In today’s fast changing social and lifestyle trends, more and more Malaysian households are eating outside uh to time constraints. More women are involving in the working force. Parents are working all day long and they are no longer willing or able to spend some time in preparing dinner for the family at home after a tiring working day (Negotiate et al. , 2011; Ganja et al. , 2012). This is especially true in the big cities like Koala Lump where the people spend most of their time working. Besides, the number of people dining out is increasing due to movement away from extended family households (Negotiate et al. 2011). In addition, some families spend their weekend gathering with other family members n restaurants Nonage et al. , 2012). On the other hand, Generation Y (Refers to those who were born from 1979 to 1994 and under the age groups between 16 to 33 years old) prefers to eat outside or involve in social gathering activities at the restaurants (Seek et al. , 2011). In the Chinese culture, restaurants are a common venue for social gatherings and business entertainment. Food consumption in restaurants provides an experience of excitement, celebration, and establishing social connections (Fang, 2003).
The best option is to get a pleasant restaurant that could provide quality revive and good dining experience. All these factors contribute to the great potential of the Malaysia’s restaurant industry in terms of profitability and economic growth. The restaurant industry is one of the key contributors for the service sector in Malaysia. The restaurant industry is relatively competitive in nature with stiff competition restaurants as well as the increasing number of new entrants offering differentiated food products and services (Von, 2011).
On the other hand, customers are becoming more demanding and their needs are rather diverse (Stevens et al. , 1995; Juke and Von, 2007). With increasing competition within the restaurant industry, attracting new customers can no longer guarantee profits and success, but retaining existing customers is more vital to the success of the restaurant businesses (Shoemaker et al. , 1999; Anderson and Nards,2004; Gee et al. , 2008; Haggish et al. , 2012). Paranormal et al. (1985) and Estimate et al. 1990) stated that the key strategy for the success and survival of any business is the delivery of quality service to customers, and this especially important in the service sectors like restaurant industry. The quality of service offered to the customers will influence customer dissipation and attitudinal loyalty, which will then lead to success of the businesses (Ravishing et al. , 2010). 2. 0 Background of Research Customer service quality is a crucial source of distinctive competence and is often considered as a key success factor in sustaining competitive advantage in service industries (Palmer, 2001).
Thus, the delivery of a higher level of service quality is a very important strategy by which service organizations can position themselves more effectively in the market place. The success of restaurant businesses relies on providing superior service quality, value, and customer satisfaction, which in turn enhances customer repeat patronage (Highest et al. , 1997). The important relationships between service quality, customer satisfaction, and customer loyalty have thus been an important area of research (Estimate et al. , 1996; Petitions et al. , 1997; Adaptable et al. 2000; Siva and Baker-Preterit, 2000; Juke and Von, 2007; Gin and Property, 2008). Paranormal et al. (1994) emphasized that SURVIVAL is a lasting and reliable scale of service quality and it is applicable in an extensive spectrum of service domains such as financial institutions, libraries, hotels, medical centers and restaurants. Many researchers have tried to use SURVIVAL in different service domains such as medical services (Swartz & Brown, 1989; Lam, 1997), tourism (Tribe and Snatch, 1998; Italian et al. , 2003), libraries (Nitpick, 1996; Coleman et al. , 1997), banks (Anger et al. 1993), restaurants and hotels (Hokey et al. , 2002), and government services (Donnelly et al. , 1995). Past researches in the restaurant industry has identified several factors that determine the level of satisfaction experienced by customers when they visit full service restaurants. The factors are such as quality of food, service and physical environment (Han and Ray, 2009), atmosphere of the restaurant (Ladder et al. , 2008), service and delivery (Goal and Sings, 2007), cleanliness and service quality (Locker, 2005), and appropriate cost and attentive service (Making and Jung, 2010).
Most restaurant quality related studies have focused mostly on the ambiance and service delivery as a core competency of a restaurant (Making and Gang, 2007). Ladder et al. (2008) mentioned that service quality has the most significant effect on dining convenience. 3. 0 Problem Statement What are the key service quality dimensions influencing the customer satisfaction ND customer loyalty in Malaysia’s restaurant industry? 4. 0 Research Objectives The main objectives of the study are: 1 . To identify the key dimensions of service quality that affect customer satisfaction and customer loyalty in Malaysia’s restaurant industry. . To study the importance and impact of service quality on customer satisfaction and customer loyalty in Malaysia’s restaurant industry. 3. To determine the current customer satisfaction and customer loyalty levels in Malaysia’s restaurant industry. 4. To recommend some guidelines for improvement of service quality from the customers’ perspective in Malaysia’s restaurant industry. . 0 Justification of Research There is a lack of researches in measuring the service quality with the five generic dimensions of SURVIVAL in Malaysia’s restaurant industry.
This has spurred on the interest of the study in identifying the importance of service quality from the customers’ perspective in Malaysia’s restaurant industry especially on the full service restaurants. This study will offer important practical implications especially in service quality for the Malaysia’s restaurant industry. This will provide the restaurateurs with detailed information in service quality to help them to identify the key service quality mentions for success and competitiveness.
This can help the restaurant managers and staffs to focus their efforts on improving customer perceptions of service quality and enhancing the dining experience of their customers. Due to the intensive competition in the restaurant industry, therefore, there is an urgent need to identify the key service quality dimensions influence the customer satisfaction and customer loyalty to their preferred full service restaurants which in turn increases patronage rates of their preferred restaurants. The focus of the study is mainly on the role of service quality adopted from SURVIVAL in the full service saturates in Malaysia. . 0 Literature Review 6. 1. 1 Restaurant Industry for dining, typically served by waiters. Restaurants are classified based on service, quality, price and facilities provided. Fast food restaurants or also known as Quick serve restaurants emphasize on speed of service and self-service where the customers order food at a counter. Fast casual restaurants do not offer table service but may offer non-disposable plates and cutlery. The quality of food and prices are higher than those of conventional fast food restaurants but are lower than casual dining restaurants.
Casual dining restaurants serve moderately-priced food and provide table service in a casual atmosphere. Casual dining restaurants fall within the category between fast casual restaurants and fine dining restaurants. Family style restaurants are a type of casual dining restaurants where food is often served on platters. An example is Pizza Hut Nonage et al. , 2012). Fine dining restaurants are full service restaurants with specific dedicated meal courses. The interior design and decoration of such restaurants feature high quality materials and create special and awesome atmosphere.
The wait staffs are usually ell trained and often dress in formal attire. Fine dining restaurants are often found in hotels and shopping malls. These kinds of restaurants have certain rules of dining which customers are expected to follow. Family chain restaurants involve both tangible and intangible elements in their services. The dining experience is a combination of goods received which is the meal, services provided by the staffs and the physical environment. All three elements contribute significantly to the level of satisfaction experienced by customers Nonage et al. 2012). Customers do take several factors into consideration before making a decision to sit a full service restaurant, either family chain restaurant or family chain restaurant. The decisive factors are such as high quality food, restaurant’s ambiance, experience with the services provided as well as the price of the food. This is because customers want the value of the money being paid. Customers are believed to view the service provided by the restaurant as the most important characteristics.
The quality of the service provided at the beginning of the dining experience when customers are welcomed and greeted by the staffs and step into the restaurant, the hysterical ambiance provided, while being ushered to a table, during the food ordering process which includes the food recommendation provided by the staff, the price of the meal, when the meal is served, when the bill payment is made and lastly, when the customers walk out of the restaurant, all these service attributes do contribute towards the overall satisfaction of the customers Nonage et al. 2012). 6. 1. 2 Service Quality Services are acts, efforts or performances exchanged from producer to user. It satisfies needs and delivers benefits when it provides pleasure, information or nonviolence to the customers (Levels, 2012; Solomon et al. , 2012). Service quality is becoming the most important competitive factor in the business world and it has been the reason of naming the present business era as “Quality Era” (Peeler, 1996). Scandalously (1998) called it the most powerful competition weapon in the business.
Service quality in food-service operations has been characterized as individualized, intangible, and subjective in nature Moons and Howard, 1998; Chow et al. , 2007). Service firms in the developing countries are now realizing the significance of customer oriented philosophies and shifting from production-led philosophy to customer-focused or quality management approaches to facilitate their business managements (Raman et al. , 2011). Service has been recognized as one of the effective tools for gaining as well as sustaining competitive advantage (Von, 2011).
Service quality is an approach to manage business processes in order to ensure full satisfaction of the customers which will help to increase competitiveness and effectiveness of the service industry. Quality in service is very important especially for the growth and development of service sectors (Powell, 1995). It works as an antecedent of customer satisfaction (Router and Bloomer, 1995). Highest et al. (1997) and Router (1997) have mentioned that service quality and customer satisfaction are indices of an organization competitive benefit. Organizations can achieve business excellence through quality control of service (Shania, 2010).
Since Paranormal et al. (1988) introduced a 22-item scale, known as SURVIVAL, for measuring service quality, the model has been widely adopted for studies in various service industries. Service quality is defined as the indirect comparisons or arithmetic differences between pre-purchase customer expectations and post- arches customer perceptions across the 22 measurement items, that is, magnitude and direction of discrepancy between perception and expectations of the consumers Mammal and Anastasia, 2009). Estimate et al. (1996) have referred to ten dimensions of SURVIVAL in their primary researches.
The ten dimensions are then combined to five generic dimensions or factors via factor analysis because they found a strong correlation among the ten dimensions in their further researches. The five generic dimensions are Tangibles, Reliability, Responsiveness, Assurance, and Empathy as a basis for testing the service quality. Tangibles are physical facilities, equipment and appearance of personnel. Reliability is the ability to perform the promised service dependably and accurately. Responsiveness is the willingness to help customers and provide prompt service.
Assurance is the knowledge and courtesy of employees and their ability to inspire trust and confidence. It includes competence, courtesy, credibility and security. Empathy is caring and individualized attention that the firm provides to its customers. It includes access, communication, and understanding the customers (Van Rewarded et al. , 2003). SURVIVAL is the most often used instrument for measuring the service quality by comparing customers’ expectations of a service and their perceptions of the actual service delivered (Paranormal et al. , 1985; Shania, 2010; Raman et al. 2011). If customer expectations are greater than the service performance, then the perceived quality of service is less than satisfactory and hence customer dissatisfaction results (Paranormal et al. , 1985; Lewis and Mitchell, 1990). Literature because of the difficulties in defining it and measuring it as no consensus emerging on both (Whiskies, 2001). There has been no general agreement on the assortment of the service quality. Furthermore, service quality is sometimes difficult to measure because it can be inconsistent due to uncontrollable factors Nonage et al. , 2012).
However, the majority of the work to date has adopted the SURVIVAL methodology in measuring service quality (Chasten, 1994; Reynolds and Moore, 1995; Advertised et al. , 1997; Lings and Brooks, 1998; Brooks et al. , 1999; Sane et al. , 2004). Bosnian and Rosen (1994) have tested the SURVIVAL framework in the restaurant industry. 6. 1. 3 Customer Satisfaction Customer satisfaction is the customer’s response to the evaluation of the received discrepancy between prior expectations and the actual performance of the product as perceived after its consumption (Curran, 2002).
Customer satisfaction is basically a customer’s evaluation of a good or service in terms of whether it has met their needs and expectations or not (Coffman and Kane, 2010; Kettle and Armstrong, 2012; Levels, 2012). A customer will be satisfied if the service provided meets their expectations. A customer will be dissatisfied if the service provided is below their expectations. A customer will be very satisfied if the service provided is beyond their expectations. Customer satisfaction is a key factor in formation of customers’ desires for repeated purchase or future purchase (Imitate and Kumara, 2001).
Furthermore, the satisfied customers will probably share with others about their good experiences and recommend the organizations to others Mammal and Maser, 2002). Paranormal et al. (1991) said that satisfaction is a decision made after experience and is the difference between expectation and performance. Alexander and Stranding (1993) said that satisfaction is an inner view resulted from customer’s own experience from the service provided. Customer satisfaction in restaurant industry covers a lot of elements such as the food quality, the service provided and the amenities provided (Coffman and Kane, 2010). . 1. 4 Customer Loyalty Customer loyalty is a complicated concept. In service domain, loyalty has been defined as observed behaviors (Bloomer, 1999). Curran (2002) argued that loyal behavior is a full expression of loyalty to the brand and not Just thoughts. However, loyal behavior such as repeated purchase has been criticized due to lack of a comprehensive conceptual basis of fundamental causes of loyalty (Curran, 2002). Customer loyalty was then considered as an attitudinal structure such as the indecency to advise the service offer to others (Mimosas et al. 2010). Finally, cognitive product or service that a person chooses among products and services while making decision for purchase (Bloomer, 1999). Oliver (1999) defined customer loyalty as a strong and deep commitment to repurchase or continuous purchase of a preferred product or service in the future which, despite potential or actual environmental effects or marketing efforts of the competitors for changing the customer’s buying behavior, is a rebury of the same brand or brand series.
Jacobs and Chemist (1978) concluded that consistent archiving as an indicator of loyalty could be invalid because of happenstance buying or a preference for convenience, and that, inconsistent purchasing could mask loyalty if consumers are multi-brand loyal. Jacobs and Keener (1973) argued that loyalty is a variable which basically consists of one dimension related to behavior and another related to attitude, where commitment is the essential. According to Jacobs and Chestnut (1978), Solomon (1992), and Dick and Bass (1994), customer loyalty can be differentiated into two types: Loyalty based on inertia and true brand loyalty.
Loyalty based on inertia is where the brand is bought out of habit rely because this takes less effort. However, consumer will not hesitate to switch to another brand of there is some convenient reason to do so. True brand loyalty is a form of repeat purchasing behavior reflecting a conscious condition to continue buying the same brand accompanied by an underlying positive attitude and a high degree of high commitment towards the brand. Loyal customers are considered as the base of any business because of customers’ repeated purchases (Curran, 2002).
Many service organizations have developed customer loyalty programs as a part of customer relationship development and management (Mimosas et al. , 2010). Customer loyalty is considered as an important factor for increasing profitability and maintaining the position and success of the organization. Organizations should keep hold of their loyal customers as a competitive asset (Haggish et al. , 2012). Organizations that are successful in gaining customer loyalty have a major competitive advantage (Asks, 2006).
According to Gee et al. (2008), the advantages of customer loyalty are less cost to serve the existing customers; customers will pay a higher cost for a set of products; and customers will CT as product or service ambassadors via word of mouth for the organization. 6. 2 Empirical 6. 2. 1 Relationship between the five generic dimensions of SURVIVAL and service quality The results of Charlatanry (2003) studies clearly showed that SURVIVAL model provides more evaluating information in relation with service quality gaps.
Ramadan et al. (2011) found that reliability, responsiveness and assurance dimensions are crucial factors in Private Commercial Banks in Bangladesh of determining service quality. Several researches have been done on the relationship between service quality and customer satisfaction. The findings of Paranormal et al. (1988) showed that customer satisfaction results in service quality. Chow et al. (2007) and Mimosas et al. (2010) found that customer satisfaction is influenced by service quality.
Customer satisfaction with the performance of a full service restaurant includes both tangible (food and physical facilities) and intangible (service provided by staffs) components. 6. 2. 3 Relationship between service quality and customer loyalty Young (2003) found that banks reputation plays an important mediator role in the effect of service quality on customer loyalty. The findings of his research showed that the five generic dimensions of SURVIVAL have direct effect on the banks reputation, which then plays an important role in determination of purchase, repeated purchase, and customer loyalty.
Chow et al. (2007) and Mimosas et al. (2010) found that customer loyalty is influenced by service quality. Ganja et al. (2012) stated a restaurant that ignores the significance of a pleasing atmosphere will result in lower repeated purchase intention or patronage intention because a pleasing atmosphere is more likely to attract customers in spending more time and money in the restaurant. Generally, the customer-perceived service quality is found to be positively related to behavioral intentions and loyalty (Von, 2011). 6. 2. Relationship between customer satisfaction and customer loyalty Satisfied customers led to long term business success in terms of customer loyalty, organizational profits and return patronage (Gilbert, 2006; Making and Gang, 2007; Ladder et al. , 2008; Kim et al. , 2009; Ray and Han, 2009). Satisfaction is considered as an antecedent to loyalty (Bitter, 1990). Foretell (1992) argued that high customer satisfaction will result in increased repurchase intention. However, in contrary to there researches, Chow et al. (2007) found that customer satisfaction do not result in customer loyalty in restaurant industry.
On the other words, there is no guarantee in satisfied customers’ repeat patronage as a behavioral intention of customer loyalty (Syrians, 2002; Hymn, 2010). A favorable relative attitude may not necessarily result in repeat purchases (Dick and Bass, 1994). 6. 2. 5 Relationship between service quality, customer satisfaction and customer loyalty Bloomer (1998) found that service quality influences customer loyalty both directly and indirectly through customer satisfaction. Curran (2002) concluded his studies in Malt’s banks that customer satisfaction plays a mediator role in the effect of service quality on customer loyalty.
It means that service quality affects customer loyalty through customer satisfaction. The results showed that service quality is an important factor to customer satisfaction. Mimosas et al. (2010) found that customer loyalty and customer loyalty is influenced by both service quality and customer satisfaction. There are also other researchers found that customer satisfaction mediates the effect of service quality on behavioral intentions and loyalty (Adaptable et al. , 2000; Brady and Robertson, 2001; Tam, 2004). 6. Conceptual Model (Modified from Chow et al. , 2007) 6. 3. Hypotheses The hypotheses generated from the conceptual model are: a) Hal: Tangibles is positively related to Service Quality b) HI b: Reliability is positively related to Service Quality c) Hal: Responsiveness is positively related to Service Quality d) Held: Assurance is positively related to Service Quality e) Hole: Empathy is positively related to Service Quality f) H2o: Service quality is positively related to Customer Satisfaction g) Hob: Service quality is positively related to Customer Loyalty h) HE: Customer Satisfaction has negative effects on Customer Loyalty. . 0 Methodology 7. Research Design This study is a quantitative research and the hypothetic-deductive method is used for this study. The purpose of the study is descriptive study and hypothesis testing. Descriptive study is undertaken to describe the relationships between the variables (service quality, customer satisfaction, and customer loyalty) in the Malaysia’s restaurant industry. Hypothesis testing is used to explain the nature of relationships between the variables in terms of causes and effects. The type of investigation is causal study because a definitive cause-and-effect relationships mongo the variables need to be confirmed.
The extent of researcher interference in this study is moderate as the findings of this study could provide a different view or could come out with a new idea compared to the past researches. The study setting is field study where the study will be conducted in organizations instead of in the same natural environment. The unit of analysis is individuals because the data is collected from each and every customer in this study. The time horizon of study is cross-sectional study because the data are gathered and used Just once, perhaps over a period of time.
