Lehlohonolo Amos Masitenyane Baccalaureus Technologiae Marketing Management Dissertation ...

183 Pages·2011·2.87 MB·English

E C S :
XAMINING USTOMER- UPPLIER RELATIONSHIPS
CUSTOMER SERVICE QUALITY IN A PRECAST CONCRETE

M C
ANUFACTURING OMPANY

Lehlohonolo Amos Masitenyane
Baccalaureus Technologiae Marketing Management

Dissertation submitted in the Department of Marketing and Sport
Management of Vaal University of Technology in fulfilment of the
requirements for the degree Magister Technologiae in Marketing (Faculty of
Management Sciences).

Supervisor: Prof. M. Dhurup
Co-Supervisor: Dr. A.L. Bevan-Dye
January 2010
DECLARATION

This work has not previously accepted in substance for any degree and is not being
concurrently submitted in candidature for any degree.

Signed …………………………………….
Date …………………………………….

The dissertation is the result of my own independent work/investigation, except
where otherwise stated. Other sources are acknowledged by giving explicit
references. A bibliography is appended.

Signed …………………………………….

Date …………………………………….

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ACKNOWLEDGEMENTS

I would first and foremost like to thank God the almighty for giving me the
strength and will power to complete the dissertation. I would also like to
express my sincere gratitude for the assistance of people without whom the
research would not have been possible.

This dissertation is dedicated to my late father who instilled in me the value of
education and devoted his life to me.
My deepest gratitude to my main tutor Professor M. Dhurup and Dr. A.L
Bevan-Dye for their continued joint support, guidance, and encouragement
throughout my research.
Many thanks to Mrs. Flavia van Straten for the preparation of the graphs and
tables, to Mrs. Aldine Oosthuyzen for statistical assistance and Professor D.
Schauffer for language editing.
My sincere gratitude to the staff members of the Goldfields Library – Vaal
University of Technology - for their assistance.
I am most grateful to the organisation I am working for, for their support.
All participants who honestly and reliably answered the questionnaires.
My mother Moipone and my sister Tshepiso for the love and support you have
given me, not only during my academic education but also throughout my life.
This has been the most important reason for where I am today. I thank you
both for that.
Finally, thank you to my wonderful wife Batshetshang and son Rorisang for
allowing me to fulfil a dream. You‟ve been with me through thick and thin
and have never questioned my decisions. Thank you for your understanding
and support. You two are the sunshine of my life.

L.A Masitenyane
Vanderbijlpark
2009

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ABSTRACT

KEYWORDS: Cementitious products, Precast concrete, Construction, Manufacturer,
Service quality, Customer satisfaction, Customer loyalty, Validity, Reliability, Factor
analysis and Analysis of variance.

This study provides a framework for customer-supplier relationships and service
quality measurement in a precast concrete manufacturing firm with the use of the
universally accepted SERVQUAL model. Within an increasingly competitive precast
concrete market, customer satisfaction is a critical goal for manufacturers of all types.
Customer-supplier relationships and service quality were therefore investigated in this
study.

A quantitative research approach was used in the study to analyse the data. This
approach enabled the researcher to obtain an accurate measure of all constructs that
relate to service quality improvement for the particular concrete manufacturing firm
amongst contractors, civil consultants, government institutions and end users. A
sample size of 246 respondents from Gauteng Province was used. Descriptive
statistics were used to explain the characteristics of sample data. In addition, factor
analysis was used to condense the variables into five factors in order to capture the
essence of service quality within a cementitious products organisation. Five
dimensions, responsiveness, problem- solving, physical aspects, service personnel
and physical appearance were extracted to measure service quality.

Results showed that satisfied customers tend to re-patronise suppliers who enhance
their service outputs provided to the customers. Thus it is imperative to enhance
customer satisfaction and ultimately customer loyalty. These results suggest that
improved service qualities can be useful for building customer loyalty and long-
lasting relationships.

The reliability analysis produced a Cronbach alpha which ranged from 0.700 to 0.815
which were deemed acceptable. The Pearson correlation analysis showed that service
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quality is associated with customers‟ future buying behaviour in terms of their
decisions to purchase and recommend the supplier to others.

Customers felt that service personnel were friendly, courteous and possessed the
knowledge to answer customer questions. They exhibited a favourable image of the
company and its services. This service dimension was ranked first in terms of
importance by the customers therefore, the precast concrete manufacturer ought not
be complacent but rather seek innovative ways in maintaining the service personnel
dimension of service quality.

The overall mean score of expectation of service quality by customers was 4.71. This
indicates that the service provided by this company is satisfactory. It therefore
suggests that, it is necessary for managerial intervention to prioritise in all these areas
to develop a strategy of service quality improvement. Training of personnel is an
essential component of service quality enhancement especially with complaints and
the complaints-handling procedures. The management team of the organisation needs to
play an active role in ensuring that all personnel are adequately trained and highly
motivated to understand the user‟s specific problems and in the process to provide
competent solutions to problems.

Based on literature and results emanating from the empirical survey, these findings
may assist the organisation in the enhancement of its service-quality levels. Hence,
service-quality levels should be monitored carefully on a continuous basis.

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T O C
ABLE F ONTENTS

CONTENTS PAGE

CHAPTER 1 INTRODUCTION AND PROBLEM ORIENTATION

1.1 INTRODUCTION 1
1.2. PROBLEM STATEMENT 2
1.3. OBJECTIVES OF THE STUDY 3
1.3.1 Primary objectives 3
1.3.2 Theoretical objectives 4
1.3.3 Empirical objectives 4
1.4. RESEARCH METHODOLOGY 4
1.4.1 Literature review 5
1.4.2 Empirical study 5
1.4.2.1 Target population 5
1.4.2.2 Sampling technique 5
1.4.2.3 Sample size 6
1.4.2.4 Method of data collection 6
1.4.2.5 Measuring instruments 6
1.5. STATISTICAL ANALYSIS 6
1.6. CHAPTER CLASSIFICATION 7
1.7. DEFINITIONS 7
1.7.1 Service 7
1.7.2 Service quality 7
1.7.3 Customer service 8
1.7.4 Cementitious products 8
1.7.5 Precast concrete 8

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TABLE OF CONTENTS… (Continued) PAGE

1.7.6 Customer satisfaction 8
1.7.7 Customer loyalty 8
1.7.8 Customer expectations 8
1.7.9 Validity 8
1.7.10 Reliability 8
1.7.11 SERVQUAL 8

1.8 SYNOPSIS 9

CHAPTER 2 INDUSTRY PROFILE, CUSTOMER SERVICES AND
SERVICE QUALITY 10

2.1 INTRODUCTION 10
2.2 GENERIC PERSPECTIVE OF THE PRECAST CONCRETE
INDUSTRY 10
2.3 INTERNATIONAL PRECAST CONCRETE SECTOR PROFILE 12
2.4 SOUTH AFRICAN PRECAST CONCRETE SECTOR PROFILE 15
2.5 COMPANY PROFILE 24
2.5.1 Background 24
2.5.2 Company‟s sales department and market segmentation 26
2.5.3 Competition 27
2.6 CUSTOMER SERVICE 29
2.6.1 Nature and definition of service 29
2.6.2 Characteristics of customer service 31
2.7 CUSTOMER-SUPPLIER RELATIONSHIPS 35
2.7.1 Dependence and power in buyer-seller relationships 39
2.8 QUALITY 41
2.9 SERVICE QUALITY 44
2.9.1 Emergence of service quality 44
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TABLE OF CONTENTS… (Continued) PAGE

2.9.2 Defining service quality 46
2.9.3 Dimensions of service quality 49
2.9.4 Measuring customer expectations 53
2.9.5 Measuring perceptions of service quality 55
2.10 CUSTOMER SATISFACTION 56
2.11 CUSTOMER LOYALTY 59
2.12 SYNOPSIS 64

CHAPTER 3 RESEARCH METHODOLOGY 66

3.1 INTRODUCTION 66
3.2 RESEARCH DESIGN 66
3.2.1 Qualitative research 66
3.2.2 Quantitative research 67
3.3 SAMPLING DESIGN PROCEDURE 68
3.3.1 Target population 68
3.3.2 Sampling method 69
3.3.3 Identification of the sample frame 70
3.3.4 Sample size 71
3.3.5 Data collection and questionnaire development 71
3.3.5.1 Questionnaire layout 73
3.4 PRE-TEST AND PILOT TESTING 74
3.5 DATA PREPARATION 74
3.6 DATA ANALYSIS 75
3.6.1 Descriptive analysis 76
3.6.2 Frequency distribution 76
3.6.3 Inferential statistics 76
3.6.4 Correlation 77
3.6.5 Factor analysis 78
3.6.5.1 Exploratory factor analysis (EFA) 78
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TABLE OF CONTENTS… (Continued) PAGE

3.6.5.2 Methods of extraction 79
3.6.5.3 Rotation 80
3.6.5.4 Naming of factors 81
3.6.6 Analysis of variance (ANOVA) 82
3.6.7 Reliability analysis 83
3.6.8 Cronbach‟s alpha 85
3.6.9 Validity of the instrument 85
3.6.9.1 Content validity 86
3.6.9.2 Construct validity 86
3.6.9.3 Convergent validity 87
3.7 ETHICAL ISSUES IN DATA COLLECTION 87
3.7.1 Anonymity and respect for the dignity of persons. 87
3.7.2 Nonmaleficence 88
3.7.3 Beneficence 88
3.7.4 Justice 88
3.8 SYNOPSIS 88

CHAPTER 4 ANALYSIS AND INTEPRETATION OF EMPIRICAL
FINDINGS 90

4.1 INTRODUCTION 90
4.2 PILOT TESTING OF THE QUESTIONNAIRE 90
4.3 ANALYSIS OF THE MAIN SURVEY RESULTS 93
4.3.1 Response rate 93
4.3.2 Gender composition of the sample 93
4.4 EXPLORATORY FACTOR ANALYSIS (EFA): SECTION B 97
4.4.1 Bartlett‟s test of Sphericity 97
4.4.2 The Kaizer-Meyer-Olkin (KMO) test 98
4.4.3 Factor rotation 98
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TABLE OF CONTENTS… (Continued) PAGE

4.4.4 Factor extraction 98
4.4.5 Percentage of variance 99
4.4.6 Eigenvalue 99
4.4.7 Scree plot 100
4.4.8 Reduction of items 101
4.4.9 Final factor structure 103
4.5 NAMING AND INTERPRETATION OF THE FACTORS 104
4.6 EVALUATION OF OVERALL EXPECTATIONS OF SERVICE
QUALITY 108
4.7 OVERALL LEVEL OF SATISFACTION 110
4.8 OVERALL ORGANISATIONAL LOYALTY 111
4.9 ANALYSIS OF VARIANCE (ANOVA) 112
4.10 RELIABILITY ANALYSIS 118
4.11 RELIABILITY FOR SATISFACTION AND
LOYALTY 118
4.12 VALIDITY 119
4.12.1 Content validity 120
4.12.2 Construct validity 120
4.12.3 Convergent validity 121
4.13 SYNOPSIS 123

CHAPTER 5 RECOMMENDATIONS 124

5.1 INTRODUCTION 124
5.2 OVERVIEW AND OBJECTIVES OF THE STUDY IN PERSPECTIVE 124
5.2.1 Theoretical Objectives 125
5.2.2 Empirical Objectives 126
5.3 RECOMMENDATIONS 127

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