The Impact of Service Quality and Customer Value on Customer Satisfaction: (The Case of Awash Insurance Company S.C.)
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Date
2015-05
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Addis Ababa University
Abstract
The main objective of this study was to examine the impact of service quality and customer value
on customer satisfaction in Awash Insurance Company S.C. In order to achieve this objective,
judgment sampling technique was used to select four branches and respondents are selected
through stratified proportional sampling from these four branches. Descriptive analysis had
been carried out to evaluate overall service quality, corporate customers’ perceived value and
customer satisfaction. Pearson correlation analysis was also employed to see the relationship
between service quality, customer value and customer satisfaction and regression analysis had
been carried out to test the hypotheses of the research. Sample size of 261 obtained by Yamane’s
simplified formula of sample size determination was used in this research. The study showed
similar results for service quality and customer value with respect to their relationships with
customer satisfaction. It was found out that service quality has significant positive relationship
with customer satisfaction. Similarly, the relationship between customer value and customer
satisfaction is positive and significant. However, the study revealed that customer value is more
significant to customer satisfaction than service quality. In addition, there exists significant
positive relationship between service quality and customer value. The findings suggest that in
order to satisfy customers, organizations in this kind of service sectors need to provide quality
service and enhance customers’ perceived value. Since customer value contributes more to
customer satisfaction (i.e., more than service quality), this result could be useful to managers in
insurance organizations for making decisions as to where to invest more in order to satisfy
customers. This study also contributes to existing theories by confirming or adding value to the
relationships that are involved in service quality, customer value and customer satisfaction
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Keywords
Service Quality, Customer Value, Customer Satisfaction