Chapter 2: Literature Review

n this part of the dissertation, a wide range of literature that relevant to the dissertation topic and influence, guide the methodology of the research as well. Here the literature chosen on various factors. Such as customer satisfaction, service quality in banking in

different countries around the world, SERVQUAL model, dimensions of SERVQUAL etc.

2.1. Customer Satisfaction Satisfaction is an emotional or feeling reaction (Westbrook, Newman, Taylor, 1978). It is the result of a complex process that requires understanding the psychology of customers. The range of emotion is wide with, for example, contentment, surprise, pleasure, or relief. Satisfaction is influenced, in the end, by expectations and the gap between perceived quality and expected quality, called "expectancy disconfirmation" (Rossat, J., Larsen, J., Ruta, D., Wawrzynosek, M. 1998). The figure below shows the predominant linkage of this process.

Figure 1: Customer satisfaction. Source: Rust, Zahorik, Keiningham, 1996

There are many attempts to make a consensus regarding the definition of customer satisfaction, but there still disappearance of it. Customer satisfaction is very famous research topic in marketing research and academic studies. Several researcher study customer satisfaction, among them Cardozo (1965), Giese and Cote (2000) try to define customer satisfaction. But they failed again to give a consensus. According to Gundersen, Heide and Olsson, (1996), a typical definition of customer satisfaction can be written as it is an evaluation of a definite product or service after consumption. It is to be noticed that the evaluation is based on the expectation and perception of the product or service in the mind of the customer. There are a lot of definitions of customer satisfaction. In the following table some definitions of customer satisfaction are tabulated. Authors Definitions Gundersen, Heide and Olsson, 1996 Customer satisfaction is typically defined as a post consumption evaluative judgement concerning a specific product or service CS is the result of an evaluative process that contrasts Oliver, 1980 pre-purchase expectations with perceptions of performance during and after the consumption experience Customer Satisfaction is considered a post choice Soscia 2002 evaluative judgment concerning a specific purchase selection The concept of customer satisfaction describes Swan & Trawick 1981 the emotional reaction to the degree in which a product meets a buyers expectations Customer satisfaction is a collective outcome of Yi ,1990 perception, evaluation and psychological reactions to the consumption experience with a product/service.
(Kotler, 2003) Satisfaction is a persons feelings of pleasure or disappointment resulting from comparing a products perceived performance (or outcome) in relation to his or her expectations

In this regard, the concept which is very popular and widely accepted as well is expectancy disconfirmation theory. In this theory, it suggested by the developer of this theory (Oliver, 1980), that the satisfaction level is sourced from the difference of the expected performance and perceived performance of consumer. Here satisfaction is a positive disconfirmation when the consumption experience is better than expected. In the contrary, when the performance of the product or service based on consumer experience is below the expectation of the consumer, it is

negative disconfirmation. This theory is very influential for defining and conceptualizes the concept of customer satisfaction (McQuitty, Finn and Wiley, 2000).

There are several other aspects of customer satisfaction. In the prior researches, customer satisfaction is defined as the post evaluative judgment regarding purchasing decision. But as a very commonly used theory is discussed in the earlier paragraph, customer satisfaction is a function of disconfirmation. And the function is related to very important element of satisfaction which is expectation and performance. This theory in practice covers various researches on satisfaction of customers. In the researches, this model provides the ground for majority of satisfaction studies. This model encompasses four pillars, namely expectations, performance, disconfirmation and satisfaction. In this disconfirmation model, the effect of expectation of consumer is in affect through the disconfirmation and later it is affected profusely by the perceived performance of the product and services. More importantly, many studies proved that there is direct effect of perceived performance on satisfaction (Finn and Wiley, 2000). Satisfaction is closely associated with performance which can fulfill ones expectation, is firstly argued by Swan and Combs (1976). They found in their research that the dissatisfaction resulted when the performance is out of expectation. They found that the satisfaction is a result of discrepancy between the observed performance of a product or service and desired performance of that product or service as well. This is going with another theory which is the value percept disparity theory. This theory was developed to solve the problem of customer behavior, where they sometime satisfied by some aspects for which the expectation usually never existed. This theory describes satisfaction as a cognitive-evaluative process which is triggered by emotional elements of that consumer. It can be worded as the comparison of the product or services done based on ones values instead of an expectation (Fornell and Wernerfelt, 1987).

In the progression of the earlier concepts, a customer want to balance their values based on their needs and wants, which judge and compare the product or service which is consumed. In the contemporary researches, the focus is driven to the nature of satisfaction which consists of emotion, fulfillment and state of a consumer (Parker and Mathews, 2001). The researches in the recent time, add to this perspective in two ways. Firstly, though the traditional view to customer

satisfaction suggests that this satisfaction is a result of cognitive processes, but in the findings of new researches which formed the new conceptual development, suggests that the satisfaction can be sourced from the affective processes which can contribute to customer satisfaction and its explanation and prediction as well (Westbrook, 1987; Westbrook and Oliver, 1991). Secondly, satisfaction can be viewed as a cumulative experience instead of single transaction specific phenomenon of a certain product or service (Wilton and Nicosia, 1986).

Usually satisfaction derived from pleasure or disappointment sourced from a product or service performance (perceived) related to the expectation. In this way customer satisfaction is a result of both cognitive and affective process evaluation, where a standard is compared between perceived and expected outcome. And then the satisfaction come as it is. If the perceived performance of that product or services is less than expected, the consumer will be dissatisfied. In the opposite direction this will happen reversely. And if there is an equality between the perception and expectation, then the consumer will be indifferent or neutral (Kotler, 2003).

There are some other aspects of customer satisfaction. Customer loyalty is an important factor in customer satisfaction. Because customer satisfaction is resulted from the overall evaluation of an offer of product or service. This overall satisfaction has strong positive effect on the intentions of customer to be loyal with service provider across the various product or service categories. moreover, the judgment of satisfaction is not only related with the single product or services but it is also affected of other experiences also with the service provider or manufacturing organization, such as the sales process, after sales service etc. additionally, customers expectation is formed from the past buying experience, others word of mouth and advices, advertising and promotional activities also. So the satisfaction has several dimension (Zairi, 2000). In the following figure the continuous improvement of customer satisfaction is depicted in this regard.

Figure 2: Continuous Improvement in Customer Satisfaction (Zairi, 2000) 2.1.1. Drivers of customer satisfaction

Based on the customer feedback on various products and services offered in financial service sector, Krishnan, Ramashawamy, Meyer and Damien (1998) identified four factors that affect customer satisfaction in their study. These four factors are branch service satisfaction, automated telephone service satisfaction, product line satisfaction and financial report satisfaction. There was a overall satisfaction factors also existed which estimated from the combination of all four factors. Customer satisfaction may also affected by firm specific factors such as advertising and corporate reputation.

Service offering is the primary driver of customer satisfaction. The above four factors are somewhat related to service offering, so it has important role in driving customer satisfaction. After the service offering, its turn to service delivery as source of customer retention by driving their satisfaction and make them delighted. Four quality attributes found by Krishnan, Ramashawamy, Meyer and Damien (1998) in their study as being critical to determine customer satisfaction with service offering and service delivery. These four attributes are easiness of account opening and closing, product variety, competitive interest rate and fees and lucid information rate on all product and services. A firm needs to channel it resources to improve

product offerings and secondly, a firm can target a specific customer segments to reap the full benefits of the satisfaction through service delivery. In particular, improving the quality of service offering and automated telephone service both offer considerable growth potential of a firm (Krishnan, Ramashawamy, Meyer and Damien 1998).

Quality of customer interface is a key driver of customer satisfaction (Ruth and Jackson, 1995). The above four factors are directly affected by multiple operational quality attributes. Firms need identify and understand the relative effects of these operational quality attributes on the customer rating of four factors (Soteriuo and Zenios, 1998; Armstrong and Harker, 1995).

Advances in IT open the door of innovation by financial firms. Using state of art, innovation in product service offering and delivery is possible. The number of customer who engage in electronic commerce for financial transaction has increased considerably over the years (Businessweek may 25, 1998). In this twenty first century, use of information technology is enormous in innovating and faster and comfortable service to customer of financial product and services. So usage of IT is also an important driver of customer satisfaction.

2.1.2. Drivers of customer satisfaction for financial services This research paper is based on financial service, especially banking sevice. There are several types of financial service which are provided by a banking organization like HSBC. These services ranges from checking account, brokering, settling customer financial transaction to arrange large loan through syndication and supplying capital to other financial and commercial organization. The important aspect of the financial service is, it is not fully fit with the full service oriented organization like hotel and travel agencies and they somewhere between product and service oriented organization, as a financial organization offers tangible products also (Soteriuo and Zenios, 1998).

The types of financial service are different from the service of manufacturing organization. In this way the quality of these two types of service is also varies and sometime financial services quality is quite different from the other types of service providers. The character of financial

service industry is very volatile as the products are mostly intangible. In a banking organization, the service it gives, not only include the prior described services only, rather some other peripheral services, such as online account information and inquiry service, ATM service etc are also included. A very important aspect of a financial service is the continuity of service. It is based on a unique feature of the financial service industry which is the daily consumption of products of financial organization. And an important matter is the actual product is not viewed as the full product, rather the total package of the financial product is accompanying the overall satisfaction of customer with the firm. For this reason, a financial company needs to model its services by including both product and service attributes (Roth and Jackson, 1995).

In several prior researches, some specific quality attributes are common in both manufacturing and service industries which are linked to customer satisfaction very importantly (Zeithaml, Parasuraman, and Berry, 1990). These researches investigated the level of service quality attributes in the interaction with the customer or in different service encounters. It is found that there is a scarcity or lacking of research and guidance to understand the drivers of total customer satisfaction which is derived from overall judgment of satisfaction at the firm level. It is important for the financial service provider, as they have multi channel firms and much diversified services also (Frei et. Al., 1997).

One of many rigorous empirical studies regarding industry of financial service, Roth and Jackson, (1995) identified various determinants of service quality of banking industry. The analysis of their research shows that the quality of service encounters with customer affect the service quality. In this analysis they use a composite measure of quality of service at service encounter, which they termed as customer interface. The measure of quality of customer interface involves several factors. They include employees response to customer questions, providing accurate account statements, timeliness of employees when they perform for the customers and problems solving approach towards the customer.

Another important issue regarding customer interface in financial services is the variety of channels of service delivery, in addition, the notion of financial service customer interface is multifaceted and it is dependent on the types of channel of service delivery. The nature of

interacting customer at branch office is different from that of at IT office. This caused because the medium of service delivery or the channels. So this is very important for developing qualigy service to increase customer satisfaction of customer of financial service. The organization should have better understanding this differences which can help to pull up the overall satisfaction of customers. It proved that various components of customer interface has varying impact on customer satisfaction (Peterson & Wilson, 1996).

2.1.3.

Techniques to measure customer satisfaction

There are a number of techniques to measure customer satisfaction. These techniques include customer satisfaction survey methodologies, focus groups to study customer satisfaction issues, standardized packages for monitoring customer satisfaction, and various computer softwares (Soteriuo and Zenios, 1998).

Among the techniques, some are somewhat problematic when it is implemented. So there are some problem associated with typical customer satisfaction measurement techniques such as focus groups, survey methodologies and customer satisfaction software (Ingrid Feelikova, 2004). These include: Analytical techniques involves with techniques modeled based on analysis, formalize procedure; analysis based systematic process of measurement etc. Secondly, Behavioral measurements of customer satisfaction consist of customer attitude, beliefs, perceptions which can give good indication of customer satisfaction. In addition, observe motivational factors, commitment and behavior of people related or involved in the process are also fall in the behavioral technique to measure customer satisfaction Lastly, Organizational technique to measure customer satisfaction cover the analysis of organizational structure, organizations information flows, its management style and culture of the organization etc (Piercy, 1996). (Ingrid Feelikova, 2004).

2.2. Service Quality

In the contemporary global business arena, service qualities are playing an important role in the success of business and contribute to the growth and profitability also. For this reason providing excellent service quality to a customer is recognized as an important business requirement (Vilares & Coehlo, 2003; Van der Weile et al, 2002).service quality is now treated as not just a corporate offering to customer but also a competitive weapons to survive in the dynamic market place (Rosen et al, 2003) which is very crucial to ensure the profitability of business and make it certain to get growing in the coming years (Newman & Cowling, 1996). However, service quality especially of financial service sector is very complex in nature and regarding the drivers of effective delivery, a very little consensus is made by the prior researches. Some prominent definitions of service quality are summarized in the following table.

Authors Parasuraman, Zeithaml, and Berry, (1985) Gronroos (1991)

Lehtinen (1982)

Definitions Service quality as the ability of an organization to meet or exceed customer expectations Service quality is made up of three dimensions: the technical quality of the outcome, the functional quality of the encounter, and the company corporate image. Service quality in three dimensions: the physical quality (of products and/or services), the corporate quality (the company image) and interactive quality (interaction between the consumer and the service organization). Service quality is the overall evaluation of a specific service firm that results from comparing that firms performance with the customers general expectations of how firms in that industry should perform. Definitions of service quality hold that this is the result of the comparison that customers make between their expectations about a service and their perception of the way the service has been performed.

Parasuraman, Zeithaml, and Berry, (1988)

Lewis & Booms, 1983

2.2.1.

Service Quality dimensions and SERVQUAL model

To develop a model to find or analyze service quality, most famous researchers are Parasuraman, Zeithaml, and Berry (1985) (otherwise referred to as PZB). They do much of the initial work for development of a model in this purpose. PZB initially isolated some factors which are crucial and influencing to service quality. These determinants of service qualities are of ten kinds. These

are: the consumer reliability, responsiveness, competence, access, courtesy, communication, credibility, security, understanding/knowing the customer and tangibility.

PZB (1985) found in their studies, that there are some discrepancies between the perception of customer and that of service provider in terms of quality interacted or rendered. In the investigation, they found that the service quality can be measured and assessed by the function of the discrepancies or they called it the gaps which derived from the customer expectation and what the same customer perceived.

Based on the review of previous research of service quality gap analysis and other factors that influence service quality, PZB (1985) introduced the SERVQUAL scale for service quality measurement. The model is designed in such a way, so that researcher can identify the good or bad service quality and it can provide the service quality trends over time as well. This SERVEQUAL scale is based the two different factors. The two factors are the expectations of a customer and the perception of a customer regarding the service quality of a target commercial organization. In this two broad categories, PZB (1985) select ten determinants that are most important for service quality. These ten determinants of service quality already listed earlier in this section.

In the later research, PZB (1985) select five most important determinants from the ten, they discovered initially. It helps the researcher to be more specific in studying the service quality attribute and its major determinants. To select the five major determinants, PZB (1985) took two stages of purification. Now the final and major determinants of service qualities remains are Tangibles, Reliability, Responsiveness, Assurance, And Empathy (PZB 1988).

The Five Key Service Dimensions TANGIBLES - the appearance of physical facilities, equipment, personnel and information materials 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 Competence - having the requisite skills and knowledge Courtesy - politeness, respect, consideration and friendliness of contact staff Credibility - trustworthiness, believability and honesty of staff Security - freedom from danger, risk or doubt

EMPATHY - a combination of the following: Access (physical and social) - approachability and ease of contact Communication - keeping customers informed in a language they understand and really listening to them Understanding the customer - making the effort to get to know customers and their specific needs
Table 1: Dimensions of service quality

Dimensions Tangibles

Particulars Appearance of physical facilities, equipments, personel and written materials.

Reliability Responsiveness Assurance

Ability to perform the promised service dependably and accurately. Willingness to help customers and provide prompt service Employees knowledge and courtesy and their ability to inspire trust and confidence.

empathy

Caring, easy access, good communication, customer understanding and individualized attention given to customers.

Source: Adapted from Zeithaml et al. (1990)

In this research paper, the model used to measure the service quality of HSBC bank is SERVQUAL model. This model used commonly in other researches to know about the status of service quality. This model is easy to understand and simple to apply, for this reason, the model is selected for this paper. As it is mentioned earlier, that there are five major dimensions which are covering the total representation of service quality of designated firm or organization. In this stage of the literature review, another description by by Brysland, A. and Curry, A. (2001) about the five dimensions will be given to help measuring the actual quality of the delivered service. Reliability When a service is performed very dependably and accurately, it can be said that the service is reliable. In more broader perspective of a company, reliability means the ability of the company to deliver as it promises to its customers, maintain service provision, problem resolution and more importantly rational pricing for the product or services (Brysland, A. and Curry, A. 2001)

Different types of attributes can be of this service quality dimension. Among them, keeping service promises, giving adequate attention, and offering reasonable service charges fall into the category of reliability, one of the service quality dimensions. This service quality dimension is dissimilar to other dimensions, as this dimension is most uniform among the customers. Responsiveness According to Brysland and Curry (2001), responsiveness is involved with the willingness of the service provider to assist customers and to render service on time. The main ingredients of this dimension are timeliness and attentiveness to the customers. A service provider should give time to hear the customer query, complaints, requests and problems and take action before it is too late to hold the customer satisfaction which ultimately may reduce the service quality. Greater emphasis on attentiveness also need to be given, because in this dimension, the two main parts comprising responsiveness is dependent to each other, so if one fail to perform, then other will also not perform that well or efficiently. So to achieve greater quality in this dimension, both timeliness and attentiveness will need to be effective and efficient.

 Assurance The third dimension of the service quality dimensions is Assurance. Brysland and Curry (2001), defines assurance as the knowledge and courtesy of employees of a service provider which will enable the employees to arouse trust and confidence in the mind of a customer. This dimension is very important for financial services. In financial services, customer has to take high risk in taking service and they are not certain about the outcome of the service in the future because banking , insurance, brokering etc service are very risky in nature and has very high uncertainty in the future outcome as well. So in this way, assurance is playing very important role in the satisfaction of customer deriving from service quality dimension. In this research paper, banking service is taken in consideration. In this regard, banking service is very sensitive and confidential to its customers. So assurance is very important than other attributes of service quality. Customer expects financial safety from a banking organization. In the research of Brysland and Curry (2001), the respondents mentioned some attributes which are essential in this regard, are friendliness and professionalism of the employees, feeling of safety etc. some other major attribute of this dimension are courtesy behavior and having adequate knowledge to understand customers need and wants. Care and Empathy

When the service tailored based on the individual customer, then it may be said that the service provider has much care to its customer. Empathy is a very customer centered dimension of service quality. It involves personalized and /or customized service for that segment of customers who are special and unique in terms of their need and wants (Brysland and Curry, 2001),. In financial service, a bank need to give customized service to the corporate customers and customer who very loyal and has good contribution to banks profitability. This dimension is given emphasis on the customization of service process so that each valuable customer will be more satisfied, as the service is tailored to service their individual need and wants.

Tangibles

Finally, tangibles which consist of everything that is tangible in the premise, indoor and outdoor facilities. These include the appearance, physical facilities, and equipments used, material used by personnel and for communication etc. this dimension give image of the service provider. So if the tangible convey negative image in the mind of customer, then it will ruin the service quality and spoil the customer satisfaction. More importantly, a very new customer will evaluate a service provider based on the tangible. So necessary attention should be given to this dimension, otherwise customer may be lost. There might be a contradiction of service intangibility and tangible dimension. But it is need to be in mind, that a customer trying to make the intangible service tangible by its physical appearance, technologies used, cleanliness of the premises, communication material etc. apart from these attributes, respondents mentioned location advantages and feature of a product or service will contributed to the overall customer satisfaction.

2.2.2.

Service quality gaps

To give services, financial firms can not satisfy their customers always. There are a gap exist between the perception of customer and expectation of the same customer as it is discussed in the earlier section. In the following page, a figure showing the types of gaps which are the result of perceptional and expectation differences. There are seven gaps found as an extension of Parasuraman et al. (1985). In the following part, three major gaps is explained with other four gaps as well (ASI Quality Systems, 1992; Curry, 1999; Luk and Layton, 2002). The important gaps identified by the researcher are gap one, gap five, gap six. These gaps are more associated with external customers and have direct relationship with customers as well. Lets have the explanation of each gap.

Gap1: this gap exists when there is a difference between managers perception and the customer expectation. This gap may arise as a result of different types of inter and outer organizational reasons. Some common elements or stimuli that may cause this gap are lack of marketing research effort, ineffective communication in the line of management, and having too many layers in the management.

Gap2: when the perception of managers and the service specification both do not match, the gap two arise in the service delivery. There are many reason identified by researchers. Among them, lack of commitment to serve customer, having perception of infeasibility, lack of standardization in the task management and inability to use the goal setting effectively are prioritized by researcher to eradicate (Curry, 1999).

Gap3: Due to having ambiguous role in providing service there are some conflict arises. So as result there are the third gap is sourced. It caused from the lack of suitability between the job and the employee who perform the job. Sometime poor technology job fit, lack of appropriate supervisory control over the subordinate. Inadequate teamwork and perceived control are also responsible for this sort of gap production.

Gap4: Service delivery versus external communication: it happens when the communication among the horizontal stakeholders of the service organization are not performed effectively. Moreover, sometime companies make over-promise which is leading to make this gap between service delivery and external communication very effectively.

Gap5: it is among the three important gaps which are identified by the researchers. This gap sourced when there is a mismatch between what customer expected and what they perceived at time, they getting the service. It is very important in a sense that it is an outcome of different influences exerted from customers and inabilities or negligence from the service provider. Moreover, the customers are influenced by different types of word of mouth, past service experiences as well. Apart from these, personal needs are also very influential external factor to this gap to be happened.

Gap6: This gap is another important gap among these seven gaps, which should be eradicated for the betterment of the service quality. This gap produced when there is a discrepancy between what customer expecting to service provider and what employees of the service provider organization are perceiving. And it occurred when there is a

difference of understanding of customer expectation by the front end employees of a service provider organization.

Gap7: when the managers and service provider have differences in the understading of customer expectation, there exists the gap seven. Though this gap is not that important like gap one, five and six but it can have a harmful effect on the service quality and it should be minimized.

Figure 2.2: Model of service quality gaps (Parasuraman et al., 1985; Curry, 1999; Luk and Layton, 2002)

Brown and Bond (1995) found in their several research of service quality that this gap model of service quality is the most heuristically valuable contribution to the research of services and it is one of the best models used in the service quality based research. As shown in the above figure, this gap identifies the key incongruities in providing quality service which are related to management perception to service quality, different activities related to service delivery to customers etc. in these seven gaps, first six gaps excluding gap five, showing the functions of the

way in which service usually delivered to the customer. In the gap five, the main emphasis is given on the customer and their evaluation based on the perception and expectation of them. This is the gap which is considered to research in this study by using a very famous model of service quality, the SERVQUAL model.

2.3. Necessity of service quality for customer satisfaction Spathis,Charalambos; Eugenia, Petridou and Glaveli, Niki (2004), in their study on Managing Service Quality in banks: Customers gender effects discussed the service quality of Greek banks on the basis of their customers perceptions, and analyses how gender differences affect customers perceptions of service quality dimensions such as effectiveness and assurance, access, price, tangibles, service portfolio, and reliability. The study supported the hypothesis that gender affects service quality perceptions and the relative importance attached to various banking service quality dimensions.

Yavas,Ugur., Benkenstein,Martin., & Stuhldreier,Uwe (2004) , examined the nature of relationships between service quality, background characteristics, and satisfaction and selected behavioral outcomes by using retail banking in Germany as its setting. Study results shown that service quality is at the root of customer satisfaction and is linked to such behavioral outcomes such as word of mouth, complaint, recommending and switching. The results indicate that tangible elements of service quality and being a female are more closely associated with positive word of mouth and commitment. On the other hand, timeliness aspects of service delivery are more closely related to customer satisfaction, and complaint and switching behaviors.

Alka Sharma and Versha Mehta (2004-05) found that public sector banks enjoy a better quality perception among their customers as for public sector banks, three out of five dimensions have scored higher than average, however, in case of private banks, only two dimensions have higher than average values.

Joshua, A.J. & Koshi, Moli.P. (2005), observed that recognition of service quality as a competitive weapon is relatively a recent phenomenon in the Indian Banking sector. Prior to the liberalization era the banking sector in India was operating in a protected environment and was

dominated by nationalized banks. Banks at that time did not feel the need to pay attention to service quality issues and they assigned very low priority to identification and satisfaction of customer needs.

Nalini Prava Tripathy (2006) highlighted the facts of customer preferences towards the bank. It is the need of the hour for PSBs to inculcate marketing orientation in their work culture. The bankers should educate their front-end staff about the need to meet the customer expectations which alone can build the reputation and image of the bank.

Ashutosh K.Singh and Shiv K.Tripathi (2007) found in their study, that the rating of executives and customers of the Private Bank differs with each other on dimensions like responsiveness, competence, product range and security and agree on dimensions like reliability, accessibility, courtesy and tangibles. Therefore, they suggested that private banks should improve responsiveness, competence, product range and security features in their services.

Purohit, H.C. & Pathardikar, Avinash, D. (2007) covered the issues in their study which related with the measurement of service quality and recorded responses of the bank customers about the services of the Nationalized Banks in India. They identified key elements of strategies seen to be adopted by leading Indian banks include building a strong presence in India and international markets, customer-focused product innovation, financial resilience and a strong operating environment. They stressed the need that the policy decision makers should make multi-cornered efforts to have a new perception of quality.

Vijayakumar T. & Velu.R (2007) collected data from 325 customers of various retail banks in their study to identify the determinants of customer satisfaction in terms of service quality, service feature, service problems, service recovery and product used and the intention of switch over to other banks. He found that in retail banking, core and relational features ought to be equally weighted when managers are interested in improving customer satisfaction. In contrast, when the focus is on reducing switching intentions, considerable emphasis should fall on core items, ensuring successful problem recovery. In this case, the influence of relational features is far less important.

Seema Girdhar (2008) conducted a study regarding banking on relationship which is related to service quality of three co-operative banks in Surat found that the perceived performance of Prime Bank (one of the bank) is relatively close to expectations in comparison to other two banks. They also studied the variations in service quality across demographic variables and income of customers.

R K Mohanty (2008) observed that there are wide gaps exist between the expectations and views of customers on one hand and products and service delivery by banks on the other hand. Also, there exist many socio-cultural aspects quite specific and relevant from the viewpoint of customers as well as banks. Many of these issues are either not addressed so far or to a little extent. Customer satisfaction is not only applicable to external customers; but also equally applicable to internal customers (i.e. employees).