Impact Of Perceived Service Quality On Customer Satisfaction And Brand Loyalty
[A CASE STUDY OF HONEYWELL FLOUR MILLS PLC]

CHAPTER ONE
INTRODUCTION
1.1     Background to the Study
The broad goal of every marketing organization is to achieve effectiveness in its mission and efficiency in its process. Whereas the mission is its major objective, the process is its means or method of achieving the objective. To be efficient is to maximize output from a minimum of input or resource. To be effective is to achieve the purpose of existence for the organization.
Every marketing organization has used over the years product, price, place and promotion for the pursuit of these twin facets of management. However, in more recent years greater creativity and improved scientific approaches are being employed to ensure that at every transaction the customer is receiving enhanced value through perceived service quality. Cowell (1996), defined perceived service quality as the judgment made by consumers when they compare their expectations with their perceptions of what they receive (service experience). Put differently, a service is regarded as an act, which add value to the recipient. It is also any activity or benefit that a party can offer to another, that is essentially intangible and does not result in ownership of anything. Its production may or may not be tied to a physical product. Service therefore may relate to the process involved e.g. operating systems for providing products or it may relate to the people involved and the quality of interaction with the customers.
Perceived service quality is today not given as a separate activity but is weaved into every facet of the business whether product, price, place (distribution) or promotion so that a total quality management in its broadcast sense is applicable. Kotler (2002) defines service quality "as all parts of the distribution (delivery) process which add value to the transaction, from the customer's view point". Service quality is designated with four characteristics. It is inseparable from the product provider, it is variable by the provider; it is perishable, meaning that it is lost anytime it is not given (utilized) and it is intangible, meaning that it is not a storable commodity.
Product or service is the main thrust for satisfying consumer needs. Today production systems are faster, able to produce more in shorter time; miniaturizations are possible and in vogue, designs look elegant, simple and compact although sophisticated in function. In all these, the consumer is being given more choice. Smart people keep creating niches for more satisfactions still for the discerning or sophisticated consumer e.g. designer wears, perfumes etc as distinct from popular brands.
Perceived service quality as a process or strategy is combined with other marketing mix to create satisfaction for the consumer and loyalty to the brand or business. No business survives for a long time without achieving these twin results. Business profitability and survival therefore force the marketer or entrepreneur to continuously challenge his/her structures, values, technology, products and offerings so that as consumers' profiles, tastes, lifestyles, needs, etc change, so will the marketer change because any business that remains static is doomed(Brandy &Robertson, 2001).
The drive to providing excellent service quality to customers has forced fundamental changes in many organizations. Traditionally, hierarchical organizations have flattened out. Authority to act has moved from the top of the ladder to the bottom allowing employees in daily or regular contact with customers to act speedily and with assurance for the satisfaction of the customers on the spot. To be able to do this with ease, such employees have been given very broad-based training in the operations of the organization and are also supplied with relevant and up to date information with regards to what the organization intends to achieve at every point in time(Christopher, 1994).
Companies that want to be in the forefront of success in satisfying consumers engage in marketing/consumer research to identify genuine needs, the size of the market, the location of prospective buyers, their age, gender, income levels, lifestyles, religious conviction etc. The companies that know all these are usually able to produce goods or services that consumers purchase to satisfy their needs.
The centrality of customer satisfaction is found in the popular marketing epithet: "The customer is king". This is because whereas a political king rules his empire and expects obedience and respect from his subjects, the customer king, also expects his/her wishes, need and satisfactions to be paramount in the schemes of the producer. This is why consumerism developed in modem marketing to forcefully, through legal or political means, make producers and suppliers, offer for sale, goods or services that are safe, economical affordable and dependable. In this way, business will be seen as being customer-driven (Cowell, 1996).