Requests for copies should beaddressed to: KGovender, Faculty of Business Management, TechnikonWitwatersrand, PO Box17011, Doornfontein, 2028 ENHANCING SERVICE PRODUCTION AND SERVICE QUALITY KRISHNA GOVENDER Faculty of Business Management TechnikonWitwatersrand ABSTRACT This article sheds light on a possible strategy to enhance service production and service quality by reporting on an exploratory mail survey conducted among a sample of1000 commercial bank customers. It became apparent that by using formal and informal strategies to socialize their customers, service providers could positively in£uence their customers’perception of service quality. However, although both formal and informal socialization strategies are sig- ni¢cantly correlated with the role ambiguity and the role con£ict experienced by customers, the role ambiguity and role con£ict experienced by service customers did not signi¢cantly in£uence their perception of service quality. OPSOMMING Hierdie artikel werp lig op’n moontlike strategie om diensproduksie en -kwaliteit te bevorder deur die rapporte- ring van’n eksploratiewe pos-opname onder ’n steekproef van 1000 handelsbankklie« nte. Dit het duidelik geword deur die gebruik van formele en informele strategiee« om klie« nte te sosialiseer dat diensverska¡ers hulle klie« nte se persepsie van dienskwaliteit positief kon be|«nvloed. Beide die formele en die informele sosialiseringstrategiee« is beduidend gekorreleerd met rolonsekerheid en rolkon£ik soos deur klie« nte ervaar, maar die ervaarde rolonseker- heid en rolkon£ik het nie hulle persepsie van dienskwaliteit betekenisvol be|«nvloed nie. Since service customers often take on the role of ‘partial’ em- ployees (Wikstrom,1996) during the service encounter, it is im- portant for service organization to ascertain what management practices could be used to ensure that the customers have the competencies to performtheir role as co-producers of the service. Zeithaml, Parasuraman and Berry (1990) suggested a number of ways by which the service performance gap could be closed, inter- alia, the provision of role clarity in job descriptions and quality standards, and informing employees about what is expected of them.These suggestions imply the need for organizational socia- lization of service employees. Due to the participatory nature of the role played by the service customers, that of a partial em- ployee, Kelley, Skinner and Donnelly (1990) suggested that the process of socialization might also be considered as a useful stra- tegy to provide role clarity for customers. Since the active role of ‘partial’employee (played by service customers) results in the in- troduction of uncertainty in the service production process, the process of organizational socialization may assist in reducing‘cus- tomer induced’uncertainty. Researchers (Starr & Fondas,1992) assert that socialization tac- tics in£uence the role orientations that newcomers ultimately adopt.Van Maanen and Schein (1979) identi¢ed various socia- lization tactics or strategies, which include collective versus in- dividual socialization, sequential versus random, ¢xed versus variable, guided versus unguided, formal versus informal, and investive versus divestive . Ashforth and Saks (1996) re- mark that despite the cogency of this typology, research on the tactics has been relatively scarce.This paper attempts to ad- dress the remark by reporting on the e¡ects of formal and in- formal organizational socialization tactics on service customers’perception of their roles, and service quality. Formality is the degree towhich socialization takes place apart from the ongoing work of the organization. Through formal socialization, employees (customers) are separated from others while they learn about the organization and their tasks (Wag- ner & Hollenbeck, 1996). During informal socialization, em- ployees (customers) interact with more experienced employees (customers), become integrated into the organiza- tion, and learn on the job. Thus formal socialization allows the employees (customers) to see and learn what the organiza- tion wants them to learn, whereas informal socialization al- lows employees (customers) to experience the organization on their own terms. Organizational Socialization ^ Service Quality Solomon, Surprenant, Czepiel & Gutman (1985) propose that when customers and employees ‘‘read from a common script’’, the service encounter will be more satisfying to both.This im- plies that the socialized customer should be more satis¢ed be- cause his or her service expectations more closely approximate the actual service provided. To explore this relationship fur- ther, it is hypothesized that: H1: Formal [FS] and Informal [IS] organizational socialization of service customers is positively associated with the over- all Service Quality [SQUAL] as perceived by customers. The literature also suggests that the e¡ects of organizational socialization on service quality is indirect or mediated through other variables, inter-alia, the customers’ role perception. This apparent relationship was explored further. Organizational Socialization ^ Role Perception Researchers (Singh, Vebreke and Rhoads, 1996) agree that when an individual has gained an appropriate understanding of his or her role and the roles of the other members of the role set, it is possible to formulate accurate role expectations. Fur- thermore, Schneider and Bowen (1995) assert that in order for service employees [and service customers] to learn their roles and be able to form accurate role expectations for the service encounter, they must be formally socialized into the organiza- tion. In view of the aforementioned, it is proposed that: H2: Formal organizational socialization of the service custo- mer is negatively associated with Role Ambiguity [RA] and Role Con£ict [RC] experienced by the customer. H3: Informal organizational socialization of the service custo- mer is positively associated with Role Ambiguity and Role Con£ict experienced by the customer. Role Perception ^ Service Quality Hartline and Ferrel (1993) suggest that role ambiguity a¡ects ser- vice employees’performance which may spill over to the percep- tions of service quality on the part of the customers. In order to explore the relationship between service quality and the custo- mers’role perception, the following hypothesis is proposed: H4: The level of Role Con£ict and RoleAmbiguity experien- ced by the service customers is negatively associated with their perception of Service Quality. Researchers such as Behrman and Perreault (1984) have found that role con£ict and role ambiguity as perceived by the servi- ce employee are positively correlated. In order to explore the relationship between role con£ict and role ambiguity as it per- tains to the service customer, it is hypothesized that: SAJournal of Industrial Psychology, 2002, 28(1), 33-36 SATydskrif vir Bedryfsielkunde, 2002, 28(1), 33-36 33 H5: The Role Ambiguity experienced by service customers is positively associated with the Role Con£ict experienced by customers. METHOD Sample and Sampling Procedure A combination of convenience and judgmental sampling was employed to select bank employees to distribute questionnai- res to a random sample of1000 bank customers, by taking cog- nizance of the comments of Churchill (1995) regarding sample selection and sample size.These front-line employees distribu- ted questionnaires to every third customer with whom they interacted for at least ¢ve minutes.The rationale for choosing every third customer was to introduce a‘‘sense of randomness’’ into the sample, a procedure which has been endorsed by re- searchers such as Danaher and Mattsson (1993) and Naumann and Giel (1995). Acovering letter explaining the purpose of the research, as well as stamped, addressed envelopes were provi- ded so that completed questionnaires could be forwarded di- rectly to the researcher. Measuring Instruments The type of organizational socialization as perceived by the bank customers was measured with a 5 point Likert scale with anchors of (1) strongly disagree, (2) disagree, (3) neither agree nor disagree (neutral), (4) agree, (5) strongly agree. A 5-point scale was used because the pre-test revealed that res- pondents could not make ¢ne mental distinctions with res- pect to whatever was being measured. The questions which attempted to determine the type of organizational socializa- tion were adapted from the questionnaire developed by Jones (1986). The questionnaire comprised of a 9-item in- strument, four of which attempted to measure ‘‘Formal’’ so- cialization. The con£ict and ambiguity scales developed by Chonko, Ho- well, and Bellenger (1986) were adapted for this research. In order to ascertain information about role con£ict, service cus- tomers were asked to indicate the agreement between themsel- ves and their banks on a 5 point scale ranging from 1 (no agreement) to 5 (complete agreement). This section of the questionnaire consisted of 2 items. For the role ambiguity scale, bank customers were asked to indicate how certain they were about each of 6 items using a scale ranging from1 (com- pletely uncertain) to 5 (completely certain). Since, recent research (Buttle,1996; Nel, Pitt & Berthon,1997) uncovered a number of de¢ciencies in the SERVQUAL scale, an alternative scale [named SQUAL], based on the 22-items of the SERVQUAL instrument was used in this study. The SQUAL scale combined expectations and perceptions into one measure by asking customers whether certain aspects of service quality exceeded or fell short of expectations.This ap- proach which was adopted by Hartline and Ferrel (1993) was recommended by Parasuraman et al. (1994). Bank customers were asked to rate each of the 22 items on a scale ranging from 1 (worse than expected) to 5 (better than expected). Statistical Analysis To empirically evaluate the hypothesized relationships the computer programme RAMONA (Brown & Mels, 1990) was used. RAMONAwhich is an improvement on LISREL, not only tests for signi¢cant deviations from zero for all para- meters, but also provides for measures of ¢t of the data to an hypothesized model. By specifying an analysis based on sam- ple correlation matrix with maximum likelihood estimation, the research model was ¢tted to the observed data. RESULTS After three months, only190 usable questionnaires were recei- ved.This response rate of19 per cent could be attributed to the research method, since customers could not be ‘‘forced’’ to complete and return the questionnaires. Furthermore, em- ployees were unable to trace the customers to whom they had given questionnaires, since this was done randomly. As a fol- low-up, branch managers were requested to display notices re- questing customers to complete and return the questionnaires to the researcher. The majority (66%) of the customers indicated that they were with the same bank for over 5 years. An overwhelming majo- rity (83%) of the customers indicated that they were satis¢ed with the service provided by their bank. The PROC.UNIVARIATE procedure was performed on the researchvariables using the SAS (SAS Institute1990) computer programme. Considering that a 5-point scale was used, it is apparent from the preliminary results re£ected in Table 1 that the bank customers perceived themselves as being more infor- mally socialized. They also did not experience a great deal of ambiguity and con£ict. Furthermore, the overall service qua- lity o¡ered by the banks was perceived as being high. TABLE 1 DESCRIPTIVE RESULTS [N=190] VARIABLES MEANS STANDARD SKEWNESS VARIANCE DEVIATION Formal Socialization 2.7463 0.8146 -0.1055 0.6636 Informal Socialization 3.0487 0.9656 -0.3738 0.9325 Role Ambiguity 3.7649 0.7534 -1.1213 0.5676 Role Con£ict 3.3763 1.4167 -0.8105 2.0071 Service Quality 4.1048 0.7946 -0.9819 0.6314 Stepwise ReliabilityAnalysis (Willie,1996) was performed on the measuring instruments using the computer programme SAS PROC.CORR (SAS Institute,1990) The process was re- peated until all the measuring instruments possessed an accep- table level of reliability as measured by its Cronbach’s coe⁄cient alpha (Cronbach, 1951). It is evident from Table 2 that the latent variables were measured with acceptable levels of reliability, since the Cronbach alpha coe⁄cient’s exceeded 0.7, a reliability coe⁄cient favoured by most social scientists. TABLE 2 RELIABILITYAND VALIDITY Formal Informal Role Role Service Sterilization Sterilization Ambiguity Con£ict Quality CRONBACH’S APLHA CO-EEFICIENT 0.807 0.847 0.861 0.886 0.966 ITEMS FACTOR 1 FACTOR 2 FACTOR 3 FACTOR 4 FACTOR 5 FS1 -0.057* -0.427* -0.133* -0.001* -0.063* FS6 -0.052* -0.829* -0.030* -0.014* -0.101* FS7 -0.012* -0.721* -0.009* -0.007* -0.151* IS5 -0.079* -0.049* -0.980* -0.031* -0.017* IS9 -0.115* -0.051* -0.732* -0.030* -0.019* RA2 -0.062* -0.015* -0.033* -0.638* -0.032* RA3 -0.014* -0.014* -0.018* -0.992* -0.028* RA4 -0.054* -0.011* -0.122* -0.813* -0.071* RA6 -0.146* -0.013* -0.007* -0.430* -0.029* RC1 -0.004* -0.005* -0.039* -0.079* -0.842* RC2 -0.025* -0.025* -0.029* -0.017* -0.899* SQ1 -0.841* -0.053* -0.020* -0.085* -0.033* SQ2 -0.924* -0.036* -0.048* -0.022* -0.013* SQ3 -0.847* -0.025* -0.090* -0.039* -0.068* SQ4 0.944* -0.026* -0.013* -0.020* -0.001* * factor loadings > 0.4 were considered signi¢cant As an initial step to address the question of validity, the mea- sure development paradigms recommended by Parasuraman (1991) was closely followed during the development of the scales. Thereafter, Stepwise Exploratory Factor Analysis (Willie, 1996) was performed to ascertain the discriminant and construct validity of the measuring instruments. In each step of the analysis, BMDP4M (Frane, Jennrich & Sampson, 1993) was used to perform a maximum likelihood factor analysis with a direct quartimin rotation (Jennrich & Samp- GOVENDER34 son, 1966) of the unrotated factor matrix. It is evident from Table 2 that the measuring instruments possessed acceptable levels of discriminant and construct validity since they load heavily only on one factor, with loadings above 0.4 (Rum- mel,1967). The research model was ¢tted to the observed data by speci- fying an analysis based on the sample correlation matrix with maximum likelihood estimation. The resulting maximum likelihood estimates with their associated signi¢cance infor- mation in terms of pvalues are re£ected inTable 3. In this table, a T-value greater than 1.96 (p<0.05) or a T-value greater than 2.58 (p<0.01) implies a signi¢cant in£uence.T-values which are equal to or less than 1.96 (p>0.05) implies a non-signi¢cant in- £uence. Based on the ¢ndings,Table 3 also re£ects the decision on the various hypotheses. TABLE 3 SUMMARY OF EMPIRICAL FINDINGS PATH SPE P-Values T-Values Hypothesized Conclusion In£uence FS ?̂SQUAL -0.193 <0.05 -2.54 Positive H1-Accepted IS ?̂SQUAL -0.164 <0.05 -2.35 Positive H1-Accepted FS/̂ ?RA -0.281 <0.01 -3.23 Negative H2-Accepted IS/̂ ?RA -0.344 <0.01 -4.37 Positive H3-Rejected FS/̂ ?RC -0.373 <0.01 -4.54 Negative H2-Rejected IS/̂ ?RC -0.308 <0.01 -3.85 Positive H3-Accepted RC ?̂SQUAL -0.047 >0.05 -0.63 Negative H4-NS RA ?̂SQUAL -0.107 >0.05 -1.54 Negative H4-NS RA/̂ ?RC -0.555 <0.01 -8.96 Positive H5-Accepted Table 3 shows that contrary to the hypothesized view, both formal and informal socialization experienced by customers exert a signi¢cant positive in£uence on their perception of the overall service quality. Formal socialization and informal socialization are signi¢cantlycorrelated with both the role am- biguity and the role con£ict experienced by service customers. This means that the better the formal and informal socializa- tion between the service organization and its customers, the lower will be the level of role ambiguity and role con£ict ex- perienced by the service customers and vice-versa. The measures of ¢t of the model suggested that the model pro- vided a reasonable ¢t to the data.The Root Mean Square Error of Approximation (RMSEA) of 0.068 was less than 0.8. Furt- hermore, the expected cross validation index (CVI) for the modelwas 3.046, whichwas less than that for the saturated mo- del, which was given as 3.345. The most revealing ¢nding is that, both formal and informal socialization exert a positive in£uence on the customers’ per- ception of the overall service quality. Previous research (Kel- ley, 1987) merely supports the hypothesis of a positive relationship between the ‘‘level’’ or ‘‘degree’’ of organizational socialization achieved by the customers and their perception of the service quality. Thus the process of socialization may provide a means of ‘‘training’’and motivatingcustomers sothat the encounter experience is satisfying to them. Moreover, it is apparent that customers are positively socialized [may acquire banking knowledge and skills] by both formal and informal strategies since both (sources) are signi¢cantly correlated. Considering that customers interact with other customers du- ring service delivery, it may be assumed that this is a source of ‘‘informal’’socialization. However, since it may be di⁄cult to control the information which customers receive from‘‘informal’’sources, service orga- nizations should endeavour to provide as much information as possible by way of ‘‘formal’’ sources, for example pamphlets and newsletters. Since the process of socialization can be controlled to a large extent by the organization, management should ensure that customers are e¡ectively socialized. Through e¡ective formal socialization, it may be possible to manage the service expec- tations of the service customers and indirectly manage their perceptions of service quality. Furthermore, the process of or- ganizational socialization may provide a means for the service organization to help customers develop more accurate role ex- pectations. This would result in customers performing their roles better, which could contribute to the delivery of higher levels of service quality. CONCLUSION Consumer behaviour research on how customers acquire their perception of their consumption and production roles may al- so bene¢t service managers trying to develop able‘partial em- ployees.’Although customers are a source of input uncertainty relative to the diversity of their demands and their disposition to participate, the service organization could in£uence the cus- tomers through formal and informal socialization strategies. 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