MEASURING SERVICE QUALITY IN THE HEALTH CARE INDUSTRY IN A

DEVELOPING COUNTRY CONTEXT

Baharak Mohabbat TalabDBA Student,

Southern Cross Business SchoolSouthern Cross University

Locked Bag 4Coolangatta 4225

Australia

Zafar U. Ahmed*Department of Marketing

School of BusinessLebanese American University

P.O. Box #:13-5053, ChouranBeirut 1102-2801

LebanonEmail: zafaruahmed@gmail.com*(Corresponding Author)

Craig C. JulianSouthern Cross Business School

Southern Cross UniversityLocked Bag 4

Coolangatta 4225Australia

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ABSTRACT

This study measures service quality in the health care industry in a developing

country of the Middle East, namely Iran, using the full SERVQUAL Gap Model developed by

Parasuraman et al., 1985, via customers’ perceptions and expectations in an outpatient section in

a private Hospital. The results of the study suggest that all 5 dimensions of the SERVQUAL Gap

Model, namely, tangibles, reliability, responsiveness, assurance and empathy were important to

achieve service quality and thereby maintain some sort of competitive advantage. The study also

provided suggestions/recommendations to senior management at the private hospital to help

enhance functional service quality and increase patient’s satisfaction.

Key Words: SERVQUAL, tangibles, reliability, responsiveness, assurance, empathy.

INTRODUCTION

In today’s global market, the service industry is growing at a rapid pace. Zeithaml and

Bitner (2003) suggested services are deeds, processes and performances whilst Padilla et al.

(2009) suggested services are intangible not including physical products or construction which is

produced and consumed according to the needs and demands of consumers. Kotler et al. (1999)

also claimed services are economic activities or benefits that are offered by one party to another

that does not affect the possession of anything.

In last three decades service quality has been defined differently by many researchers

(e.g., Parasuraman et al., 1985; Bitner et al., 1994; Cronin and Taylor, 1992). Parasuraman et al,

(1985) suggested service quality to be the difference between expectations and perceptions in a

service encounter. Bitner et al. (1994) suggested service quality was the overall impact of the

virtual inadequacy/ascendancy of the service provided by a company whilst Roest and Pieters

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(1997) suggested service quality was a known inconsistency among experienced-based norms

and deeds relating to service benefits. Yet Arnauld et al. (2002) suggested service quality was

the customer‘s evaluative verdict about the overall excellence in providing certain desired

benefits. However, many other researchers have defined service quality as an attitude of the

customer to perceived quality.

There have been several attempts to measure service quality in the services marketing

literature, however, Parasuraman et al’s (1985) work in service quality and the SERVQUAL

Model is probably the most cited and accepted measure of service quality. As such, this study

uses the SERVQUAL measure of service quality developed by Parasuraman et al (1985),

namely, the dimensions of tangibles, reliability, responsiveness, assurance and empathy to assess

service quality in the health care industry in Iran, a developing country of the Middle East.

THEORETICAL FRAMEWORK

Palmer et al (1991) suggested that quality in the healthcare industry was as a result of

enhanced health and the satisfaction of residents surrounded by the construction of equipment,

resources, and patient’s conditions and situations. Grönroos (1984) and Seth et al (2005)

suggested that there were three aspects of quality in health care that were important, namely,

technical quality, functional quality and corporate image. Technical quality is the technical

exactness of health judgment and procedures. Functional quality is the processes and deeds that

service and treatment is delivered by with corporate image being the service provider’s image

that is developed through technical and functional quality.

Rivers and Glover (2008) suggested that the technical quality of medical services consists

of two sub-dimensions. Firstly, the suitability of the service performance and the skills with

which that suitable service is performed and that hospitals need to build high-quality services for

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each and every patient. Secondly, the skills with which suitable care is complete and

implemented including overall skill, decisions that are made, and the timeliness of the

implementation. However, the quality of the interface between medical providers and patients

depends on a number of consistent issues, including the quality of communication between

employees and patients, the medical provider’s ability to sustain the patient’s trust and a

capability to delight the patient with compassion, integrity and judgment.

Grönroos (1993) noted that, particularly in the healthcare industry, technical quality

might be difficult for patients to assess that do not have sufficient technical experience and

knowledge, however, functional services quality can be assessed as patients have a propensity to

rely on how a service is delivered. Furthermore, Asubonteng et al (1996) suggested that patients

judge functional service quality as the most critical factor in service transactions compared with

technical quality due to a lack of knowledge about technical aspects. Grönroos (1993) also

suggested that quality of service in both technical and functional aspects are the main

constituents to success for a service organization and have a considerable relationship with

profitability, customer satisfaction and customer retention. Singh (1991) further suggested that

when assessing hospitals performance technical aspects must be elaborated on to include

functional quality perceptions as well as technical quality perceptions which lends support to the

use of the Parasuraman et al (1985) SERVQUAL Gap Model when measuring service quality in

such an environment.

Many researchers have a similar viewpoint in relation to a patient’s perception of quality

in the healthcare sector and believe that the variation in culture influences the assessment of

quality by customers and service providers. For instance, Mattila (1999) contended that cultural

factors have a great influence on a customer’s assessment of service than on their assessment of

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tangible benefits because of the interface between customers and front line staff when services

are delivered (Julian and Ramaseshan, 1994). Parasuraman et al. (1985) noted the perception of

quality is an outcome of the compression of customer expectations with the actual service they

receive from the service provider.

Numerous studies have shown that high service quality in the healthcare industry is

related to a patient’s satisfaction and their intention to be loyal and be retained by the service

provider. Tam (2007) suggested that a patient’s satisfaction is thought to be a significant

indicator of service quality. Bolton and Drew (1988) mentioned that perceived quality by

customers is the most significant variable affecting a customer’s perception of value and

satisfaction and in their intention to purchase a particular good or service. This was also noted by

Ross et al (1987) when they found that the initial expectation by patients is the first element that

determines satisfaction and if the perceived care and treatment fall short of their expectations,

then the consequence will be a patient’s dissatisfaction.

Donabedian (1980) illustrated that patient satisfaction is an important contributor to the

meaning of services/products quality from the perspective of patients’ values and their

expectations and a significant element of care quality because patients who are satisfied are more

willing to act in accordance with the medical providers and to collaborate or continue a

relationship with that particular provider.

Due to differences in expectations, it is also possible that a patient’s satisfaction may vary

from the same provider (Tam, 2007). One of the barriers for healthcare service providers is to be

able to learn from their patients and this was identified by Wensing et al (2003) as an issue as it

is difficult to meet all of the patients’ needs and desires. Other factors including increasing

workloads, busy timetables, cost implications and time constraints of the service provider to

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spend time with their patients were all cited as issues impacting service quality in the healthcare

industry (Tam, 2007). Jayanti and Burns (1998) also suggested that patients play an important

role in achieving quality treatment and services. As a result, patients must be more proactive in

their own care and treatment (Price et al., 2006).

Numerous studies have also reported issues pertaining to the competitive impact and

perspectives in the healthcare industry. For instance, several studies have investigated the

relationship between competitive intensity and healthcare quality (e.g., Zwanziger and Melnick,

1996; Chassin, 1997), between health care costs and competition (Robinson and Luft, 1985) and

between patient satisfaction and competition (Miller, 1996). In their studies, they stated that

traditional competition in the healthcare sector involves quality, price, expediency, and

excellence in products or services, although it can also be through the adoption of new and

advanced technologies and innovative services/products. Rivers and Glover (2008) suggested

that a main component of competition in the healthcare sector is the ability to produce a method

for reducing medical costs. Competition commonly reduces the inefficiencies of high production

costs that eventually lead to high healthcare service quality and procedures improvements. This

leads to cost reduction, which in turn improves customer satisfaction. Folland et al (1993) noted

that in the healthcare industry market failures also exist due to a lack of competition. Quality

competition is an aspect of an oligopolistic market but price competition generally is not.

As competition increases, in order to survive, service providers need to pay more

attention to increasing customer satisfaction and retaining existing customers. According to

Shahin (2006) the measurement of service quality allows for the comparison of before and after

certain service encounters and the measure of service quality should be the difference between

the expectations of the service encounter by the customer and what was actually delivered.

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There are many models, which are available to measure service quality, particularly in the

healthcare industry, namely, SERVQUAL (Parasuraman et al., 1985) and SERVPERF (Cronin

and Taylor, 1992) to name just a few. The SERVQUAL Model is the most widely accepted

measure of assessing service quality in the healthcare industry and that is why it has been

selected to assess service quality in a private hospital in Iran.

SERVQUAL was used to evaluate customers’ expectations before a service was delivered

and their perceptions of the service after it was delivered (Parasuraman et al., 1985).

Parasuraman et al. (1985) identified 22 statements in the SERVQUAL model, across five

dimensions, namely tangibles, reliability, responsiveness, assurance and empathy. A specific

advantage of the SERVQUAL model was that it is a proven reliable and valid measure of service

quality (Brysland and Curry, 2001).

METHODOLOGY

This was an exploratory study conducted in a private hospital in Iran using Parasuraman et

al’s (1985) SERVQUAL measure to determine service quality and its effect on the healthcare

industry in a developing country context of the Middle East, namely Iran. The questionnaire was

designed in accordance with the 22 original statements from the SERVQUAL model developed

by Parasuraman et al (1985) intending to measure five dimensions of service quality, namely,

tangibles, reliability, responsiveness, assurance and empathy. A 7-Point Likert Scale was used to

measure customer’s expectations and perceptions against the five dimensions of service quality.

The 7-point Likert Scale ranged from strongly disagree (1) to strongly agree (7). Questionnaires

were hand delivered to the private hospital’s patients in the outpatient department. A total of 150

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questionnaires were hand delivered to outpatients and 100 were returned indicating a response

rate of 67% and considered to be adequate. All respondents were less than 50 years old.

The amount of information requested in the questionnaire was reasonable because

participants were only requested to specify their level of agreement or disagreement with the 22-

statements in the SERVQUAL model designed to measure customer’s expectations and

perceptions against the 5 service quality dimensions of tangibles, reliability, responsiveness,

assurance and empathy. Background information was requested from the participants in order to

the differentiate them. The average time taken by participants to complete the questionnaire was

less than 15 minutes.

DATA ANALYSIS

The data were initially analysed using principal components analysis to assess the

psychometric properties of the instrument. Our primary concern was to ensure all statements

loaded onto their appropriate factors. The 5 service quality dimensions, namely, tangibles,

reliability, responsiveness, assurance and empathy all loaded appropriately and no cross loadings

above .2 were identified with only factor loadings of above .5 being accepted. The final

reliabilities for all scales were greater than .70. The preliminary results indicated that the

psychometric properties of the scales were acceptable and as such it was appropriate to examine

the gap between customer expectations and perceptions within the 5 service quality dimensions

of tangibles, reliability, responsiveness, assurance and empathy.

Patients were asked to show the extent to which they believed the private hospital had the

feature described in the statement. With a number from 1 to 7 that showed their level of

expectation and perception against the 5 service quality dimensions patients responded to 22

statements measuring customer expectations against the 5 service quality dimensions and 22

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statements measuring customer perceptions against the 5 service quality dimensions after being

exposed to the service. The difference between customer expectations and perceptions was used

to measure the gap in service quality that existed in the private hospital on the 5 dimensions of

the SERVQUAL model measuring service quality, namely, tangibles, reliability, responsiveness,

assurance and empathy (Parasuraman et al., 1985).

Data collection involved a summary of typical values with “typical” being the mean

response when the distribution was sorted from lowest to highest (Cooper and Schindler, 2003).

All data collected from patients was entered into an SPSS spread sheet in order to measure the

service quality gaps as result of G (service quality gap) = P (perceptions) -E (expectations) for

each statement. The total gap was then calculated based on the distribution of statements in each

dimension, namely, tangibles, reliability, responsiveness, assurance and empathy (Parasuraman

et al., 1985). After the final result was calculated for each dimension, as is the requirement of the

SERVQUAL model, all the data was averaged for each dimension for each single patient. The

results are described in Table 1.

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TABLE # 1SERVQUAL MEASURE OF SERVICE QUALITY IN HEALTHCARE.

Dimension Statement Average E Average P Average G Dimension Gap Average Dimension

Gap

Tangibles

Statement 1 6.52 5.52 -1

-4.21 -1.0475

Statement 2 6.59 5.65 -0.94

Statement 3 6.6 5.59 -1.01

Statement 4 6.42 5.16 -1.26

Reliability

Statement 5 6.58 3.23 -3.35

-14.82 -2.964

Statement 6 6.54 3.16 -3.38

Statement 7 6.6 5.26 -1.34

Statement 8 6.66 4.24 -2.42

Statement 9 6.68 2.35 -4.33

Responsiveness

Statement 10 6.64 5.52 -1.12

-9.71 -2.4275

Statement 11 6.61 2.38 -4.23

Statement 12 6.56 5.66 -0.9

Statement 13 6.63 3.17 -3.46

Assurance

Statement 14 6.6 3.2 -3.4

-10.92 -2.73

Statement 15 6.87 5.52 -1.35

Statement 16 6.8 3.36 -3.44

Statement 17 6.84 4.11 -2.73

Empathy

Statement 18 6.6 4.32 -2.28

-13.7 -2.74

Statement 19 6.62 2.37 -4.25

Statement 20 6.63 3.24 -3.39

Statement 21 6.59 4.7 -1.89

Statement 22 6.66 4.77 -1.89

Average Unweighted SERVQUAL Score -2.3818

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DISCUSSION

After analysing patients’ perceptions and expectations of the service quality at the

Hospital, it was quite clear that there was a higher expectation of service quality compared to the

actual perception of service quality after patients had been exposed to the service. The average

expectation of service quality was at 6.6/7 while the average perception of service quality after

being exposed to the service was 4.2/7. This suggests that the private hospital was unable to

meet customer expectations as the patients at the private hospital did not perceive the service

quality at the hospital to be at the level they expected. The overall gap between expectations and

perceptions of service quality remained negative for all dimensions of the SERVQUAL model in

the outpatient department at the hospital. The tangible dimension indicated a negative gap of –

1.0475/7, which suggests that the hospital was unable to provide physical facilities, equipment

and the appearance of their personnel at a level expected from patients. However, this negative

gap of -1.0475/7 was much less than the gaps in the other SERVQUAL dimensions i.e. reliability

(-2.964/7), responsiveness (-2.4275/7), assurance (-2.73/7) and empathy (-2.74/7) with the

reliability dimension having the highest negative gap. When analyzing the importance of the

different dimensions of the SERVQUAL model, it showed that the responsiveness dimension

was regarded as the most important dimension followed by reliability, assurance, tangibles and

finally empathy.

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