SERVICE QUALITY AND CUSTOMER SATISFACTION IN BANK OF ABYSSINIA

Abstract

The main purpose of this study was to assess the effect of service quality on customer satisfaction taking Bank of Abyssinia as a case study. Questionnaire survey approach was employed to see the customer’s perceived value of the service of Bank of Abyssinia and in this case SERVPERF instruments developed by Cronin and Taylor applied the dimensions in designing the questionnaire. The researcher took 324 sample respondents, selected conveniently from six Grade-3 branches in Addis Ababa. The finding indicates that the service quality of the organization satisfied all the three segments such as Retails (mean 4.08), Small and Medium Enterprise, SME (mean 3.91) and Corporate customers (mean 3.83). The highest perceived service quality is observed in Empathy and Assurance. The regression result shows empathy has highest impact on customer satisfactions followed by assurance and responsiveness. However, Tangibility and Assurance shows insignificant difference between customer segments but significant difference was seen on reliability, responsiveness and empathy dimensions of the banks’ service quality. As the customer groups of the bank had different perception in terms of the stated three dimensions, segmenting them with such factor holds ground. The bank is advised to give strong emphasis to all the service quality dimensions in maintaining but improving that service quality the bank provides dimensions having significant differences among customer’s groups.