Project Management

In today's competitive environment delivering high quality service is the key for a sustainable competitive advantage. Customer satisfaction does have a positive effect on an organization's profitability. Satisfied customers form the foundation of any successful business because customer satisfaction leads to repeat purchases, brand loyalty, and positive word of mouth. There are numerous studies that have looked at the impact of customer satisfaction on repeat purchases, loyalty and retention. Many researchers point out the fact that satisfied customers share their experiences with other people to the order of perhaps five or six people. On the contrary, dissatisfied customers are more likely to tell another ten people of their experience with product or service. Critics have argued that outcome quality is missing from Parasuraman et al.'s formulation of SERVQUAL (Cronin and Taylor, 1992; Mangold and Babakus, 1991; Richard and Allaway, 1993).

Measuring service quality is difficult due to its unique characteristics: Intangibility, heterogeneity,inseparability and perishability (Bateson, 1995). Service quality is linked to the concepts of perceptions and expectations (Parasuraman et al., 1985, 1988; Lewis and Mitchell, 1990). Customers' perceptions of service quality result from a comparison of their before-service expectations with their actual service experience. The service will be considered excellent, if perceptions exceed expectations; it will be regarded as good or adequate, if it only equals the expectations; the service will be classed as bad,poor or deficient, if it does not meet them (Vázquez et al., 2001).

This scale operationalizes service quality bycalculating the difference between expectations and perceptions, evaluating both inrelation to the 22 items that represent five service quality dimensions known as 'tangibles', 'reliability', 'responsiveness', 'assurance' and 'empathy'.

Customer satisfaction is a significant subject for most marketers.

Customer satisfaction is an evaluation by the customer, after buying their goods and services. The most popular view of customer satisfaction in academia is that customer satisfaction is the judgment borne out of the comparison of pre-purchase expectations with post purchase evaluation of the product or service experience (Oliver, 1997). Customer satisfaction can result from any dimension (whether or not its quality related) and its judgments may arise from non-quality issues (e.g. needs, equity, and perceptions of `fairness') and require experience with the service or provider (Taylor et al, 1994; Howard and Sheth, 1969).

Strong linkages have been apparent between service quality dimensions (for example fast responses to enquiries) and overall customer satisfaction (Anderson and Sullivan, 1993). But much debate arises from whether customer satisfaction is an antecedent of service quality judgments (Bitner, 1990; Parasuraman, et al, 1985) or the other way round (Anderson and Sullivan, 1993; Cronin and Taylor, 1992; Taylor et al, 1994).

Considerable research has focused on service quality dimensions as the primary determinants of customer satisfaction (Parasuraman et al., 1988;Brown et al., 1993; Zeithaml et al., 1996).

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Bearing this in mind this paper will endeavor to fill the gap of the SERVQUAL instrument and contribute to this neglected dimension by investigating service quality and customer satisfaction using the GrÖnroos's model.

One critics of SERVQUAL has been the point that the instrument focuses on the service delivery process and does not address the service encounter outcome (Gro¨nroos, 1990; Mangold and Babakus, 1991; Richard and Allaway, 1993).

There are two perspectives among scholars on service quality attributes, the American and the European perspectives (_________________________). The American perspective focuses on the functional quality attributes while the European perspective suggests that service quality incorporates two more components i.e. technical quality and image in addition to the functional attributes (_______________________).

There are different instruments that can be used to assess the issue. These are the SERVQUAL, SERVPURF and the GRONROOS model.

The traditional conceptualizations of service quality are based on the disconfirmation paradigm where service quality is viewed as the result of comparing particular performance with some standards (--------------------). For example, Parasuraman et al., (1988) have defined the concept of service quality as results from comparison of perception with expectations.

This instrument measures service quality as a compatible gap between customers' expectation about the service and their actual evaluation of that service in five dimensions.

Among scholars and business practitioners, there is a continuous debate about whether or

not employee attitudes can be directly associated with customer satisfaction and business

performance. According to Heskett

Service quality and customer satisfaction have been frequently studied topics in the service marketing literatures. Numerous empirical studies have been conducted to assess service quality and customer satisfaction (---------------- ---------).

The above arguments reveal that many studies on service quality concentrated on the service delivery process and little emphasis is given to the outcome of the service performance (Gro¨nroos, 1990;Mangold and Babakus, 1991; Richard and Allaway, 1993). However, there is no general agreement about the nature and the content of the dimensions, there is a general perspective that service quality is a multidimensional or multi-attribute construct and additional components should be incorporated in efforts to study and measure service quality (Groonroos, 1982, 1984; vein, Swartz and Brown, 1989).

1. Statement of the Problem

A number of empirical studies have been conducted on the subject of customer satisfaction and service quality (Cronin and Taylor, 1992; Spreng and Mackoy, 1996; Jones and Suh, 2000; Coyles and Gokey, 2002; Ranaweera and Prabhu, 2003; Choi et al., 2004). Among all the measuring instruments of service quality, the SERVQUAL instrument which is developed by Parasuraman and his colleagues has attracted attention most of all (Parasuraman et al., 1988, 1991, 1993) and most of the researches to date have focused on assessing service quality and customer satisfaction using the SERVQUAL instrument (Gro¨nroos, 1990;