INFLUENCE OF CUSTOMER RELATIONSHIP MANAGEMENT SYSTEMS ON SERVICE QUALITY OF COMMERCIAL BANKS IN KAKAMEGA CENTRAL SUB-COUNTY, KENYA

Kennedy Ntabo Otiso

Abstract


Achieving competitive advantage and improving organizational quality service have become the key goal that business firms are struggling to attain. This study therefore sought to investigate the effects of customer relationship management systems on quality service of Commercial Banks in Kakamega Central Sub-County, Kenya. The study was anchored on the Dynamic Capabilities Theory. The study adopted descriptive survey design. The study population comprised of all the licensed commercial banks in Kakamega Central Sub-County, from which a representative sample of 10 commercial banks was drawn. Three (3) senior officers (branch manager, operations manager and customer relations manager) were further drawn from each of the sampled 10 commercial banks to make a total of 30 officers. The main study instrument was a questionnaire which comprised of Likert-type scale questions on the main variables of the study. The data was analyzed using both descriptive and inferential statistics. Hypothesis testing was done by use of regression and correlation analysis. Validity was checked during piloting to ensure all the items in the main study were functioning. Moreover, to ensure validity of instruments, content validity was established pilot testing process was used to test reliability comparing with Cronbach’s Coefficient of which yielded an alpha of 0.799. The findings revealed that technological innovation, customer relationship management system and organizational structure had statistically significant influence on quality service of commercial banks in Kakamega Central Sub-County Kenya and tests for significance also showed that the influence was statistically significant. Findings revealed that 35.7 percent (R2=0.357) of the variance in quality service may be explained by customer relationship management system accounted for 81.3 percent (R2=0.813) and organizations structure at 37.1 percent (R2=0.371). The regression results indicated that technological innovations, customer relationship management system and organizational structure had positive and significant relationships with the quality service of commercial banks in Kakamega Central Sub-County, Kenya. The study recommended that: the management of commercial banks should invest more in technological innovations to ensure all the banking operations are informational technologically compliant; commercial banks should invest in training employees especially the front officers on customer relationship management since it positively affects quality service and there was need of flexible organizational structures that facilitate decision making and improvement of communication through the reduction of boundaries. The managers of commercial banks will use the study findings as a basis of formulation of policies on strategy changes that can enhance their quality service. The academicians and researchers will find the study useful in that it contributes to academic literature and theory by providing empirical evidence for use by educators, scholars and researchers in the survey of strategic management.

 

JEL: G2, M12, L84

 

Article visualizations:

Hit counter

DOI

Keywords


service quality, customer relationship management systems, commercial banks

References


Alu, A. D. (2002). Effect of information technology on customer services in the banking industry in Nigeria. International Journal of scientific research. Vol. 1 No 1 Pp 20-34.

Aragba-Akpore, S. (1998, 7 22). The Backbone of Banks’ Service Regeneration, Money Watch, p23

AI-Hawari. M. and W. Tony. 2006. The automated quality service on Australian banks financial performance and the mediating role of customer satisfaction. Market. Int. Flann., 24: 127-147.

Alis, O. F., Karakurt, E., & Melli, P., (2000). Data Mining for Database Marketing at Garanti Bank, Proceeding of the International Seminar “Data Mining 2000”, WIT Publications.

Almotairi, M. (2009), A Framework for CRM Success. Proceedings of the European and Mediterranean Conference on Information Systems 2009. Izmir, Turkey, 13-14 July.

Boulding, W., Staelin, R., Ehret, M. and Johnston, W. J. (2005), “A Customer Relationship Management Roadmap: What Is Known, Potential Pitfalls, and Where to Go,” Journal of Marketing, Vol. 69, No. 4, pp. 155-166.

Brink, D. & et. al., (2006). "The strategic and tactical cause – related marketing on consumers' brand loyalty", Forthcoming Journal of Consumer Marketing.

Eid, R. (2007). Towards a successful CRM implementation in banks: An integrated model. The Service Industries Journal, 27(8), 1021-1039.

Grigoroudis, E., Politis, Y, and Siskos, Y. (2002). Satisfaction benchmarking and customer classification: An application to the branches of a banking organization, International Transactions in Operational Research, Vol.9, p.599-618.

Grönroos, C. (1982), Strategic Management and Marketing in the service Sector, Marketing Science, Cambridge, MA.

John and Fredrick (2002) “Customer Relationship Management” 2002: 016 SHU. ISSN: 1404 – 5508

Kang, G. and James, J. (2004) ‘Quality Service dimensions: an examination of Gronroos’s Quality Service model’, Managing Quality Service, Vol. 14, No. 4, pp.266–277.

Kennedy, M. (2004).Using Customer Relationship Management to increase profits. Strategic Finance, 85(9):5-37.

Kim, W. G., Lee, Y-K., Yoo, Y-J. (2006), Predictors of relationship quality and relationship outcomes in luxury restaurants. Journal of Hospitality and Tourism Research, 3(2), 43-69.

Mugenda, M. O. and Mugenda, G.A. (1999).Research methods: quantitative and Qualitative approaches. African Centre for Technology Studies.

Mugenda, O. M. & Mugenda, A.G. (2003). Research Methods: Quantitative and Qualitative Approaches. Nairobi: Acts Press

McNaughton, R. B., Osborne, P., Imrie, B.C. (2002), Market-oriented value creation in service firms. European Journal of Marketing, 36, (9/10), 990-1002.

Nunnally, J. C. (1978) Psychometric theory, McGraw-Hill, New York.

Ndubisi, N. O. & Wah, C.K., "Factorial and discriminant analyses of underpinnings of relationship marketing, and customer satisfaction", Int. J. of Bank Marketing, Vol.23, No. 7, 2005.

Oso, W. K., & Onen, D. (2009). A general guide to writing research proposal and report: A handbook for beginning researchers. Nairobi: Jomo Kenyatta Foundation.

Panda, T. (2003) “Creating Customer life Time Value through effective CRM in financial services industry” Journal of services Research (Online)

Parasuraman, A., Zeithaml, V. A. and Malhotra, A. (2005), “E-S-QUAL: A Linear-Item Scale for Assessing Electronic Quality Service,” Journal of Service Research, 7 (February), 213233.

Perreault W. D. & McCarthy E. 2002: Basic Marketing, 14th edition. New York: McGraw-Hill.

Saunders, M., Lewis P. and Thornhill A. (2009) Research Methods for business students 4th edition Pearson education limited (P) Ltd.

Sekaran (2003). Research method for business: A skill building approach, 4th edition, John Wiley & Sons.

Tamilarasan, R. (2011). Customer Relationship Management in Banking Services. Advances in Management.

Wang Z., (2005) “Technology innovation and market turbulence: The impact and diffusion of the tractor in America agriculture 1910-1960”. The journal of economic history.”

Yim, F. H. K., Anderson, R. E. and Swaminathan, S. (2004), “Customer Relationship Management: Its Dimensions and Effect on Customer Outcomes,” Journal of Personal Selling and Sales Management, Vol. 24, No. 4, pp. 263-278


Refbacks

  • There are currently no refbacks.


Copyright (c) 2018 Kennedy Ntabo Otiso

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

The research works published in this journal are free to be accessed. They can be shared (copied and redistributed in any medium or format) and\or adapted (remixed, transformed, and built upon the material for any purpose, commercially and\or not commercially) under the following terms: attribution (appropriate credit must be given indicating original authors, research work name and publication name mentioning if changes were made) and without adding additional restrictions (without restricting others from doing anything the actual license permits). Authors retain the full copyright of their published research works and cannot revoke these freedoms as long as the license terms are followed.

Copyright © 2015-2018. European Journal of Management and Marketing Studies (ISSN 2501 - 9988) is a registered trademark of Open Access Publishing GroupAll rights reserved.

This journal is a serial publication uniquely identified by an International Standard Serial Number (ISSN) serial number certificate issued by Romanian National Library. All the research works are uniquely identified by a CrossRef DOI digital object identifier supplied by indexing and repository platforms. All the research works published on this journal are meeting the Open Access Publishing requirements and standards formulated by Budapest Open Access Initiative (2002), the Bethesda Statement on Open Access Publishing (2003) and  Berlin Declaration on Open Access to Knowledge in the Sciences and Humanities (2003) and can be freely accessed, shared, modified, distributed and used in educational, commercial and non-commercial purposes under a Creative Commons Attribution 4.0 International License. Copyrights of the published research works are retained by authors.