Empirical Study on role of customer service
Symbiosis Institute of Management Studies Annual Research Conference (SIMSARC13)Empirical study on role of customer service in deliveringsatisfaction at branded retail outlets in PuneKomal Chopraa *aAssistant Professor, Symbiosis Institute of Management Studies, Pune
AbstractThe aim of the paper is to determine the prominent factors that are important in delivering customer satisfaction at branded retailoutlets in Pune. Secondary data has been collected through research reports and research journals related to human resource andretailing. Primary data is being collected through informal interviews and structured questionnaires administered to front endemployees and customers visiting selected retail formats in Pune and Mumbai. Data was collected through a structuredquestionnaire administered to 200 respondents who visited the malls in the two cities. Factor analysis was carried out to analysethe data. The results indicated that caring, problem solving, committed and helpful salesmen play an important role in deliveringcustomer satisfaction. Hence salesmen skills is important dor customer satisfaction. The research will help retailers in designingmarketing programs that will help give superior customer service. Good service leads to customer satisfaction and retention andprofits for the retailers. This will also help the retailers to have a loyal customer base.© 2013 The Authors. Published by Elsevier B.V.Selection and/or peer-review under responsibility of Symbiosis Institute of Management Studies.Keywords: customer; satisfaction; retail* Corresponding author. Tel.: +0-000-000-0000 ; fax: +0-000-000-0000 .
1. IntroductionIn organized retail outlets, customer service is delivered by front end employees i.e. salespersons. Grönroos(2000) opined that customer service has played a very important role in every business and hence it is importantto emphasize on training of employees rather than on material resources. As front end employees meet externalcustomers and are responsible for customer service delivery, their skills impact on how store image is perceived bythe customers. Ahmed and Rafiq (2002) in internal marketing, the focus is on employee satisfaction and asemployees deliver service to customers, satisfied employees can better deliver customer satisfaction. Researchers(Brady and Cronin 2001) have re-affirmed the same. Service literature has been interested in the factors thatinfluence the attitudes and behaviors of service employees and has examined the influence of organizationalcharacteristics (e.g., Babakus et al. 2003), social environment (e.g., Sergeant and Frenkel 2000), globalperceptions of the job (e.g., Singh 2000), and personality (e.g., Hurley 1998).Behavioural skills of an employee play a vital role in delivering customer service. These skills create an impacton employee skills and help in achieving sales (Coll & Zegwaard, 2006) by improving and developingcompetencies of salespersons such as interpersonal skills, teamwork, communication and problem solving skills(Hind et al., 2007; Maher & Graves, 2007). Birkett (1993) developed taxonomy of cognitive skills and behavioralskills. According to Birkett, cognitive skills include technical skills - the application of technical knowledge withsome expertise; analytical/constructive skills - problem identification and the development of solutions; andappreciative skills - evaluating complicated situations and making creative and complex judgements. Behaviouralskills include: personal skills - how one responds and handles various situations; interpersonal skills - securingoutcomes through interpersonal relationships; and organizational skills - securing outcomes through organizationalnetworks.The training on behavioural and technical skills imparted to the employees enables them in delivering customersatisfaction. Customer satisfaction depends on how products and services meet or surpass customer expectation(Kotler et al., 2000). In a competitive marketplace where businesses are focusing on retaining customers, customersatisfaction is one of the differentiating factor. The paper investigates the impact of Employee Technical andBehavioural skills in delivering Customer Satisfaction at Organized Retail outlets in Pune. For study purpose, thebehavioural skills such as communication, promptness in service, politeness, being available on request, willingnessto help and convincing abilities have been selected. Similarly, technical skills such as product knowledge,cross functional knowledge, operational knowledge and complaint management have been selected.
2. Retailing in IndiaRetailing can be said to be the interface between the producer and the individual consumer who is buying forpersonal consumption. This excludes direct interface between the manufacturer and institutional buyers such as the Komal Chopra / Procedia Economics and Finance 11 ( 2014 ) 239 – 246 241government and other bulk customers. Retailing is the last link that connects the individual consumer with themanufacturing and distribution chain. A retailer is involved in the act of selling goods to the individual consumerat a margin of profit. (Ninetieth Report of Parliamentary Standing Committee on Commerce related to FDI inRetail, Government of India, 2009). Organized retailing refers to trading activities undertaken by licensed retailers,that is, those who are registered for sales tax, income tax, etc. These include the corporate-backed hypermarketsand retail chains, and also the privately owned large retail businesses. (Ninetieth Report of Parliamentary StandingCommittee on Commerce related to FDI in Retail, Government of India , 2009). Unorganized retailing refers to thetraditional formats of low-cost retailing, for example, the local kirana shops, owner operated general stores,paan/beedi shops, convenience stores, hand cart, pavement vendors, etc. (Ninetieth Report of ParliamentaryStanding Committee on Commerce related to FDI in Retail, Government of India ,2009)India ranks as the fifth most emerging destination for retail in the world (A.T. Kearney’s annual Global RetailDevelopment Index, 2012). The organized retail market in India is expected to reach 637 $ billion by 2015 (KSATechnopak Analysis). Mall space, from a meagre one million square feet in 2002, was expected to touch 40million square feet by end of 2007 and an estimated 60 million square feet by end of 2008 ( Jones Lang LaSalle'sthird annual Retailer Sentiment Survey-Asia). In January 2006, the Union Cabinet approved a majorrationalization of the policy on FDI in retail to further simplify procedures for investing in India and to avoidmultiple layers of approvals required in some activities. To facilitate easier FDI inflow, FDI up to 100% wasallowed under the automatic route for cash and carry wholesale trading and export trading. However to protect theinterests of Indian retailers as well as facilitate global retail in India, the FDI in multi brand retail was permitted at51 % where as it was 100 % in single brand retail (DIPP, Government of India, 2012).Currently, the share of organized retail is between 8 – 10 % (Indian Retail Report, 2012). The drivers oforganized retail in India include higher disposable incomes of consumers, change in consumer lifestyles, doubleincome households, product variety and one stop solution for all needs coupled with shopping and entertainment.
3. Literature ReviewPast research has suggested that service providers play an important role in customers’ evaluation of the servicequality of a business (e.g. Heskett, 1987; Heskett et al., 1994;Mattson, 1994; Tansuhajm et al., 1988).Service personnel play an important role in influencing customers to make purchases and develop customerrelationships. Service researchers have long acknowledged the significance of customer oriented, service drivenorganizations which is posited to result into various favorable psychological and social benefits (Jaworski andKohli, 1993; Kohli and Jaworski, 1990; Kelley, 1992).Employees understanding of customer service is critical tohow they carry out their work; yet because it is abstract and defies absolute definition, this understanding issusceptible to varied interpretation.(Rita D Mascio, 2010). According to a researcher, (Rita D Mascio, 2010),
three distinct interpretations of customer service, or service models, exist among front end employees: (1) the actof giving customers what they ask for, efficiently and courteously; (2) a means to accomplishing immediateobjectives, such as sales quotas; and (3) the formation of mutually beneficial relationships with customersthrough problem solving. Only a few studies have addressed the construct of customer oriented service employee(COSE) and its impact on service firms’ success (Brown et al., 2002; Hennig-Thurau, 2004).Though somenoteworthy studies in this area have been conducted by Brown et al. (2002), Donavan et al. (2004), HennigThurau and Thurau (2003), and Kelley (1992) there has been far less interest in researching the connectionbetween COSE and the employee outcomes than there has been in studying direct links with external customerresponse.Loveman (1998) examined linear and main effects (i.e., internal service quality employee satisfactionemployee loyalty external service quality customer satisfactioncustomer loyaltyrevenuegrowth/profitability).He found support for many of these links, but did not assess key employee perceptions orperformances. The practitioner literature suggests a “value chain,” whereby perceptions and behaviors of frontline store employees shape customer satisfaction and intent, and ultimately, store performance (Heskett et al.2003). However, the impact of customer service through behavioural skills on customer satisfaction in Indianorganized retailing has not been explored. The paper proposes to achieve the same through the study.4. Research MethodologySecondary data has been collected through research reports and research journals related to human resource andretailing. Primary data is being collected through informal interviews and structured questionnaires administeredto front end employees and customers visiting selected retail formats in Pune and Mumbai. Mumbai and Pune areincluded in the top eight metropolitan cities in India and easily accessible (Census of 2011). Metropolitan city isdefined as a region with population of more than one million (Constitution of India’s 74th ConstitutionalAmendment, 1992). The selected cities have outlets in various formats and hence have been chosen for the study.Non probability purposive sampling technique was being used to collect the data. Sample was taken fromprominent malls in Pune and Mumbai. Both the cities have the largest malls in India.Data was collected through a structured questionnaire administered to 200 respondents who visited the malls inthe two cities.. The data was collected at three different times during the day ie morning, afternoon and evening tosee the variation in response. The respondents were intercepted at the entrance of malls and their responsescollected. Rank order scale (“1” for lowest rank and “5” for highest rank) was used to measure the responses..Since rank order scale relates to ranking employee technical and behavioural attributes, this scale was used.Descriptive frequencies were used to find out the attributes ranked by employees. To record the data fromcustomers, 5 point Likert scale (“1” for poor and “5” for excellent) was administered. As Likert scale Komal Chopra / Procedia Economics and Finance 11 ( 2014 ) 239 – 246 243enables to measure customer experience on a scale of 1-5, this scale was found to be appropriate. Factor analysistest using SPSS was done to find out the prominent factors.5. Data Analysis and InterpretationComponent MatrixaComponent1 2 3 4responsive .181 .370 .445 -.185presentable .163 -.612 .525 .190courteous -.212 -.647 -.229 .155caring -.002 .562 .451 .361helpful .667 .099 -.062 -.471home_delivery .229 .530 -.454 .082met_expectation .736 -.309 -.120 .076cooperative -.506 -.023 .504 -.506problem_solving -.170 .154 .049 .729commitment .664 -.074 .426 .216Extraction Method: Principal Component Analysis.a. 4 components extracted.5.1. InferenceThe results of factor analysis and scree plot show 4 prominent factors :Factor 1 – helpful, met expectation and commitment (salesman related)244 Komal Chopra / Procedia Economics and Finance 11 ( 2014 ) 239 – 246Factor 2 – caring and home delivery (service related)Factor 3 – cooperation (salesman related)Factor 4 – problem solving (problem related)6. Limitations of Research Papera) The research is confined to selected outlets in the city of Pune. However, the results may differ inother cities and with varied outlets.b) The sample size selected was 90 for front end employees and 100 for customers.However, with larger selection of sample size, the results may differ.7. Implications for PractitionersConsidering the high set up costs and operation costs of organized retail in India and a strong competitiveunorganized market, it is important that retailers focus on customer satisfaction and retention. To deliver superiorcustomer value and ensure high degree of customer satisfaction, superior customer service is essential. The researchwill help retailers in designing marketing programs that will help give superior customer service. Good service leadsto customer satisfaction and retention and profits for the retailers. This will also help the retailers to have a loyalcustomer base.ReferencesAhmed, P.K and Rafiq, M. (2002). “Internal Marketing – Tools and concepts for customer-focused management”, Oxford:Butterworth-Heinemann.Babakus, Emin, Ugur Yavas, Osman M. Karatepe, and Turgay Avci (2003), “The Effect of Management Commitment toService Quality on Employees’ Affective and Performance Outcomes,” Journal of the Academy of Marketing Science, 31 (3),272–86.Birkett, W.P. (1993). “Competency based standards for professional accountants inAustralia and New Zealand”, ASCPA/ICAA/NZSA.Brady, Michael K. and J. Joseph Cronin Jr. (2001), “Customer Orientation: Effects on Customer Service Perceptions andOutcome Behaviors,” Journal of Service Research, 3 (3), 241–51.Brown, T.J., Mowen, J.C., Donavan, D.T. and Licata, J.W. (2002). “The customer orientation of service workers: personalitytrait influences on self and supervisor performance ratings”, Journal of Marketing Research, 39 (1): 110-19.Komal Chopra / Procedia Economics and Finance 11 ( 2014 ) 239 – 246 245Coll, R. & Zegwaard, K.E. (2006). “Perceptions of desirable graduate competencies for science and technology newgraduates”, Research in Science & Technological Education, 24(1), 29-58.Grönroos, C. (2000). “Service Management and Marketing: A Customer relationship management approach” Chichester: Joh
AbstractThe aim of the paper is to determine the prominent factors that are important in delivering customer satisfaction at branded retailoutlets in Pune. Secondary data has been collected through research reports and research journals related to human resource andretailing. Primary data is being collected through informal interviews and structured questionnaires administered to front endemployees and customers visiting selected retail formats in Pune and Mumbai. Data was collected through a structuredquestionnaire administered to 200 respondents who visited the malls in the two cities. Factor analysis was carried out to analysethe data. The results indicated that caring, problem solving, committed and helpful salesmen play an important role in deliveringcustomer satisfaction. Hence salesmen skills is important dor customer satisfaction. The research will help retailers in designingmarketing programs that will help give superior customer service. Good service leads to customer satisfaction and retention andprofits for the retailers. This will also help the retailers to have a loyal customer base.© 2013 The Authors. Published by Elsevier B.V.Selection and/or peer-review under responsibility of Symbiosis Institute of Management Studies.Keywords: customer; satisfaction; retail* Corresponding author. Tel.: +0-000-000-0000 ; fax: +0-000-000-0000 .
1. IntroductionIn organized retail outlets, customer service is delivered by front end employees i.e. salespersons. Grönroos(2000) opined that customer service has played a very important role in every business and hence it is importantto emphasize on training of employees rather than on material resources. As front end employees meet externalcustomers and are responsible for customer service delivery, their skills impact on how store image is perceived bythe customers. Ahmed and Rafiq (2002) in internal marketing, the focus is on employee satisfaction and asemployees deliver service to customers, satisfied employees can better deliver customer satisfaction. Researchers(Brady and Cronin 2001) have re-affirmed the same. Service literature has been interested in the factors thatinfluence the attitudes and behaviors of service employees and has examined the influence of organizationalcharacteristics (e.g., Babakus et al. 2003), social environment (e.g., Sergeant and Frenkel 2000), globalperceptions of the job (e.g., Singh 2000), and personality (e.g., Hurley 1998).Behavioural skills of an employee play a vital role in delivering customer service. These skills create an impacton employee skills and help in achieving sales (Coll & Zegwaard, 2006) by improving and developingcompetencies of salespersons such as interpersonal skills, teamwork, communication and problem solving skills(Hind et al., 2007; Maher & Graves, 2007). Birkett (1993) developed taxonomy of cognitive skills and behavioralskills. According to Birkett, cognitive skills include technical skills - the application of technical knowledge withsome expertise; analytical/constructive skills - problem identification and the development of solutions; andappreciative skills - evaluating complicated situations and making creative and complex judgements. Behaviouralskills include: personal skills - how one responds and handles various situations; interpersonal skills - securingoutcomes through interpersonal relationships; and organizational skills - securing outcomes through organizationalnetworks.The training on behavioural and technical skills imparted to the employees enables them in delivering customersatisfaction. Customer satisfaction depends on how products and services meet or surpass customer expectation(Kotler et al., 2000). In a competitive marketplace where businesses are focusing on retaining customers, customersatisfaction is one of the differentiating factor. The paper investigates the impact of Employee Technical andBehavioural skills in delivering Customer Satisfaction at Organized Retail outlets in Pune. For study purpose, thebehavioural skills such as communication, promptness in service, politeness, being available on request, willingnessto help and convincing abilities have been selected. Similarly, technical skills such as product knowledge,cross functional knowledge, operational knowledge and complaint management have been selected.
2. Retailing in IndiaRetailing can be said to be the interface between the producer and the individual consumer who is buying forpersonal consumption. This excludes direct interface between the manufacturer and institutional buyers such as the Komal Chopra / Procedia Economics and Finance 11 ( 2014 ) 239 – 246 241government and other bulk customers. Retailing is the last link that connects the individual consumer with themanufacturing and distribution chain. A retailer is involved in the act of selling goods to the individual consumerat a margin of profit. (Ninetieth Report of Parliamentary Standing Committee on Commerce related to FDI inRetail, Government of India, 2009). Organized retailing refers to trading activities undertaken by licensed retailers,that is, those who are registered for sales tax, income tax, etc. These include the corporate-backed hypermarketsand retail chains, and also the privately owned large retail businesses. (Ninetieth Report of Parliamentary StandingCommittee on Commerce related to FDI in Retail, Government of India , 2009). Unorganized retailing refers to thetraditional formats of low-cost retailing, for example, the local kirana shops, owner operated general stores,paan/beedi shops, convenience stores, hand cart, pavement vendors, etc. (Ninetieth Report of ParliamentaryStanding Committee on Commerce related to FDI in Retail, Government of India ,2009)India ranks as the fifth most emerging destination for retail in the world (A.T. Kearney’s annual Global RetailDevelopment Index, 2012). The organized retail market in India is expected to reach 637 $ billion by 2015 (KSATechnopak Analysis). Mall space, from a meagre one million square feet in 2002, was expected to touch 40million square feet by end of 2007 and an estimated 60 million square feet by end of 2008 ( Jones Lang LaSalle'sthird annual Retailer Sentiment Survey-Asia). In January 2006, the Union Cabinet approved a majorrationalization of the policy on FDI in retail to further simplify procedures for investing in India and to avoidmultiple layers of approvals required in some activities. To facilitate easier FDI inflow, FDI up to 100% wasallowed under the automatic route for cash and carry wholesale trading and export trading. However to protect theinterests of Indian retailers as well as facilitate global retail in India, the FDI in multi brand retail was permitted at51 % where as it was 100 % in single brand retail (DIPP, Government of India, 2012).Currently, the share of organized retail is between 8 – 10 % (Indian Retail Report, 2012). The drivers oforganized retail in India include higher disposable incomes of consumers, change in consumer lifestyles, doubleincome households, product variety and one stop solution for all needs coupled with shopping and entertainment.
3. Literature ReviewPast research has suggested that service providers play an important role in customers’ evaluation of the servicequality of a business (e.g. Heskett, 1987; Heskett et al., 1994;Mattson, 1994; Tansuhajm et al., 1988).Service personnel play an important role in influencing customers to make purchases and develop customerrelationships. Service researchers have long acknowledged the significance of customer oriented, service drivenorganizations which is posited to result into various favorable psychological and social benefits (Jaworski andKohli, 1993; Kohli and Jaworski, 1990; Kelley, 1992).Employees understanding of customer service is critical tohow they carry out their work; yet because it is abstract and defies absolute definition, this understanding issusceptible to varied interpretation.(Rita D Mascio, 2010). According to a researcher, (Rita D Mascio, 2010),
three distinct interpretations of customer service, or service models, exist among front end employees: (1) the actof giving customers what they ask for, efficiently and courteously; (2) a means to accomplishing immediateobjectives, such as sales quotas; and (3) the formation of mutually beneficial relationships with customersthrough problem solving. Only a few studies have addressed the construct of customer oriented service employee(COSE) and its impact on service firms’ success (Brown et al., 2002; Hennig-Thurau, 2004).Though somenoteworthy studies in this area have been conducted by Brown et al. (2002), Donavan et al. (2004), HennigThurau and Thurau (2003), and Kelley (1992) there has been far less interest in researching the connectionbetween COSE and the employee outcomes than there has been in studying direct links with external customerresponse.Loveman (1998) examined linear and main effects (i.e., internal service quality employee satisfactionemployee loyalty external service quality customer satisfactioncustomer loyaltyrevenuegrowth/profitability).He found support for many of these links, but did not assess key employee perceptions orperformances. The practitioner literature suggests a “value chain,” whereby perceptions and behaviors of frontline store employees shape customer satisfaction and intent, and ultimately, store performance (Heskett et al.2003). However, the impact of customer service through behavioural skills on customer satisfaction in Indianorganized retailing has not been explored. The paper proposes to achieve the same through the study.4. Research MethodologySecondary data has been collected through research reports and research journals related to human resource andretailing. Primary data is being collected through informal interviews and structured questionnaires administeredto front end employees and customers visiting selected retail formats in Pune and Mumbai. Mumbai and Pune areincluded in the top eight metropolitan cities in India and easily accessible (Census of 2011). Metropolitan city isdefined as a region with population of more than one million (Constitution of India’s 74th ConstitutionalAmendment, 1992). The selected cities have outlets in various formats and hence have been chosen for the study.Non probability purposive sampling technique was being used to collect the data. Sample was taken fromprominent malls in Pune and Mumbai. Both the cities have the largest malls in India.Data was collected through a structured questionnaire administered to 200 respondents who visited the malls inthe two cities.. The data was collected at three different times during the day ie morning, afternoon and evening tosee the variation in response. The respondents were intercepted at the entrance of malls and their responsescollected. Rank order scale (“1” for lowest rank and “5” for highest rank) was used to measure the responses..Since rank order scale relates to ranking employee technical and behavioural attributes, this scale was used.Descriptive frequencies were used to find out the attributes ranked by employees. To record the data fromcustomers, 5 point Likert scale (“1” for poor and “5” for excellent) was administered. As Likert scale Komal Chopra / Procedia Economics and Finance 11 ( 2014 ) 239 – 246 243enables to measure customer experience on a scale of 1-5, this scale was found to be appropriate. Factor analysistest using SPSS was done to find out the prominent factors.5. Data Analysis and InterpretationComponent MatrixaComponent1 2 3 4responsive .181 .370 .445 -.185presentable .163 -.612 .525 .190courteous -.212 -.647 -.229 .155caring -.002 .562 .451 .361helpful .667 .099 -.062 -.471home_delivery .229 .530 -.454 .082met_expectation .736 -.309 -.120 .076cooperative -.506 -.023 .504 -.506problem_solving -.170 .154 .049 .729commitment .664 -.074 .426 .216Extraction Method: Principal Component Analysis.a. 4 components extracted.5.1. InferenceThe results of factor analysis and scree plot show 4 prominent factors :Factor 1 – helpful, met expectation and commitment (salesman related)244 Komal Chopra / Procedia Economics and Finance 11 ( 2014 ) 239 – 246Factor 2 – caring and home delivery (service related)Factor 3 – cooperation (salesman related)Factor 4 – problem solving (problem related)6. Limitations of Research Papera) The research is confined to selected outlets in the city of Pune. However, the results may differ inother cities and with varied outlets.b) The sample size selected was 90 for front end employees and 100 for customers.However, with larger selection of sample size, the results may differ.7. Implications for PractitionersConsidering the high set up costs and operation costs of organized retail in India and a strong competitiveunorganized market, it is important that retailers focus on customer satisfaction and retention. To deliver superiorcustomer value and ensure high degree of customer satisfaction, superior customer service is essential. The researchwill help retailers in designing marketing programs that will help give superior customer service. Good service leadsto customer satisfaction and retention and profits for the retailers. This will also help the retailers to have a loyalcustomer base.ReferencesAhmed, P.K and Rafiq, M. (2002). “Internal Marketing – Tools and concepts for customer-focused management”, Oxford:Butterworth-Heinemann.Babakus, Emin, Ugur Yavas, Osman M. Karatepe, and Turgay Avci (2003), “The Effect of Management Commitment toService Quality on Employees’ Affective and Performance Outcomes,” Journal of the Academy of Marketing Science, 31 (3),272–86.Birkett, W.P. (1993). “Competency based standards for professional accountants inAustralia and New Zealand”, ASCPA/ICAA/NZSA.Brady, Michael K. and J. Joseph Cronin Jr. (2001), “Customer Orientation: Effects on Customer Service Perceptions andOutcome Behaviors,” Journal of Service Research, 3 (3), 241–51.Brown, T.J., Mowen, J.C., Donavan, D.T. and Licata, J.W. (2002). “The customer orientation of service workers: personalitytrait influences on self and supervisor performance ratings”, Journal of Marketing Research, 39 (1): 110-19.Komal Chopra / Procedia Economics and Finance 11 ( 2014 ) 239 – 246 245Coll, R. & Zegwaard, K.E. (2006). “Perceptions of desirable graduate competencies for science and technology newgraduates”, Research in Science & Technological Education, 24(1), 29-58.Grönroos, C. (2000). “Service Management and Marketing: A Customer relationship management approach” Chichester: Joh
