Service Quality Model and Airline Companies - Essay Example

?Service Quality Model s s Grade 16th October Background and Introduction This paper is a review of six articles whose focus is on service quality in airline companies. The articles bring out a number of factors that relate to service quality and that include competition, operational and financial features. The first article focuses on the existing association between different service quality dimensions and the satisfaction of low- cost carriers. The second article looks at the effect that service quality has on the image of airline and the behavioral intentions of passengers in the future. The focus in the third article is on performance variance among different airlines. The fourth conducts a multivariate analysis to assess the relationship between an airline’s financial and operating characteristics and the service quality. In the fifth study, the service quality is assessed on the basis of the Analytic Hierarchy Process which involves the evaluation and comparison of service quality among different companies. The sixth study looks at how competition can determine service quality by looking at the connection between market concentration and the delay of flights. The Scope and Objectives In the first article, the authors present an analysis of the underlying dimensions of service quality for low cost carriers. The study also seeks to determine the relationships between the aspect of service quality and the satisfaction of the passengers on the airlines services (Asbudin, 2010). The investigations of Park, Robertson and Wu (2005) were centered on the effects of airline service quality on its image and passengers’ future behavioral intentions in the Australian International Air. Thereafter, another study by Rhoades and Waguespack (2000) dwelt on service quality in the U.S. Airline industry. The main objective of the research was to find out on the variations that exist between the regional and major airlines across the U.S. and the causal factors of the discrepancies. Bhat (n.d.) used the canonical correlation analysis to present the findings of the association between the financial and operating characteristics of an airline and its service quality. This was done using the service quality variables such as complaint rates, delays and involuntary denials of boarding; and operating and financial variable(market share, load factor, revenue per passenger) Mazzeo (2003) study examined the effect of competition in a given route on quality of services delivered in the U.S. airline industry. Finally, the last paper uses the Analytic Hierarchy Process (Ahp) to come up with an evaluation of service quality of airlines (Pei, Peng & Mustafa, 2005). Methodology Ariffin, Salleh, Aziz & Asbudin sampling method to acquire their respondents through questionnaire method. The respondents who qualified for the study had flown in a three hour local low cost flight in Kuala Lumpa. Twenty seven questions enquiring on the service quality were at hand and 125 questionnaires were distributed, 100 filled ones were used for analytical findings. 17 queries were on the airline service operation expectations while 7 incorporated the original SERVQUAL parameters. The last three aimed at presenting special service extent in the Industry. Eigen value measure, factor loading and multiple regression analyses were used in the final analysis of the data obtained. Those with Eigen value less than 1 and factor loading less than 0.5 were discarded. Rhoades and Waguespack article dwelt with airlines in the U.S. numbering 25 between 1987-1996 whereby 12 were major ones and 13 were regional carriers. Data on various complaints were obtained from the Department of Transport Air Travel Consumer Report. The one on departures from the Bureau of Transportation Statistics, and used in the normalization of the quality measures. Service quality rate was calculated adding the following: late flights, consumer complaints, involuntary deprived of boarding and mishandled luggage reports divided by the total number of departures in the year for that given airline. Then total complaint rate calculated by summing all complaints and dividing by yearly departures. Park, Robertson and Wu in their article, use the questionnaire method to obtain data from five categories. An investigative survey on service quality in the airline industry was conducted with a bias on aviation context rather than the SERVQUAL model-by interviewing the members of staff and the passengers. Parameters used here were based 22 items the image of the industry measured by three queries to the passengers with the overall analysis using a 7-point Likert-type scale. Data was specifically obtained from Australian, international passengers, who had experience in at least on an international flight in the year before. 600 questionnaires were distributed, and 554 completed ones were collected, but 53 were incomplete, thus 501 questionnaires were analyzed. Bhat, V. in his research tried to evaluate the airline service quality by use of complaints from the customers, those bumped unwillingly and delays. The quality is measured using three variables namely; complaint rate per 100,000 passengers, unwilling denial of boarding per 10,000 passengers and the rate of delayed arrival of scheduled flights. Data was drawn from the U.S. airlines from 1988-1991 in the issues like Air Transport World and Standard and Poor Industry Surveys, Aerospace & Air Transport Section. 12 financial and operating characteristics of an airline, as well as 3 dummy variables, were used as the independent variables. Mustafa, Jia-Pei and Siaw-Peng’s study evaluated tangibility, responsiveness, reliability and assurance, as the procedure of service quality. Respondents were obtained with disregard of the number of airlines they had boarded. One hundred questionnaires were given out to tourists in 2003 and 71 completed questionnaires were collected, and analyzed. Also, the use of secondary information was incorporated. The passengers in consideration were asked on a set standard of service quality. At the same time, data on the performance of the specific players in the industry were used to rank the airlines giving a wide range of study. Evaluation of the data obtained was done using the analytic hierarchy process (AHP) model. Mazzeo’s article on completion and service quality was based on the increase in concern over delays in air traffic. The information used was retrieved from Bureau of Transportation Statistics website and incorporated all the flights between 50 main airports in January, April and July 2000. Above 800,000 flight observations were put into consideration any late arrival of more than 15minutes recorded. Major causes of delay while flying were also illustrated for evaluation, as well as causes of poor time adherence in airports as control parameters during analysis. These are the ones whereby the carriers have no ability to control like weather conditions. Major findings Asbudin et al (2010) study showed that the most important dimensions of service quality for low cost carriers were caring and tangible. These are followed in order of importance by reliability, responsiveness, affordability and visual attractiveness. Furthermore, the study established that only the first two aspects (caring and reliability) contribute considerably to the ability of low cost couriers to deliver high quality services. Park, Robertson and Wu (2005) investigations, revealed that there was a significant relationship between the variables except one path. The research further found out that the dimension of in-flight service, reliability and customer service and the dimension of convenience and accessibility have a positive outcome on the image of the airline. Consequently, a positive image is directly related to the future behavioral patterns of passengers belonging to the Australian International air. A positive image help to filter out the negative perceptions that customers may have on the airline, they remain royal to the airline and may recommend it to potential passengers. In the research carried out on the U.S. Airline industry by Rhoades & Waguespack (2000), revealed considerable annual disparities between regional and national/major carriers in terms of service quality provision. The main verdict was that there was a high emphasis on service quality in the U.S. Airline Industry even though the levels differed between the regional and major carriers. The latter performed better than the former, even though there has been a significant increase in the overall performance across the board in comparison with the 1987 industry average. Bhat (n.d.) study found out that there is a direct relationship between service quality (first canonical variable) and complaints. The study further reveals that the debt- capital ratio, load factor and market share positively affect complain rates. Therefore, it was concluded that delays are positively related to the load factors and complain rates to debt ratio. Involuntary denial is likely to be high in airlines with a high debt ration to capital ratios, low employees per departure, high operating revenue per each worker and profitable airlines. However, the study reveals that compensating such passengers ensure that IVDR have minimal impact on the profitability dummy and the operating revenue per worker. One of the key findings of Mazzeo (2003) research reveals that there is a connection between the level of competition in a route and the quality of service delivered. It is evident that there was a high prevalence of flight delays and poor service delivery in a route with a monopoly or few carriers, as opposed to one with good competition. However, the flight delays are also influenced by the other factors such as weather condition (poor weather accelerates flight delays), level of congestion, and scheduling decisions in the airport (when number of flights scheduled to land in a given hour is high, likelihood of delays is high). Lastly, Pei, Peng and Mustafa (2005) study, establish that safety and comfort are the main concerns among the passengers in the air industry and plays a significant role in determining the service quality offered by airlines. This aspect of safety is to a greater extent influenced by the five top attributes namely; comfort and cleanliness, efficiency of the crew, courtesy of cabin crew, rate of accidents and cabin safety procedure. The research further found that reliability, responsiveness, tangibility and assurance as the criterion for determining service quality in a subsequent order. Limitations and Implications The paper failed to keep into consideration the per capita income of the passengers in the option of service they opt. Some passenger will opt for low quality services due to their financial implications and end up not getting satisfied. Mazzeo (2003) illustrates that some customers do not value time will opt to go for airlines with delayed flights to pay lesser. The study by Mustafa, Jia-Pei and Siaw-Peng clearly indicates that assurance was not of interest to the passengers as they only yearned for reliability. Bhat’s study well illustrates that airline debts have implications on service delivery. Organizations opt to cut other costs to alleviate the debt burden reading to poor service. The magnitude of in-flight service and convenience enhances the airline image and thus has a direct implication on how passengers behave towards service delivery scheme. Thus, the reliability should be of the essence, to enhance confidence in passengers. (Park, Robertson and Wu) Ariffin, Salleh, Aziz & Asbudin imply that airline employees must be in possession of strong communication and interpersonal skills. This is to enable them effectively intermingle with passengers, failure to which a hindrance to knowing their customer’s interest is created. Their study was limited to local flights and small study area; thus less scope of the target population was realized. Conclusion The paper well illustrates that low cost in the airlines does not dictate passengers’ satisfaction; it encompasses among other factors like, physical evidence and other services offered by the employees are of much importance. Convenience and accessibility of the airlines’ services is of much consideration to customers’ satisfaction as well as in-flight service, airline image and passenger behavior. Rhoades and Waguespack did not take into consideration any cases of complaints that were not reported. The management of airlines has the noble mandate to ensure that services rendered are up to standard failure to which this will affect the image of the Industry. The industry also has the challenge of improving the services of the regional airlines to be at per with the international ones thus ensure customer satisfaction at all cadres of life. Lastly the financial undertakings and operations in the Industry should be clearly bench-marked to enhance quality service delivery. The welfare of the passengers comes first in their quest of flying, whether regionally or internationally. References Ariffin, A. et al. (2010). “Service Quality and Satisfaction for low Cost Carriers” International review of Business research Papers 6: 47-56. Bhat, V. (n.d). A Multivariate Analysis of Airline Service Quality. New York: Lubin School of Business. Mazzeo, M. (2003). “Competition and Service Quality in the U.S. Airline Industry” review of Industrial Organization 22: 275-296. Mustafa, A. (2005). “The evaluation of airline service quality using the Analytic Hierarchy Process” International Conference on Tourism and Development, Grand Plaza Parkroyal, Penang. Park, J., Robertson, R. and Wu, C. (2005). “Service Quality on Airline Image and Passengers’ Future Behavioral Intentions: Findings from International Air Passengers” The Journal of Tourism Studies 16 (1): 1-11. Rhoades, D. and Waguespack, B. (2000). “Service Quality in the U.S. Airline Industry: Variations in Performance within Airlines and Between Airlines and the Industry”, Journal of Air Transportation Worldwide 5(1): 60-77. Appendix – 1 Studies Examining Consumer Motivation etc... Author (s) DV=Dependent Variable IV=Independent Variable Relationship with DV Measurement used Country Method Number of Respondent & Response Rate Population size Survey method Unit of Analysis Asbudin et al (2010) DV- Customers satisfaction/expectation IV- Service quality-caring, reliability, responsiveness, affordability, visual attractiveness A high level of service delivery result in high passengers satisfaction Ordinal Malaysia Quantitative 100 Convenience sampling technique Principal component factor analysis-27 item of service expectation of service quality and their influence on customers satisfaction Park, Robertson &Wu (2005) DV- Image of the airline and future behavioral patterns of passengers IV-Individual dimensions of airline service delivery A high dimension of airline service delivery results into a positive image and positive behavioral patterns Ordinal Australia Quantitative 501 Random sampling Individual dimensions and its impact on the airline image and future behavioral patterns Rhodes & Waguespack (2000) DV-Complain by passengers IV-Service quality High quality of service results into low rate of complains Ordinal U.S.A. Quantitative 25 Random Survey Rate of complain s from the passengers in terms of service delivery Bhat (n.d.) DV-Customer Service quality IV-Financial and operating characteristics of the airline An airline with a good financial base is likely to have high quality service delivery Ordinal U.S.A. Quantitative 110,000 Random Sample The effect of financial base on the overall delivery of service Mazzeo (2003) DV-on time performance IV-Competition in a route Lack of competition on a particular route results on Ordinal U.S.A. Quantitative 50 airports Random sampling Competition are directly related to the efficiency of airlines in terms of on-time performance Peng & Mustafa (2005) DV-Service quality IV-Tangibility. Reliability, responsiveness, assurance The four dimensions influence the quality of service offered in a hierarchical way Ordinal Malaysia Quantitative 100 tourists 71 returned Random sampling Penang international airport and the service quality offered by various airlines Read More