Managing Service Quality in Commercial Banks: A Gender Focus
Vanniarajan, T., Manimaran, S., Asia-Pacific Business Review
The Indian banking system was heavily dominated by nationalized commercial banks until the globalization. The financial regulation and credit controls imposed by the Government created a system in which competition was very less. A more competitive banking environment has gradually been achieved through the deregulation measures and permission granted to many private and foreign banks into the Indian banking industry. These changes have also caused a compression of profits and a re-orientation of banking strategy towards quality service provision. (Noulas and Glaveli, 2002). The introduction of new private sector banks and foreign banks has decreased margins and revenues to banks. All commercial banks in the market try to sell mere products (Cross-selling), adopt new dynamic marketing strategies, to develop new innovative products and to place greater emphasis on both the tangible and intangible aspects of their service (Petridon and Glaveli, 2003). As a result of this heightened competition, bank service quality has become an increasingly important factor in determining market shares and profitability in the banking sector (Anderson et al., 1994; Spathis et al., 2002). Perceived service quality results from a comparison of consumer's expectation with their perceptions of the service actually delivered by the supplier (Kangis and Voukelatos, 1997). Groonross defined service quality as a mixture of three elements the quality of the consumption process itself; the quality of the outcomes of the process; and image of the provider of the service.
In the increased competitive banking industry, the Indian commercial banks cannot be too far removed from their customer focus. To achieve the customers satisfaction and retention, it is critical to determine which dimensions of service quality (Reliability, Responsiveness, Assurance, Empathy, Tangibles, Price, Access, Effectiveness) are more important to different customers. The customers are classified on the basis of their profiles. These customer segments require different types of marketing strategies in the banking industry. The customers are classified on the basis of their gender, occupation, benefit seeking, location and other (Gordon et al., 1994; Hood and Walters, 1982; Anderson et al., 1976). Gender is the critical segmentation variable due to the number of reasons. There has been a dramatic increase in women investors in recent years (Philips et al., 1992). Significant difference among male and female consumption pattern was identified in financial goods and services (Burton, 1992). Variables leading to investment among the women have also been changing considerable in recent years (Kover, 1999).
Over the past several years, there have been a variety of studies on different issues pertaining to service quality. Traditionally, service quality has been defined as the difference between customer expectations of service to be received and perceptions of the service actually received (Groonroos, 1984; Parasuraman et al., 1988, 1991). Various models have been developed measuring service quality (Stafford, 1996; Bahia and Nantel, 2000). The SERVQUAL model of Parasuraman et al. (1988) proposed a five dimensional construct of perceived service quality-tangibles; reliability, responsiveness, assurance and empathy-with items reflecting both expectation and perceived performance. The application of SERVQUAL scale has been questioned (Bresinger and Lambert, 1990; Finn and Lamb, 1991; Babakus and Boller, 1992; Dabholkar et al., 2000) in terms of both reliability and validity. Cronin and Taylor (1992) profounded the SERVQUAL model to measure the service quality. In this model, the service quality is measured by the performance only measurement.
Bahia and Nantel (2000) developed a specific new scale for perceived service quality in retail banking. The bank service quality model (BSQ) was an extension of the original ten dimensions of the model of Parasuraman et al. …