CHAPTER 1 INTRODUCTION 1 INTRODUCTION 1.1 Executive summary of the research 1.1.1 Focus and Justification for the Study This study is an in-depth empirical investigation that seeks to compare consumer expectations to perceptions in the delivery of service within MSRTCs in the Ahmednagar District. It has its aim to develop a useful instrument to evaluate service quality by comparing consumer expectations to their perceptions of delivered service. An additional purpose is to determine MSRTC Depot managers' ability to predict consumer expectations in the area of service delivery. The theoretical portion of the study focused upon a review of the history of Public Road transportation industry in India, Maharashtra and its Ahmednagar district, which is uniquely different from the Public road transportation systems of other states. The literature was also examined to review service quality and customer satisfaction. In order to examine methods to predict service quality in MSRTC, an investigation was carried out among consumers of MSRTC from Fourteen Tehsils of the Ahmednagar district of Maharashtra. The collection of the data was driven by six research hypotheses and involved two questionnaires. One questionnaire asks for customer expectations versus perceptions. A second questionnaire required the Depot managers of MSRTC to state their perceptions of what their consumers expected in the way of service delivery. The main findings of the research built upon and extended the research by various researchers which noted that the three prime components of customer satisfaction revolved aroxmd three specific antecedents—^perceived quality, perceived value, and customer expectations, the study strongly reinforced and confirmed the importance of the three antecedents. This study indicated that while expectations are very high, perceptions are also high, but not as high as expectations. This study concluded that service quality was the most important factor in the selection of a MSRTC in the Ahmednagar district of Maharashtra. With no specific literature relating specifically to MSRTCs' perceptions of service delivery expectations by consumers, one of the most significant findings in this study noted that 77.3 percent of the responses to the questions indicated a match of MSRTCs' perceptions with consumers' expectations. While outcomes indicated that perceptions were equal to or greater than expectations, this does not conclusively prove that satisfactory service quality will tend to be associated with outcomes equal to or above expectations. This could indicate that the customers did not expect much in the way of outstanding service. Based upon results obtained from surveys, there appears to be a high likelihood that a MSRTC could reasonably predict the retention of customers using the overlaid plots that in this study show high expectations and high perceptions. However, this study could not conclusively substantiate that gender, income, and education impact service quality in MSRTC. Given the limited amount of literature relating to the delivery of service quality by Public road transport operators in India , this study provides both researchers and practitioners an empirical study of both consumers' and MSRTCs' expectations and perceptions of service delivery, which had not been fully explored in the past. 1.1.2 Research Aims and Objectives The unique nature of the study revolves around customer expectations and perceptions of service quality in the delivery of Transport services by MSRTC, The aim of this study was to advance academic knowledge in an area that has had limited empirical study-customer expectations versus customer perceptions giving additional support to group discrimination. Research problem The research was undertaken to study the service quality of MSRTC in Ahmednagar district. The i-esearcher tried to find answer to following research questions. 1. Whether selection of MSRTC by customer was strongly influenced by service quality. 2. Whether service quality was more important in the selection process than location, advertising, recommendation of others and fare. 3. What are the expectations of the customers from MSRTC? 4. What are the perceptions of the customers about performance of MSRTC? 5. What are the perceptions of MSRTC about the expectations of the customers? 6. What are the factors which affects selection of MSRTC? 7. Whether Differences in gender, age, income, and education would have a significant impact on service quality perceptions and service quality expectations. Objectives of the Research 1. To study whether selection of MSRTC by customer was strongly influenced by service quality. 2. To study whether service quality was more important in the selection process than location, advertising, recommendation of others and fare. 3. To study Customer's Expectations from MSRTC in Ahmednagar district. 4. To study Customers' Perception about performance of MSRTC in Ahmednagar district. 5. To study MSRTC's perceptions of customers' expectations. 6. To determine if satisfactory service quality would tend to be associated with outcomes equal to or above customer expectations. 7. To study impact of differences in gender, age, income, and education service quality perceptions and service quality expectations. 8. To study Performance of MSRTC in Ahmednagar district. Scope of the Research a) The scope of the research covers the entire Ahmednagar district having 14 tehsils. b) The scope of the research covers customers of MSRTC from Ahmednagar district. c) The scope of the research covers Depot managers and stand in charge of MSRTC from Ahmednagar division. d) The scope of the research covers measuring service quality of MSRTC using SERVQUAL model developed by Parasuraman et al. e) Scope of MSRTC Ahmednagar division performance analysis was related to only following parameters. 4 Schedule operated Effective kms. !n lakhs: Earnings (traffic) in lakhs Rs. Load factor (%) : Earnings per kilometer in paisa. (EPKM in ps.) ; Cost per kilometer in paisa (CPKM in ps.); Margin (+)/!oss (-) per kilometer in paisa (Margin/km ps.) ; .Rate of breakdown per 10.000 kilometers ; Rate of accidents per lakh kilometers ; Cancelled kilometers in lakhs : Average bus-staff ratio. ; Average off road vehicles 1.1.3 Research Design and Methodology Tvpc of research: Exploratory and Descriptive Research -..' . 'i; Data used for research: , >' Primary and secondary data Data collection method: Field research -Cross sectional Sample survey, observation and desk research. Sources for data collection: Primary data was collected from MSRTC passengers and MSRTC Depot managers/Stand in charges. Secondary data was collected from Books .journals. MSRTC website. MSRTC Divisional office, MSRTC Central oftlce. MSR'fC Passengers associations, Ahmednagar District official website. Central Institute of Road fransport. Pune, Central Training institute ,MSR'1C. Pune, ASRTLf Delhi. Sampling technique: Stratified random sampling technique was used . Research instrument used: Modified SERVQUAL questionnaire is used Statistical tools used for Data analysis: SPSS 16 software, labulatioii. Graphs, Charts and figures are used for analysis of data. Statistical tests used: Percentage, frequency, mean, standard deviation, paired sample t teat, spearman correlation coefficient, anova tests are used for analysis oi'data. Sampling Design: The research sample consists of MSRTC passengers from fourteen tehsils of Ahmednagar district. Total 546 Passengers travelling from MSRTC Buses were surveyed .A list of the Tehsils and MSRTC Depots are set out in Appendix 1, Total fifteen Depot managers of MSRTC Depots from each of the tehsils were asked to complete the MSRTC's questionnaire, and return it directly to the researcher. The resulting research sample represented fourteen tehsils with response of 100 percent. 1.1.4 Structure of the Study. The study was organized into a total of seven chapters to order the study to sequentially flow to conclusion. Chapter 1 It has its main thrust to set the scenes of the study. First, it informs the audience about the focus, value, and justification for the study, and secondly, it focused on the extensive lack of knowledge on predicting customer retention as a result of service quality. Third, it specified the reasons why the study focused on MSRTC in the Ahmednagar district of Maharashtra, India. Fourth, it presented the aim of the study and the research objectives, and concluded by giving an overview of the remaining chapters of the studyr— Chapter 2 It is dedicated to a review of the literature in the area of customer satisfaction with a three-fold aim of examining and exposing customer loyalty, customer retention, and customer relationship management. First a discussion of the evolution of the literature on customer satisfaction mih its primary elements—customer loyalty, customer retention, and customer relationships was presented. Finally, the chapter concludes by providing concepts that indicate the interrelationships of customer loyalty, customer retention, and customer relationship management and how they impact the customer satisfaction aspects of service quality. The chapter concludes by focusing on the conceptual framework of the study and a summary of the research issues. Chapter 3 Upon completion of the review of the literature, the study sought a direction for the research methodology. Most of the literature related to non-Public road transportation in the study of service quality. There were no publicly available standard scales