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Customer Satisfaction in the Tourism and Hospitality Industry: Analysis on Service Quality and Service Failure Essay

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TITLE OF THE STUDY Customer Satisfaction in the Tourism and Hospitality Industry: Analysis on service quality and service failure 2. 0 BACKGROUND OF THE STUDY / INTRODUCTION Customer satisfaction plays a crucial role for success and survival in today’s competitive market. Customer satisfaction is considered a prerequisite for customer retention and loyalty, and obviously helps in realizing economic goals like profitability, market share, return on investment, etc. (Scheuing, 1995; Reichheld, 1996; Hackl and Westlund, 2000).

Customer’s overall satisfaction with the services of the organization is based on (or a function of) all the encounters/experiences of the customers with the organization. There are many researchers conceptualize customer satisfaction as an individual’s feeling of pleasure or disappointment resulting from comparing a product’s perceived performance in relation to his or her expectations. Satisfaction is a widely researched consumer evaluation because it is of the utmost importance to firms, in order to ensure sustainability.

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Keeping customers satisfied is vitally important for hospitality industry to generate revenues. To achieve a high level of customer satisfaction, it is important to meet customer expectation. However, it is sometimes difficult to realize what customers expect and unless they wish to feedback their opinions to the restaurant. Listening to the customer can be of strategic importance for the future of hospitality industry. Customer retention has become a continuous focus of service organizations. In hospitality industry, service quality is most important in retaining and gaining customer.

Service quality has been defined in different ways. According to the Bitner, Booms and Mohr (1994) define service quality as ‘the customer’s overall impression of the relative inferiority/superiority of the organization and its service’. Parasuraman, Zeithaml and Berry (1985) defined service quality as ‘a function of the differences between expectation and performance along the quality dimensions’. Roest and Pieters’ (1997) define service quality is a relativistic and cognitive discrepancy between experience-based norms and performances concerning service benefits.

Other researchers view service quality as a form of attitude representing a long-run overall evaluation. In today’s world of intense competition, the key to sustainable competitive advantage lies in delivering high quality service that will turn result in satisfied customers (Shemwell et al. , 1998). Perceptions of service quality could occur at multiple levels such as with the core service, physical environment, etc. (Bitner and Hubert, 1994). The performance of service quality is measure base on customers’ perception and expectation.

The differences between expectation and perception of customers represent positive and negative will affect customer satisfactions. Employees in an organization need to deliver excellent services to create positive quality perceived by customers. Service quality influence a customer’s subsequent behaviour, intentions and preferences. If customers chooses a provider that provides service quality that meets or exceeds his or her expectation, he or her will found that service quality has significant effect on repurchase intentions.

Service failure can be defined as that service which does not meet the customer’s expectations. Apparently this will have an effect on a customer’s evaluation of service performance, as their expectations are not being met. The hotel industry involves a high degree of interaction between employees and consumers and hotels are characterized by continuous operation and highly fluctuating demand, relative to constant rates of supply. Thus, it provides many opportunities for service failures to occur and is more likely than in other industries.

It is difficult to observe hospitality service is often immediate and spontaneous, relying on experiential aspects for consumer evaluation. To achieve a situation of zero defects is difficult, perhaps even impossible. Therefore, striving toward reducing the number of service failures remains an important goal in hospitality industry. Service failure is further compounded by the fact that there is an increased competition in most service industries. The competition between hospitality providers is reflected in the ways that customers nowadays critically assess the quality of service offerings.

Thus, in an era of increased competition and perceptual differences between the customers and the service providers leading to service failures, service recovery becomes an important strategy to reduce the dissonance in customers. It is important for hospitality industry to investigate the best methods for recovering from service failure. 3. 0 PROBLEM STATEMENT In today fast-growing competitive market, many companies are trying to implement strategies in order to help them gain the competitive advantage in the business industry.

Buyer or customer as the major sources income for the business, they control the volume of sales and profit margin of the organization. In order to success and survival in the competitive market, many companies trying to maintain an on-going relationship with the customer as well as focus on their needs and wants to protect their long-term interest. Besides that, they also found that satisfaction of customer can influence the financial performance of the organization. In the hospitality industry, service quality is always considered as the important criteria that need to be focus by the organization.

Concept service quality and customer satisfaction is related with each others. The way of service provider delivery services to the customer during business transaction influence the customer overall satisfaction. When the services provided meet the expectation and perception of the customer, it gains the positive impact on the customer satisfaction. Good customer satisfaction arises as specific customer needs and wants are understood better and served better. In the context of service quality, different people have its own perceptions and viewpoint to define the service.

Generally, they will compare the performance of the organization with their expectation. Service gap form when quality of service experienced by the customers is different with actual delivery from the service firm. Service gap as the source of customer dissatisfaction, it cause the high customer turnover and reduces the revenue of the organization. Satisfaction of the customer is one of the key factors in keeping them in the business. In the hotel industry, it requires a lot of the people to perform the job in the front-of the house and back-of the house.

Employees are recognized as one of the main drivers involves providing services for the customer. The way how their perform services can directly or indirectly give the impact to the customer satisfaction. However, issue of high employee turnover rate influence the service performance especially in the services industries. Inconsistence quality service provided from different capabilities employee resulting customer dissatisfaction. Employee commitment and involvement influence the customer perceptions on service quality.

Work facilitation with good surrounding working condition enhances positive commitment of the employees to the organization. When they feel obligation to perform their jobs and work role, they are more likely to produce high quality of service which beneficial to the organization. Employee attitude and behavior give the impact on the service quality as well as customer satisfaction. Even nowadays the quantities of hotel is increasing and this have affected the intense competition between the entire hotelier through local and also internationally.

The increasing of the hotels bring out the higher demand of the customers about the quality service that been provided by each hotel. The higher the demand of the customers, the better the service quality and the higher the service failure to be occur. This has brought a lot of problem to the hotelier since each customer has the different needs and wants. When this has been effected different demands or requests from the customers to the hotel.

This is similar like different people have its own perception, viewpoint and even special requests regarding the service that provided by the hotel. Ones the service didn’t achieve the customers’ satisfaction; this will cause the service failure in the hospitality. Based from the customers’ needs and wants, this has caused the customers’ expectation to occur. Apparently this have been affected the evaluation regarding the service performance from the customer when their expectation didn’t been achieve by the hotelier and bringing the dissatisfaction toward the customers.

Hotel everyday involves high degree of interaction between employee and customer, service failure happen through the outcome or progress failure between the customer and the employee. Outcome failure is happen form what the customer receive from the employee, while the progress failure is occur from the process of service that been given from the employee to the customer for example the employee manner toward the customers. Outcome and progress failure easy to happen when the hotel are continues business which operated 24 hours daily, therefore opportunities for service failure to occur are likely increased.

Through the increasing of service failure in hospitality industry have cause of this researchers have researched customers’ satisfaction through customer respond and behavior toward the service provided by the hotel staff to the customers that stay in. This is important to the hotel to maintain the sustainability. Satisfactions from the customers are essential element which can help to keep the on-going business of the organization, Quality of the service delivery from the employee influenced on the customer satisfaction and service failure in the hotel industry.

Therefore, it is very important for us to understand how the service quality and service failure give impact on customer satisfaction. 4. 0 OBJECTIVES OF THE STUDY The main objective of this study is to analyze the effect of service quality and service failure on the customer satisfaction. The sub-objectives are as follow: i) To examine the influence of service quality on the customer satisfaction. ii) To examine the influence of service failure on the customer satisfaction. Questions of the study: 1) How the service quality influence on the customer satisfaction? ) How the service failure influence on the customer satisfaction? 3) Does the quality of service deliver from the organization can give impact on the satisfaction of the customer? 4) Does the customer satisfaction can be affected by the service quality and service failure? 5. 0 REFERENCES Caruana, A.. (2000). Service Loyalty: The effects of service quality and the mediating role of customer satisfaction. European Journal of Marketing, Vol. 36, No. 7/8, pp. 811-828. Dr Sparks, B. and Dr Fredline, L..

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