EFFECTS OF SERVICE QUALITY ON CUSTOMER SATISFACTION: THE CASE OF SHERATON ADDIS

Abstract

The study was to investigate the effect of service quality on customer satisfaction in reference to Sheraton Addis. And the researcher applied cross sectional research design. The study was conducted on 384 customers. The sampling technique used in this study is the probability sampling method which is covenant sampling. This study applied mainly the following information gathering tool, i.e. survey questionnaire. Data Analysis was done by inferential statistics, Pearson’s correlation & multiple regressions. As of the result of the study the service quality dimension with the highest mean score is tangibility followed by responsiveness and assurance. This indicates Sheraton Addis is performing at satisfactory level in possessing good looking equipment’s, visually appealing materials and neat appearing employees. In addition the customer perceived that Sheraton Addis is performing better in having knowledgeable and courteous employees and providing secure and trustworthy service. Moreover, Sheraton Addis is performing at satisfactory level in answering customers’ questions and responded quickly to solve customers’ problems. The correlation between T (tangibility), R (reliability), Re (responsiveness), A (assurance) and E (empathy) of the service & CS (customer satisfaction) was strong with r = .594**, p < 0.01; .628**, p < 0.01; .661**, p < 0.01, .625**, p < 0.01 and .630**, p < 0.01 respectively. The coefficient of determination specified that 55.5% of the deviation in customer satisfaction for the 369 responded employees explained by variations in T (tangibility), R (reliability), Re (responsiveness), A (assurance) and E (empathy) of the service while 44.5% remains unexplained. Based on the above findings, the study concluded that the model shows the real practice of customer satisfaction which is affected by T (tangibility), R (reliability), Re (responsiveness), A (assurance) and E (empathy) of the service. Empathy of the service has highly significant effect on customer satisfaction in contrast with other dimensions. Next reliability and responsiveness have significant effects on customer satisfaction. Finally, based on the findings and the conclusions made before, the following recommendations are provided: in limited resource setting it is better to put effort on empathy, reliability and responsiveness of the service.