Edited Literature Review

Introduction

In today’s world of fierce competition, many companies are facing new challenges that force them to seek competitive advantage, efficiency, and profitable ways to promote themselves. In both domestic and international markets, the service concept is gaining importance in proportion to economic development and increasing standards of living.

In some industries such as tourism, catering, and banking, the delivery of high quality services to consumers is increasingly recognised as a key factor affecting the performance of firms (Parasuraman et al., 1985; Zeithaml et al., 1990). Not surprisingly, service quality measurement has become the main subject of several empirical and conceptual studies in services marketing. Though, measuring service quality seems to pose difficulties for academics and practitioners because of the unique characteristics of service: intangibility, heterogeneity, inseparability and perishability.

Service quality has become a strategic issue to many managers and has been the subject of an increasing amount of academic and practitioner literature (Berry and Parasuraman, 1993; Buttle, 1996). It has emerged from an almost negligible business discipline in the 1970s to become an indispensable management subject and a highly sought-after consultancy area in the early 1990s.

The need to understand and measure service quality is related to the growing recognition that it is more profitable to retain satisfied customers than to be continually seeking to recruit new customers to replace lapsed ones (Fornell, 1992). Also, satisfying customers through excellent service quality is becoming a vital measure of performance for firms and industries, and there is a critical need for the ability to evaluate service quality so that the quality of service a firm delivers can be reliably measured. Such an evaluation can assist the service providers to monitor and improve their service quality.

One way to measure service quality is using the SERVQUAL model developed by Parasuraman et al. (1988). The SERVQUAL model has been used by both academics and practicing managers in various industries across different countries. Despite its wide usage, critics impeach its conceptual foundation and methodological limitations, in particular the reliability and validity of the scale. The purpose of this paper is to review literature on measuring service quality using SERVQUAL approach. The paper will explore the SERVQUAL model and identify the key areas of critical praise and censure.

Literature Review

Development

It is now two decades since the SERVQUAL model was first published (Parasuraman et al., 1985). Since then, its innovators Parasuraman, Zeithaml and Berry, have further developed, promulgated and promoted the technology through a series of publications (Parasuraman et al, 1985; 1986; 1988; 1990; 1991a; 1991b; 1993; 1994a; 1994b Zeithaml et al, 1990; 1991; 1992; 1993).

Although initial qualitative research by Parasuraman et al. (1985) suggested that consumers use ten criteria in evaluating service quality, development of the SERVQUAL scale indicated that there were five key underlying dimensions to service quality – tangibles (physical facilities, equipment and appearance of personnel), reliability (ability to perform the promised service dependably and accurately), responsiveness (willingness to help customers and provide prompt service), assurance (knowledge and courtesy of employees and their ability to inspire trust and confidence), and empathy (caring, individualized attention the firm provides its customers) (Parasuraman et al., 1988).

Moreover, evaluation of service quality involves a comparison of customers’ expectations of the service before it occurs with their perceptions of the service after its provision (Parasuraman et al., 1985). Thus, the SERVQUAL scale is comprised of two sets of items measuring expectations and perceptions. The first set aims to measure customer’s expectations of a service firm while the second measures customer’s perceptions of the firm’s performance.

The respondents are asked to rate their expectations and perceptions of performance on a seven point Likert scale. The results of the survey are then used to identify positive and negative gaps in the firm’s performance in relation to the five service–quality dimensions. The gap between expectations and performance perceptions (perceived service quality) is measured by the difference between the two scores (performance minus expectations). This information can help managers diagnose where performance improvement can best be targeted.

However, viable and revealing as this expectation-perception evaluation might seem, several critical reservations are raised on a close examination:

1. 1. There are as many expectations as there are customers and prospective customers, some expectations being relatively raw and crude, some relatively modest, while others, exquisite, ultimate and quite futuristic. Perceptions, then, if they are really to be represented, are likely to define a corresponding scale of perspective—though some non-correspondence is naturally to be expected (considering human psychological variability and changing judgements and viewpoints over relatively short or long periods).
2. To truly represent customer perceptions, the canvassers will need to institute as many parameters as they are criteria of tastes and evaluations, thus incorporating into their survey document the whole gamut of evaluative standards of the different social classes who patronise their services, assigning values to this each criterion and thus capturing the actual customer perception in the light of tastes of specific classes of customers.

This quite idealistic scenario is obviously not in recorded practice. Therefore, given the current reality, will the numerical (Likert) representation of the gaps between expectation and perception—a representation that is void of any individual qualitative appreciation of the customers—give accurate or approximate appraisals of the service quality as judged or perceived by the customers?   

2. The existence of a possibility of a variation in the expectations of the customer, as his or her yardstick of service-quality evaluation, after the period he or she indicated this expectation in a numerical scale and before the actual tasting of the services, is not reckoned with in the SERVQUAL model. Such possibilities as change in moods and tastes, image-enhancing or depreciating pieces of new information about the service-provider in question, a re-examination of the given evaluative expectation in the light of second or third-hand information, and newly conceived personal or extraneous prejudices about the services—all these can understandably change the expectations of the prospective or regular customer whose opinions might be part of the service-quality survey, and thus preclude exact or even approximate objectivity or currency of the recorded expectation-perception gap.

Fortunately, in the present-day industries and academic researches, the first impeachment above (the omission or misrepresentation of the existing classes of expectations) seemed to have been reckoned with in the extension of the five-dimensional methodology of SERVQUAL to the current ten. The original dimensions were: tangibles, reliability, responsiveness, assurance and empathy. These have been modified into: tangibles, reliability, responsiveness, competence, courtesy, credibility, feel secure, access, communication and understanding the customer (SERVQUAL Zertham Parasuraman Berry)

 The additions of competence, courtesy, feel secure, access, etc, reckoning with the more delicate perspectives of assessments, will give better representations of customer perception

A more recent version of the instrument (Parasuraman et al., 1991) includes a third section that measures the relative importance of the five dimensions to the customer. These scores are then used to weight the perceived service quality measure for each dimension, the main purpose being to give a more accurate overall perceived service quality score.

SERVQUAL was developed based on data from five service industries: appliance repair and maintenance, retail banking, long-distance telephone service, securities brokerages, and credit card companies. It has been tested and used to measure service quality in various contexts such as banking (Avkiran, 1994), public services (Carman, 1990), professional services (Bojanic, 1991), hospitals (Babakus and Mangold, 1992), hospitality (Barsky, 1992; Saleh and Ryan, 1991), retailing (Finn and Lamb, 1991), auto repair (Bouman and Van der Wiele, 1992), entertainment (Fick and Ritchie, 1991), education (Rigotti and Pitt, 1992; Hampton, 1993)—services in general (Bolton and Drew, 1991b; Zeithaml et al., 1990).

Critique

Despite its growing popularity and widespread utilization, SERVQUAL has been subjected to criticisms in service quality literature since 1990 (as early as 1990) by Carman (1990) and subsequently by other researchers (Finn and Lamb,1991; Babakus and Boller, 1992; Brown et al., 1993; Cronin and Taylor, 1992, 1994; Teas, 1993a, 1993b, 1994; McDougall and Levesque, 1992; Freeman and Dart, 1993; Spreng and Singh, 1993; Kettinger and Lee, 1994; Taylor, 1995; Buttle, 1996; Asubonteng et al., 1996; Genestre and Herbig, 1996; Robinson and Pidd, 1998, ) both with regard to conceptual foundations and to methodological limitations.

The two key areas of the criticism in the literature of SERVQUAL are: Disconfirmation and Dimensionality. However, other issues are explored because of their vital significance to the literature review. These include: Criticisms of the supposed purpose of SERVQUAL, Customer Satisfaction vs. Service Quality, and Reliability and Validity.

Disconfirmation

It is generally agreed that service quality is an attitude about the superiority of a service, although the exact nature of this attitude is not agreed. Some suggest that it stems from a comparison of expectations with performance perceptions (disconfirmation) (Parasuraman et al., 1988), while others argue that it is derived from a comparison of performance with ideal standards (Teas, 1993a) or from perceptions of performance alone (Cronin and Taylor, 1992).

The first issue arises as the critics argue that SERVQUAL has been inappropriately based on a disconfirmation model, widely adopted in the customer satisfaction literature, rather than on an attitudinal model of service quality (Buttle, 1996). The operationalisation of this concept as performance minus expectation (P-E) makes it difficult to reconcile with general attitudinal models even though service quality is conceptualised as an attitude by the SERVQUAL developers (Carman, 1990; Taylor, 1995).

Another stream of objections suggest that absolute measures of attitudes provide a more appropriate measure of quality than explanations based on disconfirmation models (Cronin and Taylor, 1994). Cronin and Taylor (1992) suggest that there is no real evidence to support the concept of the performance minus expectations gap as a basis for measuring service quality. Instead they controverted the framework of Parasuraman et al. (1988) and propounded a performance-based measure of service quality called ‘SERVPERF’ by illustrating that service quality is a form of consumer attitude. They argued that using performance scores alone (SERVPERF) gives a better measure of service quality by explaining more of the variance in an overall measure of service quality.

Teas (1993b) also provides support for Cronin and Taylor’s view on the theoretical and operational ambiguity of the expectations element of SERVQUAL. Teas (1993b) raises the problem of ideal performance in which the level of performance over expectations will lead to negative service quality evaluation. It is evident in most SERVQUAL studies that the expectations scores are quite high, often over six but not seven on a 7-point Likert scale, which would imply that these expectations have an infinite idealpoint.

Finally, Cronin and Taylor (1994) suggest that the disconfirmation-based SERVQUAL scale is measuring neither service quality nor consumer satisfaction. Rather, the SERVQUAL scale appears at best an operationalisation of only one of the many forms of expectancy-disconfirmation.

Dimensionality

Another area of criticism has been the dimensionality of SERVQUAL. Despite Parasuraman et al.’s (1988) initial claim that their five service quality dimensions are generic, it is generally agreed that this is not the case, and that the number and definition of the dimensions varies depending on the context. Indeed, Zeithaml et al. (1990) reaches this conclusion when stating that a two-dimensional service quality model is the preferred model for overall perceived quality for our particular application.

Cronin and Taylor (1992) advanced a one-factor measure instead of the five-factor measure proposed by Parasuraman et al. (1988). In subsequent studies, the number of dimensions underlying SERVQUAL has varied. After completing a comprehensive review of service quality studies, Asubonteng et al. (1996) concluded that differences in the number of dimensions appear to be linked to differences among industries.

For example, Kettinger and Lee (1994) identified four dimensions in a study of information systems quality. The tangible dimension was not evident; this is understandable since in the information industry tangibles are not visible to the customer. Moreover, when measuring the quality of accounting firms, Freeman and Dart (1993) conclude that service quality is a seven-dimensional construct. Robinson and Pidd (1998) propose 19 dimensions of service quality in the context of management science projects.

Spreng and Singh (1993) have commented on the lack of discrimination between several of the dimensions. In their research, the correlation between Assurance and Responsiveness constructs was 0.97, indicating that they were not separable constructs. They also found a high correlation between the combined Assurance-Responsiveness construct and the Empathy construct (0.87). Even Parasuraman et al. (1994b) recognize the overlap of Assurance, Responsiveness and Empathy, and the possible blending of these three dimensions into one. All of this provides further evidence of the complexity of the service quality construct and the fact that it cannot be defined in any one way for all service encounters.

McDougall and Levesque (1992) also criticised the fact that SERVQUAL is a compensatory model. A high score on one dimension can compensate a low one on another. This establishes a kind of balance between positive or negative elements interfering customers overall perception or global estimation of service quality.

Lastly, Carman (1990) suggests that the SERVQUAL instrument provides a good starting point for analysis but may need modification in any specific context. Such modifications might include the omission or addition of scale items depending upon the particular context of the application. This statement agrees with Parasuraman et at (1988) claim that SERVQUAL provides a basic skeleton through its expectations/perceptions format encompassing statements for each of the five service quality dimensions. The skeleton, when necessary, can be adapted or supplemented to fit the characteristics or specific research needs of a particular organization.

Service Quality vs. Customer Satisfaction

The debate over the usefulness of the SERVQUAL model continues as it is argued that service quality is distinct from customer satisfaction. Some argue that, while service quality is an overall attitude towards a service firm, customer satisfaction is specific to an individual service encounter (Bolton and Drew, 1991a; Parasuraman et al., 1988).

For instance, a customer may be very satisfied with an individual service encounter in a bank, but his/her overall attitude towards that bank might be one of offering poor service. Under these definitions, it is not necessary for a person to have experience of a service firm to form a perception of service quality, although it is obviously a prerequisite to judgements concerning customer satisfaction (Oliver, 1993).

There has also been considerable debate concerning the nature of the relationship between the service quality and customer satisfaction. While the majority of research suggests that service quality is a vital antecedent to customer satisfaction (Parasuraman et al., 1985; Cronin and Taylor, 1992) there is also some evidence to suggest that satisfaction may be an antecedent of service quality (Oliver, 1980; Bitner, 1990). Regardless of which view is taken, the relationship between satisfaction and service quality is strong when examined from either direction (McAlexander et al., 1994).

In one of the few empirical studies of the relationship between service quality and customer satisfaction, Iacobucci et al. (1994) concluded that the key difference between the two constructs is that quality relates to managerial delivery of the service while satisfaction reflects customers’ experiences with that service.

They argued that quality improvements that are not based on customer needs will not lead to improved customer satisfaction. Furthermore, Iacobucci et al. (1996) review various models of service quality and customer satisfaction, finding many similarities, and conclude that instead of studying the concepts separately, future research should investigate the macro issue of “consumer evaluation”.

Purpose of SERVQUAL

There is some debate over the purpose of SERVQUAL. Cronin and Taylor (1992) place great emphasis on the predictive validity of the instrument, that is, the ability to provide an accurate service quality score. In so doing, they appear to see the provision of a predictive score as the primary reason for measuring service quality. Meanwhile, Parasuraman et al. (1994a) consider diagnostic ability to be more important, that is, the ability of the instrument to identify specific reasons for shortfalls in quality. They believe that managers are more interested in diagnosing service shortfalls than in an accurate measure of service quality.

At a more fundamental level both Buttle (1996) and Genestre and Herbig (1996) argue that SERVQUAL only measures the process of delivery and not the outcome of the service. In their research they tested the model applying it to pizza delivery service. However, Genestre and Herbig (1996) include items relating to product quality in their survey. Both find that service only factors predict less than half the variance, and conclude that outcome or product quality is more important. Buttle does recognise, however, that outcome quality is reflected in some of the SERVQUAL dimensions already.

Reliability and Validity

Several statistical shortcomings of the SERVQUAL model are addressed in terms of reliability and validity. Since the development of the SERVQUAL scale in 1988, all replication studies have used internal consistency as a measure of the reliability of SERVQUAL. Brown et al. (1993) and other researchers in customer satisfaction (Prakash & Lounsbury, 1984) have raised concerns about low reliability when using the difference score.

Brown et al. (1993) found in their study that the reliability of SERVQUAL is .94, slightly below the reliability of the non-difference score measure (.96). Hence, a non-difference score approach is adopted by Brown et al. (1993) to redesign the SERVQUAL instrument so that the expectations and perceptions are measured by one statement.

From empirical tests with SERVQUAL and the non-difference score instrument, Brown et al. conclude that although SERVQUAL is reliable, the non-difference score approach is more so, and that it does not exhibit the same problems with validity. Not only does the approach perform better, but it does so while asking only half the number of questions.

Parasuraman et al. (1993) respond to Brown et al.’s critique, pointing to a number of shortcomings in their argument and reaffirming that SERVQUAL is both reliable and valid. They argue that the diagnostic benefits of the difference score approach, the ability to track changes in expectations and perceptions over time, gives it a significant advantage over the non-difference score method.

Conclusion

The research literature on measuring service quality is numerous, with various contributions from numerous researchers over the past few years (e.g. Cronin & Taylor, 1992, 1994; Parasuraman et al., 1985, 1988, 1991, 1993, 1994a, 1994b; Teas, 1993a, 1993b, 1994; Zeithaml et al., 1985, 1990, 1993, 1996). This review of the literature has identified a number of theoretical and operational issues which should concern users of the instrument.

The SERVQUAL instrument of Parasuraman et al. (1988), a 22-item scale that measures service quality along five dimensions, forms the keystone for all the other works. Though the effectiveness of SERVQUAL in evaluating service quality has been questioned by different authors for diverse reasons, there is a general agreement that the 22 items are reasonably good predictors of service quality in its entirety. Despite these shortcomings, SERVQUAL seems to be moving rapidly towards institutionalized status. SERVQUAL has undoubtedly had a major impact on the business and academic communities.

However, serious doubt must be raised over the future use of SERVQUAL as a means for measuring service quality. Although it has probably been the best, and most popular, approach available during the 1990s it is becoming apparent that it has some significant shortcomings. As a result it is questionable whether SERVQUAL is a reliable measure of service quality or, indeed, whether it is measuring service quality at all.

Until a better but equally simple model emerges, SERVQUAL will predominate as a service quality measure (Wisniewski, 2001).

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SERVQUAL( Zertham Parasuraman Berry) <http://www.12manage.com/methods_zeithaml_servqual.html>

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SERVQUAL( Zertham Parasuraman Berry) <http://www.12manage.com/methods_zeithaml_servqual.html>