SERVICE QUALITY

- A research on how recruitment companies secure service quality

Efendic, Elvira, 901119 Tutor: Halvarsson, Dan International Marketing Programme Examiner: PH. D Oghazi, Pejvak Lajiq, Sabina, 890505 International Marketing Programme Subject: Business Administration

Level & Semester: Bachelor Thesis, Spring 2012.

“Excellent firms don’t believe in excellence – only in constant improvement and constant change” - Tom Peters

Acknowledgement

First and foremost the authors would like to offer their sincerest gratitude to the examiner of this research, Dr. Pejvak Oghazi at Linnaeus University, Dr. Vinit Parida at Luleå University of Technology as well as Dr. Magnus Hultman at Leeds University for their valuable feedback during this thesis.

The authors also wish to express their gratitude towards their supervisor, Prof. Dan Halvarsson who has been abundantly supportive and has offered this thesis valuable assistance as well as guidance.

This dissertation would not have been possible without the cooperative support from the recruitment companies and the respondents. In addition the authors wish to express their sincerest gratitude towards their families who during trials continued to encourage, inspire and support us throughout this thesis.

Last, but by no means least, the authors wish to express the sincerest gratitude towards each other for encouraging and supporting one another during challenging times that occasionally occurred during these study years.

Title: Service quality - A research on how recruitment companies secure service quality

Authors: Efendic, Elvira Lajiq, Sabina

Tutor: Dan Halvarsson Date: 2012-05-15

Abstract

Background Service quality is considered to be a vital strategy for survival and success in today’s competitive environment. Although there have been an emphasis in quality overall, the research in companies performance within a business-to-business approach is still largely unexplored. Accordingly, service quality in recruitment companies will be interesting to examine in order to explore the business-to- business industry further.

Purpose & The purpose of this research is to study how recruitment Research Question companies secure quality in their services. What factors indicate various quality levels?

Methodology This is a qualitative study with a deductive approach. Multiple case studies were conducted with a total of six respondents from three companies.

Conclusion This research concluded factors that indicate various quality levels in recruitment companies. The collected data that could not be strengthened with the theories was recommended as further research.

Keywords: Service quality, heterogeneity, intangibility, gap analysis, self- service, servqual, service quality in B2B.

Table of Content

1. Introduction ...... 1 1.2 Problem Discussion ...... 2 1.3 Purpose ...... 2 2. Literature Review ...... 3 2.1 Theoretical Introduction ...... 3 2.2 Aspects of Services ...... 3 2.2.1 Intangibility ...... 3 2.2 Heterogeneity ...... 4 2.3 What is Service Quality? ...... 5 2.3.1 Definition of service quality ...... 6 2.3.2 Characteristics of the business-to-business market ...... 6 2.3.3 Service Quality in business-to-business ...... 7 2.4 Service Quality Methods ...... 7 2.4.1 Gap analysis ...... 7 2.4.2 Self Service ...... 10 2.4.3 Method for Measuring Service ...... 11 2.4.4 Research Question ...... 13 2.5 Conceptualization ...... 13 3. Methodology ...... 15 3.1 Research Approach ...... 15 3.1.1 Inductive versus Deductive Research...... 15 3.1.2 Qualitative versus Quantitative Approach ...... 16 3.2 Research Design ...... 17 3.3 Data Sources ...... 18 3.3.1 Primary Data ...... 18 3.3.2 Secondary Data ...... 19 3.4 Research Strategy ...... 20 3.4.1 Experiment ...... 20 3.4.2 Surveys ...... 20 3.4.3 Archival Analysis ...... 20 3.4.4 History ...... 21 3.4.5 Case study ...... 21 3.5 Data collection method ...... 23 3.6 Data Collection Instrument ...... 25 3.6.1 Operationalization and Measurement of Variables ...... 25 3.6.2 Interview guideline ...... 26 3.6.3 Pretesting ...... 27 3.7 Sampling ...... 27 3.7.1 Sampling frame ...... 28 3.7.2 Sample selection ...... 28 3.8 Data analysis method ...... 29 3.9 Quality Criteria ...... 31 3.9.1 Content Validity ...... 31 3.9.2 Construct validity ...... 31 3.9.3 External validity ...... 32

3.9.4 Reliability ...... 32 4. Empirical ...... 34 4.1 Discussion of the empirical findings ...... 34 4.1.1 Intangibility ...... 34 4.1.2 Heterogeneity ...... 36 4.1.3 Gap Analysis ...... 38 4.1.4 Self-service ...... 41 5. Analysis ...... 42 5.1 Discussion of the Analysis ...... 42 5.1.1 Intangibility ...... 42 5.2 Heterogeneity ...... 44 5.3 Gap Analysis ...... 45 5.4 Self Service ...... 47 6. Conclusion and Implications ...... 49 6.2 Discussion of the findings ...... 49 6.2.1 Intangibility ...... 49 6.2.2 Heterogeneity ...... 50 6.2.3 Gap analysis ...... 50 6.5 Self-service ...... 51 6.6 Implications for Managers ...... 51 6.7 Implications for Academicians ...... 52 6.8 Limitations & Future research ...... 53 7. References ...... 54

Appendix Appendix 1 Appendix 2

List of Tables

Table 2.1: Definitions and Characteristics of Service Quality………………………………... 5 Table 2.2: Factors causing gaps in Service Quality…………………………………………... 9 Table 2.3: A multiple Item Scale for Measuring Consumer Perceptions of Service Quality...12 Table 3.1: The differences between qualitative and quantitative research…………...………17 Table 3.2: Relevant Situations for Different Research Strategies……………………………22 Table 3.3: Interview Process Outline…………………………………………………………24 Table 3.4: Aspects of Service Quality………………………………………………………..25 Table 3.5 Service Quality Methods…………………………………………………………...26 Table 3.6: Criteria for Respondents…………………………………………………………. 28 Table 3.7: Criteria for Companies…………………………………………………………….28 Table 3.8: Presentation of the Respondents…………………………………………………..29 Table 4.1 Presentation of the Companies……………………………………………………..34 Table 4.2: Attributes of ISO 9001 and 14001………………………………………………...36

List of Figures

Figure 2.1 Conceptualization of theoretical framework…………...…………………………14 Figure 3.1: Data analysis process……………………………………………………………..30

1. Introduction

This chapter will provide a presentation of the background for the research in order to create logic for the project at hand. Further, a problem discussion addressing critical issues of the research subject is presented and concludes with the purpose of this research.

The importance of retaining a stable position by maintaining quality in a competitive market has been in focus for decades. (e.g. Regan, 1963; Juran, 1974; Crosby, 1979; Garvin, 1984; Parasuraman et al, 1985; Deming, 1986; Feigenbaum, 1951; Cronin and Taylor, 1992; Heskett et al, 1997; Grönroos, 2000). Between the years of 1995-2007 the employment opportunities were mainly created within the service sector and a very important contribution to the economic growth in Sweden has since 1995 been investment in intangible assets (Almega, 2011). Usually, only tangible assets are considered as investment in the National Account, despite the importance for output that stems from intangible assets. The main reason for this is related to the complexity of measuring intangible assets. Result has showed that investment in intangible assets in the Swedish business sector reaches 10% of the GDP (Almega, 2011). In a continuously increasing competitive environment, it is not enough for organizations to just reach the top, but to maintain a leader-position (Kandampully, 1998). Delivering service quality is considered to be a vital strategy for survival and success in today’s competitive environment (Dawkins and Reichheld 1990). Zeithaml et al (1996) state that the main difference between services and goods is that services are intangible. According to Kaplan & Norton, (1997), a company’s ability of handling their intangible assets is of greater importance for reaching success, than the ability of managing and investing in tangible assets. In the 1980’s the main focus of both managerial and academic effort focused on determining what service quality meant to the customers. According to Berry et al. (1985) service quality is the match between service expectations and service performance. In order to deliver quality, customer expectations should be met by the service provider on a consistent basis (Berry et al. 1985). Kandampully (1998) stress that gaps between customers’ expectations and the service they are provided with, is what most likely will contribute to low quality. Since providers of service are aiming for customer’s loyalty, the customers, in turn, are searching for service loyalty (Kandampully, 1998). The customer seeks the loyalty as an assurance for being provided with service of a consistent quality level in the short-run as well as over a longer period of time, which means gaining loyalty by providing loyalty (Kandampully, 1998). Since it is argued that customer loyalty is occasional and time-limited,

1 for an organization to reach long-term success, they need to maintain and seek to develop the relationship to their customers continuously.

1.2 Problem Discussion

According to Zeithaml et al (1996) the difference between goods and services is that services are intangible. A customer purchasing products can judge the quality on physical attributes such as colour, package and fit. Since fewer physical attributes exist in services, the quality is instead, before the purchase, judged upon the provider’s equipment, personnel and facility (Zeithaml et al, 1985). Due to the absence of tangible attributes, Zeithaml (1985) state that evaluating services quality is an issue. Services complicate the expectations that are usually requested by the customer since they do not have a tangible outcome from the service, therefore it is also impossible for them to decide on what to expect (Paraguayan et al, 1988). The search of quality goes back to the 1980’s when striving towards quality was a huge consumer trend. Back then there was very little research on the area due to the complexity of modelling and defining quality. Kandampully (1998) and Zeithaml (1985) stress the complexity of defining quality, but emphasized the importance of it for customer’s and companies. Berry et al (1985) and Zeithaml (2000) argues that profitability is an outcome of investments in quality.

This far the literature has emphasized in quality overall, the research in company’s performance within a business-to-business approach is still largely unexplored (Forker et al, 1996). In the environment of business-to-business, service providers and customer’s need to understand the customer’s unique needs and attributes as well as the importance of building a strategic relationship (Rauyruen and Miller, 2007). Currently, limited research has investigated the recruitment industry, the research that exists only emphasizes on the customer’s perspective (Englund et al 2000). Therefore, investigating the recruitment companies’ perspective on how to secure quality in their services will be the aim of this study since they operate within a business-to-business approach.

1.3 Purpose The purpose of the research is to study how recruiting companies secure quality in their services.

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2. Literature Review

This chapter will present an overview of the literature within the frame of the presented research problem. The first section of this chapter will provide a brief introduction of service marketing and further a presentation of the service aspects; intangibility and heterogeneity as well as several service quality methods and models are presented followed by the research question.

2.1 Theoretical Introduction Service marketers need to understand the expectations of the potential customers in order to be in a position to develop marketing strategies for the service delivery (Liu et al, 2000). Liu et al (2000) also argues that if the service providers manage to establish a good relationship with their customers, a lifetime value will be accomplished. There are three types of marketing approaches that can be distinguished for this purpose; attracting the consumers, retaining customers and creating loyalty (Izduierdo et al, 2005). Accordingly, Izduierdo et al (2005) states that service quality is reached by establishing good relationships. According to Gilbert (1996), quality is the main facilitator to achieve objectives of relationship marketing. The mentioned aspects to this statement are; the commitment to a brand, the moving involvement and also the active relation (Gilbert, 1996).

2.2 Aspects of Services This section will present two vital aspects of services; intangibility and heterogeneity. Bauer (1960) argues that these aspects are important to take into consideration since customer’s usually experience insecurity when purchasing services due to the lack of tangible attributes and various quality levels of services.

2.2.1 Intangibility

Zeithaml et al (1996) argues that the main difference between a service and a good is that goods are tangible while services are intangible. Berry (1980) states that another important attribute of service, is that services are processes rather than goods, which leaves the customer with no opportunity to have a tangible product but instead have interactive processes. Since services are intangible it is an issue to specify and explain the contents of services (Bauer, 1960). Customers will experience certain insecurity from the purchase due to of the amount of

3 quality of the information in a service (Bauer, 1960; Cox, 1967, Riel et al, 2001; Berry, 1980). Since intangibility of services complicate a service, it becomes impossible for consumers to determine what they should expect (Paraguayan et al, 1988). Since intangibility cause problems for the customer’s, companies need to emphasize in demonstrating the service value which is difficult to asses before consumption (Martin, 1999) According to Lovelock (1991), consumers tend to evaluate services depending on if they can experience the delivery of the service and also on the perceived service outcome. A study conducted by Bebko (2000) has showed that environmental cues in services help the consumers shape their expectations. Previous research has showed the importance of understanding customers’ expectations and satisfaction of service quality but there is a small amount of empirical evidence that demonstrate how consumers expectations of quality differ between services (Bebko, 2000). Grönroos (1982) research, which is a classification model of different services on the other hand, proved that differences in service attributes do exist. Bebko (2000) states that, if intangibility affects consumer’s perception of risks, then the promise of reliability can reduce it. However businesses need to be careful while they are promoting their reliability because if they exaggerate or overstate it, consumer’s expectations will increase. According to Bebko (2000) it is more important that companies emphasize on their reliability first and where after it should be promoted to the customer’s. In a research made by Bebko (2000) there is a hypothesis which states that most issues with quality would follow a pattern where reliability would be the most important dimension of service quality to consumers for all services. Intangible services, risks, uncertainty and customers’ expectations are an area that still needs to be examined in the service literature (Bebko, 2000).

2.2 Heterogeneity

Throughout the last a numerous of researchers have made an effort to create knowledge of heterogeneity in different markets. The result has provided useful classification tools for uncovering different groups with different sensitivities and preferences (Allenby et al, 2012). Berry (1987) stresses the difficulty of providing services with consistent quality levels due to heterogeneity. The inconsistency in services is unavoidable and each service should be considered as unique. (Berry, 1980; Zeithaml et al, 1985) Services usually vary from one purchase occasion to another and services are often viewed as experimental, why consumers tend to re-evaluate the quality criteria of services each time (Friedman & Smith, 1993; Parasuraman et al, 1985). If services are treated right from both the seller and the buyer, Crosby et al (1990) argues, that this will lead to a permanent buyer-seller relationship. High

4 service quality has the ability to reduce service uncertainty and increase the companies’ reliability (Li and Ho, 2008). The higher quality of relationships, long-term exchanges will be developed between the service providers which results in mutual benefits for both parties (Singh, 2008). Grönroos (1990) argues that services are heterogeneous since both the provider of the service and the consumer has a major influence on the construction and the delivery development. Heterogeneity is not necessarily connected to a dire matter since according to Bubkek (2000) service organizations are seeking to differentiate themselves in today’s competitive market and delivering high service quality has been related to success in the service industry. Therefore it is important that services are designed in the right way from the beginning, since they can not be exchanged, stored or redone (Bubkek, 2000)

2.3 What is Service Quality? The first part of this section provides several definitions of service quality. Further, the role of service quality in B2B is presented, since this is the approach that the project at hand will highlight. The section ends by a presentation of service quality models relevant for the project.

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2.3.1 Definition of Service Quality Service quality can be viewed from different aspects; interactive, corporate and physical quality (Lehtinen & Lehtinen, 1982). Below several definitions of service quality are provided (See Table 2.1).

Table 2.1 Definitions and Characteristics of Service Quality Author Definitions of Service Quality Grönroos (1982) Service quality is evaluated based on the extent to which customer’s expectations are met by the service provided.

Lewis and Booms (1983) Service quality measures the extent to which the service provided matches customers’ expectations, and meets the expectations.

Gefen (2002) Service quality is the subjective comparison that customers make between the quality of service that they receive and the one they get. Smith and Houston (1982) Service quality means confirmation or disconfirmation of the expectations a customer has. Customer’s base research upon the disconfirmation paradigm which stresses that is connected to the direction and size of the disconfirmation experience. The disconfirmation on the other hand is related to a person's primary expectations. Ramsawamy (1996) The creations of service quality are the business transactions that occur between a service provider and the customer in order to create an outcome that will satisfy the customer.

Zeithaml and Bitner (1996) Service quality includes a process, performance and deeds.

Companies can gain great benefits if service quality is secured properly (Buzzel and Gale, 1987). Companies that can offer superior service have the ability to charge approximately eight percent more for their service and as a results achieve more than the average market share growth (Buzzel and Gale, 1987). This is also strengthened by Liu et al. (2007) who state that delivering more effective service quality than competitors, is a way for firms to become successful in today’s business environment. Providing a service that is of high quality is a noticeable way for companies to differentiate from competitors and achieve a competitive advantage (Liu et al, 2007).

2.3.2 Characteristics of the Business-to-Business Market The business-to-business (B2B) market concerns commercial business interactions between business organizations where the customers are businesses purchasing products and services from other businesses. Business may refer to an institution or the government as well (Hutt &

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Speh 2010). The differences between the B2B and business-to-consumer (B2C) market are concerned with marketing and buying processes; B2B companies have fewer customers who purchases large quantities Kotler (2003). Accordingly, it is stressed that supplier-customer relationships are closer in B2B due to a high corporation level between parties. Another characteristic of the B2B is the incidence of customized solutions which evolves as supplier and buyers becomes more integrated with one another Kotler (2003).

2.3.3 Service Quality in Business-to-Business Mehta and Durvasula (1998) argue that service quality has a significant concern within business-to-business marketing of services and the lack of delivering high service can have consequences for businesses. If customer’s perceived quality is below their expectations, a service quality gap occurs (Brogowicz et al, 1990). Therefore quality gaps need to be identified.

2.4 Service Quality Methods The research and the service quality methods will shed light to the service provider’s perspective since currently this area is largely unexplored. This statement is strengthen by Svensson (2004) who states that the existing models of service quality are frequently based on the interpretations of involving different actors in a service encounter but not the service provider’s point of view.

2.4.1 Gap Analysis According to Grönroos (1990), managers who believe that providing 100% quality is not possible are not putting enough effort. Grönroos (1990) state that the problem usually is concerned with the company’s approach of addressing quality improvement and that many companies see service quality as a project, something temporary and restricted to a time- frame. Grönroos (1990) argues that quality improvements should be addressed as a continuous process and every individual in the organization should understand how they can influence service quality.

Management perceptions of customer expectations serve as a guide for decisions on service quality which the organization should take into consideration when the delivery of the service

7 takes place (Grönroos, 1990). Another thing that influences the perceived, as well as the expected service, is marketing communication (Grönroos, 1990). Berry et al (1988), presents a model including five gaps that can be used for identifying factors affecting quality and provides managers with an understanding of how service quality can be improved. The gaps occur due to inconsistence in quality management and the factors behind them should be taken into considerations during the planning process of service quality (Berry et al, 1988). Berry et al (1988) initial model was based on an investigation of companies from four different industries; credit card, securities brokerage, retail banking and product repair and maintenance. Grönroos (1990) further discuss the consequences and reasons behind the gaps. The structure of the model demonstrates steps that need to be considered when planning and analyzing service quality in order to identify factors causing quality problems.

Further on, this research will emphasize on Grönroos (1990) clarification on the model presented by Berry et al (1988). The first four gaps are viewed from companies’ perspective, while the fifth gap investigates customer’s perspective of service quality (Grönroos, 1990). Since this research will emphasize on investigating the company’s perspective of service quality, the fifth gap will be excluded.

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The table below (Table 2.2) presents information and reasons that need to be considered in order to prevent gaps from occurring in companies’ services.

Table 2.2: Factors causing gaps in Service Quality. Gap Analysis Model

Gap 1 - The management perception gap The managements perceptions of quality expectations is not accurate

Factors causing gap: - Analysis of demand and information form market research are not accurate - Expectations are interpreted in a non-correct way - Lack of demand analysis - Lack in the information between the firms connection link to the customer and the management - Information becomes inaccurate when assign through too many organizational layers Gap 2 – The quality specifications gap Mismatch between manager’s perception of quality and quality specifications

Factors causing gap: - Mistakes during the planning process - Lacks in the management responsible for planning - No clear goals - No sufficient support from top management in the planning of service quality

Gap 3 – The service delivery gap Quality is not delivered in line with what is stated in specifications

Factors causing gap: - Specifications are too complicated - Employees are not fulfilling specifications because they don’t agree with them - The specifications don’t match the corporate culture of the organization - Internal marketing is not sufficient - Performance is not technologically supported - Lack of real commitment to service quality among management. - Lack of employee training Gap 4 – The market communication gap Promises in marketing communication are not being properly fulfilled through the actual service delivery

Factors causing gap: - The service operations are vague integrated with the marketing planning - Marketing communication campaigns are not in line with specifications - The organization has a tendency of promising too much

According to Grönroos (1990) the first gap (Gap 1) concerns the management of an organization and stresses that if management’s perception of quality is not accurate, a gap will occur. The gap indicates that management’s perception of quality is not in line with customers expectations. An example provided by Parasuraman et al (1985) concerns internet payments; for a consumer internet payment is related to uncertainty, while management believes that it contributes to high quality.

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Grönroos state that companies will fail to match customer’s expectations if they interpret their perception of expectations incorrectly; they will also fail to match service specifications (Gap 2), (Grönroos, 1990). In the following gap (Gap 3), it is stressed that if there is a difference between an organizations specification for services and the actual delivery of the service, a gap will occur (Grönroos, 1990). Parasuraman et al. (1985) stresses the importance of employees’ impact on the service delivery. It is argued that employees might perform services in different ways, which implies that specifications for services not necessarily indicate high quality (Parasuraman et al, 1985). The fourth gap (Gap 4) stresses that if an organization does not deliver what is promised through marketing, a gap will occur (Grönroos, 1990). Despite the possibility of identifying quality problems that the gap analysis provides, criticism concerning its lack of ability to measure the quality gaps has been pointed out by Seth et al (2005). Since the focus of this thesis will aim to identify factors affecting service quality, measuring service quality will not be a relevant strategy to complete this research. Accordingly, this will justify the author’s acceptance of the criticism.

2.4.2 Self-Service The offering of services can be divided into two main components, where one part is the process and the other one is the outcome of the service (Oghazi et al, 2012). In line with the expansion of e-business and technology overall, technology based self-services has grown as a result and more companies are encouraging consumers of their services to perform the services by themselves (Oghazi et al, 2012). Self-service contributes to increasing the importance of service delivery. Many service companies has implemented technologies in order to provide customers with the possibility of serving themselves (Oghazi et al, 2012) According to Oghazi et al, (2012) there are several benefits to gain by offering self-service. From the service providers’ perspective this is mainly concerned with facilitating employees’ jobs as well as achieving great cost efficiency. For the consumers purchasing services on the other hand, benefits are found within the possibility of individual control and customization as well as time efficiency (Oghazi et al, 2012). Accordingly, Oghazi et al (2012) stressed that consumers would prefer using self-services due to the possibility of control even if there are no price or time benefits to gain. Despite the benefits, some are still not convinced about the attractiveness of self-service (Oghazi et al, 2012). In some cases, consumers seek to avoid self-service due to the expected additional physical and mental efforts.

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According to Oghazi et al (2012), whether a consumer accepts or rejects a self-service is decided upon the attributes of the self-service. It is stressed that the attributes consumers’ values the most is individual control, time efficiency as well as how easy navigated the self- service is (Oghazi et al, 2012). Self-services that are perceived as difficult to use, will decrease customer’s desire of using the service due to the risk of looking foolish (Oghazi et al, 2012).

2.4.3 Method for Measuring Service According to Parasuraman et al (1985), intangibility complicates the measurement of service quality. This is strengthened by Levitt (1981) who argue that the difficulties that arise from intangibility leads to quality control problems for both the consumer and the producer. According to Lovelock and Wirtz (2007) researchers state that the nature of service quality requires a unique approach in order to measure and identify service quality. As stated by Parasuraman et al (1985), the intangibility makes it difficult to measure service quality but Lovelock and Wirtz (2007) also state that the comprehensive nature of services makes it hard to evaluate the quality of a service. In some cases it is beneficial to measure service quality, since measurement allows for a comparison before and after the changes when finding out the source of quality related problems (Lovelock and Wirtz, 2007). Most of the services that are offered today can not be measured, tested or counted neither be confirmed in advance of a sale in order to ensure quality delivery (Zeithaml, 1988). One way to measure service quality according to Bebko (2000) is by the level of differences between consumer’s expectations and desire as well as their perceptions of the service outcome. There need to be a drawn distinction between the service delivery process and the output of a service (Bebko, 2000). It is importance to understand the expectations of the customers since when evaluating services, customers compare their expectations with what they receive (Bebko, 2000). Customer’s expectation can vary since customers are influenced by new technologies, advertising, service innovation and other socially observed factors. In a successful company, customer’s expectations are met in every step (Lovelock and Wirtz, 2007). While exploring the field of service quality, it is noted that the Servqual model is an important aspect. The statement is strengthened by the innovators Parasuraman et al (1985), article "SERVQUAL: A multiple item scale for measuring consumer perceptions of service quality" which currently have 9559 citations. Servqual is a model that provides a technology for measuring and managing quality (Parasuraman et al, 1985). Servqual measures the gap between the customer’s expectations

11 and the experiences of the delivered service. In Parasuraman et al (1985) original formulation of Servqual, ten components were identified. The formulation was later on collapsed into five dimensions which is presented in the table below (Table 2.5). All the dimensions beside reliability, concern the process of service delivery while reliability concern whether the outcome of service was delivered as promised (Parasuraman, 1985). The table below (Table 2.5) provides descriptions of Parasuraman et al (1985) five dimensions of the Servqual model.

Table 2.5: A multiple Item Scale for Measuring Consumer Perceptions of Service Quality. SERVQUAL 1. Tangibles Here the appearance of communication material and physical facilities matters. 2. Reliability Within this dimension the performance of companies’ promises are vital. 3. Responsiveness This dimension is about the willingness to help the customers and to provide them with punctual service. 4. Assurance The politeness and knowledge of employees and their ability to impart confidence and trust. 5. Empathy The last dimension is about the attention the firm give to its customer. (Bebko, 2000).

With its growing popularity and extensive request, Servqual has been criticized in both a theoretical and operational way (Masser, 1957). Servqual has been improperly based on an expectations-disconfirmation model instead of an attitudinal model of service quality. As a result it does not build on present knowledge in statistics, economics and psychology. Masser (1957) among other authors state that Parasuraman (1988) management technology does not take any account of the costs required to improve service quality. Masser (1957) also tackled the issue of the cost and benefits of quality improvement in service settings. The existing model of service quality such as Servqual is usually not provided for professional evaluation of the interactive environment of service quality in service encounters (Svensson, 2004). Therefore, this model will not be further investigated in this study.

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2.4.4 Research Question In order to be able to investigate how recruitment companies secure quality in their services the following question will be aimed to be answered:

- What factors indicates various quality levels in recruitment companies?

2.5 Conceptualization In order to demonstrate the relevance of the chosen theories for this research, the figure below (figure 3.1) illustrates a conceptualization of how the theories will be used throughout the project. The model clarifies the components of service quality that will be examined in this research. Intangibility and heterogeneity in this model represents aspects of service quality, which through the literature review were noted to be critical aspects since they make the determination of service quality complex (Zeithaml et al, 1996; Allenby et al, 2012). Since there is an issue in explaining and specifying services due to their intangibility, the research aims to study how recruitment companies address this issue in order to secure quality in their services. Since the service provider and the consumer have equal influence on the construction and delivery development, services consistent (Grönroos, 1990). Therefore, the desire was to examine how recruitment companies manage to address this issue to keep their services consistent. Bubkek (2000) argues the importance of designing the services properly from the beginning, due to their non-ability to change, restore or exchange. In order to examine the factors affecting the quality outcome; the aim is to study how recruitment companies design their services.

As mentioned, the two mentioned aspects contribute to the determination of what factors indicates various quality levels. However, since intangibility and heterogeneity complicate the determination of service quality, the service quality methods; gap analysis and self-service will contribute by indicating what high service quality is for the recruitment companies. The research will highlight the complexity of services as well as identify the factors affect the quality outcome. The chosen theories will form the foundation for the empirical investigation of this study, and have been divided into constructs and further into items. From these items, an interview guideline will be constructed that further on will be mastered throughout the empirical material. The collected data will provide inferences about the recruitment

13 companies’ strategies of securing quality in their services. The final outcome will demonstrate factors affecting the quality outcome.

Service Quality

Intangability Heterogeneity Self - Service Gap Analysis

Factors affecting quality outcome

Figure 2.1 Conceptualization of theoretical framework

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3. Methodology

In this chapter a description of the research methodology will be presented. The first section sheds light to the chosen research approaches, followed by a discussion and justification of the chosen method, while the last section highlights quality criteria. The chosen methods will be in accordance with the subject of this research.

3.1 Research Approach In this section the different research approaches will be presented. At the end of the presentation a justification of the suitable approach chosen for this study will be provided.

3.1.1 Inductive versus Deductive Research When conducting research there are two possible ways of building the theory; inductive and deductive. The most common approach of describing the relationship between theory and research is by applying deductive theory (Bryman and Bell, 2007). In order to construct a hypothesis, the researcher studies what is known about the area of interest from which a hypothesis is formed which further should be mastered through empirical material. The hypothesis should enclose ideas that can be transformed into units that are possible to research on (Bryman and Bell, 2007). The different steps of the deductive approach are demonstrated as a linear and logical progression, however, there are situations where this will not be the case. The researcher might due to several reasons, change his or her view of the literature and theory while analysing the data that has been collected. One reason might be that, before the researcher has accomplished the project, other researchers might publish new ideas or findings. In addition, the relevance between data and theory might not be clear until after the data has been collected. Also, a mismatch between the data and the intended hypothesis might exist. After studying what is known about the research phenomena a theory is constructed as a basis for the hypothesis. The hypothesis is then tested by empirically studying the phenomena in order to finally be able to confirm, or not confirm, the intended hypothesis (Bryman & Bell, 2007). Inductive research approach is reverse of the deductive one; theory is what will result from the collected data. Through this approach the researcher is able to draw generalizations based on observations. Inductive research may have influences of the deductive approach because when theoretical reflection is carried from the collected data, the researcher might collect more data in order to examine under what conditions a certain theory will hold or not

15 hold. Inductive research usually provides very insightful generalizations but thus very little theory (Bryman & Bell, 2007). This research will be carried out with a deductive approach. Since the conclusions of the research project will be based on pre-chosen theories. The reason for excluding the inductive approach is since the outcome of the research will not be theories.

3.1.2 Qualitative versus Quantitative Approach Two approaches can be used in a research; a quantitative and a qualitative approach. The qualitative approach demands an emphasis on one of the qualities of units and on processes which meanings are not experimentally examined or measured (Lincoln and Denzim, 2005). However, the quantitative approach emphasizes on intensity, amount and frequency. In the qualitative approach the researcher seeks answers to questions that strain how experience is created and given meaning (Lincoln and Denzim, 2005). Qualitative data is not analyzed through numbers and is concerned with collecting and analyzing information in as many predominantly non-numeric forms as possible instead it emphasises on exploring as many details as possible (Lincoln and Denzim, 2005). Small numbers of examples or instances that are seen as illuminating or interesting are preferable since it aims to achieve depth instead of breadth (Blaxter, 2006). Unlike qualitative research, the quantitative approach highlights the analysis and measurement of fundamental relationships between variables instead of processes. Blaxter (2006) state the proponents work is based on a value-free structure, meaning the quantitative approach does include values, beliefs and attitudes. Quantitative research is a pragmatic research where the data is presented through numbers (Blaxter, 2006). The quantitative approach tends to engage a somehow representative and large scale of data and also perceived as if the context is about the gathering of facts (Blaxter, 2006).

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The table below (Table 3.1) provides the reader with differences between the qualitative and quantitative approach. The purpose of the table is to give more depth to the reader and a clearer understanding of the mentioned research approaches.

Table 3.1: The differences between qualitative and quantitative research Qualitative Research Quantitative Research Focus on understanding behaviour of actors Seeks the causes and facts of social phenomena

The insider perspective (Close to the data) The outsider perspective (Removed from data)

Subjective Objective

Process-oriented Outcome-oriented

Assumes a dynamic reality Assumes a stable reality

Since the purpose is to investigate how service quality is secured within the recruiting industry, the qualitative approach is more suitable for this study. This, since in a qualitative approach, the researcher seeks answers to questions that shows how experience is created and given meaning (Blaxter, 2006). This will be beneficial for the thesis since the purpose is to find out what service quality is according to the respondents experience. The respondents will have to justify their answers in their own words and not mark any options, since there will be in-depth interviews and therefore the quantitative approach which is objective and presented in numbers is not as suitable for our thesis. The data will be presented in words and will therefore fulfil the criteria for a qualitative approach.

3.2 Research Design If a research question is interpreted incorrectly, an exploratory research design is sufficient. In an exploratory research, the researcher collects data and tries to find a lead, as more information comes up, the pattern or lead becomes clearer which lead to an identified answer for the researcher (Ghauri and Grønhaug 2005). The key attribute of the researchers approach to solving the problem is flexibility and a skilled researcher. When new information comes up, the search for the answer may change direction. In this research design, exploratory research requires the ability to obtain information, observe and construct explanation that is theorizing (Ghauri and Grønhaug 2005). In contrast from exploratory research, the problem in descriptive research is well structured and understood. The key attributes of descriptive

17 research are precise rules, structure and procedures. Descriptive studies can include more than one variable. At first the researcher is confronted with definitional and conceptual problems. When they are solved, the next step is a procedure on how to collect the data in order to be able to produce the data needed to answer the research question (Ghauri & Grønhaug 2005). In a casual research the problems under analysis are well structured. In comparison to descriptive research, the researcher is confronted with “cause-and-effect” problems. The key task in this research is to isolate the cause and thereafter explain if and to what extent the cause results in an effect (Ghauri & Grønhaug 2005). For this thesis, there will be more than one variable that will be included and there will be an assortment of what service quality is in the previous chapters before examining how the recruitment companies secure it through their services. Therefore descriptive research will be used since it is structured and fulfils the criteria for the chosen research design. When the research question is defined, the next step is to collect the data in order to produce the data required to answer the research question, therefore the descriptive approach which is following this pattern is the most suitable one for this study.

3.3 Data Sources This section presents different sources of data. First, primary data will be presented with a justification of its contribution for this thesis. Accordingly, the characteristics of secondary data will be presented.

3.3.1 Primary Data Primary data is a type of data source used for collecting data in situations when secondary data is not available or does not provide enough information in order to complete the study at hand (Ghauri and Grønhaug 2005). The relevant data for the research has to be collected by the researcher in order to solve the particular problem. The most important advantages of collecting primary data are that it is gathered to fulfil the purpose of the specific project at hand (Ghauri and Grønhaug 2005). Primary data can provide more in-depth information about people’s intentions or attitudes toward a specific subject or product, which can be difficult to obtain an understanding of without asking the right questions (Ghauri and Grønhaug 2005). The main drawbacks with the process of collecting primary data are that it is time-consuming and costly. Another problem is that it might be difficult to access information; there might be

18 difficulties in finding customers or companies that are willing to participate, especially if the subject is of sensitive manner. The researcher it therefore dependent of information sources willingness to participate. When collecting primary data the researcher has a lower degree of control and the result might be affected by unexpected situations (Ghauri & Grønhaug 2005). In order to address the problem of the project at hand primary data was required. The data was collected through six in-depth interviews in three recruiting companies. The questions were asked in accordance with the objective of the project. Accessibility to primary data was not an issue due to the respondents’ willingness to corporate. The primary data collection was both costly and time consuming, however, it was accomplish for the purpose to guarantee accurate information for this study.

3.3.2 Secondary Data Secondary data is another type of data sources that is used for another purpose than to answer the research question for the project at hand. Secondary sources can be useful in the process of finding or clarifying a research problem at the beginning of a project. It might provide a partial solution or provide cues about the research problem at hand but not solve it completely (Bryman, 2007). There are several advantages of using secondary data. The most important one is that it is very timesaving as well as financially favourable for researchers. The data is in many cases of high quality since it is data provided by governments and international organizations is reliable since it is collected by experts. Secondary data is also useful when historical information is needed. However, there are some risks with using secondary data. On issue is that the information from secondary data is provided for another purpose than the one for the research at hand. Another problem is that it might be difficult to classify the data in ways that will be consistent with the study since concepts and variables might have been defined differently (Ghauri & Grønhaug 2005). Since this thesis will built upon a deductive study, secondary data was gathered to serve as guidance towards the research problem. The secondary data was valuable since it led to useful information for the chosen theories and simplified the research question. With the heavily considered and criticised data collection method of secondary data in mind, secondary data was gathered from the companies’ website and annual reports from 2011 and therefore considered to be valuable and relevant for this study.

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3.4 Research Strategy The research strategy will be a description of the way a study is completed. Strategies such as experiments, surveys, history, case studies and the analysis of archival information are available strategies according to Yin’s (2007) differentiation. These strategies differ from each other based on the extent of control the investigator has over actual behavioural events, the type of research question posed and the degree of focus on contemporary events.

3.4.1 Experiment The experiment is a situation which the independent variable also known as the intervention, exposure is cautiously influenced by the investigator. It is influenced under tightly defined and controlled conditions or sometimes by natural occurrence (Blaxter, 2006).The experiment consists of an experimental group who is uncovered to the intervention under investigation, and also to a control group that is not exposed (Blaxter, 2006). The experimental and the control groups should be investigated systematically and equivalent under conditions that are exactly identical, this in order to minimize the possible variation between them. Experiments are often used as a research approach in a number of the social sciences, usually in the social science (Blaxter, 2006).

3.4.2 Surveys Another type of research strategies are surveys which involves systematic interviewing or systematic observation (Blaxter, 2006). Surveys ask the questions that a researcher wants answered so that they thereafter can state the range of answers that may be given. Homogeneity lies at the heart of survey research (Blaxter, 2006). The purpose of surveys is to get reliable answers to consistent questions. Through surveys researchers try to ask questions in the exact same way in each interview, in order to regulate the questionnaires as a measuring instrument (Blaxter, 2006). Surveys are more often associated as a research approach with an idea of asking groups of people questions (Blaxter, 2006)

3.4.3 Archival Analysis In addition to open-ended interviews and direct observations, a third common source consists of archival data. Archival data is information that is stored in existing channels such libraries, electronic records and old fashioned paper files (Blaxter, 2006). Newspapers, television as

20 well as the mass media are one type of channel. On the other hand records maintained by public agencies, meaning law enforcement or public health serve another (Blaxter, 2006). The resulting archival data can be both qualitative and quantitative as well as subject to their own biases or shortcomings from a researcher’s perspective (Blaxter, 2006). Case studies rely heavily on archival data to be sensitive to the possible prejudices and take steps to, if possible, neutralize them (Blaxter, 2006).

3.4.4 History In historical review, the mission is to describe what has happened in the past so that there can be a deeper understanding of the present but also a plan for the future (Ghauri & Grønhaug 2005). In this section, the task is to go through existing records and report. It’s also important to talk to different people in order to get as true picture as possible (Ghauri & Grønhaug 2005). The records are reviewed in a curious manner with a certain research question/problem in mind. The risk in using a method like this is that we have to trust the human memory, which records that are selective parts of reality (Ghauri & Grønhaug 2005). It is possible that two different people can record or remember different things even if they go through a certain situation or experience together. Sometimes there will be mistakes or misunderstandings (Ghauri & Grønhaug 2005). Therefore while using this method, it is important that researcher’s cross-check written sources with another (Ghauri & Grønhaug 2005).

3.4.5 Case Study A case study is a method of choice when the phenomenon under study is not differentiable from its context. The experimenter manipulates variables to determine their casual significance (Blaxter, 2006). Through a survey a researcher ask standardized questions of representative, large samples of individuals while the case study researcher usually observe the attributes of an individual unit which can be a clique, class, community or school (Blaxter, 2006). The generalizations that may occur from case studies need to be handled with care. In order to serve a foundation for generalization, this type of studies should be related to a theoretical framework, which in turn may be adjusted as case study results that provide new evidence (Blaxter, 2006). A case study is in many ways ideally suited to the needs and resources of the small-scale researcher (Blaxter, 2006). In business studies, the case study approach is useful when the area or industry of interest is complex to investigate and when variables are difficult to quantify due to too many variables (Ghauri & Grønhaug 2005). They

21 are conducted in order to describe management situations and usually include data collected from various sources such as interviews, verbal reports and observations (Ghauri & Grønhaug 2005). Case studies are suitable when ‘how’ and ‘why’ questions need to be answered and when the area that is being studied is from a real-life context (Ghauri & Grønhaug 2005). Case studies are also suited when a single organization is to be studied, but it is equally feasible to apply it on several organizations out from variables that have been identified or assumed (Yin, 2012). This study approach is called comparative case study and is conducted through asking different organizations the same questions in order to draw conclusions from that (Yin, 2012). Case studies are similar to historical review in the sense that a historical review is conducted together with interviews. The difference is that in case studies the possibility of interacting and observing directly is given (Yin, 2012). In a qualitative research there are two approaches to choose between; single or multiple case studies (Runeson et al, 2012). By using multiple case studies the researcher might broaden the study. If the cases with different attributes would provide similar information about a certain topic, it would indicate a well-built and good finding (Runeson et al, 2012). The main purpose of multiple case studies is to get another set of data points that will bring light to the phenomena during the study (Runeson et al, 2012).

The table below (Table 3.2) provide the reader with an overview of five types of research strategies, what type of research questions should be included within the different strategies and if it requires control and focus on behavioral and contemporary events.

Table 3.2: Relevant Situations for Different Research Strategies Strategy Type of Research Does it Require Control Does it Focus on Question of Behavioural Events? Contemporary Events?

Experiment How/ Why Yes Yes Survey Who/ What/ Where/ No Yes How Many/ How Much Archival Analysis Who/ What/ Where/ No Yes/ No How Many/ How Much History How/ Why No No Case Study How/ Why No Yes (Yin, 2007, p. 22)

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For this thesis, case studies will be conducted since it will answer why/how questions and the chosen subject emphasises on contemporary events. One reason for choosing case studies is, as mentioned above, that this approach is useful when the industry of interest is complex to investigate due to too many variables. Another reason why it is the desired approach for this thesis is that case studies are well-suited for new research areas. This is suitable for this study since, the current literature has not yet explored service quality within the recruitment industry (Svensson, 2004). Data will be collected by conducting multiple case studies in order to collect information from different point of views and might bring validity for the research.

3.5 Data Collection Method In order to get a deeper insight and understanding of the chosen field of study, in-depth interviews will be conducted. In-depth interviews are used as the main method of data collection in a qualitative research. The difference between a normal conversation and an in- depth interview is the objectives of the conversations and the roles of the interviewer and interviewee (Ritchie, J. & Lewis, J, 2003). When conducting qualitative interviews, a researcher can choose between an unstructured and semi-structured format (Bryman and Bell, 2007). In a semi-structured format, the researcher has questions and topics to follow but the method also has a lot of room for the respondents to justify their answers (Bryman and Bell, 2007). However, the unstructured format may include a few topics that the researcher might ask, then later on follow up the relevant answers but is usually improvised (Bryman and Bell, 2007). In-depth interviews are intended to be a combination of structure and flexibility. Although the interview is unstructured the researcher will need structure of the themes that are wished to be explored (Bryman and Bell, 2007). The interview is usually based on an interview guide of the key subjects and issues that should be brought up during the session. The structure is flexible to allow issues to be brought up in an order that is most suitable for the respondent and also allows the interviewer to raise questions spontaneously (Bryman and Bell, 2007). The researcher should have an interactive nature; questions are asked with the purpose to encourage the respondent to talk freely about the topics. How the interviewer acts and in which order questions are asked is determined by the interviewees answers (Bryman and Bell, 2007). An in-depth interview will generally begin with the respondent not giving any deep answers. In order to achieve depth in the interview the researchers asks follow-up questions gradually to obtain a deeper understanding of the respondent’s opinions (Bryman and Bell, 2007). Through this the interviewer can identify reasons behind the participant’s

23 beliefs and opinions and how he/she is reasoning and feeling, which is of high importance when conducting a qualitative research (Bryman and Bell, 2007). According to Merian (2009), in-depth interviews involves several steps that all should be completed before the interview session is over. In line with Merriam (2009), the different steps that will be used for this research, are explained below:

Table 3.3: Interview Process Outline Interview Process Step 1 - Meeting At this step the interviewer meets the interviewee. Here a relationship begin, which is crucial for the success of the interview. The interviewer should act as a guest but still be confident and express control of his/her own territory.

Step 2 – Presentation of Research At this stage the topic as well as the purpose of the interview is presented. The interviewer asks for allowance to record and the environment should be private and quiet.

Step 3 – Beginning of the interview The interview should begin by asking the interviewee personal questions, such as age and occupation, in order to create a comfortable environment. These types of questions are asked informally and should not be asked as if they are read from an interview guideline.

Step 4 – During the interview The interviewee is being guided by the interviewer through the topics by both structured questions and questions emerging during the interview. The topics are aimed to be explored at a deep level and the interviewer aims to uncover the interviewees’ underlying feelings, beliefs and attitudes.

Step 5 – The end of the interview At the end of the interview, in order to create a more comfortable environment, the interviewer should prepare the interviewee for the last question.

Since the desire of this study is to gain a deeper understanding regarding how the chosen recruiting companies’ secure quality in their services, a qualitative approach has been chosen combined with a semi-structure format of the interview guide. As Bryman and Bell (2007) stress the quality of a semi-structured format as a method qualified to allow the respondents to justify their answers, this will bring more depth for the study. In order to gain understanding and meaning about the subject the primary source of collecting data will be through in-depth interviews since this is the purpose of case-studies (Merriam, 2009). In combination with a deductive approach this will provide richly expressive result.

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3.6 Data Collection Instrument This section presents a justification of the choice of theories. This will show the chosen constructs from the theories that will serve as a guide for the collection of empirical material. Further, an interview guideline has been constructed and the questions relevance for the chosen theories has been motivated.

3.6.1 Operationalization and Measurement of Variables The section will facilitate the empirical testing which will be the basis for the operationalization of the theoretical framework. The theories in the literature review are here defined as constructs and further into items. The constructs builds on the service quality aspects; intangibility and heterogeneity, and service quality methods: gap analysis and self- service, in order to create meaning for this study and serve as a guide for the interview guideline.

The table below (Table 3.4) displays the constructs intangibility and heterogeneity, as well as the items and questions that the constructs are divided into.

Table 3.4: Aspects of Service Quality Aspects of Service Quality Constructs Items Questions Intangability Inability to access value from a service 7, 8

(Paraguayan et al, (1988) Keywords: Service risk, Uncertainty, Zeithaml et al, (1996) Customer expectations Bebko (2000) Heterogeneity Variation from one service to another 6, 9, 10, 12

Allenby et al, (2012) Keywords: Service delivery, Service design Grönroos (1990) Bubkek (2000)

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The table below (Table 3.5) displays the constructs gap analysis and self-service, as well as the items and questions that the constructs are divided into.

Table 3.5: Service Quality Methods Construct Items Questions

Gap Analysis Factors affecting quality problems 1, 3, 13, 14, 11, 4

Berry et al, (1985) Keywords: Management perception, Quality Grönroos (1990) specifications, Service delivery, Market communication, Perceived service quality (See table 2.2) Self- Service The process and outcome of the service 5

Oghazi et al, (2012) Keywords: Customization, Convenience, Time efficiency

3.6.2 Interview Guideline The interview guideline is a modification of the table above (Table 3.3) and the questions are based on the four different constructs. In this section the questions are presented in order to provide the reader with a clear justification of the questions construction. The interview guideline has been constructed in a way that will contribute to a clearer structure of the interview. The construct intangibility will be examining the service provider’s view of the risks and challenges with their own services. (See Appendix 1.1) Furthermore, factors contributing to the companies design and structure of their services will be investigated which is connected to the construct, heterogeneity. In order to further explore the construct heterogeneity, the interviewee will be asked about how service quality is secured. This, since Bubkek (2000) stress that services are never identical, therefore it will be interesting to find out how the recruitment companies make up for not delivering good service, if this is the case. (See Appendix 1.2) The questions will cover the factors causing gaps since gaps occur due to the inaccurate market information. The interview will continue examining the companies’ strategy of communicating their services to the market. Customer satisfaction is another subject that will be covered in the following questions and will cover the gap analysis construct. This will investigate if the company has had any unsatisfied customers the reasons behind it in order to identify potential gaps between the indented quality and the service quality delivered. Also, the researchers will investigate the recruitment companies’ strategy of confirming customer’s expectations and ensure that a customer is satisfied. In order to

26 investigate the service delivery gap, questions concerning internal employment of new staff members and how the company secure their competence are asked. (See Appendix 1.3) Since Oghazi et al. (2012) state that companies can gain several benefits by offering their customer’s self-service, such as time and cost efficiency, questions concerning this matter will be asked. (See Appendix 1.4)

3.6.3 Pretesting Pretesting of an interview guideline or a questionnaire is conducted before the population answer the questions. Pretesting is used in order to anticipate what answers researchers can expect when conducting interviews. It is especially useful when the subject matter concerns the respondent’s beliefs, attitudes and opinions (Bernsen & Dybkjaer, 2009). The questions will be pretested by a randomly chosen sample of ten students at Linnaeus University in order to see if the questions are interpreted as they are intended to. After the pretesting, the result will be reviewed by the researchers where potential changes will be made to form the questions in order for them to be interpreted in the desired way. The questions will be reviewed by Dr. Pejvak Oghazi, professor at Linnaeus University School of Business and Economics and the examiner for this research. Since the interviews will be conducted in Swedish, the questions in the interview guideline need to be translated to Swedish. This will be done by the authors since both are fluent spoken and written in English. To ensure that the translation is correct, the questions will be back- translated into English by five English native students at Linnaeus University.

3.7 Sampling When conducting a research, the researcher can choose to collect data from an entire population also referred as a census, which is the optimal method (Saunders et al, 2009). Although, conducting a census survey will not necessarily provide more useful results than collecting data from a sample (Saunders et al, 2009). Alternatively, the researcher can choose to only examine a sample, which is referred as a sample survey (Saunders et al, 2009). A sample is used when the researcher has to consider time constraints as well as financial restrictions (Ghauri & Gronhaug, 2005). Therefore, a sample survey is preferable for this research. The sample criteria for the respondents was decided to include a group where 50% of the respondents have a minimum of six months experience and the other 50% should have

27 a minimum of three year experience. The second criterion is that at least one of the respondents from each company should have an academic background. In order to obtain a wide perspective the sample should include both men and women.

Table 3.6: Criteria for Respondents Sample criteria: interview respondents Gender Male/Female Experience 50% should have a minimum of six months experience & 50% should have a minimum of three years’ experience Academic Background At least one respondent from each company should have an academic background

In order to satisfy the desire of obtaining an understanding of how quality is perceived nationally, all the companies should be represented nationally. The location of the companies’ offices is restricted to the region of Småland, Sweden, due to the convenience of visits.

Table 3.7: Criteria for Companies Sample criteria: companies

Industry Recruitment Location Sweden (south) Geographical Representation National

3.7.1 Sampling Frame The sampling frame was decided upon two criteria: access to information and geographical convenience. The researchers have through meetings concerning business matters established relationships with employees at the companies and therefore held relevant information which was beneficial when contacting the companies. The chosen interviewees were initially contacted by e-mail and researcher held response from the chosen companies within one week.

3.7.2 Sample Selection The number of companies was decided to include three companies due to time and financial restrictions. In order to satisfy the desire of a broad perspective and satisfy quality

28 requirements, the number of respondents was decided to include two from each company. The table below (Table 3.6) will present the respondents age and their position in the company. The respondent’s employment and earlier experience is also presented. Since there were two interviewees in each company, the respondents will be referred as R1 and R2.

Table 3.8: Presentation of the Respondents Presentation of the Respondents Company Age Position Length of Earlier Experience employment from the Industry Company A, R*1 25 Key Account Manager 8 months None Company A, R2 27 Recruiting Manager 2 years None

Company B, R1 46 Headhunter 4 years None Company B, R2 46 Executive Search Consultant 7 years None

Company C, R1 26 Office Manager 1 year None Company C, R2 33 Key Account Manager 7 years None (*R referees to Respondent)

3.8 Data Analysis Method For this study, a qualitative approach has been chosen, therefore a qualitative data analysis will be conducted. According to Bryman and Bell (2007), the qualitative data analysis techniques are vaguely described which might make the chosen approach difficult to analyze. In order to enrich the information of the study, multiple case studies will be conducted. The empirical findings will build upon information from three different recruitment companies. All together there will be six in-depth interviews, two from each company. If the collected data would provide similar information about the chosen topic, service quality, it will show that the findings are well-built. For a qualitative theory, there are two methods that are common; these are the analytic induction and grounded theory. If the chosen case for the study does not suit the chosen hypothesis, the researcher will reformulate the hypothesis in order to exclude the case so that it will suit the study, this method is referred to analytic induction (Bryman and Bell, 2007). However, grounded theory is the most used method for a qualitative data analysis among the two mentioned. The quality of grounded theory is the process of coding. In this method, the researchers starting point is to transcribe the data which provides the researcher with the ability of securing the collected data. After the transcribing,

29 the second step is to code the data, meaning emphasizing key words that will cover the overall data (Bryman and Bell, 2007). Thereafter, the data need to be displayed and organized to increase the possibility of drawing conclusions and afterwards identifying patterns (Bryman and Bell, 2007). After these steps are conducted, to make the analysis possible, the researcher has to connect the chosen data with the theories in order to answer the research question (Bryman and Bell, 2007). Beside the mentioned methods; grounded theory and analytic induction, there are two other approaches that can be used; within-case and cross-case analysis (Huberman & Miles, 1994). However, the focus of this study will be on grounded theory since the analysis has been connected to the theoretical chapter in this study. The data analysis for this study will include data reduction and pattern matching and therefore grounded theory is the most suitable method for this study. This includes comparing the data against the theoretical framework in order to note regularities and decide what the collected data mean. The analysis will be strengthened with the empirical evidence. From the patterns found in the analysis, conclusions has been drawn which thereafter provide an answer for the research question. The theories that have not been strengthened by the empirical material will be suggested for further studying. The figure below (Figure 3.1) demonstrates the process of the analysis.

Qualitative Approach

Case Study

Transcribing

Data Reduction

Gorunded Theory Coding

Data Display

Pattern Matching Figure 3.1: Data analysis process

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3.9 Quality Criteria The following section presents content validity, construct validity, external validity and reliability. These are ways through which quality will be added to the research.

3.9.1 Content Validity When it comes to validity a re-test method might be used to see if measurement instruments are reliable over a certain time. In terms of validity, researchers, especially those who use an interpretive paradigm, they replace validity with trustworthiness as the overarching standard for the field research (Bailey, 2007). This study has included numerous efforts with the purpose of confirming the content validity. The interview guide have been pre-tested by Dr. Pejvak Oghazi, the examiner of this study, which provided a helpful input in order to make the chosen questions for the in-depth interviews valuable. In order to prevent misinterpretations, the interview guideline was also tested by ten respondents, whereas three of them were from the chosen recruiting companies in order to maximize the validity of this study. Careful considerations have been included when constructing the interview guideline in order to have as unbiased questions as possible when the pre-testing was made by the chosen recruiting companies for this study. Although, it was the chosen respondent’s colleagues who were pre-testing the interview guideline, it was of great importance to not lead the companies into the wrong direction. Accordingly, since the remaining respondents had no pre-knowledge of the chosen subject, concepts and theories connected to the purpose of this study was not included in the layout of the questions. Instead, the questions were constructed with the purpose of providing relevant information to cover the chosen theories.

3.9.2 Construct Validity Validity can be a measurement based on external criteria and logical judgment, this type of validity is known as construct validity (Connaway & Powell, 2010). The construct validity sounds very familiar to face validity but construct validity stands for the extent to which an instrument measures the concept or construct that it is intended to measure (Connaway & Powell, 2010). On the other hand, face validity, when selecting an instrument or a test to employ in a research study, one of them must choose one that accurately measures the construct of interest (Connaway & Powell, 2010). This kind of selection process should be based on the judgment of subject experts. Construct validity does require more that an expert opinion for determination (Connaway & Powell, 2010). Since construct validity requires more

31 than an expert opinion for determination, both experts within this subject and the examiner will be asked for an input in the interview guideline before conducting the interviews. After their input, there will be a stronger argument that the measurement validity is fairly high. All of the possible quality criteria’s were included to increase the validity of this study. The sources were collected from six respondents in three different companies within the recruiting industry to increase the validity from the collected information and fulfil the desire to include multiple sources. The interviews increased the validity since they were recorded for the purpose of preventing inaccurate data. Due to the positive aspects of in-depth interviews, the respondents had been given the opportunity to have the questions explained by different examples provided by the researchers to prevent misunderstandings, which also lead to an increased validity. Since the interview guide was originally written in English thereafter translated into Swedish, the possibility of translation errors could not been excluded, therefore the translated interview guideline had further on been tested by an additional five respondents.

3.9.3 External Validity External validity is the ability to generalize from a sample to a somehow larger population or from one setting to another although this is difficult to achieve (Bailey, 2007). Validity has to do with methods, approaches and techniques and whether they are easily related or measured to the issues that have been explored (Blaxter, 2006). Multiple case studies have been conducted to strengthen the external validity, in order to draw general conclusions. Since the interview guide was used for all case studies, it will strengthen the theory chapter provided for this research.

3.9.4 Reliability Another important criterion for evaluating research that implies consistency is reliability. A good example to explain reliability is a bathroom scale (Bailey, 2007). If the weight does not change on the bathroom scale it will give the same results every time somebody steps on it. Questions within reliability are those that, regardless of when they are asked it will generate the same responses from interviewees (Bailey, 2007). The respondents that are reliable are those who provide steady answers. Since the lack of reliability is not a constant problem for the qualitative researcher as for those who exercise other methodologies, some researchers use criterion of reliability as an alternative construct (Bailey, 2007). The concept of reliability is concerned with how well the researcher can carry out the research project. It should be carried

32 out in a way that if another researcher were to look into the same questions in the same setting, they would easily come up with the same results. If this is the case, then the study would be reliable (Blaxter, 2006). In order to increase reliability, researchers do create an audit trail, which is a detailed account of the entire research process that will show a correspondence between the conclusions and the methodology (Bailey, 2007). In order to maximize the reliability, multiple case studies have been conducted in combination with requesting key respondents review the interview guideline to secure the outcome as relevant and consistent data in order to answer the research question.

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4. Empirical

In this chapter the empirical data gathered from six in-depth interviews from three recruitment companies, two interviews at each company will be presented. First, a table displaying information about the companies is presented. Further, the collected data is presented due to the structure of the service aspects; intangibility, heterogeneity as well as service quality methods; gap analysis model and self-service.

The figure below (Table 4.1) displays information about the recruitment companies that has been investigated in this research. The information concerns the companies’ foundation, turnover, number of offices in Sweden and their niche.

Table 4.1 Presentation of the Companies Presentation of the Companies Company A B C Founded 2003 1996 2007 Turnover in EUR 0.933 0,590 20,5 millions (2011)

Number of offices in 5 50 2 Sweden

Niche Students and young HR solutions provider Search/Headhunting of Graduates executives

4.1 Discussion of the empirical findings Empirical data gathered from the six respondents in the recruitment companies will further be presented. The structure of the collected data will be presented due to the structure of the operationalization (Table 3.3). The questions that the empirical structure was built on can be found in Appendix 1.

4.1.1 Intangibility From the companies’ experience, the greatest challenge is, according to both company A and C, to have the ability of analysing the candidates during the interviews in order to minimize an incorrect recruitment. Company A stress that “Sometimes it's difficult to know if a person is trying to impress only during the interview or if their actually are willing to do an impressive job for our customer's to, even when the contract is signed”. Company C stress the

34 importance of gathering the correct information about the candidates in the beginning by applying appropriate tools, techniques and methods required for this purpose. Accordingly, the challenge for Company C and A is to find the right competences within the customer’s requested time-plan. Company A also express the challenge of having exclusivity of their customer’s mission, meaning having full responsibility of the mission, and thereby excluding their competitors. Since advertisement is used in a small-scale the challenges stressed by Company B concerns always relying on the network Manager Recruitment International (MRI) which they are a part of. MRI is a vital source for Company B for the purpose of finding new candidates.

Company A’s strategy for securing quality in their services by always following the steps included in their recruiting process. This process includes calling their candidates for an interview at their office, ask suitable questions for the job offering, where after the company request their customer to conduct another interview before making a decision. Another important strategy from Company A for securing quality of their services is to always ask their customer’s for references. The references are used as a strategy for increasing the company’s reliability when recruiting new customers. Company B is applying a well elaborated and tested method that has been used and developed continuously for 50 years. This method includes a careful mapping of industries and potential candidates. Company C strategy to secure service quality in their services is to request their employers to have evaluation meetings with the company’s managers once a month. The purpose of the meetings is to discuss how well the employees meet the customers’ expectations. The company has business developers responsible for developing and improving the services. Company C also stress that they conduct a national research which is an important tool for securing the quality of their services since is gives infers about to what extent the company delivers their services in accordance to their customer expectations. Accordingly, internal as well as external revisions are conducted on a regular basis as a natural part of the company’s everyday work. The company is ISO-certified (ISO 9001 and 14001) where the including standards have to be proven in order to fulfil the company’s right of having the certification. The ISO certificate leaves a warranty on processes and candidates to their customers and quality can be guaranteed if the process is implemented completely. I some cases the customer only request help from Company C for one purpose of the process, in which cases the company can not leave any guarantees.

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The table below (Table 4.2) displays the attributes of the mentioned ISO certifications.

Table 4.2: Attributes of ISO 9001 and 14001

ISO 9001 attributes Less misunderstandings and complaints The management is working systematically to develop and improve Prevention initiatives instead of corrective actions The staff becomes involved in the work of quality The company meets the frequent customer demand for Certificates Increased support for the company’s offering

ISO 14001 attributes Improve the relationships with the customer’s and the community Contributes to goodwill Contributes to effective cost savings Provides a better level of competitiveness and profitability

4.1.2 Heterogeneity When asked how the companies package their services, Company A stress that their structure is based on their two initial concepts which is offering their customers the ability to hire either a young graduate or a student. Formally these are the two concepts that Company A build their services on but in reality they are very flexible and adjust to their customer’s requests. According to Company B their services are already finalized. However, at the first contact with the customer’s, Company B presents a detailed description of their offering, if a customer would not be satisfied with Company B offering, their services are adjustable due to the customer’s request until both parties have reached an agreement and this is when the service is created. Company C also stress that their recruitment process is carried out in the same way, regardless the position the recruitment concerns. According to the company this is not always effective in the short-term but is rather a long-term solution.

Accordingly, Company C packaging of their services is also adjustable to the customer’s needs. Company C services are evaluated continuously in order to keep a certain standard and in cases where quality specifications are not fulfilled, underlying reasons causing defects are searched to be identified. According to Company A, recently a more structured method of evaluating their services has been adapted. Earlier the company has not been working with evaluation actively, but are currently developing more structured processes for this purpose. In contrast from Company A, Company B improves their services by continuous follow-ups. After a mission is completed a first follow-up is conducted. The second follow-up is done

36 follows one month and finally after five months. The candidates on the other hand are evaluated continuously. At company C, in order to evaluate the services, all employees have internal goals as well as evaluation meetings with their managers once a month. The purpose of the meetings is to discuss how well the employees meet the customers’ expectations. The company has business developers responsible for developing and improving the services.

When the companies were asked about their ability to keep the customer’s requested deadline, both Company A and B stressed that there have been rare cases where the companies did not manage to deliver their services in time. Company A stressed that the challenges within the industry the company is operating in is difficult to handle due to the stressful and competitive environment. Company A stress that the factors causing the missed deadline is usually that the customers are not aware of what they want or the competence that the customers request is hard to find but both parties are usually aware of this issue. Accordingly, Company B stressed that the reason for not delivering their services in time is when the customer’s does not deliver the part they are responsible for in time. Company C stress that in most cases time plans are both flexible and reasonable agreements that can be reached through good communication. Due to the good communication, the company has never missed a deadline.

According to company A, in order to keep the quality of the company's services on a consistent level, the company’s national marketing manager provides them with guidelines. The guideline that concerns the recruitment of new candidates is a lead for how to advertise, interview and present a suitable candidate. The company can always take use of their guideline regarding questions concerning employments or disagreements. They also stress the importance of having a good internal communication. The employees at Company B has a well-established network in the manufacturing industry since they have a background of operating there which provides them with the tools needed in order to ask right questions and understand people’s needs and how a career reasonably would develop. According to company B “It is difficult to win customers if they do not have trust in you. It is vital to show that you have understanding for the customer’s situation and have knowledge enough to navigate in that industry”. In order to secure that the quality of the services is provided on a consistent basis, the company is running a well-elaborated and tested process, according to the headhunter. The method has been used for 50 years and is continuously developing. Since the method is applied in several countries, it is modified by the company in order to suit the Swedish culture. However, how a franchiser implements the method is not controlled by any

37 superior authority. It is important to ask numerous of questions in order to see and understand all different aspects in order to be receptive of the customers need.

4.1.3 Gap Analysis Concerning the companies strategy for staying updated in today’s market, Company A mentioned a method of keeping track of how frequently their competitors are advertising; this gives an indication of how much their competitors are ahead of them. The company also invest a great amount of time in networking, participating in fairs and reading the local newspapers, as well as that they are frequent users of social media (Facebook, LinkedIn). Company B, are members of the world’s largest recruitment network, MRI, from where they receive a lot of information about the current market. On an individual level the employers keep their selves updated through media such as newspapers and television news. Company C has a team of 15 people from the company, together with an external strategy consultant, who recently have presented a strategy that is thought to be used until 2014. The strategy maps the company’s general direction and includes an advice counsel that controls and follows changes and trends in the market as well as in the recruitment industry. Accordingly, Company C answered, in line with Company A strategy, that it is every employee’s responsibility to continuously follow changes and trends in the market through their everyday- work. By having an open communication internally the employers can spread the best practice.

Company A promotion strategy includes advertisement of their offerings through their webpage, social media, local newspapers, sponsoring and by contacting the customers by phone. In contrast from Company A, Company B, states that services are promoted through networking as well as selling directly to the customers. Another communication channel is the website which is used for promoting ongoing missions and occasionally the services are promoted through advertisement in newspapers. Arranged meetings for networking and seminars are not a part of their promotion routines.

The job requires a lot of direct selling through phone calls to present an opportunity for the candidates. The importance of Company B promotion strategy lies in creating awareness and a good reputation which they can rely on and where the good word will be spread. Another way of promoting their services is, in accordance to Company A answer, through social media. The employees are loyal user of Linkedin, and one of them has the largest network in

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Scandinavia. Company C has a large team of sales representatives responsible for regularly promoting the company’s services by meeting the existing as well as potential customers on a regular basis. Meanwhile, the company’s consulting managers, office managers as well as recruitment consultants are working on the field to sell. Another way of promoting their services is through various campaigns, as for example one where the company offers the CEO position to someone during one summer. In accordance with company A’s answer, advertisement in newspapers and directly to customers is also included in the company’s promotion plan. The company has also consciously chosen to promote them as concerned in health maintenance, for example they are sponsors of class two in soccer. All the employees are offered benefits connected to health maintenance, for example they have the opportunity of exercising at the gym for one hour during work.

When Company A recruits internally, what is usually required is that the candidates have experience from the recruitment industry. Education is not an obligation, the personality is more important, since the person has to be able to handle the stressful environment the recruitment industry faces. Company B on the other hand, hire people to their own company very rarely and it will take time before they hire someone. The importance of potential staff members is, in accordance with company A’s answer, that they should have knowledge and experience about the industry in which they are mainly operating in and the type of people they are recruiting. In that way a better understanding of the candidates and the customers is reached. Company C stress that when hiring people to their own organization, the same process as for their recruitment processes is gone through. Other than a mandatory face to face interview also references are taken and in some cases tests and portfolios are checked.

According to Company A, the company does not have any process for securing the staff member’s competence other than having a good internal communication. The staff members that are responsible for the recruitment of the candidates have been to a few lectures in labour law provided by their company but they did not feel that it was worth their time, as Company A stated “I learn more by being present in the office”. In accordance with Company A answer, Company B does not provide any continuous training but have had training in personality tests in order to be certified. It is the staff member’s individual responsibility to keep updated. In contrast, every function of the organization at Company C has an training program that is customized according to what position an employee has. Educations are held approximately every third month, and most are completed internally with experienced

39 consultants. Some education that concerns for example management is acquired from external suppliers. The company has people that regularly evaluates the methods based on how well educated the employers are.

According to Company A, the company’s strategy of securing customer satisfaction is to always follow up their recruitment of candidates one to three weeks after the candidate has been employed. The recruiting manager also stresses the importance of good communication in order to exclude conflicts. If a customer is not satisfied with their presented candidates, Company A will offer a second recruitment process without any monetary compensation, as a guarantee for their customers. In contrast to Company A, Company B stress that there is no structured process for securing customer satisfaction. Recently an online questionnaire has been provided to the customers which is thought to help them receive feedback on their services but they state that almost all customers have returned. Another method of securing customer satisfaction is by keeping a good communication internally, support and help each other. The staff members always ask each other about candidates and take advantage of each other’s network. Accordingly, internal meetings are held every week. Company C has several methods used for securing customer satisfaction. The most simple and common method is to keep an open dialogue with the customer’s to ask how the services are perceived. They believe that quality is a responsibility shared by themselves together with their customer’s. In some cases the so called Service Level Agreement (SLA), is signed which clearly shows how the service will be delivered, for example within a certain time span. These are evaluated continuously at meetings that are held on a regular basis. In accordance with Company A answer, follow-ups are done immediately after a closed deal. In order to see if the candidate lives up to expectations, a second follow-up is done after three months and finally after six months. If the candidate in some way does not fulfill the expectations that were showed in tests conducted at the point of recruitment, the company will review the tests in order to improve them.

Company A believes that somebody that is not familiar with the company associate them with their initial niche which focus was only students. The key account manager’s mission is to promote their services to match their current segmentation. For this purpose, a vital element of the recruitment process is to always leave references to new customers so that they personally can hear from earlier customers what the company is capable of recruiting. The recruiting manager believes that the customer's perceive them as a company that fulfils their

40 promises and delivers good quality. Company B on the other hand, strives to be recognized as a company that has a stable and well-structured process. They believe that they are recognized as quite expensive, but they believe that this can justified by their good reputation that they know they have. They believe that their solutions are more long-term which they try to communicate to their customers. Company C that is among the leading recruitment industries in Sweden, have according to them compacts with most of the larger companies. The company believes that customers chose them due to their complete HR solutions and educated and competent employees. They also believe that customers perceive them as being precise and careful in their processes. Warranty is always offered to the customers, which they believe implicates their loyalty. The customers are given the opportunity of making complaints if not satisfied and are offered a new candidate without any monetary compensation.

4.1.4 Self-Service Company A offers self-service through their website where the potential candidates can engage in their services. The candidates can register their resume in order to receive job offerings from the company that matches their resume. Included in the self- service is the offering of availability through phone, also referred to as customer service. In contrast from Company A, Company B has almost no incidence of self-service. The website is mainly used as an information source of the company’s services as well as a place for promoting their current missions. The website does not have a database of potential candidates and does not offer the opportunity of applying for the advertised positions. According to the office manager, the fundamental idea is to keep direct contact with the customers through for example phone calls, email and meetings, though, self-service are offered by the company to a smaller extent, which is the case for Company A. Company B offers the customers to register requests through a web-based system. People searching for a job can also register their resume on their website and customize their profile in order to facilitate the company’s recruitment process. Each time a registered profile matches a new job, the person will receive an email. The employees are also offered support by the company’s HR department if they have questions concerning for example salary.

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5. Analysis

Chapter five will provide an analysis of the findings generated by the empirical investigation. The findings will be analyzed in relation to the chosen literature that concerns the aspects of services, which are intangibility and heterogeneity, and methods of services which are referred to as gap analysis and self-service.

5.1 Discussion of the Analysis This section will analyse the collected information in the empirical investigation. The analysis will be structured and displayed in the order of the operationalization (Table 3.3). Further, the questions that the operationalization is built on, which are found in Appendix 1, will form the structure of the analysis.

5.1.1 Intangibility It seems as the chosen companies have understood that issues which arise from services are the complexity of the services intangibility, since the companies expressed their challenges as issues related to the service aspect intangibility. Accordingly, the companies expressed their challenge in analyzing candidates properly for their customer’s in order to minimize the risk of an incorrect recruitment. It is noted that the companies challenges with their services are connected to Bauer (1960) and Cox (1967) statement which states that since services are intangible, customer’s will experience the complexity of specifying and explaining the service content. If the companies’ challenges affect their reliability, this will further complicate their services due to Bebko (2000) argument that reliability can either increase or decrease the customers’ perception of risks. Since the companies’ challenges with their services concerns intangibility, this can have an impact on the customer’s perception the companies need to be aware of methods and tools to prevent and minimize their challenges in order to have their services reliable. This since, if a company’s reliability is exaggerated, and not in line with the actual service delivery, the reliability will be harmed (Bebko, 2000). Further, the companies’ challenges might result from the lack of proper methods for analyzing potential candidates. If the company would have well developed methods, the risk of an incorrect recruitment might decrease which would increase their reliability. Advertisement is a strategy used for recruiting potential candidates and is the first presentation of the company’s services that the potential candidates are provided with, therefore companies should emphasize on clear descriptions of their services. It is of high importance for the companies to deliver what they promise due to

42 the advantages of increased value for the companies’ (Martin, 1999). Due to the previously mentioned challenges the companies will have to emphasize on demonstrating their value of the intangible offering to facilitate customer’s evaluation of their services (Martin, 1999). It is noted that the company has an understanding of how the concept of intangibility affects their services due to their strategies of securing quality in their services. Company A and B have well-elaborated processes for the purpose of securing service quality. Due to the well- elaborated processes, it is noted that the companies have understood the complexity of intangibility and the importance of securing service quality. This is in accordance with Paraguayan et al (1988) who argue that intangibility complicates consumer’s determination of what to expect and the customer’s evaluate the services depending on if they can experience the delivery of the services as the perceived service outcome (Lovelock, 1991; Zeithaml and Bitner, 1996). Accordingly, service concepts can anytime be copied by the competitors, therefore it is very important to have well-developed recruiting processes which Company A and B stress that they have. Berry (1980) statement concerning the importance for companies to make an effort for the purpose of making their customer’s aware of the companies’ as somebody who takes their needs into consideration is well-connected with Company C. The company’s strategy of securing service quality is to conduct a national research to find out the customer’s needs. This research does not only aim to investigate the customers’ needs but it gives the customers’ an understanding of to what extent the company is delivering their services to suit the customer’s expectations. Another strategy from Company C perspective which could not be seen at the other companies was their ISO certification. As mentioned in the empirical chapter, this certification, including its standards, always has to be proven in order to fulfil the company’s right of having the certification. It is a good strategy for securing quality since the certification which is well-developed is a warranty for the company’s customers. The ISO certification might provide Company C with competitive advantage since the content of the certification is also available for the customers to obtain. Accordingly, due to the certifications accessibility, Company C might be perceived as more reliable. It is beneficial for Company C to have these strategies which covers both their needs and the customer’s needs since Riel et al (2001) state that intangibility of services provides problems for the customer’s as well as for companies.

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5.2 Heterogeneity Since heterogeneity generates difficulties for companies in order to provide services with a consistent quality it is important to have good strategies when delivering the services (Berry, 1987). All of the companies services are finalized when presented to their customer’s but their contribution to keep the quality of their services consistent are to further adjust their services for the customer’s. Although heterogeneity is not necessarily connected to a dire matter according to Bubkek (2000), as long as the company adjusts their services to the customer’s requests, services of high quality can still be delivered. This since, Friedman and Smith (1993) state that services are viewed as experimental which leads to a re-evaluation of the quality criteria from the customer’s perspective every time the service is consumed or purchased. Due to services heterogeneity it is a good strategy for the companies to adjust their services in accordance with their customer’s needs and request, since this might lead to higher service quality. (Berry, 1987; Friedman and smith, 1993; Parasuraman et al, 1985).

The company’s strategies for improving their services is somehow different from each other, it is noted that Company C have a more structured and developed process of evaluating their services, accordingly, all companies evaluation strategies aim for the same purpose which is to meet customer’s expectations. Although Company C invests more effort than Company A and B, this does not necessarily make their evaluation process better than the other companies since Berry (1980) state that inconsistency in services is unavoidable: each service experience can be unique. However, the companies’ evaluation strategies can not be covered in the literature of the aspect heterogeneity, but can be connected in Grönroos (1990) Gap Analysis Model (Gap 1). It is important to evaluate services and meet customer’s expectations so the information is not interpreted in a non-correct way since incorrect interpretations are a factor causing gaps in the service quality (Grönroos, 1990). Due to this, Company A and B that does not conduct a demand analysis, will face difficulties in meeting their customers’ expectation.

Both Company A and B have had problems with keeping their deadlines and argues that the undelivered services depends on the customer, who is not delivering their part of work in time. For this reason, companies need to improve their communication with their customer’s and create better relationships. This since, Crosby et al (1990) state that if successful exchanges are treated equally from both the buyer and the sellers’ perspective is will result in a continuous buyer-seller relationship. If Company A and B would improve their communication and relationship with their customer’s, they would reduce the uncertainty that

44 the customer’s face due to services heterogeneity (Li and Ho, 2008). As mentioned, even though the companies’ services are finalized and adjusted to their customers’ needs, the importance of having a written specification of the missions for both parties should not be excluded. Since the companies’ stress that the missed deadlines are caused by the customers, they should include a clear plan for both parties where potential issues of missed deadlines that might occur in the process can be referred to the written specification of the process. Accordingly, the companies’ reliability can remain the same or increase since the company does not have to take the blame of a missed deadline.

Guidelines and evaluation meetings are some of the strategies all the companies use in order to keep their service quality consistent. It is good that the companies’ understand that the mentioned strategies are important to include in their services to avoid heterogeneity in order to see the services from different perspectives which might help them identify where improvements can me made. This since, Allenby et al (2012) argues that heterogeneity provides the companies with a differentiation for product offerings, different niche strategies as well as effective targets in marketing efforts. Company C strategy to keep their services on a consistent level is to always use the same recruiting process for all candidates, regardless of the position. By not discriminating any candidate, this implies in a good relationship and therefore it might be a good strategy. Singh (2008) state that higher quality of relationships leads to a long-term exchange between partners and both of the parties can gain mutual benefits.

5.3 Gap Analysis It was noted that, on an individual level, the companies’ strategy for keeping themselves updated about today’s market is quite similar. Keeping updated is a natural part of all the respondents’ everyday work which indicates that the information is accurate. However, Company B who relies heavily on their network (MRI) for information matters might miss out on accurate information. This since, the information origins from a higher organizational layer, which according to Grönroos (1990) indicates that the management’s perception of quality is not in line with customers’ perception of quality (Gap 1). Having a clear division of responsibility indicates high quality, which is the case of Company C, who was the only company to conduct a national demand analysis. A demand analysis will, according to Grönroos (1990), minimize a gap between managements and customers perception of quality, since if the managements perception of quality is accurate they are more likely to meet

45 customers expectations (Gap 1). A clear division of responsibility can serve as a motivational factor for the company’s employees since every individual’s contribution to the company will be clearer. What was noted concerning the companies’ promotion strategies was that only Company C had a structured process. The company has a team responsible for all the marketing, which indicates that communication campaigns will be in line with what is stated in specifications, since the specifications are only interpreted by the people responsible for the marketing. This implies that the marketing communication will be fulfilled through the actual service delivery, which according to Grönroos (1990) minimizes gaps in the marketing communication (Gap 4). Not having a structured process for promoting services, which is the case of company A and B, might result in insufficient internal marketing since the employees perception of quality might differ (Gap 3). If the management has different perception of quality, it will be difficult to meet the customer perception of quality (Gap 1).

Concerning what criteria the companies take into consideration when employing new staff, it was noted that personality is more important than an academic background. Accordingly, Company A and B stressed the importance of having knowledge about the recruitment industry. It might be assumed that similar experiences among the organizations members indicates similar goals and similar commitment to quality, which according to Grönroos (1990) will provide quality that is in line with specifications (Gap 3). Accordingly, Company C processes for recruitment missions are the same when recruiting internally. Since the company’s process for this purpose is ISO-certified, this implies careful and correct employment of new staff members. Since the recruiting process is implemented in the same way nationally, all managers follow the same quality specification. However the interpretation of the specifications might differ due to different corporate cultures but if the shared perception of quality among managers is fulfilled it will minimize the quality specifications gap (Gap 2). Only Company C had a process for securing their employees competence, which according to Grönroos (1990) is of huge importance in order to minimize gaps in the service delivery (Gap 3). A company that does not provide employee training might lack in having a shared perception of goals among management which result in that manager’s perception of quality is not matching quality specifications (Gap 3). Since Grönroos (1990) state that gaps within the company’s quality specifications occurs due to insufficient support from the management in the planning of service quality, the importance of securing employees competence is vital (Gap 2). It is important to secure the employees competence before hiring them but it’s also important that their competence remains updated in today’s market. The

46 companies that did not provide employee training stressed that it is an individual responsibility to stay updated, which also implies that the company does not have shared perception of goals and the management does not perceive quality as is stated in specifications (Gap 2).

As already stated, only Company C has a process of conducting a demand analysis, which indicates gaps in management’s perception of quality in Company A and B (Gap 1). The lack of demand analysis will complicate the process of securing customer satisfaction, since if a company does not know what the customer wants; it will be difficult to meet their expectations (Gap 1). Company C signs agreements in order to guarantee the customer the delivery of the company’s service and evaluates their services continuously at meetings that are held on a regular basis. Also, the company’s reliability might increase due to agreement accessible to the customer. This structured way of working implies that the company’s perception of quality is in line with the customers’ perception of quality (Gap 1). This can also be strengthened by the fact that the company has compacts with most of the larger companies. Company A stress that customers that are not aware of the company’s business might associate the company with their initial niche, which focused on only students and young graduates. This might affect customer’s perceived expectations of the company’s services. This factor might also cause a gap in the marketing communication since the company’s marketing communication is not in line with their service operations (Gap 4). Both Company B and C stressed that they believe that their customers perceive them as having stable processes. Thus, company B that does not conduct a demand analysis, might lack knowledge about what their customers actually want (Gap 1).

5.4 Self-Service What was noted concerning self-service is that both Company A and C are offering the same type of self-service which is offering potential candidates to through their webpage register and customize their resume in order to receive desired job offerings. This is beneficial for the companies since Oghazi et al (2012) state that companies gain several benefits by offering self-service. It is cost efficient, time-saving and allows the customer’s to control the services themselves, which are benefits that company B miss by not offering self-service. Oghazi et al. (2012) also stress that whether a consumer accepts or rejects a self-service is decided upon the attributes of the self-service. Company A and B that does not conduct any demand analysis,

47 might face difficulties in meeting their customers expectations due to no infer about what attributes of self-service their customers value (Gap 1).

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6. Conclusion and Implications

In this final chapter the final findings of this study will be presented. The collected information will aim to answer our research question concerning the major factors contributing to high quality. Firstly this section presents an overall concluding discussion and thereafter the findings of the chosen service aspects and methods for this research are presented.

6.2 Discussion of the findings As discussed in the literature review, currently the field of service quality within the recruiting industry has not been widely explored yet. This research aims to study how recruitment companies secure quality in their services that will contribute to the already available literature. In order to examine what factors that indicate various quality levels, a model was developed for the purpose of conceptualizing the aspects of services; intangibility and heterogeneity, as well as service quality methods; gap analysis model and self-service. Further, the contribution of the findings to managers and academicians will be presented. Finally, limitations and suggestions for future research will be provided. Concluding remarks from the findings collected from three recruitment companies will be presented in this section. The aim of the discussion of the findings is to answer what factor that indicates various quality levels.

6.2.1 Intangibility Since the customer will experience certain insecurity form services due to the small amount of quality of the information, this research has identified techniques for solving this issue. This research states that right tools and methods are important when analyzing candidates in recruitment companies since this will minimize the risk of an incorrect recruitment when analyzing new potential candidates. Right tools and methods refers to structured process which looks the same regardless of what position the recruitment concerns and in what geographical area it is conducted. By doing this, in order to deliver the customer’s desired request, it was also found that service quality is secured through well-elaborated processes. Since intangibility makes it difficult for customers to determine what they should expect, having well-elaborated processes will decrease their insecurity. This study could determine that quality can be guaranteed with an ISO 9001 & 14001 certification. Applying the stated

49 standards of the ISO certification will increase the companies’ reliability due to the opportunity of having the warranty documented for the customers.

6.2.2 Heterogeneity Since inconsistency in services is unavoidable each service should be considered to be unique since customers re-evaluate the quality criteria of services each time. This research states that in order to minimize inconsistencies in service quality, recruitment companies need to adjust their services to customer’s needs and requests. In order for recruitment companies to provide high service quality they need to provide their customer with written specification of their missions. This in order to minimize the potential issues that arise from missed deadlines, which the companies currently fault the customers for. Due to the intangibility of services, having a tangible specification will increase the reliability of the companies. It was also found that companies need to have evaluation meetings and specific guidelines to keep the quality of their services consistent. Results showed that recruiting companies increase the quality in their services by carrying out the same recruiting process for every candidate, regardless the position. The results showed that services need to be considered from different perspectives through evaluation meetings.

6.2.3 Gap Analysis Further, this study could determine that in order for recruitment companies to secure accurate information to keep them updated, they should not rely on external factors such as networks for this purpose. It was also found that recruitment companies’ employees should have clear responsibility of the marketing, in order for the information to not be interpreted and inconsistent with recruitment companies promises. Accordingly, this study could determine that recruitment companies need to be clear in the marketing communication in order to deliver their actual intentioned services. Results showed that in order to prevent quality gaps in recruitment companies’ services, they should require new staff members to have knowledge about the industry since it indicates that same experience will imply shared perception of quality. It was also found that recruitment companies need to offer their employees training for them to remain their competences since this will imply that the employees are sharing the same goal within the recruitment company. This research also stated that continuous evaluation meetings should be held and demand analysis should be conducted in order to prevent gaps in recruitment companies’ services.

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6.5 Self-Service Results showed that recruitment companies increase quality in their services if they offer their customers self-service through their webpage. The customer’s should have the ability to customize their resume through the webpage to match their desired job offerings. It was also found that in order for recruitment companies to increase the quality of their services with self-service, they need to have a clear perception of what attributes that should be included in the customer’s self-service to keep the self-service offering from being an obstacle.

6.6 Implications for Managers Managers need to review their current recruiting processes and improve them continuously to minimize the risk of wrong recruitment of their candidates. Managers should implement sub- goals that in order to follow-up the quality of their processes. They should also implement statistics of both correct and incorrect recruitments as a part of their strategy for increasing the quality of their recruitment processes, whereas they can have the ability to review the results and identified reasons behind them. When the statistics are not in line with the recruitment companies’ sub-goals, the material can be used for future improvements. This study argued that since the perception of quality differs among customers and recruitment companies, managers should adjust their services to customer’s request in order to keep the quality consistent. Since the recruitment companies’ service package is rather finalized, it does not necessarily need to be an issue, on the other hand it does not ensure that they are in line with the customer’s perception of quality either. Therefore managers should adjust their services to customer’s request. The results of this thesis also showed that a successful strategy for keeping the quality of the recruitment companies’ services consistent is to have continuous meetings and clear guidelines. Managers should encourage the employees to work in accordance with the same guidelines in order to ensure that the recruitment company strives for the same goal. Managers should carry out the same recruiting process for every candidate, regardless the position in order to keep the quality of the recruitment companies’ services consistent. A suggestion for managers would be to implement this strategy into their company, since it will facilitate the evaluation and comparison of their missions, which will result in consistent services. By evaluation services, obstacles can be identified which can provide managers with solutions for improving their services. Managers should have clear

51 division of responsibility for their employees to ensure that information is both accurate and not misinterpreted to keep the recruitment companies’ services consistent. For this purpose managers should avoid to outsource the responsibility of acquiring information. In accordance, this strategy should be applied by managers for the purpose of securing the companies promises through marketing. If the managers have clear descriptions of their responsibilities, the information will be secured. The result of this thesis showed that when recruitment companies expand internally, managers should require new employees to have knowledge as well as experience from the recruitment industry, in order to prevent gaps in services quality. If these requirements are fulfilled, the risk of different interpretation of quality among employers can be avoided. In this competitive and developing industry, managers should ensure their employees competence by offering them training. A suggestion is that the training is adjusted to every individual’s position in the recruitment company. Accordingly, the training should ensure the employees understanding of striving for the recruitment company’s shared goal. In order for managers to secure quality in recruitment companies, a demand analysis should be conducted. This will contribute to a shared perception of quality among the customer’s and the service provider. This study argued that recruitment companies should offer self-service to their customer’s. Accordingly, it is manager’s responsibility to make sure that the attributes of self-service are not an obstacle for the customer but rather is in line with the customer’s desire. A suggestion could be to offer the customer’s the ability to customize their resume in accordance with their desired job.

6.7 Implications for Academicians The contribution has created knowledge about two important aspects of services; intangibility and heterogeneity in combination with the methods; gap analysis developed by Grönroos (1990) and self-service developed by Oghazi et al (2012). The chosen literature of this research has, through the empirical investigation, been confirmed to be valid. The aspects of services, intangibility and heterogeneity were stressed to be obstacles of achieving quality, which could be proven through this study. The qualitative approach contributed to a deeper insight of the chosen subject through in-depth interviews which would not have been possible with a quantitative approach. The initial gap analysis model was based on a research from four different industries; securities brokerage, retail banking, credit card and product repair and maintenance. However, in this research this model was applied for the recruitment industry and has been proven to be applicable in the field of service quality. Accordingly the

52 model ahs been proven to be a suitable model for identifying gaps in service quality. Finally, self-service which is another method included in the literature has also been confirmed to be a valid method for answering our research question. Since previous research has emphasized on the business-to-consumer approach, this research has through the service aspects and service quality methods shed light to the business-to-business industry in the field of service quality.

6.8 Limitations & Future Research The theoretical foundation and research approaches of this research were chosen for the purpose of avoiding possible weaknesses that would prevent the research from reaching the desired purpose. Although, the limitations that were unavoidable will be highlighted in this section. Previous research within the field of service quality has emphasized on investigating a business-to-consumer approach. However this research has brought contribution to the literature by investigating service quality from a business-to-business perspective. Firstly, the chosen theoretical foundation builds upon reliable and frequently cited literature for this subject, however the year of the publications has been concerned as limitations for this study. The majority of the frequently used articles are more than 10 years old. For future research, it would be interesting to see if the results would differ due to a more updated literature. This research has not included gap five in Grönroos (1990) Gap Anslysis Model which considers the customers perspective of service quality but has only focused on the companies’ perspective. This research has, in accordance with the companies’ perspective, provided suitable tools for securing service quality. It would be interesting to investigate the customers’ perspective in order to create knowledge about their perception of service quality. A suggestion would be to provide a comparison between our study and the suggested future study. Accordingly, since this research was limited to a business-to-business approach, in the recruitment industry, it would be interesting to investigate another industry within business- to-business or the approach of business-to-consumer.Since this study has excluded Parasuraman et al (1985) SERVQUAL model which it suitable for measuring service quality, a suggestion for further studies would be to include the model in a business-to-business approach. Since this research was delimited to a qualitative approach with in-depth interviews for identifying factors contributing to high quality, future research could include a quantitative approach with questionnaires and surveys. This would provide results from a broader perspective since this study was delimited to three recruitment companies with two respondents from each company. However if future researcher still desires to acquire a deeper

53 insight of the service quality, which can only be accomplished through a qualitative study, more companies and respondents could be included. Accordingly, since this study has not included perspectives from different organizational layers, this would be suggested for a future study. This study has not been delimited to companies with a certain size but is rather a mixture; therefore it would be interesting to only emphasize on small-, medium or large- size companies.

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Appendix 1

1.1 Intangibility:  From your experience, what is the greatest challenge of the company’s services?  What is your strategy for securing quality in your services? (For example products have quality control tests) What methods and resources are reserved for this purpose?

1.2 Heterogeneity:  What factors contribute to the design and structure of your services?  How does the evaluation process look like? How do you improve your services?  Have you always managed to deliver your services in time?  How do you manage to keep the quality of your services on a consistent level?

1.3 Gap analysis:  What is your strategy for staying updated in today’s market?  How do you promote your services?  What criteria are taken into consideration when you employ new staff to your company?  Does the company have a process for the purpose of securing the employers competence?  How do you secure customer satisfaction? What methods and resources are reserved for this purpose?  How do you think the customer’s perceive your services?

1.4 Self-service  Is self- service included in your offering? (For example website or customer service)

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Appendix 2

Interview questions

1. What is your strategy for keeping updated about today’s market?

3. How do you promote your services?

4. How do you think the customer’s perceive your services?

5. Is self- service included in your offering? (For example website or customer service)

6. What factors contribute to the design and structure of your services?

7. What is your strategy for securing quality in your services? (For example products have quality control tests) - What methods and resources are reserved for this purpose?

8. From your experience, what is the greatest challenge of the company’s services?

9. Have you always managed to deliver your services in time?

10. How do you manage to keep the quality of your services on a consistent level?

11. How do you secure customer satisfaction? What methods and resources are reserved for this purpose?

12. How does the evaluation process look like? How do you improve your services?

13. What criteria are taken into consideration when you employ new staff to your company?

14. Does the company have a process for the purpose of securing the employers competence?

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Linnaeus University – a firm focus on quality and competence

On 1 January 2010 Växjö University and the University of Kalmar merged to form Linnaeus University. This new university is the product of a will to improve the quality, enhance the appeal and boost the development potential of teaching and research, at the same time as it plays a prominent role in working closely together with local society. Linnaeus University offers an attractive knowledge environment characterised by high quality and a competitive portfolio of skills.

Linnaeus University is a modern, international university with the emphasis on the desire for knowledge, creative thinking and practical innovations. For us, the focus is on proximity to our students, but also on the world around us and the future ahead.

Linnæus University SE-391 82 Kalmar/SE-351 95 Växjö Telephone +46 772-28 80 00

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