Customer Satisfaction in Banks Essay

A PROJECT REPORT SUBMITTED TO LOVELY PROFESSIONAL UNIVERSITY IN PARTIAL FULLFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF DEGREE OF MASTER OF BUSINESS ADMINISTRATION BY ABINASH PADHA REG. NO. 10900399 UNDER THE SUPERVISION OF MS. KANIKA JHAMB (Faculty Guide) DEPARTMENT OF MANAGEMENT LOVELY PROFESSIONAL UNIVERSITY PHAGWARA 2010 1 PREFACE This research project is a part of the business administration course being taken up at Department of Management Studies, Lovely Professional University, Phagwara.

I was provided opportunity to undergo training at the Jammu and Kashmir bank at its zonal office JAMMU, my field of interest was to study the: “CUSTOMER SATISFACTION TOWARDS JAMMU AND KASHMIR BANK IN JAMMU” This project has been of great help in providing me an insight into the real life working of an organization.

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It gave me a chance to apply, all I had learned to practical situations, enhancing my understanding and image of the market and business world. This experience in decision making and practical application of knowledge has contributed greatly to my growth both as a person and a trainee.

ABINASH PADHA 2 STUDENT DECLERATION

I declare that project entitled: “CUSTOMER SATISFACTION TOWARDS JAMMU AND KASHMIR BANK IN JAMMU” A critical and comprehensive study of Customer satisfaction in banks is my own work. I also undertake that the work is purely academic and no part has been copied or taken from anywhere. This report neither in part nor full is submitted for any degree or diploma in any Institute or college. ABINASH PADHA MBA (LSM) Registration Number: 10900399 Lovely Professional University 3 4 5 6 ACKNOWLWDGEMENT My all praises to Almighty God, who blessed me with sufficient courage and capacity to carry out and complete this study.

Being aware of my limitations and shortcomings, it was not possible for me to accomplish this work without His help. I would like to thank the management of the Jammu and Kashmir bank. For providing me an opportunity to work as a summer trainee with their B. U (business units) Jammu At the very outset, I extend my deepest sense of gratitude to my project guide Mr. GOVERDHAN DUBEY, BUSINESS CLUSTER II J&K bank, without whose indefatigable and strenuous effort and valuable expert guidance this research would have not been concluded. Inspite of his busy schedule he was every ime ready to take out time and assisted me a lot in the execution of my present venture, through his scholarly disclosure, critical analysis, work designing, valuable suggestions and more ever his excellent moral support and encouragement through out my work. Thus I deem it to be my pleasure to have worked under the supervision of such a resourceful and learned person like him. I also express my deep and sincere gratitude to my faculty guide, Ms. KANIKA JHAMB, whose encouraging vigil proved to be great source of inspiration in accomplishing this work. I am really thankful to him for his guidance and support.

I am indebted to my parents who provided all the facilities and encouragement for the pursuit of this project work. ABINASH PADHA 7 CHAPTER 1 ? ? ? ? ? ? ? ? ? PARTICULARS INTRODUCTION Need of the study Objectives of the study Hypothesis Methodology Sample design Data base Primary data Secondary data Questionnaire and sample size ? Design of the study CONCEPTUAL FRAMEWORK & REVIEW OF LITERATURE ? ? ? ? ? Meaning Measurement of customer satisfaction Customer Satisfaction in Service industry Customer Satisfaction in Banking Industry Review of Literature References PAGE NO. 3 COMPANIES PROFILE ? ? ? Company profile of J&K Bank Company profile of SBI Company profile of PNB 4 RESULTS & DISCUSSIONS ? Analysis of customer satisfaction regarding attitude, efficiency, Products & services, physical facilities, advice & problem solving Role of the bank. ? Analysis of overall customer satisfaction ? Analysis of reasons for banking with a particular bank ? Analysis of response of customers for recommending their bank ? Analysis of customer complaints. 5 CONCLUSION & SUGGESTIONS ? Summary of findings & suggestions BIBLOGRAPHY 8 9 INTRODUCTION

Customer is the nucleus around whom bank business ought to take shape/operate, The policies and procedures should be used as tools to manage the physical resources, but more importantly the human resources as, banking services are rendered by human beings to human beings. Important to customer service in banks are the systems and organizational arrangement, as well as the characteristics and behavior of employees/employers towards customers. There has been phenomenal growth of service industries in recent years. More people are now employed in service industries than in manufacturing industries.

A good part of business sector with its banks, hotels, law firms, consultation firms, air lines etc, is in the service business. In the changed milieu, every banking organization tries to utilize its resources in the most efficient and effective way. This calls for propounding new concepts, develop new skills, redefine the objectives and goals, formulate new strategies and reorient training and modify attitudes of the employees and executives so that products and services are delivered to the customers as per their demands and expectations which would lead to the satisfaction of customers.

Customer satisfaction is a dominant factor in the success of an enterprise. In the banking industry where intangible products are to be marketed, the importance of customer satisfaction is all the more significant. The customer has, therefore, necessarily and consistently to be the focal point in all decision making relating to the policies, programs and practices of an organization. From this point of view, the prime function of banks can be defined as the creation and delivery of need based customer service in a customer -satisfying manner, to begin with; therefore, a banker? s task is to identify his customer and his needs.

The problem would really arise in locating or identifying a potential customer on the one hand, and the right marketing and developmental attitude on the other. “. 10 NEED OF THE STUDY Customer satisfaction can be critical barometer of how well a company is serving its customers. This information can show a company what it needs to do to increase its customer satisfaction level unless its majority of customers are totally satisfied. In order to assess how satisfied or dissatisfied customers are, companies should undertake surveys and understand what customers need, when they provide various responses.

OBJECTIVES OF THE STUDY The study aims to achieve the following objectives: 1. To gauge the satisfaction of the customers in organizations under study. 2. To identify the factors which act as impediments for the customer satisfaction in banks? HYPOTHESIS To achieve the desired objectives we hypothesize as under: Ho: There will not be a significant difference of opinion/response between the customers of sample organizations i. e. JKB, SBI & PNB regarding satisfaction. H1: The customer of sample organizations will differ in opinion.

METHODOLOGY The empirical method of research would be followed to complete the study. To gather the information required for the study, attempts have been made to collect the information related to customers on the basis of well-defined samples, which are discussed as: SAMPLE DESIGN The study is based upon the sample drawn from the three important commercial banks operating in the Jammu viz. , Jammu and Kashmir Bank, State Bank of India and Punjab National Bank. Since the organizations have lot of branches and customers and because of 11 imitation of time and resources, the investigator selected the three branches of Jammu i . e. from SAMBA District, where these banking organizations are operating. In this way the investigators have selected a sample of 300 customers at random basis from town of Jammu, which will be a representative sample of Jammu. While selecting a sample, care has been taken for considering different characteristics of the customers like age, gender, qualification, business/professional, level of income, and nature of their accounts as described in table 1, table 2, table 3, table 4,table 5 and table 6.

TABLE 1 AGE OF SAMPLE CUSTOMERS Age in years 18-30 30-50 Above 50 68 22 10 JKB (%) 62 36 02 SBI (%) 56 28 16 PNB (%) TABLE 2 GENDER OF SAMPLE CUSTOMERS GENDER MALE FEMALE JKB (%) SBI (%) PNB (%) 86 14 98 02 78 22 12 TABLE 3 QUALIFICATION OF SAMPLE CUSTOMERS QUALIFICATION BELOW 10Th JKB (%) SBI (%) PNB (%) 06 38 46 12 04 32 60 08 0 10Th-GRADUATION 76 PROFESSIONAL/ TECHNICAL ANY OTHER 18 0 TABLE 4 BUSINESS/PROFESSION OF SAMPLE CUSTOMERS BUSINESS/ JKB (%) PROFESSION GOVT. EMPLOYEES 18 BUSINESS PERSON 64 PROFESSIONALS HOUSE WIVES SBI (%) PNB (%) 26 64 08 02 0 20 58 10 10 02 10 06 RETIRED PERSONS 02

TABLE 5 LEVEL OF INCOME OF SAMPLE CUSTOMERS LEVEL OF INCOME BELOW Rs. 4000 PM 34 RS. 4000-10000 PM JKB (%) SBI (%) PNB (%) 56 36 06 02 44 40 10 06 44 RS. 10000-30000 PM 20 ABOVE 30000 PM 02 13 TABLE 6 NATURE OF ACCOUNT OF SAMPLE CUSTOMERS NATURE OF A/C SAVING A/C FIXED DEPOSIT CURRENT A/C RECURRING A/C ANY OTHER 36 04 46 12 02 JKB (%) 30 04 22 06 38 SBI (%) 40 02 34 24 0 PNB (%) DATA BASE The data for the study was collected from both primary as well as secondary sources described below: 1. Primary data ? The primary data was collected through well-designed questionnaires served.

The questionnaire had two parts, part first would deal with the background information of respondents, part two would ascertain the level of satisfaction of customers with regard to the sample banks. Since the data relates to the psychological aspects of the customers, attempts were made to quantify these data. For this purpose, the five point Likeret -type scale ranging from highly satisfied to highly dissatisfied was used. The intermediate categories were labeled as satisfied, neither satisfied nor dissatisfied and dissatisfied.

The weights of highly satisfied to highly dissatisfied are given as under: Highly satisfied Satisfied 5 4 14 Neither satisfied nor dissatisfied Dissatisfied Highly dissatisfied 3 2 1 The variables and their dimensions, which have a direct bearing on the customer satisfaction, have been identified on the basis of the extensive survey of literature on the subject and on the studies conducted by earlier investigators. The main dimensions of customer satisfaction thus studied relate to the following: ? Attitude of the staff ? Efficiency of bank ? Product and services provided by the bank ?

Physical facilities of the bank, and ? Advice and problem solving role of the bank. ? Interviews and personal discussion with officers and employees of the sample organizations. 2. Secondary data The secondary data was obtained from various books, journals, periodicals, newspapers, publication of govt. , semi govt. , & other allied, agencies like Ministry of Finance, Govt. of India, RBI, Indian Banks association, NIBM & so on. ADMINISTRATION OF THE QUESTIONAIRE AND SAMPLE SIZE The questionnaires were served to the customers after dully pre-testing them.

With a view to have a representation of JAMMU by each town in the survey, the size of sample was taken as 300 i. e. 100 customers for each bank (JKB, SBI, PNB) and approximately 33 customers from each bank to be suggested that have taken.. DATA PROCESSING AND STATISTICAL ANALYSIS In order to reach to logical conclusion, the data collected, both from the primary & secondary sources have been arranged in a rational order & processed both manually & computer, the verbal responses were converted into symbols & proper codes.

The analysis of the data has been done with the help of various statistical techniques like ratio, percentage, mean, 15 combined mean, standard deviation & combined standard deviations. For testing the hypothesis the „Z? test was used to find out the level of significance of difference in the mean scores of the responses among the customers of different banks. DESIGN OF THE STUDY The whole study has been computed in five chapters as explained below: ? Introduction & Methodology: This chapter introduces the problem & discusses the objectives & methodology of the research to be followed. Conceptual Framework & Review of Literature: In this chapter, a survey of the existing literature on the subject has been done & the need for the current study has been highlighted. ? Companies Profile: company profile of J&K Bank, SBI and PNB ? Results & Discussions: This chapter has presented the main results of the survey. The analysis & interpretations of the empirical data has been discussed in detail to outline the findings. ? Conclusions & Policy Implications: This chapter has summarized the main findings of the study & has given conclusions & policy mplications for the organizations about which the study is related 16 17 CONCEPTUAL FRAMEWORK Man is a “perpetual wanting animal” & therefore when one need is satisfied a new need at a high level emerges. His continual drive for more & more can be explained in terms of psychological theories of motivation. As basic needs are satisfied humans strive to satisfy higher social & egoistic desires. The fulfillment of these cannot be directly measured. In this way a man as a customer tries to purchase goods & services to satisfy his wants (Maslow, 1990).

Consumer gives his purchasing power in return expects certain benefits, customer satisfaction is the fulfillment of expectations of consumer needs. Humans are born creatures of needs; as they mature, want is added to need; economic needs are spontaneous & in their crudest sense, limited, humans, like all living things, need a minimum of nourishment, & like a few other living things; they need shelter. Unlike other beings, they also need essential clothing. The human beings have some other needs as well as which arises not from an inner desire for preservation of self or services but from a desire for a fulfillment & spiritual satisfaction.

Mounting evidence tells us that satisfying our customers all the time is being perceived as a quality leader in a market carry significant advantages. PIMS (profit impact of marketing strategies research project of the strategic planning institute) has concentrated that acclaiming recognition as the markets quality leader leads to profitability more often than any other strategy. Unfortunately, it has always been very difficult to determine what features services & innovations (or combination of these & other products & services attributes) will lead to being perceived as the quality leader . t is even more difficult to answer the following questions, Which of the myriad things we could do to improve the products, or the sales, services & support activities that go with it, will lead to the greatest increase in perceived quality. ” The answer to this question contains important strategic information because, it also reveals where a company’s product & services are most vulnerable to quality improvements by its competitors & inversely it reveals where a company’s competition may be most vulnerable to quality improvement that it might under take. 8 “The goal of marketing is to create customer satisfaction profitably by building value-laden relationship with important customers . the marketing department cannot accomplish this goal by it self It must team up closely with other departments, in the company & partner with organizations throughout its entire value-delivery system to provide superior value to customers. Thus, marketing calls up on every one in the organization to “think customer’s & to do all they can to help create & deliver superior value & satisfaction. (Kotler & Strong, 2000) Customer satisfaction is the core element of the banking concept, for which all the companies, irrespective of their nature of business should strive for their existence & survival, customer satisfaction ratings are the indicators to gauge the functional/aesthetic performance of products & services of any organization. The term satisfaction means different things to different people. In the economic sense, satisfaction is equated with utility, or the customers’ ability to enjoy a good (Bennet & Kussarjian, 1972) & utility is never measured directly but inferred from the action’s of the marketplace.

In the buyer behavior model developed by (Howard and Sheth, 1969), customer satisfaction is defined as the point at which expectations & reality coincide. Anderson, (1973) defined dissatisfaction in a similar, but reverse, manner as “the degree of disparity between expectations & perceived product performance. ” Measurement of customer satisfaction When we ask ourselves what we want to focus on, we need to know what our customers’ real requirements are & how well we are meeting them; effective measurement plays a pivotal role in determing those requirements.

It is straightforward, easy to contract, & easy to understand. Measurement demonstrates the value & effectiveness of what we do. It provides feedback on whether or not we have adequately met our customers, requirements. It also creates an awareness quality goals and progress. Hill (1967) operationally measured satisfaction by asking consumers to evaluate their satisfaction with the purchase decision they made rather than with the products themselves.

This concept of satisfaction embraces not only what is gained in the use of the product but also consumers feeling about the effectiveness of their own decision process. By continually identifying & reidentifying requirements, we position ourselves to better understand how successfully we are meeting them. It gets us away from anecdotal 19 assessments, from the tendency to remember the traumatic moments & base our evaluations & decisions on those memories. Effective measurements focus action tracts progress & quantify results.

It provides a base for introduction of more complex analytical methods in the future. Individual doing the works identifies specific measurement to tract & determines how often measurement should take place, which will chart the measurements, & how they will be charted. A diversity of meaning variations within specific contexts emerges from the literature on the concept of customer satisfaction. The first that might be called a gestall approach assumes that a single evaluation of a product can be made, which includes all of the experience surrounding its purchase & use.

The second, or disaggregative approach, assumes that measuring separately each of the various components, which affect satisfaction, & then combining them into an overall measure can best quantify satisfaction. A strong theoretical basis for the disaggregative approach is that it recognizes multiple motivation of the customers’ behavior but it also raises the question of how to examine the individual components or facets of products & consumption relevant to the measurement of the customer satisfaction. Defining the fact: Most studies of customer satisfaction to date have measured specific components.

These facets vary according to the product or service classifications. In this “consuming . mix system” Renoux (1973) identified this element; shopping (availability and adequacy of shopping outlets), buying cease with which customers can evaluate alternative products & make purchase decision); & consuming (experience in owing the products). In her construction of an index of customer satisfaction for a “market basket” of several products, ptaff (1972) emphasis product & marketing price, to develop a comprehensive list of customer satisfaction facet.

The following are the proposed: ? purchase process; ? decision; ? service & ? Environmental attributes. Purchase process: refers to the action of the customers in buying the product. Could he find 20 the product easily? Did he have to travel for to buy it, was sufficient information available? Was the purchase act itself convenient? Obviously for a banker who exercises strongly over his channels any measurement of customer satisfaction should include this facet. Decision: refers to the extent to which the customers thought his decision to be correct or “satisfying. Apart from the product or the purchase process. The customer might have regrets about one facet, which would color other facets. He might feel ‘yes’ “I am happy with the service, but I see, now that I cannot afford it. ” Service attributes refer specifically to the post sale service available to & required by the customer & would vary in importance depending on the service. Environmental attributes: is a facet of customer satisfaction, which is growing in importance, should be considered. Any successful strategy to manage satisfaction is the ability to listen to the customers.

Most highly successful banks employ several approaches, which are: (a) Customer satisfaction indices surveying customers about their level of satisfaction & plotting the results can help & understand just how satisfied or dissatisfied customers are with both their dealings with banks in general & service provided by the banks in particular. (b) Feedback: Collection after, complaints from complaint box, their comments & their raised questions. The management cannot survive the past activities but to some extent it can amend when something has gone wrong. (c) Market research: A huge amount is spent on this activity.

Although companies traditionally invest significantly in this area customers are simply asked few questions, new trend of interacting with customers is totally different in the sense, when you are interviewing the large no. of customers though a single device at fixed place. A list of questions is placed of a questionnaire. The answer to the first question will provide data about the effectiveness of the company’s awareness advertising, and the customers to the second will supply information about the specific factors that actually sparked the decision to try to product or services also is absolutely critical to understand where is a defect.

A market research will be fruitful when such information is implemented in providing better and the best satisfaction to the customers. Customer satisfaction in service industry 21 The basic relation in any service industry is between the organization and its customer. The success of the service is solely dependent on whether the customer is satisfied or not. This relationship is of prime importance. So when a customer begins to feel that the organization is not longer capable or does not want to help him, or that is no longer gives him efficient service.

It is time for the organization to do something about it, organization should become aware of these problems and devise ways & means to stop the rumbling of customer dissatisfaction from developing into an uproar. They can anticipate such consumerism by critically evaluating their services & introducing changes wherever necessary. During the past decade services have increasingly assumed an important role in the India economy. The competition, in the other hand in service organization is becoming intense & severe.

As a result, the service organizations if they have to be successful have to have a more professional approach to manage their business. Perhaps, today the role of marketing is gaining importance in service organizations. The service organizations are quite varied & different from each other & can be put into four categories: ? Firstly it is public agency sector which includes post office, police, fire departments, water & electricity authorities etc. ? Secondly the private non-profit sector running charities, foundations, old ge homes, or various societies involved in issue related to the women, literacy, family welfare, etc. , ? Thirdly the business sector comprising banks, hotels, airlines, travel agencies, tour operations, courier service, insurance, consultancy, legal management or medical. ? Lastly, the manufacturing sector, which provides to those, involved in manufacturing. This includes those firms providing security personnel, accountants & auditors, computer operators, & software consultants which help manufacturing firms in their operations.

The “service-driven service company,” an article by Schlesinger & Haskett (march-April 1994) assert that the net service model puts frontline workers first who are carefully selected & the service strategy are designed around them. Schlesinger & Haskett comments certain arguments that: 1) Any effective service strategy comprises a number of carefully integrated, internally consistent elements. 22 2) The model that industrializes a service has worked well in the past for organizations. 3) Another model- one that emphasizes the human factor in association with technology that improves service to customers & increases customer satisfaction.

The importance of customer satisfaction is implied that customer satisfaction is rooted in employee satisfaction & includes technology. They suggest the employee satisfaction is high in service organization that not only delivers high value to customers but gives latitude to solve customer problems. Schelesinger & Haskett believes that more job narrowing, technology restrictive controls & programmed behavior & reduction of human elements in service delivery will offer the potential & high value to both customers & employee who served them.

In 1973 Besson proposed that “for the customers services or activities offered for sale that provides valuable benefits or satisfaction; activities that he could not perform for himself or that he choose not to perform for himself. ” Peter Drucker (1954) has given greatest significance to customer. He has said that Marketing is not only much broader than selling, it is not a specialized activity at all. It encompasses the whole business. It is the whole business seems from the point of view of its results that is from the customers’ point of view.

Concern & responsibilities for marketing therefore permeate all areas of the enterprise. Drucker also suggested that there is only one valid definition of business purposes i. e. , to create a customer. His hidden message in this statement is innovations, it is only through innovations organizations can continuously replacing products with newer products. Satisfying customers needs better. Customer services in banks Customer service is the hallmark of banking industry. It is the service of the people (user/customers) rendered by people (bank employees at all levels & the counter personnel in particular).

Generally, a customer is taken as a user or a potential user of bank services. Accordingly as a customer would obviously include an accountholder, or his representative, or a person carrying out casual business transactions with the banks. Banking industry places employees in face to face interaction with customers. Both experience interpersonal sensitivities, since many of the transactions are made on the spot. Customer service extents 23 beyond the spot transactions. It is more then effectively meeting the customer needs or handling of their grievances.

Banks are community-based organizations. Banks are also business organizations. The two roles are complementary, as business organizations. Traditionally, they accept deposits for purpose of lending and investment with a view to making profit. As part of business, they also provide ancillary service, like remittance, collections, custody of valuable etc. in fulfilling their roles as community -based organizations, banks have to be alive to the aspirations and total needs of community & endeavor to satisfy these needs by themselves & in coordination with other community-based organizations.

It is also a part of bankers’ task to anticipate the needs & provide positive response. This task is rendered more challenging as the society’s needs are ever changing. It would be unrealistic today to believe that banks are mere financial institutions, working for profit but are also serving a social purpose, as we see, banks essentially are social organizations, rendering financial services to sub serve the socio-economic objectives of the society. It is important to recognize that the social purpose of the banks is not peripheral but vital to the banks themselves, & in a way, the vary reasons for their existence.

We also believe that fulfillment of this social purpose does not militate against surplus generations; indeed generations of surplus, in the aggregate, is itself a component of this social obligation. Relevant to the customer service are the organizational arrangements at branches of different banks, policies & practice, working conditions as well as the socialization experience, motives, attitudes, perceptions, & beliefs of personnel employed by the banking industry & of customers.

The observation made by Peter Drucker that customers defined the business appears to be more true for banks, than for any other industry, it is here that customers needs, beliefs, perceptions, & cognition’s remain supreme & influence the needs & goals of banks at the organizational level in banks are under pressure indeed to structure their programmed around the expectations of the customers. Customers have so demographic characteristics & have expectations from banks. Their expectations & evaluations of services rendered by banks are complex & manifold.

Customer’s evaluations of employees performance can indeed provide meaningful feedback to employees & through them to banks, customers’ values, perceptions & purposes are simply 24 not the subjective states of their individual minds which arise spontaneously in the process of their own & employees historical & biographical experiences with the definite social milieu. It is this that employees behavior in the banks should be examined in relation to the services rendered to customers.

As knowledge of the values & understandings of the norms that shape employees perceptions & guide evaluations of customers can offer important insight into their individual goals & the imperative of these for organizational growth of banks. In bank advertising in India; some issues Ouly-dec 1991) Manoj Kumar assert that bank marketing in general and bank advertising in particular are still in nascent stage in India because of competitors and communication. Potential customers can be informed about the availability of services offered through proper channel.

A present banker implies competition from non-bank financial intermediaries and threatens profitability of banks. Development of bank advertising took birth after nationalization of 14 banks in July 1969. Its results are qualitative and quantitative change in bank services and accordingly, advertising also changed, the first choice was newspapers, magazines, followed by outdoors advertising, cinema & radio. Second, the ads were addressed to a specific group like farmers, small-scale enterprises, self employed, house wives and minors. Third, India commercial banks used a variety of themes in their slogans.

A suitable slogan not only communicates but conveys the perception or attitude of the bank towards customers. The banks aim at providing customer service, which is efficient as well as satisfactory. The employees & customers desire the two attributes in the service but valued them differently. If the banks were to intervene & monitor the operations to achieve the desired levels of efficiency & satisfaction. They ought to understand which employees’ or/& customers attributes influenced these. Also does efficiency lead to satisfaction & vice-versa.

Customers came to banks as a matter of right & the banks have a primary duty towards customers to serve them well. The customers where also egoistic to some extent in their expectations. Their expectations were always higher then the banks could meet within the institutional framework. Often customers expectation where characterized by contradictory beliefs. Bank marketing deals with providing services to satisfy customer? s financial needs & wants. Bank has to find out the financial needs of the customers &offer the services, which can satisfy those needs.

Bank may also require to satisfy the customers financial & other related needs. The individual & corporate bodies have certain needs in ration to money commodity, to 25 satisfy these financial needs, customers want specific services. Different banks offer different benefits by offering various schemes, which can take care of the wants of the customers. Hence the marketing concept is essentially about the following few things which contribute towards bank success: (a) The bank cannot exist without the customers. (b) The purpose of the bank is to create, win & help a customer.

The customer is & should be the central focus of everything the bank does. (c) The bank should ensure that the services are performed & delivered in the most efficient way. Service facilities also should be designed for customer convenience. (d) Ultimate aim of the bank is to deliver total satisfaction to the customer. (e) Customer satisfaction is affected by the performance of all the personnel of the banks. All the techniques & strategies of marketing are used so that ultimately they induce the people to do business with a particular bank.

To create & keep a customer means doing all those things so that people would like to do business & continue to do it with a particular bank rather than with the competitors. REVIEW OF EXISTING LITERATURE Recent studies have demonstrated that knowing & satisfying the customers with competitively superior services is the key to profitable performance. The service firm must effectively train & motivate its employees as well as all the supporting service personnel to work as a team to provide customer satisfaction. Many researchers have contributed a lot on customer satisfaction & have given their own ideas about how to satisfy a customer.

Some of the important studies are described here under: Studies abroad Halstead (1993) proposed a model of satisfaction & complaint resolution in which the expectations determined the purchase service & the related disconfirmation. The study further 26 suggested that, to the extent the expectations are clearly formed, the customers are more satisfied with complaint resolution. It also suggests providing additional services other then whatever is expected by customer, because service disconfirmation is more strongly correlated with satisfaction & complaint resolution than warranty confirmation.

Jones and Sasser (1995) reveals that one of the methods of measuring the impact of quality improvement process in corporate sector is to create a customer satisfaction survey. The study discussed a survey with one of the company’s senior officer, the CEO proudly points out that 82% of customers surveyed responded with an over all satisfaction and only 18% of its customers were less then satisfied. There divisions with average ratings 5(completely satisfied), 4(satisfied) 4. 5(neutral) 3. 5(dissatisfy) and the lowest rating 2. 7very dissatisfied.

The study concludes that there is tough competition in lubricant division and its price conscious customers will never be satisfied, as it does not pay to make additional investment to try to satisfy them. Kotler (1995) in his study comments that some companies raise expectations to match their performances. They aim for total customer satisfaction as Xerox, (e. g. ) guarantees “Total satisfaction “and will replace at its expense in dissatisfied customer’s equipment’s for a period of three years after purchase with the same or comparable products.

Another company like Cigna advertises that their company will be never 100% satisfied until their customers are too. One of the studies of Toyota buyers showed those highly satisfied buyers shows high customer loyalty than those who are just satisfied. Lovelock and Young (1979) in an article, “Look to consumers to increase productivity”, observed that in many services, attempt to improve productivity are likely to fail unless the support of consumers can be secured. On the contrary, some see consumers as a barrier to productivity.

They further observed that the insensitivity towards customers can be avoid by developing customer trust in the productivity related changes through systematic and planned communication program and by understanding customers habit and understand determinants of customer behavior. The study on “selected determinants of customer satisfaction & complaint reports” by Bearden & Teel (1983), & Oliver (1980), reveals that consumer satisfaction is based on the preference shares-purchase belief, regarding products performance, expectation & 27 isconfirmation belief or post purchase perception that a product could or could not performs as expected have a significant influence on customer satisfaction. Kendall & Russ (1975) reveals that express warranties are promises of complaint resolution & they often encourage unsatisfied customers. Further concluded by them are that expectations of warranty serviced in case of durable goods are greater then non-durable goods. Lele & Sheth (1988) says that for determining customer satisfaction, one of the factors will be the expectations regarding after sale’s support like tool free, numbers, warranties, Parts availability etc. hey further reveals that after sales support is said to be the litmus test of firm’s intentions towards its customers. Solomon (1985) argues that customer satisfaction services with regard to complaining process is a function of the “congruence” between perceived behavior & the behavior expected by the role player. Gilbert A. Churchill and C. Surprenant (1982) concluded that in determining customer satisfaction, a high correlation exists between performance & satisfaction of customers.

The study further concludes that in case of durable goods, the satisfaction is more dependent on the actual performance of the product then that of non-durable goods. Baumgarten (1972) in their nursing home study found no relation ship between satisfaction as such functional attributes as the modernity of the home, its size or any objective feature. To a statistically significant degree they found satisfaction related to the ability of the respondents to make friends there to the number of such friends and to the religious affiliation of the home.

Despite a difficulty in specifying which psychosocial veritable are important in any case and in measuring them. It is a taste, which should be handed for all but most common place product classification. Rolphe E. Anderson (1973) in this study defines customer satisfaction as the disparity between expectation & the perceived product performance, whereby customer satisfaction is viewed as a type of comparison process. Anderson further suggested satisfaction measures to reconcile the disadvantaged customer.

Theodore Levitt (1960) emphasis that there is a need for farsighted marketing remarks, because most of the business suffer from “marketing myopia,” when they fails to ask 28 themselves a question i. e. , what business are we in? Levitt further suggests from the customers point of view that one must define & understand his business not in terms of product made or sold, but in terms of what needs of customers are satisfied i. e. , in terms of what service is provided to customers, & that should be better in quality.

Jonathan Freedman (1964) suggests a slight understatement of the products qualities might lead to higher customer satisfaction. Of course, the advertisement of company’s product qualities could not understate so that the customer boy passes it for mother brand. Several studies have supported the possible success of this promotional strategy. The generalized negativity is that any discrepancy between expectations & the real result in a generalized negative state, cause the product to receive less favorable rating than the matched with expectations, even if the products performance exceeds the customers expectations.

Carlasmith & Aronson (1963) suggest two cross word theory regarding the customer satisfaction. He says that if a customer expects more & get a better a disconfirmed expectancy results which would support contrast theory, & on the other hand he further says, is a customer expects better & get a tasteful solution which support assimilation theory, if a customer expects a particular performance from a product or service, but a different performance is offered, he will judge the service to be less pleasant then if he had no previous expectancy.

The study by Hoveland, Lumstaine & Sheffield (1948) assumes that individuals have latitudes of acceptance, rejection, & neutrality. They have further suggested that the customer expectation should not exceed so which will fall outside the consumers’ range of acceptance. Anita Ptaff (1972) in her study states that both cognitive & affective models may be alternatives for describing satisfaction Dinah Nemeroff (1991).

Director of customer affairs citi bank New York agrees with Schlesinger and Hashett that companies must be service driven, foremost they must be customer satisfaction driven, Nemeroff asserts that optimal model over the service model by Schlesinger and Hashett puts customer first and design a business around their satisfaction, Nemeroff disagreed that the economies of customer loyalty are only beginning to worked out. Nemeroff asserts that the impact of customer satisfaction are knowable in terms of both 29 xpense reduction on revenue growth and increased satisfaction demonstrably leads to higher customer revenue. Latour & Peat (1979) have given leading contribution in customer satisfaction/dissatisfaction theory to social science research. They assert that the primary distinction between satisfaction and attitudes derives from tempoial positioning. Attitude can be defined as a preference shares-decision and satisfaction as a post-decision. Social equity theory has been widely used to explain the formation customer satisfaction/dissatisfaction.

A customer evaluates the costs & benefits realized by other person with those of the costs & benefits he actually received. This comparison process becomes the basis for the degree of equity. Sometimes company’s fail to provide frequent changes in these brands which results either or neutral or emotional response from consumer. Consumer get reluctant towards the same variety & the same choice, they want to have additional benefits with the introduction of new uses instead of brand’s instead of repeated use.

Keith Hunt (1977) stresses upon the balanced scale for measurement of customer satisfaction. In this study, he advised a scale of different levels, such as ‘very good’ & absolutely delighted Keith further reports that most of the researchers claiming multidimensionality have less responsibility for showing their validity than that of undimensional. Multidimensionality is itself raises the problem of working with all the relevant dimensions. It at the same time needs to examine the separate consideration for other evaluation or studies that price & product shows separate evaluation.

Keith Hunt further cautions that the timing can be important for measuring customer satisfaction/dissatisfaction in case of specific purchase, time is of essence then overall judgement of satisfaction. Dissonance & dissatisfaction will be reduced if the measuring is delayed & favourable report exists. Czepiel & Rosenberg (1977), Analyse in their study that customer satisfaction can be measured. As per than, customer behavior cannot exist prior to the purchase or consumption of the attitude object. They further stressed for the customer satisfaction/dissatisfaction studies in ualitative terms they have actually in search of meaning for existence of 30 satisfaction. The effect of social or psychological factors, consumer references evaluation & customer perception towards the experiential satisfaction. C. R. Handy (1977) in his study suggested that, if private factors are given chance or are encouraged for the self-regulation or voluntary action. Their respond will be flexible towards the minority interest to whom they seek to serve because once the legislation & regulations are enacted, tend to impose universal behaviour & values on all.

The another dimension added by the study as defined the consumer dissatisfaction as the gap between the customer’s ideal attribute combination of the product or service & alternatives desired by consumers are not incorporated into any specific choice. Working Group formed by RBI, IBA, on “Customer Service” (1977) observed as “Bank users criticize, and bankers them selves concede, that customer service rendered by banks leaves much to be desired, and in certain respects has indeed reached very low levels, both absolutely and in comparison with the past.

The study has identified some areas where dissatisfaction occurs: ? It has been found that there is inaccuracy in putting transactions and inadequacies in correspondence and if any decision making takes place, they are mostly faulty and bring no help to the customers. ? There is lack of elementary discipline with regard to truly and producers and organizational support for reasonable departures. ? Dissatisfaction with regard to credit application: a) Flexible to meet customer needs. ) Irrelevant questions and data are asked which are not always available and expensive to obtain. c) Cumbersome procedures regarding documentation. ? More than half of the depositors receive from small and large size branches intimation from their branch about the maturity of their fixed deposits. 48. 57% depositors from medium sized branches avail the same service. ? 92. 44% of customers get their remittances correctly. 31 ? Very few errors are contained in the monthly statement of accounts of customers. Many customers fixed it difficult to understand the entries made in their passbook because of illegible handwriting, abbreviations used in complete details ? It takes about 10-15 minutes an average to deposit or withdrawals cash in C. D/C. C/O. D accounts ? The time taken to en cash a fixed deposit receipts are on an average 15-30 minutes. It takes about two days to receive the amounts of loans against fixed deposit receipt. ? It takes 30-60 minutes to purchase a bank draft while as in large sized branches it takes more than 60 minutes. ? It takes on an average 5-1 days for collection of out station cheques . Over 75% of small customers do not fixed the branch manager or his staff at the branch taking interest kin helping then in their transactions with the branch, such as advise on matters like choice of deposit plans or mode of operating account or choice of borrowing facilities. ? About 70% of customers are treated politely depending upon age and their occupations. ? On an average 57. 50% of customers are corresponded politely by the bank. Studies in India Mona Mehra (1976) disclose the real results of the customer dissatisfaction, she says, by taking the customer dissatisfaction lightly affects the whole business & transfer of accounts.

She further says, due to customer dissatisfaction, customer change their agencies, banks, hotels, airlines etc. Anticipating customers in service industries can therefore be a catalyst for constructive evaluation & analysis of the service offered. Vivek Deolanker (1985) highlights the consumer behavior with related to their decision making which plays a vital role in a purchase transaction. The buyer according to Behaviorists has to pass through five stages in the buying process to effect a purchase. The buyer process starts with recognition of unsatisfied need.

As per the author needs can be dormant or latent which can be aroused by external stimulus and once need is recognized, the 32 buyer starts to identify the different alternatives. The individual subjects himself to more active in formation search, by evaluation of alternatives the consumer tends to view a product not merely an object of entity but also a bunch of attributes such as utility, durability. Dependability etc, after searching and evaluation the consumer forms his purchase intention on the taste of anticipation situations, if the purchased brand does not offer the expected satisfaction.

The study made by Singhal (1987) is regarding the efficiency and satisfaction In banks. She made a study both at the branch and individual level. The main findings of the study are summarized as follows: ? Employee diversities were significant on some variables by their position, the type of branch at which they were placed, in the employing bank . ? The employees and the customers belonged to a common social environment. They had compatible needs and values. It was thus neutral to expect that they should have different perception of services. The difference between the officers and the clerks were significant on some demographic and psychological dispositions that affect the efficiency and satisfaction. Branches also acted as a source of variance. ? On the part of the customers, sex, was found to be a relevant predictor of satisfaction. ? In getting loan repayments and advance, lack of satisfaction, was indicated. The time taken in each transaction was the main concern of the dissatisfaction. However, the customer did not expect over all satisfaction from their dealings.

Seshaiah & Krishnama Raju (1990) concludes in their study that there is need for maximization of satisfaction for both producer as well as for customer. One cannot ensure that the maximization of profit would lead to maximization of satisfaction of customers or vice-versa. The study gives a probable solution to integrate the mutual interests of producer & customer by creating the mutual understanding with the help of ‘producer-customer conscience’. The mutual interests of both the parties can be achieved through the consumer education & actions of voluntary associations.

The desired result of maximizing the producer’s profit & customers satisfaction can’t be achieved as long as the misunderstanding 33 prevails in the minds of both the prices. A sample study of customer expectation & customer satisfaction with respect to a 100CC bike by Aileni & Azeem (1998), suggests that the service provided by the companies should be efficient, effective & more accurate to the satisfaction of customers. It has seemed that most of the customers were not satisfied with the complaint resolution. The companies are advised to interact their dealer network for providing better services.

The study also suggests the companies to be clear with respect to warranty expectations, if somewhere lacks communication between customers & companies. Almost 60% of the respondent are expecting solution for the problem rather than lip service, because majority of the customers is not happy with post -purchase service, therefore the top management are advised to take appropriate measures. Biswa N. Bhattachary (1991) as per his study, it is quite clear the customer service of a bank has to be evaluated on objective & subjective basis.

These evaluations require a periodic survey by interviewing a sample of bank customers either directly or mail reply questionnaires. Finally one can measure the time taken for each transaction as specified by the customers. The study further suggested to conducts survey by direct observation on a sample of bank premises for measuring the time taken for each transaction. Again, one can compare this observation to the optimal time limits. For subjective evaluation, a sample survey is conducted on the quality of bank services rendered by bank employees as, mentioned in the study.

Now Reserve Bank of India and Indian Banks Association can decide about the performance rating for banks A, B, C, 0 & E depending on how many times a bank exceeds specified time limits & also on the percentage of the customers dissatisfied with the quality of service. Rao, Nath and Munishwami (1990) made an attempt to review and asses the extent of application of marketing concept in the service sector, even though service sector industries have grown phenomenally, only recently they starting learning and implementing marketing concept and techniques.

The article reveals that by circumstances like staff competition, rising costs, poor productivity compel them to do so. The strategies recommended by marketing management are helpful in creating demand, growth of profitable sales volume and effective 34 services to customers, they says that various developments have been taking place in service organizations in recent years. The objects of these developments, strategies are satisfying the needs and wants of customers and making service organization highly productive in all aspects. C. S.

Rayuda (1990) in his study reveals that there is less competition in banking service. However some US banks located in the metropolitan cities are more marketing oriented because they are serving small segment of the market with high-income class. Bank helps in mobilization of small saving and provides advances to the entrepreneurs; the main task of banks is to play a vital role in the economic and social progress of the country. Banking advertisements donot fully focus attention on the customers, they need to attract them and to create an image of customer oriented banking.

Shanmugasundaram, &. Kumar (1978) conducted a comparative study on “consumer satisfaction for hand loom and mill cloth” in Coinbotare. The major findings of the study are as under: ? The sample respondents are more satisfied with mill cloth than handloom cloth. ? Respondents of all the age groups are more satisfied with mill cloth than with handloom cloth. Age affects satisfaction with mill cloth. Old respondents tend to be less satisfied with mill cloth than the young and middle aged are less satisfied than the young are. Illiterate respondents are more satisfied with hand loom cloth than mill cloth. ? Occupational status influences satisfaction. Agriculturists are more satisfied with handloom cloth than with mill cloth. The respondents with higher occupational status are more satisfied with mill cloth than the respondents with lower occupational status did; conversely respondents with higher occupational status are less satisfied with hand loom cloth than those with lower occupational status . Income influences satisfaction with mill cloth while it does not influence the satisfaction with handloom cloth. Respondents with higher annual income are more satisfied with mill cloth than those with lower annual income. ? Expenditure cloth influences satisfaction with mill cloth while this is not so for handloom cloth. Higher spenders are more satisfied with mill cloth than lower spenders . ? Consumers who plan their purchase get more satisfaction from mill cloth and handloom 35 cloth than those who do not plan.

Hannah (1978) this conclusion makes it possible to suggest to marketers with pricing responsibilities that a high price policy is not necessary the only avenue to high evaluation of, & satisfaction with the product, rather, it is suggested that the key to the attainment of desired customers evaluation a product is to create a situation where the marketers offering allow the customers choice of expending a variety of amounts of efforts which each customer can adjust relative to his effort capability creating such a situation can mean that individuals expending relatively different level of satisfaction.

This marketing strategy can be achieved by providing a wide selection of products of different prices & or at different degree of availability or degree of ease of use. A camera manufacturer, for instance, may offer a time of cameras rating in price from high to low, characterized by different degree of ease of use by altering the amount of efforts required by the user to set the camera for actual picture taking; & it different degree of availability by adopting distribution policy which may range from very selective distribution system to intensive ones.

The varied amounts of financial, mental, or physical efforts expended to obtain a product relative to the effort reservoir of the buyer will be final determinant of the amount of perceived satisfaction obtained. The study “consumer satisfaction-determinants & measurement” by Ravichandran & Thyagarajan (1998) related the evaluation of the purchase decision of consumers with addition to their purchase behavior.

Consumer satisfaction can be perceived differently by different persons, the further study reveals that after post-purchase, a consumer expects certain benefits from the product or service for which a consumer spends cost & if this expectation falls down it causes dissatisfaction . the further enlightenment by the study about the human attitude is that, a marketer has to take into consideration the different elements of customer attitudes such as preferences, likes, or beliefs because of complexity in their nature while valuating the attitudes scaling technique or rankling can be used in many situations. Brahmanandan & Narayana (1990) concluded a study on customer service in banks in the Guntur Town (Andra Pradesh) the main finds are: ? The convenient location & suitable timings of the branch is the attracting force of the customers . 36 ? In depositing & withdrawing the cash, the banking staff took less time while updating the passbooks lot of time was wasted & majority of the customer’s complaint that in writing the passbooks illegible handwriting & unknown abbreviations were used which created problems for them . For getting new chequebooks, collection of cheques, encashing bank drafts & remittances generally the customers were not satisfied with the time taken by bank employees for these purposes. Archana Muthur (1988) revealed in her study that, two branches were selected for study one of the state bank of India (SBI) & the other of the state bank of Bikaner & Jaipur (SBBJ) located in Jaipur. A sample size of 35 customers were selected belonging to the different age group, different segments viz. students, service class, business class & others was actually drawn by convenience sampling from each. The major findings of the study are as under: ? This has been seen that the highest percentage of the customers is taking advantage of the saving bank accounts . ? The study suggests that the role of employees should be rendered as a desirable goal . ? The customers of state bank of Bikaner & Jaipur had no difficulty in opening their a/c, whereas 22. 85% customers of the state bank of India had to face difficulties, while as the considerable time taken was the main problem . Bank staff is appreciated for working in urgency. ? About 57% of customers are dissatisfied regarding the updating of passbooks & with illegible writing. ? The time wasted in receiving pension is the main problem, which created frustration among pensioner customers. National Council of Applied Economic Research did the first systematic study on customer service in (1971) wherein 5000 customers were selected as sample from 100 branches in Urban India. The major conclusions of the study are as nder: 1) Rating of efficiency to the proportion of the depositors stating the transaction to be efficient to the proportion of those stating that is inefficient is given below: 37 Encash of cheques Withdrawal from saving alc’s Collection of cheques Issue & payment of drafts Credit acceptance to current or saving alCs Credit process of mailltelegraphic transfers Dealing in travelling cheques 22:1 18: 1 12:1 9:1 6:1 5: 1 2. 5 :1 2) Above the half of the customers have complaints with in efficient services of banks.

Most of them have complaints with regard to delay in encashment of cheques. 3) During surveying few customers offered suggestion for improvement: ? There was a common suggested from customers to increase the strength of the staff . ? The other suggestion was to make communication system efficient in balances, overdraft facilities etc. ? A need was felt by the customers for making banking service more efficient & more courteous, some customers suggests more house loans for marriages & purchase of durable goods.

The customers suggested that the waiting time should be reduced as much as possible or by introducing the Teller System The meaningful conclusion cannot be drawn out of a small size of sample which consists of 10 depositors from each branch, & the study does not consider the rural customers which can be potential one in the near future, the study has failed in collecting information about time taken to compute different bank transactions. The study conducted by NIBM (National Institute of Bank Management) in 1975 carried 90 branches of 32 commercial banks.

The main purpose of this study was to investigate how well the commercial banks serve their customers in the city & sub-urbs of Bombay area, the major findings related to the poor quality of customer services are as : 1) It has been seen that branches fitted with ‘Teller’ are provided better & quick services to their customers. 2) Generally, the collection of local cheques takes about 2 days & the collection of out-station 38 cheques takes a couple of weeks. 3) A large no.

Of customers complained that the passbook are never kept ready in time, & is sometimes they are ready almost 60% of them are difficult to understand because of abbreviations used & illegible. 4) It was found that customers how to wait for long hours in transferring a deposit or purchasing a bank draft or those who wish to encash a bank draft. 5) Not many cases of misbehavior have been reported on the part of employees & very few customers’ goes for complaining about the poor service. ) It takes 15 to 30 minutes on an average in renewal & issue of fixed deposits receipts, about 15% of the depositors do not receive information about the majority of their fixed deposits. 7) It takes on an average half an hour for issue of new chequebooks. 8)Remittance send by mail transfer reaches to the receiver between 1-2 weeks on an average. 9) Small customers seem much satisfied with small branches. It was found that bigger branches do not take interest in dealing with small deposit holders. Credit application of small borrowers gets delayed for over a month due to higher officials. 0) 1/3rd of corporate customers like medium & large industries & other big institutions complaint about the time taken by branch authorities in rendering the desired service. The transaction in which the delay occurs is: ? Purchase of demand draft . ? Collection of local cheques & outstation cheques . ? Over 50% of customers are unhappy with the conduct of bills business . ? It takes 2 to 4 weeks on an average for processing of loan proposal. Another study conducted by NIBM on behalf of Indian banks Association in (1984), Sample size of the study was one lack.

The major objectives of the study were to estimate the household institutional savings. To ascertain the savers. & the factions which affect the saving behavior & to evaluate preferences of customers for various financial assets & to develop broad marketing strategies for promoting banking services. The main findings of which are as under: (i) 80 to 95% of customers were satisfied with the courtesy, promptness & with the presence 39 of staff during working hours. (ii) It has been observed that bank staff having positive attitude towards customers ranging from 50-62%. iii) 63-83% of customers is satisfied with the speed of services provided by banks, only 1014% of customers opined that negatively regarding the speed of service provided to them. (iv) 45-75% of customers is not satisfied with the existing network of branches in their locality. Urban bank savers are much satisfied with the availability of space then the rural savers. Some of Banc (1994) one’s operating units formally conducted their own customer satisfaction surveys. The surveys have been centralized made mandatory and are administrated by mail on a quarterly basis to around 125000 customers.

When combined with periodic measurement, the survey provide highly relevant trend information that informs the managerial decision making process. A research study conducted over 6 years by A. C. Nielson (1981) suggest that, when individual small problems resulting in aggravation on minor monetary loss (less then 5 dollar) only one person in 50 will write a letter to the manufacturer a fever then half will even return the item to the store. In a National Cross Sactional Survey by the U. S. Office of consumer affairs (1979), reported that 31% of the people having serious problem never complained to anyone who could help.

As figure shows customers who complaint to effective serious system & are satisfied exhibit high brand loyalty than non-complaint or those who complaint by are not satisfied, A* =Percentage of customers with major complaints (over 100 losses) who will buy from you again. B*= Percentage of customers with minor complaints (1-5 losses) who will buy from you again. 40 100 80 60 40 20 0 N. C C. N. R C. R 9 37 19 46 54 82 70 95 A* B* C. R. Q N. C = Non Complainers C. N. R = Complaints Not Resolved C. R = Complaints Resolved C. R. Q = Complaints Resolved Quickly. REFERENCES . Aileni and Azeem (April 1998), “ the management accountant” vol. 33. (No 4) 2. Anita pfaff, (1997) “ An index of customer satisfaction”, in M. Venkatesan ed, proceedings of the 3rd annual conference of the association for the consumer research, IOWA city, IOWA Association for consumer research: 713-737 3. Archana Mathur (April- june 1998) “ Indian journal of marketing” vol. 18 No. 8-10 4. Atlanta, Ca. (1981) “ the coca- cola companies”. 5. banc, (1991) “ how does service drive the service company? ” “ Harvard business review. 6. Baumgarten, Steven A, Santosh, K. houdry Rao, Tanniura, R and Ring L Winston (1973) “ A study of nursing homes: the patient as consumer”. American marketing Association. P 452-456. 7. Bearden W. O and teel , J. E (1983) “selected determinants of consumer satisfaction & 41 complaint reports” Indian Journal of marketing research ( Vol. 20 PP 9-21). 8. C. S. Rayudu (1990 ) “ Indian Journal of marketing vol 20 (5), 7-16 9. Christoper H. lovelock, Robert F, young (May-june 1979) “Lock to consumers to increase productivity” Harvard Business Review, May, June. 10. Dinah Nemeroff (1991) “How does service drive company? ” Harvard business review 11. Gilbert A Churchill, Jr. nd Carol Superenant, (Nov 1982) ” An investigation into the determinants of customer satisfaction,” Journal of Marketing Research, (vol-19, pp491-504) 12. Halstead, D. Droge, C. and Cooper M. B (1993) “Product warranties and post purchase service”. Journal of Service Marketing (voL7, No 1 pp33-40). 13. J. Merril, Carlsmith, and Elliot Aronson, (1963) “some Hedonic consequences of the confirmation & disconfirmation of expectancies”. Journal of abnormal & social psychology, (vol-66 pp-151-6). 14. John Czepiel, Larry J. Rosenberg (Oct 1977) customer satisfaction and dissatisfaction: perspectives and overview, p. 15. 15.

Jonathan L. Freedam, “Involvement, discrepancy and change,” Journal of abnormal & social psychology, voL, 69: 290-295. 16. K. Seshaiah, G. Krishnama Raju (1990) “customer satisfaction is a Myth”. ” Indian journal of marketing”, voL, No 6 17. Keith Hunt (1977) “proceedings of conference conducted by marketing science Institute Cambridge, Mass (8. 15) 18. Kendall, CL and Russ, F. A (1975),’Warranty and complaint policies. An opportunity for marketing management,” journal of Marketing,(Vol. 39, pp. 3643) 19. Lele, MM. and Sheth, J. D (1988) “The four fundamentals of customer satisfaction,” Business Marketing ( vol-73, pp. 0-92) 20. M. Ravichandran and V. Thyagarajan (1998) customer satisfactiondeterminants & Measurement. (NMIMSMGT review), July-Dec. 21. Mona Mehra (1976) Indian journal of marketing vol. vii No 1. 22. National cross sectional survey, U. S. office of consumer affairs (1979) ‘consumer complaint handling in America (Washington). 23. Nessim, Hannah (1978) Journal of the academy of Marketing science, vol. 6, No 1, p. 91-100. 42 24. Nielson AC. (1981) Harvard Business Review 25. Philip Kotler (1995) “Marketing Management “Printing hall of India. 26. Report of working group on customer service in banks (1977) p. 27. Rolphe E. Anderson (1973) “customer dissatisfaction; the effect of disconfirmed expectancy on perceived Produce performance, Journal of Marketing Research vol-10 (pp. 38-44). 28. S. shannmugasundaram, R. Kumar (1978) Indian Journal of marketing 29. Singhal, Sushilla (1987) banks and customer- A behavioral analysis; shri Ram center for Industrial relations & human resources. 30. Soloman, M. R, Suprenant, C. Czeptel, J. A and Gutman, E. G, (1985) ” a role of theory perspective on dynamic interactions. The service encounter”. Journal of Marketing (vol-49, pp. 99-111) 31. Stephen A. La Tour, and Nancy c. eat (1979) “Conceptual and methodological issues in customer satisfaction research,” advances in consumer research, vol. 6 w. L. Wilkie ed. , Miami: Association of consumer research (431-7) 32. Survey of customer service in banks. National council of Applied Economic Research (1971) 33. Survey of customer service in commercial banks in India, National Institute of bank management (1975) 34. Survey of customer service in commercial banks in India, National Institute of bank management (1984) 35. Theodore Levitt “Marketing Myopia”, Harvard business Review, July-Aug. 36. 41. Thomas O. Jones, W. Earl, Sasser, Jr. 1995) Harvard business review, Nodec. 42. Vivek Deolankar (1985) ‘India Journaing’ vol. xv nO. 7 43 44 COMPANIES PROFILES JAMMU & KASHMIR BANK The origin of Jammu and Kashmir Bank Limited, more commonly referred to as J&K Bank, can be traced back to the year 1938, when it was established as the first state-owned bank in India. The bank was incorporated on 1st October 1938 and it was in the following year (more precisely on 4th July 1939) that it commenced its business, in Kashmir (India). It was initially set up as a semi-State Bank, with its capital being contributed by State as well as the public under the control of State Government.

It was in the year 1971 that Jammu and Kashmir Bank was granted the status of a ‘Scheduled Bank’. Five years later, it was declared as “A” Class Bank, by the Reserve Bank of India (RBI). As the years passed on, the bank started achieving more and more success. Today, it boasts of more than 500 branches across the country. It was only recently that Jammu and Kashmir Bank became a billion dollar company. Governed by the Companies Act and Banking Regulation Act of India, it is regulated by RBI and SEBI. It finds a listing on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) as well.

Unique Characteristics & Services ? ? J&K Bank carries out banking business of the Central Government Inspite of a government equity holding of 53 per cent, Jammu & Kashmir Bank (J&K Bank) is regarded as a private sector bank ? J&K Bank is the one and only banker and lender of last resort to the Government of J&K ? Plan and non-plan funds, taxes and non-tax revenues are routed through the J&K Bank ? J&K Bank claims the distinction of being the only private sector bank that has been designated as agent of RBI for banking 45 The services of J&K Bank are utilized for the purposes of disbursing the salaries of Government officials ? J&K Bank collects taxes pertaining to Central Board of Direct Taxes, in Jammu & Kashmir Products & Services The bank principally provides various financial products and schemes which include housing loan scheme, educational scheme, car loans schemes, mortgage loans, consumer loans, loans to pensioners, Agri-term loan, Apple advance scheme, Dastakar finance, Craft development finance, Saffron scheme and Giri finance.

The insurance scheme provided by the company includes tax saver scheme and tax saver term deposit scheme. The bank also offers a full range of deposits products that include savings accounts, Ujala- No Frills account, deposit schemes. Smart saver scheme, recurring deposit scheme, recurring plus account, depositor? s pension scheme; current accounts namely platinum current account, gold current account, premium current account, basic current account. It offers services such as global access cards, empowerment cards and merchant acquiring and mutual funds.

Support Services ? ? ? ? ? ? ? Anywhere Banking Internet Banking SMS Banking ATM Services Debit Cards Credit Cards Merchant Acquiring Depository Services ? ? Demat Account Other Services 46 Third Party Services ? ? ? Mutual Funds Insurance Services – Life & Non Life Remittance Services Cash Management Services ? ? Real Time Gross Settlement (RTGS) National Electronic Fund Transfer (NEFT) Registered Office & Corporate Headquarters Jammu And Kashmir Bank M A Road Srinagar 190 001 Jammu & Kashmir Phone: (+91- 0194) 2481930 -2481935 Website: www. jkbank. net

STATE BANK OF INDIA The evolution of State Bank of India can be traced back to the first decade of the 19th century. It began with the establishment of the Bank of Calcutta in Calcutta, on 2 June 1806. The bank was redesigned as the Bank of Bengal, three years later, on 2 January 1809. It was the first ever jointstock bank of the British India, established under the sponsorship of the Government of Bengal. Subsequently, the Bank of Bombay (established on 15 April 1840) and the Bank of Madras 47 (established on 1 July 1843) followed the Bank of Bengal.

These three banks dominated the modern banking scenario in India, until when they were amalgamated to form the Imperial Bank of India, on 27 January 1921. An important turning point in the history of State Bank of India is the launch of the first Five Year Plan of independent India, in 1951. The Plan aimed at serving the Indian economy in general and the rural sector of the country, in particular. Until the Plan, the commercial banks of the country, including the Imperial Bank of India, confined their services to the urban sector.

Moreover, they were not equipped to respond to the growing needs of the economic revival taking shape in the rural areas of the country. Therefore, in order to serve the economy as a whole and rural sector in particular, the All India Rural Credit Survey Committee recommended the formation of a state-partnered and state-sponsored bank. The All India Rural Credit Survey Committee proposed the take over of the Imperial Bank of India, and integrating with it, the former state-owned or state-associate banks. Subsequently, an Act was passed in the Parliament of India in May 1955.

As a result, the State Bank of India (SBI) was established on 1 July 1955. This resulted in making the State Bank of India more powerful, because as much as a quarter of the resources of the Indian banking system were controlled directly by the State. Later on, the State Bank of India (Subsidiary Banks) Act was passed in 1959. The Act enabled the State Bank of India to make the eight former State-associated banks as its subsidiaries. The State Bank of India emerged as a pacesetter, with its operations carried out by the 480 offices comprising branches, sub offices and three Local Head Offices, inherited from the Imperial Bank.

Instead of serving as mere repositories of the community’s savings and lending to creditworthy parties, the State Bank of India catered to the needs of the customers, by banking purposefully. The bank served the heterogeneous financial needs of the planned economic development. Branches The corporate center of SBI is located in Mumbai. In order to cater to different functions, there are several other establishments in and outside Mumbai, apart from the corporate center. The bank boasts of having as many as 14 local head offices and 57 Zonal Offices, located at major cities throughout India.

It is recorded that SBI has about 10000 branches, well networked to cater to its customers throughout India. 48 ATM Services SBI provides easy access to money to its customers through more than 8500 ATMs in India. The Bank also facilitates the free transaction of money at the ATMs of State Bank Group, which includes the ATMs of State Bank of India as well as the Associate Banks – State Bank of Bikaner & Jaipur, State Bank of Hyderabad, State Bank of Indore, etc. You may also transact money through SBI Commercial and International Bank Ltd by using the State Bank ATM-cum-Debit (Cash Plus) card. Subsidiaries

The State Bank Group includes a network of eight banking subsidiaries and several non-banking subsidiaries. Through the establishments, it offers various services including merchant banking services, fund management, factoring services, primary dealership in government securities, credit Cards and insurance. The eight banking subsidiaries are: ? ? ? ? ? ? ? ? State Bank of Bikaner and Jaipur (SBBJ) State Bank of Hyderabad (SBH) State Bank of India (SBI) State Bank of Indore (SBIR) State Bank of Mysore (SBM) State Bank of Patiala (SBP) State Bank of Saurashtra (SBS) State Bank of Travancore (SBT)

Products and Services Personal Banking 49 ? ? ? ? ? SBI Term Deposits SBI Loan For Pensioners SBI Recurring Deposits Loan Against Mortgage Of Property SBI Housing Loan Loan Against Shares & Debentures SBI Car Loan Rent Plus Scheme SBI Educational Loan Medi-Plus Scheme Other Services ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? Agriculture/Rural Banking NRI Services ATM Services Demat Services Corporate Banking Internet Banking Mobile Banking International Banking Safe Deposit Locker RBIEFT E-Pay E-Rail SBI Vishwa Yatra Foreign Travel Card Broking Services Gift Cheques

Contact State Bank of India Corporate Centre Madam Cama Road Mumbai 400 021 India Website: www. statebankofindia. com 50 PUNJAB NATIONAL BANK Punjab National Bank (PNB) is the second largest government-owned commercial bank in India. Having more than 3. 5 crore customer, Punjab National Bank has one of the largest branch networks in India. The bank’s assets for financial year 2007 were about US$60 billion. Products and Services Savings Fund Account – Total Freedom Salary Account, PNB Prudent Sweep, PNB Vidyarthi SF Account, PNB Mitra SF. Account Current Account PNB Vaibhav, PNB Gaurav, PNB Smart Roamer

Fixed Deposit Schemes – Spectrum Fixed Deposit Scheme, Anupam Account, Mahabachat Schemes, Multi Benefit Deposit Scheme Credit Schemes – Flexible Housing Loan, Car Finanace, Personal Loan, Credit Cards Social Banking – Mahila Udyam Nidhi Scheme, Krishi Card, PNB Farmers Welfare Trust Corporate Banking Gold Card scheme for exporters, EXIM finance Business Sector – PNB Karigar credit card, PNB Kushal Udhami, PNB Pragati Udhami, PNB Vikas Udhami Apart from these, the PNB also offers locker facilities, senior citizens schemes, PPF schemes and various E-services. Awards and Distinctions ?

Ranked among top 50 companies by the leading financial daily, Economic Times. 51 ? Ranked as 323rd biggest bank in the world by Bankers Almanac (January 2006), London. ? Earned 9th place among India’s Most Trusted top 50 service brands in Economic Times- A. C Nielson Survey. ? Included in the top 1000 banks in the world according to The Banker, London. ? Golden Peacock Award for Excellence in Corporate Governance – 2005 by Institute of Directors. ? FICCI’s Rural Development Award for Excellence in Rural Development – 2005 PNB Overseas Offices PNB has a banking subsidiary in the United Kingdom, as well as branches in Hong Kong and Kabul.

It has representative offices in Almaty, Shanghai, and Dubai. Coming into Being The bank was established in 1895 at Lahore. PNB’s founders included several leaders of the Swadeshi movement like Dyal Singh Majithia, Lala HarKishen Lal, Lala Lalchand, Kali Prosanna Roy, EC Jessawala, Prabhu Dayal, Bakshi Jaishi Ram, and Lala Dholan Dass. Lala Lajpat Rai was actively associated with the bank? s management in its early years. It holds the distinction of being the first Indian bank to have been started solely with Indian capital.

In 1969, it was nationalized by the Government of India along with 13 other banks. Head Office Punjab National Bank. 7, Bhikhaiji Cama Place, New Delhi – 110066 Phone: 91-11-2371 6185 52 Fax: 91-11-26196176 Website: www. pnbindia. com 53 54 RESULT AND DISCUSSION In order to gauge the level of satisfaction of customers in various banks in JAMMU, comparative study has been undertaken by the investigator selecting a sample of 100 customers from each bank i. e. SBI, PNB & JKB. The customers of the respective banks have been selected from the three major branches of Samba town.

The survey of the customers has been conducted by visiting various branch offices of the concerned banks in the month of July-August 2010 & by personally contacting the customers. The views of the customers regarding their satisfaction/dissatisfaction have been quantified on the basis of a scale having 5 different points on the continuum. The scale and their respective score values are given as under: Point of scale 1)Very satisfied 2)Satisfied 3)Neither satisfied nor dissatisfied 4)Dissatisfied; & 5) Very Dissatisfied Assigned score 5 4 3 2 1 The high score is the corresponding dimension or indicates very high satisfaction of the customers.

Score in the low range indicates conversely, low satisfaction of customers. The dimensions selected for measuring the customer satisfaction have been selected as described below: 1) Attitude of the staff towards customers 2) Efficiency of the bank. 3) Products and services of the bank. 4) Physical facilities of the bank 5) Customer advice and problem solving role of the bank. Each dimension is supplementary by various variables, which are responsible for higher/lower level of customer satisfaction the empirical results of the survey are discussed here under: 5 ATTITUDE OF THE STAFF One of the important dimensions of the satisfaction of the customers is the attitude displayed by the staff towards them. The attitude of the staff studied with reference to the behavior of officer & employees of the respective banks towards the customers. Moreover, the variables like dedication & commitment, willingness of the staff to serve customers needs, personal attention, courtesy and friendliness of the staff are the important ingredients of the satisfaction experienced by customers.

The pro-active response of the staff to inquiries and requirements of the customers are also important variable, which determine the satisfaction of the customers. The attitude of the staff of the banks under study is exhibited in the table 3. 1: An introspection of the table 3. 1 indicates that the highest satisfaction of customers is provided by SBI as the combined mean score of different variables which determine the satisfaction of the customers on the basis of behavior of the staff which is represented by the combined mean 4. 38 in case of SBI.

The score ranges between satisfied and very satisfied. The views expressed by the customers are consistent as the standard deviation is in significant (0. 977). The satisfaction of the customers representing SBI & PNB is satisfied as the combined mean scores of variables signifying behavior of the staff towards customers. The scores are 4. 38 & 4. 26 respectively. However the scores of standard deviation, of both the banks shows some inconsistency of the views of the customers as the standard deviation scores are 0. 977 and 0. 958 respectively.

A further analysis of the table 3. 1 indicates that in case of SBI the courtesy and friendliness displayed by the staff is the highest contributory factor for bringing satisfaction to customers, the mean score being 4. 88 while in case of JKB & PNB the highest contributory factors are response of staff towards inquires by the customers, the mean scores being 4. 14 & 4. 54 respectively. Similarly the least important factors responsible for customer satisfaction in case of JKB & PNB are willingness of employees to serve customers needs, the mean value being 3. 4 & 4. 06 respectively. However in case of SBI, the least contributory factor for customer satisfaction is the personal attention given by the staff to the customers. The mean value being 4. 17. 56 TABLE 3. 1 SATISFACTION OF CUSTOMER REGARDING ATTITUDE OF STAFF JKB MEAN Behavior of officers towards customers 4. 02 SBI MEAN 4. 20 PNB MEAN 4. 32 S. D 1. 191 S. D 0. 916 S. D 0. 779 Behavior of employees towards customers 3. 09 1. 225 4. 46 0. 641 4. 34 0. 894 Dedication & commitment to serve customer Interest. Willingness of employees to serve customer needs. . 82 1. 367 4. 42 0. 894 4. 20 0. 959 3. 34 1. 408 4. 18 0. 994 4. 06 1. 017 Personal attention given by the staff. 3. 76 1. 269 4. 17 0. 815 4. 10 1. 020 Courtesy & friendliness displayed by the staff. 3. 70 1. 203 4. 88 1. 182 4. 26 0. 953 Response of staff towards inquiries by the customer. 4. 14 1. 152 4. 34 0. 929 4. 54 0. 983 COMBINED MEAN & S. D 3. 81 3. 539 4. 38 0. 977 4. 26 0. 958 57 EFFICIENCY OF THE BANK Another important dimension of the satisfaction of the customers is the efficiency of the bank for discharging various functions.

The efficiency of the bank is studied with reference to the time taken for opening an a/c , & speed of deposits & withdrawals of the respective banks towards the customers. Moreover the variable like time taken for updating pass book, providing error, free records, promising to do something by a certain time & doing the same by that, providing the prompt & efficient service & knowledge of employees about the banks products & services are the important ingredients of the satisfaction experienced by the customers. The efficiency of the staff of the banks under study is exhibited in TABLE 3. 2. An introspection of the table 3. indicates that the highest satisfaction of customers is provided by PNB as the combined mean scores of different variables which determine the satisfaction of the customers on the basis of the efficiency of the bank which is represented by the combined mean 4. 17 in case of PNB. The score is in between satisfied & very satisfied. The views expressed by the customers are consistent, as the standard deviation is significant (2. 845). The satisfaction of the customers representing PNB & JKB is satisfied as the combined mean score of the variables signifying efficiency of the staff towards customers. The scores are 4. 17

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