THE IMPACT OF SERVICE QUALITY DELIVERY ON CUSTOMER SATISFACTION; THE CASE OF ETHIOPIAN INSURANCE CORPORATION (EIC)

Abstract

In any business–to-customer (B2C) type of environment, satisfying a customer is the ultimate goal and objective. The primary objective of any business organization is profit maximization. Service giving organizations can maximize their profit by rendering quality service to their customers and this leads to customer satisfaction and loyalty. The general objective of this study is to determine the relationship between service quality and customer satisfaction, and also investigate the strategies utilized by the Ethiopian Insurance Corporation to deliver exceptional service quality and customer satisfaction through customer service. It is also clear from this research that customer service has an impact on service quality perception and customer satisfaction. In this research, the SERVQUAL instrument developed by Parasuraman (1985), has been applied in designing the questionnaire by using five dimensions of service quality: tangibility, reliability, responsiveness, assurance, and empathy. Data collected from respondents are analyzed by using SPSS (statistical package for social sciences), Qualitative analysis, descriptive, correlation, and regression analysis. Questionnaires are distributed to randomly selected customers of the six districts and interview conducted to the six retail team leaders of the corporation. The results revealed that the reliability and responsiveness dimensions raised the highest level of expectation, whereas, the results revealed that all of the five dimensions of service quality scored a negative customer gap. The study also investigates the dimensions and their levels of service quality that have significant effect on customer satisfaction in EIC. The findings shows that all dimensions of service quality (tangibility, reliability, responsiveness, assurance, and empathy) are positively correlated to customer satisfaction. The researcher measure service quality and try to identify those areas that need improvement in order to gain a competitive advantage. In addition, the researcher has examined the relationship between five service quality dimensions and customers’ satisfaction in EIC and tried to identify which dimension has the highest impact on customers’ satisfaction and which need improvement. Tangibility has the highest impact on customer satisfaction. EIC need to improve the tangibility dimension of service quality, employees of the corporation need to dress up professionally and the physical setting of the corporation needs improvement.