or technology fit - the wrong person or system for the job – inappropriate supervisory control or lack of perceived control - too much or too little control – lack of teamwork
Gap 4: The difference between service delivery and what is communicated externally - are promises made consistently fulfilled?
7
The reasons for GAP 4 - when promises made do not match actual delivery – inadequate horizontal communication - between departments or services – a propensity to overpromise
Gap 5: The difference between what customers expect of a service and what they actually receive -expectations are made up of past experience, word-of-mouth and needs/wants of customers -measurement is on the basis of two sets of statements in groups according to the five key service dimensions
These are the five factors of SERVQUAL model. The independent variables which affect the above dependent variables can be grouped as: o Trust worthiness o Service time o Response o Communication
8
o Approach of employees o Facilities
DATA ANALYSIS The data collected from the respondents using the research instrument is analyzed with the help of statistical tools for the purpose of drawing inference regarding the study 1. Classification and Tabulation The data collected will be classified on the basis of the variables, and tabulated as per methodology in order to facilitate analysis. Various statistical tools will be used 2. Statistical analysis tools • Z test • Measurement of skewness • Arithmetic mean • Standard deviation
9
CHAPTERISATION The whole project is divided into four chapters Chapter
Title
Description
Number 1
INTRODUCTION
This chapter includes the brief introduction of the topic, significance of the study, objectives, the research methodology and limitations of the study.
2
INDUSTRY
This chapter is divided into two parts. The
PROFILE
first part contains a detailed industry profile. The second part deals with the company profile.
3
4
LITERATURE
This chapter briefly describes the various
REVIEW
aspects of service quality
DATA
ANALYSIS In this part the classified and tabulated data
AND
is analyzed using statistical tools from which
INTERPRETATION
the inference is drawn. All the questions in the questionnaire is subjected to analysis and interpreted accordingly
5
FINDINGS
AND This chapter contains the main findings and
SUGGESTIONS
the suggestions. A summary and conclusion are also included in this part.
10
the
LIMITATIONS OF THE STUDY As the study is concentrated on a particular unit, the project gets only a limited area under study Data will be collected through random sampling so the disadvantage of the same will be reflected on the project. 1. One of the most obvious limitations of simple random sampling method is its need of a complete list of all the members of the population. 2. This list is usually not available for large populations. In cases as such, it is wiser to use other sampling techniques. Time constraints The data collected from 75 respondents form the basis of the entire study. Since the study is based on SERVQUAL model the disadvantage of the same will be reflected on the project: 1. SERVQUAL's 5 dimensions are not universals 2. The model fails to draw on established economic, statistical and psychological theory 3. Concept of expectation is loosely defined and leads to multiple interpretations and resulted operationalisation of SERVQUAL is open to multiple interpretations, 4. A number of researchers cannot agree on the different dimensions are appropriate for expectations, perceptions and gap scores. 5. SERVQUAL only focuses on process of service delivery rather than outcomes of service encounters.
CHAPTER II 11
INDUSTRY PROFILE The first form of motorbikes was a bicycle was a very crude one. It was called clarifier or wooden horse which was invented in France sometime around the 1770‟s on this model there was a fixed steering wheel and no pedals, this means that the person riding has a very little steering capability and had to push their feet across the ground to propel them. The next improvement was the attachment of a movable steering, which made for much easier riding, this model was called Drasine or dandy horse in1839 a Scottish blacksmith named Kirkpatrick Mac Millan added a very important invention to the Drasine it was the pedal which he attached to the back wheel this made it easier to propel the bike. It was the first ever bike to be patented in the U.S. The automobile was the reply of the 19th century dream of self propelling the horse drawn carriage. The similarly the invention of the motorcycle created the self propelled bicycle. Edward butter an English man built the motor cycle in 1884. The first gasoline engine motorcycle to appear publicity was built by Gottieb Daimler of Germany in 1885. One wheel in the front and one in the back although it has a smaller spring loaded outrigger wheel on each side. It was constructed mostly on wood; with the wheels being of the iron banded wooden spoiled wagon type, definitely a bone crusher chassis. The 1980‟s saw the conversion of many bicycles or pedal cycle by adding small certainty mounted spark ignitions engines. There was then felt the need for reliable constructions; this lead to road trail test and completion between manufactures such was the providing ground floor many new ideas early two stock
12
cycle designs to supper charge multi mate engines mounted on aerodynamic, carbon fiber reinforced body work. The popularity of the vehicle grew especially after 1910 during world war-I all branches of the armed forces in Europe was principally sent for dispatching after the war it enjoyed a spout vogue until the great depression began in 1929. After the world war-II a revival of interest in motorcycle lasted into late 20 th century with the vehicle being used for high speed touring and sport competition. The practice of attaching auxiliary engines in bicycle in western Europe and parts of the us led to the development during the 1950‟s of a new type of light motorcycle is called moped originating in Germany has 50cc machine with simple control and low cost. It was largely free of licensing and insurance regulations except in Great Britain. INDIAN SCENARIO The Indian two wheeler industry contributes the largest volume among all the segments in the automobile industry. Though the segments can be broadly categorized into three sub segments viz scooters, motorcycles and mopeds. Some categories introduced in the market area are combined of two or more segments. Eg scooters and step thrus. In the four to five years the two wheelers market has witnessed a market shift towards motorcycle at the expenses of scooters. In the rural areas consumer have come to sturdier bikes to with stand the bad road conditions. In the process of motorcycle segment has grown from 48% to 58%. The share of scooters decline drastically from 33% to 25% while that of Mopeds declined by 2% from 19% to 17% during the year 2000-01. The euro emission norms effective from april2000 led to the existing players in to the stroke segment to install catalytic converters. 13
Excise duty on motorcycle has been reduced from 32% to 24% resulting in price reduction which has aided in propelling the demand for motorcycles. Fierce competition has also forced players to cut prices of certain models. Two wheelers are the entry- levels personal transport. THE INDIAN MOTOR CYCLE MARKET India has traditionally been a two stroke scooter market. With the introduction of stricter euro I and II emission norms, scooter makers were forced to upgrade their technology, gradually robbing them of their substantial price advantage over motorcycles. This coupled with aggressive pricing by motorcycle turned the tables of the two wheeler market in favor of motorcycles. The recent years have seen the motorcycle market grow at scorching rates as it wrestles share from the scooter and moped market. For the period of 1993-94 to 2001- 02, motorcycle sales recorded a CAGR of 25.8% compared to CAGR of 0.6% for scooters and 0.8% for Mopeds. CREATING NEW SEGMENTS The booming motorcycle market coupled with the low growth rates of the scooter and moped market, has led many erstwhile scooters and moped manufacturers to jump on the four stroke motorcycle bandwagon. The majority of the market is still accounted for by the basic 100cc Rs 40000 to 45000 motorcycle. However, the new launches in the last two years have created entirely new segments in the market. At the lower end, there have been successful launches in the Rs 30000-Rs35000 band, which have redefined the entry level market. At the same time the upper end performance segment has been flooded with many new launches in the 125cc+category. These segments also look all set to be further sub
14
segments as market players continue to launch new products to fill in any existing gaps. Positioning an Indian bike While the scooters appeals to the family man, a motorcycle‟s main audiences has always been the young mail individual. Niche brands Bajaj pulsar are targeted towards college students, while most mainline brands have concentrated on the young working man in the 25-35 year age group. Being a high involvement purchase, rational benefits derived are very important in deciding the purchase. At the same time, a motorcycle, like a car is one of the most obvious statement of self leading to immense potential on the emotional benefits paradigm as well the brands in the markets have tried every trick in the book to appeal to the Indian market from promoting rational benefits such as performance to creating brands personalities that would appeal to the male buyer. From trying to cash in on nationalistic feelings through corporate campaigns to using celebrities such as Hrithic Roshan and Sachin Tendulkar to endorse the brand various tactics have been used by various players to lure the motorcycle customers. India is the second largest manufacturer and producer of two wheelers in the world. It stands next to Japan and China in terms of the two wheelers produced and doestic sales respectively. This distinction was achieved due to variety reasons like restrictive policy followed by the government of India towards the passenger car industry, rising demand for personnel transport inefficiency in the public transportation system etc. The Indian two wheeler industry made a small beginning in the early 50‟s when automobile products of India. Until 1958 API and ENFILD were the sole producers. 15
In 1948, Bajaj auto began trading in improved VESPA scooters and three wheelers. Finally in 1960, set up a shop to manufacturer them in technical collaboration with piaggio of Italy. In the initial stages, the scooter segments was dominated by automobile products or India(API) later it was over taken by Bajaj auto, LML was one of the leading scooters at that time and nova it stands shine among the scooter industry in India. The motor cycle segments in India was controlled by only three manufacturers ENFIELD, JAVA and ESCORT bullet was a four stoke bike. Initially the market was mainly captured by ENFIELD and ESCORT. ENFIELD was a 350cc bikes and escort 175cc bikes. The two wheeler market was opened ended to foreign competition in the mid 80‟s. at the time it emerged the era of 100cc bikes and existing leaders enfield and escorts werw thrown out from the market. It resulted in the emergence of hero Honda, the only producer of four stroke bikes (100cc category)gaining the top slot. The first japaneese motor cycle were introduced in the early 18 th century. Tvs suzki and hero Honda brought in the first two strokes and four stroke engine motor cycles. The entry of kinetic Honda in the later 18 th with a scooter helped in providing easy and smooth use to scooter owners. This helped in the industry in youngter and working women towards buying scooters. Later the scooter industry had a decline and the trend of scooters was changed to two strokes and four strokes bikes. In 1990 the entire automobile is a drastic fall in demand. The main reason for the recession in this sector was the 16
raise in the fuel prices, high input costs and reduced purchasing power of the people. India is one of the very few countries manufacturing three wheelers in the world. It is the world‟s largest manufacturing and sellers of three wheelers. Bajaj auto commends a monopoly in the domestic market with a market share of above 80%.
17
COMPANY PROFILE About Bajaj Bajaj automobile is one of the India‟s top 10 companies in terms of market capitalization and one among top 5 in terms of annual turnover. Bajaj automobile limited came into existence on Nov 29, 1945 as Automobile Pvt Ltd. The founder of Bajaj Automobile Pvt Ltd was Jamnalal Bajaj. The wheeler areas they produce include pick up vans, autorikshas and delivery vans. Bajaj is also popular in manufacturing various consumer goods which have become so relevant, for all the people over the world. Goods like bulb, tube lights, and fan are the other products. The most important persons of Bajaj Auto Ltd are Rahul Bajaj (Managing Director), R.A.Mahtra ,Rajiv Bajaj (President) and R.L.Ravichandran (Vice President) with overall 350 dealership all over India and one regional office at Cochin they are rated as the best dealer in India. The main advantage of Bajaj Automobile are they have low maintenance value and good mileage and pick up compared to other two wheelers. The Bajaj two wheelers are also rated as five star vehicles in terms of its cultural gearbox, good handling, power breaking, lasting style, comfort and of course in terms of money which is affordable by every person. The Bajaj Auto Ltd has got over a strength of 12000 employees, which is definitely supreme that other automobile companies. The Bajaj Automobile Ltd has got around 25 dealers in India including Bajaj dealers at Calicut. The main competitors of Bajaj are Hero Honda, TVS, are Hero Honda, TVS, Yamaha and Suzuki.
18
About KVR KVR motors is the authorized dealers of M/S Bajaj Auto Ltd for selling and servicing of two wheelers and three wheelers in the district Calicut, Wayanad, Kannur and Malappuram. KVR motors is a sole proprietorship concern owned by K.P.Nair an NRI hailing from Kannur district. KVR Bajaj was started on Nov 21, 1987. KVR motors namely KVR Bajaj is now one of the leading services, sales and spare parts provider in India. KVR has execellent facilities at their show room and service workshop at Chakkorathkulam, Kannur road, Calicut. The company was inaugurated on 20 th 1997 by Sri Madhur Bajaj who was the president of Bajaj Auto Ltd in 1997. The opening of KVR group in Calicut has been born to the customers in the Malabar region. KVR motors was the first business organization when the KVR group had set up at Calicut 10 year back and more production projects had followed with the main aim of providing employment to the youth of Malabar region. KVR motors has its main show room and service enters at WEST HILL- Calicut and has branches at VADAKARA, QUILANDY, RAMANATTUKKARA, SULTTHAN BATHERY, KALPETTA, MANATHAVADY, PRERAMBRA, BALUSSERY, KUNNAMANGALAM, KODUVALLY and THAMARASSERY. M/S Bajaj Auto Ltd awarded the dealership performance award to KVR motors several time. KVR motors was successful in increasing the market share of Bajaj Auto Ltd from 7% to 30% in motorcycle industry managed by a professional team. KVR motors was awarded the best spare parts dealer at all India Bajaj dealer conference held at KualaLampoor May 2002. Bajaj Auto having convinced with
19
financial and management capabilities of KVR motors awarded the dealership status at Kannur in 2003. The main financiers of KVR motors are ICICI, HDFC, Bajaj finance and SBI. They provide attractive scheme to the customers. KVR Bajaj has 6 departments namely services, sales, administration, finance and EDP. Each department has got its own managers to control the department. It consists of 176 staff in total. KVR Bajaj show room spread out in 1000 sq feet. The working hours are from 9am to 6pm.
KVR mainly concentrate on the
satisfaction of customer providing better quality services.
20
PRODUCT PROFILE Bajaj products are classified on the basis of its rate 1
ECONOMY/ ENTRY PRODUCTS
RATE
CT 100 ORDINARY 100 CC CT 100 DLX 100 CC PLATINA ORD 100 CC
30 to 40 thousands
PLATINA DLX 100 CC 2
EXECUTIVE PRODUCTS DISCOVER JADOO 112 CC K 70
RATE 40 to 55 thousands
DISCOVER KS 125 CC Dts i DISCOVER ES 125 CC DISCOVER Dtssi 135 CC 3
PREMIUM PRODUCTS
RATE
PULSAR 150 ES 150 CC above 55 thousand PULSAR 150 KS 150 CC PULSAR 180 ES 180 CC PULSAR 180 ES 180 CC UG-3 PULSAR 150 ES 150 150 CC UG-3 PULSAR 200 CC Dts i PULSAR 220 CC Dts i AVENGER 180 CC ES Table no: 1 product profile 21
ORGANISATIONAL CHART
PROPRIETOR
JOINT MANAGER
P&A MANAGER
FINANCE MANAGER
EDP MANAGER
ASSISTANT
FINANCE OFFICER
SYSTEMS OFFICER
ACCOUNTANT
SERVICE MANAGER
ASSISTANT MANAGER
SERVICE ENGINEER
SUPERVISOR
SPARE PARTS MANAGER
GERNERAL MANAGER SALES
ASS. SPARE PARTS MANAGER
SALES MANAGER
STOREKEEPER
STORE ASSISTANT
SALES EXECUTIVES
ASS. SALES MANAGER
SALES OFFICER
MECHANICS CLERICAL STAFF
SALES EXECUTIVE
Fig no: 1 organizational chart 22
CHAPTER III REVIEW OF LITERATURE
THEORECTICAL PERSPECTIVE OF STUDY The most basic concept underlying marketing is that of human needs. The task of any business is to deliver customer value at a profit. In a hyper competitive economy with increasingly rational buyer faced with abundant choice, a company can win only by fine tuning he value delivery process and choosing, providing and communicating superior value. Consumer‟s needs and wants are fulfilled through Marketing offer some combination of products, services, information, or experiences offered to a market to satisfy a need or want. Marketing offers are not limited to physical products. They also included services, activities or benefit offered for sale that are essentially intangible and do not result in ownership of anything. Services have been studied extensively since 1980‟s. The idea of linking services value and customer satisfaction has existed for a long time. Customer satisfaction has been studied and recognized as an important factor in the management literature fp0r the past decades. A study indicates that there are links among customer satisfaction, customer loyalty, and profitability. During recent years there have studies that have established mechanisms that attempt to link customer satisfaction and service quality. Many studies additionally attempt to establish connections between service quality, customer satisfaction, customer loyalty and profitability. Many organizations spend millions of dollars annually on marketing research because it can be used for various purposes. Marketing researcher can help an organization improve quality of its customer service, identify new service 23
opportunities and gain a competitive edge over competitors. Service organizations can use different approaches to conduct market research. Customer satisfaction
To understand the importance of customer satisfaction, consider these facts: customers with problems usually don't react and only 4% of them complain; normally a person with problem tells 9 other people about it; while satisfied customers tell 5 other people about their good experiment; keeping a current customer costs about 1/7 of the cost of acquiring a new customer; retaining a current employee costs one tenth of hiring and training a new one. These facts; highlights the crucial role of satisfying customers which brings employee satisfaction; hence, the profit maximization of the company. Therefore, organizations need to understand that to what extend their customers would be satisfy. Customer satisfaction in marketing context has specific meanings: Anders Gustafsson, Michael D. Johnson, & Inger Roos (2005) brought customer satisfaction definition as customer's overall evaluation of the date. This satisfaction has positive influences on retaining customers among different variety of services and products. In service based enterprises; service quality directly affects customer satisfaction.
Ingrid FecÏikovaÂ, (2004) interpreted satisfaction as a feeling which results from a process of evaluating what was received against that expected, the purchase decision itself and/or the fulfillment of needs/want. Satisfaction refers to achieving the things we want. If satisfaction interprets as "not going wrong" the firm should decrease complaint which by its own is not sufficient. In order to satisfy customers, company should improve its services and products. Customers with less 24
expectation are more satisfied: companies by adding innovative features would easily increase customer satisfaction. In contrast, when customers are unaware of improvements but critical of losses in existing quality are less satisfied and expect more.
One of the main ingredients of success in the market place is customer satisfaction. Jochen Wirtz (2003) listed the results of customer satisfaction as follows: repeat purchase; loyalty; positive word-of-mouth and increased long term 8 profitability. Therefore, companies should measure their customers' satisfaction to fortify their strengths and improve their weaknesses.
Customer satisfaction in 7 steps 1. Encourage face to face dealings 2. Respond message promptly & keep your clients informed 3. Be friendly and approachable 4. Have clearly defined customer service policy 5. Attention to detail(also known as „the little niceties‟) 6. Anticipate your clients needs & go out of your way to help them out 7. Honor your promises.
Service Quality
Service quality is a concept that has aroused considerable interest and debate in the research literature because of the difficulties in both defining it and measuring it with no overall consensus emerging on either (Wisniewski, 2001). There are a 25
number of different "definitions" as to what is meant by service quality. One that is commonly used defines service quality as the extent to which a service meets customers‟ needs or expectations (Lewis and Mitchell, 1990; Dotchin and Oakland, 1994a; Asubonteng et al., 1996;Wisniewski and Donnelly,1996).
Service quality can thus be defined as the difference between customer expectations of service and perceived service. If expectations are greater than performance, then perceived quality is less than satisfactory and hence customer dissatisfaction occurs (Parasuraman et al., 1985; Lewis and Mitchell, 1990). Always there exists an important question: why should service quality be measured? Measurement allows for comparison before and after changes, for the location of quality related problems and for the establishment of clear standards for service delivery. Edvardsen et al. (1994) state that, in their experience, the starting point in developing quality in services is analysis and measurement. The SERVQUAL approach, which is studied in this paper is the most common method for measuring service quality.
Model of Service Quality Gaps There are five major gaps in the service quality concept, are Gap 1: The difference between management perceptions of what customers expect and what customers really do expect The reasons for GAP 1 - not knowing what customers expect – lack of a marketing orientation – inadequate
upward
communication
management) – too many levels of management 26
(from
contact
staff
to
Gap 2: The difference between management perceptions and service quality specifications - the standards gap The reasons for GAP 2 -the wrong service quality standards -inadequate commitment to service quality -lack of perception of feasibility - „it cannot be done‟ -inadequate task standardisation the absence of goal setting Gap 3: The difference between service quality specifications and actual service delivery - are standards consistently met? The reasons for GAP 3 - the service performance gap – role ambiguity and role conflict - unsure of what your remit is and how it fits with others – poor employee or technology fit - the wrong person or system for the job – inappropriate supervisory control or lack of perceived control - too much or too little control – lack of teamwork
Gap 4: The difference between service delivery and what is communicated externally - are promises made consistently fulfilled? The reasons for GAP 4 - when promises made do not match actual delivery – inadequate horizontal communication - between departments or services 27
– a propensity to overpromise
Gap 5: The difference between what customers expect of a service and what they actually receive -expectations are made up of past experience, word-of-mouth and needs/wants of customers -measurement is on the basis of two sets of statements in groups according to the five key service dimensions
The Five Key Service Dimensions -TANGIBLES - the appearance of physical facilities, equipment, personnel and information material -RELIABILITY - the ability to perform the service accurately and dependably -RESPONSIVENESS - the willingness to help customers and provide a prompt service -ASSURANCE - a combination of the following o Competence - having the requisite skills and knowledge o Courtesy - politeness, respect, consideration and friendliness of contact staff o Credibility - trustworthiness, believability and honesty of staff o Security - freedom from danger, risk or doubt
28
-EMPATHY - a combination of the following: o Access (physical and social) - approachability and ease of contact o Communication - keeping customers informed in a language they understand and really listening to them o Understanding the customer - making the effort to get to know customers and their specific needs
29
CHAPTER IV ANALYSIS AND INTERPRETATION
RELIABILITY Reliability is defined as the ability to perform the promised service dependably and accurately. In the broadest sense, reliability means that the company delivers on its promises. Customers want to do business with the companies that keep their promises particularly about the service outcomes and core service attributes all the firm needs to be aware of customer‟s expectation of reliability. The mean reliability scores and its standard deviation both for the expectation and experience of consumers are worked out and presented in table no 1.
Table no: 1 mean reliability score and standard deviation in respect of KVR Bajaj Particulars Mean STDV Tabular value
expectation 3.925 0.809
experience 3.671 0.892
difference 0.254
Z value 1.827 1.960
From the table it can be noticed that the mean expectation score for reliability is 3.925 where the experience score is 3.925. The difference is 0.254. The z test is used to test the significance of difference and the results are shown below.
30
The computed Z value (1.827) is less than the table value (1.960) at the 5% level so the null hypothesis that there is no significant difference between customer expectation for reliability and their actual experience at KVR Bajaj is accepted. Hence it can be concluded that there is no gap between customer expectation for reliability and their actual experience at KVR Bajaj.
Acceptance region
Rejection region
Rejection region
-1.960
0
+1.827
+1.960
Fig no: 1 A 5% level of significance, with acceptance and rejection regions of reliability.
31
RESPONSIVENESS
Being willing to help, responsiveness is the willingness to help customers and provide prompt service. This dimensions emphasis attentiveness and promptness in dealing with the customers‟ requests questions complaints and problems. To excel on the dimensions of responsiveness a company must be certain to view the process of service delivery and handling of request from the customer‟s point of view rather than from the company‟s point of view.
The mean responsiveness scores and its standard deviation both for the expectation and experience of consumers are worked out and presented in table no.2. Table no: 2 mean responsiveness score and standard deviation in respect of KVR Bajaj
Particulars Mean STDV Tabular value
expectation 4.133 0.733
Experience 3.819 0.92
difference 0.314
Z value 2.311 1.960
From the table it can be noticed that the mean expectation score for responsiveness is 4.133 where the experience score is 3.819. The difference is 0.314. The z test is used to test the significance of difference and the results are shown below.
The computed Z value (2.311) is less than the table value (1.960) at the 5% level so the alternate hypothesis that there is significant difference between customer
32
expectation for responsiveness and their actual experience at KVR Bajaj is accepted. Hence it can be concluded that the gap is because of service gap already exists. 800 700 600 500 400
responsiveness expectation
300
responsiveness experience
200 100 0 -100
0
1
2
3
4
5
6
fig no: 2 Gap exists between responsiveness expectation and experience.
Acceptance region
Rejection region
Rejection region
-1.960
0
+1.960 +2.311
Fig no: 3 A 5% level of significance, with acceptance and rejection regions of responsiveness. 33
ASSURANCE
Inspiring trust and confidence, assurance is defined as employee‟s knowledge and courtesy and the ability of the firm and its employees to inspire trust and confidence. This dimension is likely to be particularly important for the services that the customer perceives as involving high risk about which they feel uncertain about their ability to evaluate outcomes. The mean assurance scores and its standard deviation both for the expectation and experience of consumers are worked out and presented in table no:3 Table no: 3 mean assurance score and standard deviation in respect of KVR Bajaj
Particulars Mean STDV Tabular value
expectation 3.963 0.785
Experience 3.851 0.867
difference 0.112
Z value 0.83 1.960
From the table it can be noticed that the mean expectation score for assurance is 3.963 where the experience score is 3.851. The difference is 0.112. The z test is used to test the significance of difference and the result is shown below.
The computed Z value (0.83) is less than the table values (1.960) at the 5% level so the null hypothesis that
there is no significant difference between customer
expectation for assurance and their actual experience at KVR Bajaj is accepted. 34
Hence it can be concluded that there is no gap between customer expectation for assurance and their actual experience at KVR Bajaj.
Acceptance region
Rejection region
Rejection region
-1.960
0 +0.83
+1.960
Fig no: 4 A 5% level of significance, with acceptance and rejection regions of assurance.
35
EMPATHY
Treating customers as individuals, empathy is defined as the caring individualized attention the firm provides to its customers. The essence of empathy is conveying, through personalized or customized service that the customers are unique and special. Customers want to feel understood by and important to firms that provide service to them. The mean empathy scores and its standard deviation both for the expectation and experience of consumers are worked out and presented in table no.4 Table no: 4 mean empathy score and standard deviation in respect of KVR Bajaj Particulars Mean STDV Tabular value
expectation 3.963 0.906
Experience 3.843 0 .915
difference 0.12
Z value 5.48 1.960
From the table it can be noticed that the mean expectation score for empathy is 3.963 where the experience score is 3.843. The difference is 0.12. Z test is used to test the significance of difference and the result is shown below. The computed Z value (5.48) is less than the table value (1.960) at the 5% level so the alternate hypothesis
that there is significant difference between customer
expectation for empathy and their actual experience at KVR Bajaj is accepted.
Hence it can be concluded that the gap is because of service gap already exists.
36
700 600 500 400 EMPATHY expectation 300
EMPATHY experience
200 100 0 0
2
4
6
Fig no: 5 Gap exists between empathy expectation and experience.
Acceptance region
Rejection region
Rejection region
-1.960
0
+1.960
5.48
Fig no: 6 A 5% level of significance, with acceptance and rejection regions of empathy.
37
TANGIBLES
Representing the service physically tangibles are defined as the appearance of physical facilities, equipment, personnel and communication materials. All of these are physical representation or images of the service that customers particularly new customers, will use to evaluate quality. In contrast, firms that don‟t pay attention to the tangibles dimension of the service strategy can confuse and even destroy an otherwise good strategy. The mean tangibles scores and its standard deviation both for the expectation and experience of consumers are worked out and presented in table no:5
Table no: 5 mean tangibles score and standard deviation in respect of KVR Bajaj
Particulars Mean STDV Tabular value
expectation 3.864 0.672
Experience 3.747 0.856
Difference 0.117
Z value 0.93 1.960
From the table it can be noticed that the mean expectation score for tangibles is 3.864 where the experience score is 3.747. The difference is 0.117. Z test is used to test the significance of difference and the result is shown below.
The computed Z value (0.93) is less than the table values (1.960) at the 5% level so the null hypothesis that there is no significant difference between customer expectation for tangibles and their actual experience at KVR Bajaj is accepted.
38
Hence it can be concluded that there is no gap between customer expectation for tangibles and their actual experience at KVR Bajaj.
Acceptance region
Rejection region
Rejection region
-1.960
0
0.93
+1.960
Fig no: 7 A 5% level of significance, with acceptance and rejection regions of tangibility.
39
SERVICE QUALITY Service quality is more difficult for the customers to evaluate that the quality of goods. It is based on the consumer‟s perception of the outcome of the service and their evaluation of the process in which the service was performed. The perception results from a comparison of what the customers expected prior to the service and the perceived level of service received The mean service quality scores and its standard deviation both for the expectation and experience of consumers are worked out and presented in table no:6
Table no:6 mean service quality score and standard deviation in respect of KVR Bajaj Particulars Mean STDV Tabular value
expectation 3.923 0.843
Experience 3.872 0.860
Difference 0.051
Z value 0.367 1.960
From the table it can be noticed that the mean expectation score for tangibles is 3.923 where the experience score is 3.872. The difference is 0.051. Z test is used to test the significance of difference and the result is shown below. The computed Z value (0.367) is less than the table values (1.960) at the 5% level so the null hypothesis that there is no significant difference between customer expectation for service quality and their actual experience at KVR Bajaj is accepted.
40
Hence it can be concluded that there is no gap exists between customer expectation for service quality and their actual experience at KVR Bajaj.
Acceptance region
Rejection region
Rejection region
-1.960 -1.960
0 0.367
+1.960
Fig no:8 A 5% level of significance, with acceptance and rejection regions of service quality.
41
CHAPTER V FINDINGS The study is related to service quality and customer satisfaction by using SERVQUAL model with reference to KVR Bajaj, Calicut and 75 respondents were interviewed with the help of the questionnaire on the basis of the data analysis presented in the chapter four, the following findings have been drawn. 1. From the study it is found that, there is actual or perceived gap between customer expectation and perception of the service provided. 2. There is gap between service quality specifications and actual service delivery. 3. KVR Bajaj is providing satisfactory service to its customer. 4. The overall service performance at KVR Bajaj is good. 5. KVR Bajaj has the ability to perform the promised service dependably and accurately in case of reliability 6. 69% of the customers recommend KVR Bajaj dealership to their friends and relatives. 7. Majority (55%) of customers agree that KVR Bajaj is able to provide consistency in service 8. The personnel show interest in solving the problems of the customers. 9. The components and spare parts provided by the company are of high quality. 10.There
is
significant
difference
between
customer
expectation
for
responsiveness and their actual experience at KVR Bajaj the difference is mainly because of the service gap already exists. 42
11.The main problem found in the study is that customers are not highly satisfied with the followup call and service reminder of periodic service maintenance at KVR Bajaj. 12.The billing system in KVR Bajaj is good. 13. KVR Bajaj lack the ability to inspire trust and confidence among the customers 14.There is no significant difference between customer expectations on delivery time and their actual experience at KVR, Bajaj. 15. The factors like time promptness, service person behavior etc have great influence on service. 16.There is significant difference between customer expectation for empathy and their actual experience at KVR Bajaj, it occurs because of the service gap already exist. 17.Consumers expectations on employee performance matches with their experience. 18.There is no significant difference between customer expectation for tangibles and their actual experience at KVR Bajaj. This is because them the technology and machines used by KVR Bajaj are modern. 19.The service providers‟ physical facilities are not visually appealing. 20.There is no significant difference between customer expectation for service quality and their actual experience at KVR Bajaj. 21.The major problem is that the customers‟ complaints are not fully solved, they are having repeated complaints but the amount charged by them for the service is reasonable. 22.From the entire study it is found that the KVR Bajaj should improve a lot to meet customer expectation.
43
SUGGESTIONS i.
Delightful and prompt service should be provided.
ii.
Provide good customer care facility as usual.
iii.
Collect periodical feedback from the customer in order to understand changing market demand.
iv.
As the automobile industry is highly competitive, the company can adopt different types of promotion which can attract different kinds of customer.
v.
Introduce more attractive schemes for the customers. Easy monthly repayment loan, attractive prizes for every new purchase, free accessories in every new purchase, etc.
vi.
Collect all the details of customer and remind them for a periodic service through the call or e-mail. In other words give follow up calls to the customers for a periodic maintenance.
vii.
Provide better technical service in the first time so that KVR can reduce repeated complaints from customer.
viii.
The physical infrastructural facility of KVR Bajaj should improve.
44
CONCLUSION Quality means the degree of excellence in service performance. Service quality is based on consumer‟s perception on the outcome of the service and their evaluation of the process by which the service has been performed.
Service quality
perceptions result from a comparison of what the consumer expected prior to the service and the perceived level of service received. In this project SERVQUAL model is used to know whether there is any gap between consumer expectations and experience offered by KVR Bajaj. It enables us to understand that how company can provide service conveniently to equate with maximum satisfaction. Through this project we came to a conclusion that there is actual or perceived gap between customer expectations and their experience, but KVR Bajaj can improve by providing delightful and prompt service by knowing what the customer actually wants.
45
Bibliography
46
QUESTIONNAIRE We are Manasa Sunny & Vidhya S H (MBA, DCMS, University of Calicut).This questionnaire is for the purpose of conducting project work with regard to a study on service quality and customer satisfaction by using the SERVQUAL model with reference to KVR Bajaj, Calicut. We will be grateful if you could fill this questionnaire and help us to complete our project work successfully. The study is purely academic and we assure strict confidentiality of the subject. PART ONE: PERSONAL DETAILS Name: Age group: 18-25
25 -35
35-45
45 and above
PART TWO: SERVICE DETAILS Mark your answers in 5 point scale
RELIABILITY PARTICULARS
EXPECTATION 5
4
3
1.You recommend KVR BAJAJ dealership to your friends and relatives 2.All the spare parts are original and quality tested 3.You are always getting the new replaced parts of your vehicle after service 4.There is always consistency in service provided by KVR BAJAJ 5.The personnel shows interest in solving the problems of customers
47
2
EXPERIENCE 1
5
4
3
2
1
RESPONSIVENESS PARTICULARS
EXPECTATION 5
4
3
2
EXPERIENCE 1
5
4
3
2
1
6.For lodging the complaints over telephone the service provider is easily accessible 7.Your complaints or queries are taken seriously and attend timely 8.Application/ registration formalities in KVR are convenient to customer 9.KVR offers satisfied follow up and service reminder of periodic maintained service 10.The billing system of the firm is accurate and error free
ASSURANCE PARTICULARS
EXPECTATION 5
4
3
2
11.KVR BAJAJ offers timely delivery 12.KVR BAJAJ offers promising delivery security 13.You are kept well informed prior to service 14.KVR BAJAJ is always trust worthy to customer 15.Your overall experience at KVR BAJAJ dealership is satisfactory
48
EXPERIENCE 1
5
4
3
2
1
EMPATHY EXPECTATION PARTICULARS
5
4
3
2
EXPERIENCE 1
5
4
3
2
1
16.KVR BAJAJ is operating at convenient working hours 17.Service executive are friendly and polite while handling your complaints 18.KVR BAJAJ shows interest to give personnel attention to you and your specific needs 19.KVR BAJAJ has less formalities to be completed before providing service 20.While waiting for the service of the vehicle the customers are given the facilities for all comfort in the waiting lounge
TANGIBLES PARTICULARS
EXPECTATION 5
4
3
21.KVR BAJAJ operating at convenient location 22.The service provider‟s physical facilities infrastructure are visually appealing 23.Technology and machines used are modern 24.The service personnel are skilled enough to diagnose your problem 25.The billing system accurate and up to the mark 49
2
EXPERIENCE 1
5
4
3
2
1
SERVICE QUALITY PARTICULARS
EXPECTATION 5
4
3
26.KVR BAJAJ successfully match customer expectation through all forms of communication 27.KVR BAJAJ educate customers adequately 28.KVR BAJAJ always keep service promise which they communicate through advertisement 29.KVR BAJAJ able to match between advertisement and its operation 30.After sale service of the KVR BAJAJ is satisfactory 31.Same complaints are reoccurring after the service 32.Comfortable with the performance of the vehicle after the service 33.All complaints are fully solved
50
2
EXPERIENCE 1
5
4
3
2
1
51
