Birhane Gebre Dibaba

Assessment on Service Quality in Commercial
Bank of Ethiopia: Emphasis on Customers’

Accounts and Transaction Service
A Thesis submitted to St. Mary’s University Graduate

Studies Programin partial fulfillment of the
Requirements for the Award of Masters of Business
Administration Degree in Human Resource
Management
Prepared by: BirhaneGebre

SGS/0664/2008A
Advisor: Ato Simon Tareke
(Assistant Professor)
St. Mary’s University

June, 2017
Addis Ababa, Ethiopia
Assessment on Service Quality in Commercial
Bank of Ethiopia: Emphasis on Customers’
Accounts and Transaction Service
BY
BirhaneGebre
SGS\0664\2008A
A Thesis submitted to St. Mary’s University Graduate

Studies Programin partial fulfillment of the
Requirements for the Award of Masters of Business
Administration Degree in Human Resource
Management
June2017
Addis Ababa Ethiopia

Approved by Board of Examiners
St. Mary’s University
School of graduate studies
Department of Human Resource Management
Assessment on Service Quality in Commercial Bank of

Ethiopia: Emphasis on Customers’ Accounts and
Transaction Service
By
BirhaneGebre
Dean, Graduate Studies Signature Date
_______________________ _________ _______
Thesis Advisor Signature Date
_______________________ _________ _______
Internal Examiner Signature Date
_____________________ ________ _______
External Examiner Signature Date
______________________ ________ _______

ENDORESEMENT
This thesis has been submitted to S.T Mary’s University, School of Graduate
studies for examination with my approval as University advisor.
Ato Simon Tareke (Asst .Professor) ----------------------------

Signature
St.Mary’s University. AddisAbaba ---------------------------

Date
Declaration
I, BirhaneGebre; hereby declare that this research paper entitled “Assessment
on service quality in commercial bank of Ethiopia: emphasis on
customers’ accounts and transaction service” is my original work and has
not been submitted for award of any degree or diploma program in this or in
any other institution. I also declare that I have fully acknowledged all the
sources used.
Declared by
Birhane Gebre Date Signature
___________ __________
Confirmed by
Ato Simon Tareke Date Signature
(Asst. Professor)
____________ __________
Acknowledgement
First and foremost, I would like to give my glory and praise to the Almighty
GOD for his invaluable cares and supports throughout my life.
Next I am greatly grateful to my Advisor Ato. Simon Tareke (Asst. Professor)

who has been very patient and supportive of my work. Without his comments
and advice this research would have not been possible. At the last, I would like
to thank the staffs and customers of CBE who participated in the study and
forwarded their frank response to the questionnaires.
i
Table of Content
Acknowledgement ............................................................................................................................... i
Table of Content...................................................................................................................................... ii
List of Tables ...................................................................................................................................... iv
Abbreviations and Acronyms .......................................................................................................... v
List of Appendices............................................................................................................................. vi
Abstract .............................................................................................................................................. vii
CHAPTER ONE ................................................................................................................................... 1
1. INTROUCTION ........................................................................................................................ 1
1.1. Background of the study .............................................................................................. 1
1.2. Background of the organization (CBE) ...................................................................... 2
1.3. Statement of the problem ............................................................................................. 4
1.4. Objectives of the study .................................................................................................. 6
1.4.1. General objective ..................................................................................................... 6
1.4.2. The specific objectives are to: .............................................................................. 6
1.5. Significance of the study............................................................................................... 6
1.6. Scope of the study .......................................................................................................... 6
1.7. Limitation of the study .................................................................................................. 6
1.8. Organization of the Study ............................................................................................ 7
CHAPTER TWO .................................................................................................................................. 8
2. LITERATURE REVIEW .......................................................................................................... 8
2.1. Introduction ..................................................................................................................... 8
2.2. What is Service?.............................................................................................................. 8
2.3. What is Quality? ............................................................................................................. 9
2.4. Service Quality ................................................................................................................ 9
2.5. Dimensions of Service Quality .................................................................................... 9
2.5.1. Determinants of service quality ...................................................................... 11
2.6. Factors Considering for the study ............................................................................ 12
2.7. Service excellence ......................................................................................................... 16
2.8. Managing Service Quality and its Effectiveness ................................................... 17
2.9. Customer Service Delivery in the Banking Industry ........................................... 17
2.10. Conceptual Framework ........................................................................................... 19
CHAPTER THREE ............................................................................................................................ 21
3. Research methodology .............................................................................................................. 21
3.1. Introduction ................................................................................................................... 21
3.2. Research Design ........................................................................................................... 21
3.3. Sampling Technique .................................................................................................... 21
3.4. Sampling Frame ............................................................................................................ 21
3.5. Sample Size .................................................................................................................... 21
3.6. Data Source and Types ............................................................................................... 22
3.6.1. Validity and Reliability Evaluation ................................................................... 22
3.7. Response rate ................................................................................................................ 23
3.8. Data analysis ................................................................................................................. 23
CHAPTER FOUR .............................................................................................................................. 24
4. DATA PRESENTATION AND ANALYSIS .......................................................................... 24
4.1. Data Analysis of Employees’ Response ................................................................... 24
4.2. Data Analysis of Customers’ Response ................................................................... 34
CHAPTER FIVE ................................................................................................................................ 42
5. SUMMARY OF FINDINGS, CONCLUSION, AND RECOMMENDATION .......................................... 42
5.1. Findings .......................................................................................................................... 42
5.1.1. Findings from Employees’ Response ................................................................ 42
5.1.2. Findings from Customers’ Response ............................................................... 43
5.2. Conclusion ..................................................................................................................... 44
5.3. Recommendations ........................................................................................................ 44
References ......................................................................................................................................... 46
List of Tables
Table 1. Staff Respondents General Information………………………………………………………………24
Table 2. Staff Training………………………………………………………………………………………………………25
Table 3. Staff Communication…………………………………………………………………………………………..27
Table 4. Materials and office facilities………………………………………………………………………………28
Table 5. Performance management system of the Bank…………………………………..………………30
Table 6. Delegation of authority………………………………………………………………………………………..32
Table 7. Employee attitude towards customers………………………………………………………………..33
Table 8. Customer Respondents General Information………………………………………………………34
Table 9. Reliability…………………………………………………………………………………………………………….35
Table 10. Responsiveness………………………………………………………………………………………………….36
Table 11. Assurance………………………………………………………………………………………………………….37
Table 12. Empathy…………………………………………………………………………………………………………….38
Table 13. Tangibles…………………………………………………………………………………………………………..39
Abbreviations and Acronyms
CBE: - Commercial Bank of Ethiopia
CATS: - Customers’ Account and Transaction Service
SERVQUAL: - Service Quality
PM: - Performance Management
PMS: - Performance Management System
ICT: - Information Communication Technology
BPR: - Business Process Re-engineering
BSC: - Balanced Scored Card
E-Banking: - Electronics Banking
POS: - Point of Sales
SPSS: - Statistical package for social science

List of Appendices
Appendix I: - Questionnaire for Employees of CBE
Appendix II: - Questionnaire for Customers of CBE in English
Appendix III: - Questionnaire for Customers of CBE in Amharic

Abstract
In this era of intense competition, one of the key challenges that organizations
face is how to manage quality service which is a prerequisite for customer
satisfaction. As a result of improved information communication technology,
customers have become well informed, discerning and value sensitive.
Understanding the need, wants and desires of customers and demonstrated
ability to satisfy them efficiently is imperative for success in the market place. To
this end, this research paper aimed to evaluates the service quality in
Commercial Bank of Ethiopia emphasizing on Customers’ Accounts and
Transaction Service. The research has adopted a descriptive research design
approach. Data were gathered from employees and customers of the bank
through close and open ended personally administer questionnaires. Employees
and customers of CBE were targeted in this study. Multi stage cluster and simple
random sampling strategies were used for choosing the respondents of the
study. 250 employees and 150 customers took part in the study. The information
obtained from the respondents was analyzed using descriptive statistics. The
research has significant implications for branches and for CBE in general, in
terms of developing operational, marketing and human resource strategies, and
can help CBE to incorporate service quality issues in to their strategies planning.
The study may be useful for private commercial banks with a similar banking
culture of CBE.The findings of this study were:- lack of training on the bank’s
new products and service delivery, improper office arrangement to deliver
service, shortage of the necessary working equipment and materials, problem on
the allocation of physical facilities, lack of technologically up-to-date physical
facilities, lack of performance management system, lack of employees complaint
handling system and lack of recognition for employees who do best job in serving
customers.
Key word:Quality Service (SERVQUAL), Commercial Bank of Ethiopia (CBE),

Customer accounts and transaction service (CATS).
CHAPTER ONE
1. INTROUCTION
1.1. Background of the study
The banking industry is an indispensable financial service sector supporting
development plans through channeling funds for productive purpose,
intermediating flow of funds from surplus to deficit units and supporting for
the implementation financial and economic police of the government (Sandeep
and Parul, 2012).
The industry is facing a rapidly changing market, new technologies, economic

uncertainties, fierce competition, and more demanding customers, and these
has presented an unprecedented set of challenges. Titko and Lace (2010)
accentuate that the competitive power and survival of a bank lies in the degree
of delivering quality service to satisfy their customers. While delivering services
in the development nations banks face some challenges which includes poor
data base management of customers, lack of adequate infrastructure and
technology on which customer service quality depends on employees awareness
on the impact of service quality in organizational performance,. On the other
hand, customers form service expectations from many sources, such as past
experiences, word of mouth, and advertising and try to compare the perceived
service with the expected service. (P. Kotler, 2012). Whenever a gap exists
between the perceived service and the expected service another challenges will
emanate.
Perceived service quality determinants tend to play an important role in high

skill and technology-involving industry like banking service. There is no doubt
that development of technology has increased customers’ expectations to
receive quality and on time services. In other words, as bank services become
more and more “high tech”, their technical services become standardized,
reducing the importance of such services as differentiating factors; thus
customers will evaluate banks based on their “high touch” factors than their
“high tech” factors. In view of this, delivering quality service to customers is a
must for success and survival in today’s competitive banking environment
(Samit and Frohlich, 2009).
One of the most useful measurements of service quality is the dimensions from
the SERVQUAL model. The SERVQUAL scale which is also known as the gap
model by Parasuraman, et al. (1988) has been proven to be one of the best
ways to measure the quality of services provided to customers and to measure
the differences between customers’ perception and expectation associated with
1
the service quality.This service evaluation method has been proven consistent
and reliable by some authors (Brown et al., 1993) They held that, when
perceived or experienced service is less than the expected service; it implies
less than satisfactory service quality; and when perceived service is more than
expected service, the obvious inference is that service quality is more than
satisfactory (Jain et al., 2004).According to Parasuraman, et al (1988) the
refined SERVQUAL model incorporates five determinants of service quality
these are Reliability, Responsiveness, Assurance, Empathy and Tangibles.
Commercial Bank of Ethiopia (CBE) accounts a major portion of financial

intermediation and is acknowledge as main vehicle for monetary policy signals,
credit channel and facilitator for payment systems. It is expected to deliver high
quality financial services/products to contribute to the growth of GDP of the
country through stimulating trade and commerce, accelerating the pace of
industrialization, boosting up export, creating employment opportunity for the
educated youth, poverty alleviation, raising living standard of limited income
group and overall sustainable socio-economic development of the country.
As the success of today’s competing organizations have dependency on their

delivering quality service for their customers. CBE has established service
excellence as its major strategic variable. An increasingly innovative and
aggressive financial service through different banking channels together with a
variety of products forced it moving toward customer oriented strategies,
through the application of technologies such as CORE banking, automated
teller machines (ATMs), mobile banking, an internet banking which intern help
the bank to improve its efficiency of operating process and increases the
opportunity for delivering quality service.(Commercial Bank of Ethiopia,
2014/15). However, as an employee of the bank the researcher observed some
problems on service quality of the bank such as lack of adequate equipment,
system failure (it may be internal or external), customer complaints, etc.
Thus, this research tried to identify major challenges of delivering quality

service from the employee perspective and assessed how customers evaluate
the service quality of the Bank.
1.2. Background of the organization (CBE)

The commercial bank of Ethiopia (CBE) was incorporated as a share company
on December 16, 1963 per proclamation No. 207-1955 to take over the
commercial banking activities of the former state Bank of Ethiopia. Under this
name, it began operation on January 1, 1964, with a capital; of Eth. Birr
20,000,000. The bank was wholly owned by the state and operated as an
autonomous institution under the commercial code of Ethiopia. CBE is striving
to become a world class commercial bank by the year 2025, through rendering
2
reliable services to its millions of customers, both at home and abroad. The
business strategies of the bank focuses on the interest of the public it serves.
Currently the bank has one head office in Addis Ababa and 15 district offices
with more than 1160 branches stretched across the country and abroad.
At the end of fiscal year 2014/15, the total assets of the bank stood at Birr 305
billion, while total deposits and other liabilities reached Birr 291.7 billion (CBE
annual report, 2015/16). Itsstrong capital base, rich experience in the market
and wide branch network throughout the country have enabled the bank to
accommodate the large demands for its services, and increase its overall
revenue on sustainable basis.
Thus; these makes the state owned CBE still dominates the market in terms of
assets, deposits, capital, and branch network, despite the growing competition
from private banks over the last 15 years. This makes it one of the most
reliable and strong commercial banks in the country.
Some of the products that the Commercial Bank of Ethiopia provides are:-
 Depositing customers’ financial and non- financial assets.

 Facilitating fixed time deposit and demand deposit.
 Foreign and local money transfer.
 Foreign transaction and exchange of currency.
 Availing credit facility.
 Interest free banking, mobile banking, and internet banking.
 Teen and youth saving.
 Rendering ATM services etc.
Vision, Mission and Values of CBE
Vision
To become a World-Class commercial bank by the year 2025
Mission
We are committed to best realize stakeholders’ needs through enhanced

financial intermediation globally and supporting national development
priorities, by deploying highly motivated, skilled and disciplined employees as
well as state of the art technology. We strongly believe that winning the public
confidence is the basis of our success.
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Values
 Corporate Citizenship
 Customer Satisfaction
 Quality service
 Innovation
 Teamwork
 Integrity
 Employees satisfaction
 Public confidence (CBE Annual report, 2014/15)
1.3. Statement of the problem

Many business companies in our country are engaged in providing services to
the public, usually the same service is being provided by different
organizations. These days, customer has many choices to satisfy him/her when
he/she needs, if a customer doesn’t feel comfortable with the service provide,
he/she can go other service provider. Due to this, service provider should
control and evaluate their service quality to increase customer perceptions and
keep their profitability.
Since customer is a base for profitability and grows of the business, a company
must keep and improve its service quality. If organizations fail to serve and
satisfy their customers they will lose their profit as well as business.
In our country the banking industry is slow-growing in many aspects such as

in number, in financial strength, in kind of services and application of
technology. Poor quality service is one of the major factors for the failure of
many financial institutions and service organizations. Mostly, customer’s
dissatisfaction is related to poor quality services that can result poor
organization image. When CBE providing service it should be realize that the
bank’s vision which being a world class commercial bank at 2025. One of the
important strategies to meet this vision is to excel/meet the ever increasing
need and wants of customer to enhance their good perception. (Commercial
Bank of Ethiopia, 2014/15)
4
It is difficult to find today a bank that doesn’t initiate some kind of service
quality improvement programs. Also, CBE is still struggling to improve and
keep its service quality towards increase customer positive perceptions by
providing and implementing like change tools (BPR and BSC), modern banking
systems (core banking systems, E-Banking, Mobile Bankingand Internet
Banking) and technological instruments (ATM,POS) and other many banking
services tools. However, there are some problems and difficulties observed on
its service quality.
Presently CBE is benchmarked and ranked based on its size of capital, deposit,
branch network, volume of credit, accessibility, use of skilled man power and
technology, turnover and profit. All these are quantitative financial indices.
However these indices do not in any way shield light on the quality of service
delivered to customers and effect on customer satisfaction. There are situations
where account holders of CBE attempted to withdraw cash via ATM (automatic
teller machine) but the machine didn’t distribute the requested amount of cash
due to system failure, yet their accounts are debited, longer waiting time for
transaction processing and requests, lack fast and effective complaints
resolution. Poor service delivery often led to disagreement and conflict between
banks and their customers (Ebiringa, 2011). In this study the researcher tried
to identify critical factors that hamper delivering quality service and assessed
how customers evaluate the service quality of CBE.
Therefore to fill this gap, this study raises the following research questions;
 What do employees of CBE perceives as key elements for delivering

quality service?
 What factors affect the service delivery of CBE in its CATS process?
 How do customers evaluate the service quality of CBE?
5
1.4. Objectives of the study
1.4.1. General objective

The general objective of this study is to evaluate service quality in the case of
CBE: emphasis on customer accountsandtransaction service.
1.4.2. The specific objectives are to:

 To evaluate service quality from employees’ perspectives in CBE
 To identify factors affecting service delivery of CBE
 To assess how customers evaluate the service quality of CBE
1.5. Significance of the study

The findings of the study can have the following importance to CBE
 The findings can help CBE management to take appropriate action for
the factors of delivering quality service for the customers.
 A research like this is essential to assess and improve service delivery
because it will provide management with data that they can use in
making inferences about the customers.
 Findings can also help for the realization of service excellence which is
the strategic pillar of the bank by improving the service quality.
 It helps as a source document and as a stepping stone for those
researchers who want to make further study on the area afterwards.
1.6. Scope of the study

Any service providing organization wants to know how customers evaluate their
services and needs to identify factors of delivering quality service for
improvement. However, demarcating this research serves the purpose of
making the research topic manageable from a research point of view. Thus, the
research focused on CBE emphasizing on customers’ Account and Transaction
Service (CATS). Moreover, taking into account the time available, and the size
of the Bank; the research is delimited to focus on Branches found in South
Addis Ababa District.
1.7. Limitation of the study

Every research is limited by the constraints on the researcher, and this study
is of no exception. The limitations of this research are:
 The sample study had been restricted to some selected branches of

South Addis Ababa District of CBE; thus; only 150 customer
6
respondents and 250 employee respondents were selected as a sample
from the targeted population of CBE customers and 2204employees of
the bank who are working in branches of South Addis Ababa District, so
generalization of the findings of this research are limited to CBE.
 Some respondents were not cooperative to respond for the questionnaire
openly and timely.
1.8. Organization of the Study

The research was organized in five chapters. Accordingly, the first chapter
deals with the introductory part which comprises of background of the study,
statement of the problem, objectives of the study, significance, scope and
limitation of the study. The second chapter discussed the details of related
literatures which can serve as theoretical framework for the research. Research
methodology, data source and types, validity and reliability of the study, the
response rate and method of data analysis are part of the third chapter.
Chapter four focused on data presentation and analysis, and finally the last
chapter includes research findings, conclusions and recommendations
forwarded.
7
CHAPTER TWO
2. LITERATURE REVIEW
2.1. Introduction
Most bankers would like to believe that banks are in the financial industry,
and not in the service industry. Thus they tend to compete in terms of financial
powers rather than service quality. Bank management most often focus more
on assets and liabilities rather than service delivery and customers’
satisfaction. In some the operational systems adopted by banks are structured
to control sequence of service than managing the quality of the delivered effect
on customers’ satisfaction. Evidence available also shows that in most
commercial bank back end service /complain desk are operated by junior
inexperienced staff or even contract workers. It must be noted the life-blood of
any business is its customers. Revenue and profit are ends, while service
delivery and customers’ satisfaction are the means to an end. In effect,
financial sustainability of any business is dependent on continuous
satisfaction of customers over the service delivery by the firm (Ebiringa, 2011).
Commercial banks have to maintain good image, reputation, and credibility in
order to be competitive in the business of financial service delivery. Thus,
Customers’ service has become a pivotal issue in formulating business
strategies. In the changing socio-cultural milieu; banks as service providers
have aptly realized the necessity for extending appropriate services to the end
users from time to time. Parasuraman et al. (1990) opine that service quality is
the function of “customers’ expectation” and “service providers’ performance”.
Customer’ service is vital function in any walk of life and especially so in
business and service organizations like banks. In banks, the role of the
customer service needs to be emphasized as it is what banking is all about.
Continuous improvement, gaining the competitive edge, increased market
share and higher profits are not possible unless business can find new ways of
maintaining the loyalty of the existing customer. Further, superior customers’
services would facilitate achieving service excellence. In the banking sector the
quality of service is turning out as an important differentiator among the rivals.
2.2. What is Service?

Kotler P; (2003) defines service as work carried out for others by an
organization where no transfer of goods is involved. It consists of social
processes that involve a physical or informational interaction between a service
provider and a client (user), the interaction of client and employees really lies at
the heart of most service system.
8
An author defines as any intangible act or performance that one party offers to
another that does not result in the ownership of anything (Kotler & Keller,
2009).
2.3. What is Quality?

Donald Water (2002) defines quality as the ability of a product or service to
meet and preferably exceeds customer expectation.
Kotler(2003) also defines quality as “the totality of features and characteristics

of a product or service, which bear up on its ability to satisfy stated and
implied needs. The quality of services can be particularly difficult to measure
as it relies more on the subjective opinions of customers. But among other
things, it is dominated by judgments about availability, responsiveness to
customers’ needs, competency of staff, courtesy and help fullness of staff,
communication between participants timeliness, and, fairness. It is evident
that quality is related to the value of an offer, which could evoke satisfaction or
dissatisfaction on the part of the user.
2.4. Service Quality

Service quality in the management and marketing literature is the extent to
which customers’ perceptions of service meet and/or exceed their expectations
for example as defined by Zeithaml et al. (1990), cited in Bowen & David,
2005). Thus service quality can intend to be the way in which customers are
served in an organization which could be good or poor.
Parasuraman (1988) defines service quality as the differences between

customer expectations and perceptions of service. They argued that measuring
service quality as the difference between perceived and expected service was a
valid way and could make management to identify gaps to what they offer as
services.
2.5. Dimensions of Service Quality

One of the most useful measurements of service quality is the dimensions from
the SERVQUAL model. In the creation of this model for the very fast time,
“Parasuraman et al. (1985) identified 97 attributes which were condensed in to
ten dimensions; they were found to have an impact on service quality and were
regarded as the criteria that were important to evaluate customer’s
expectations and perceptions on the delivered service (Kumar et al., 2009).
The SERVQUAL scale has been proven to be one of the best ways to measure
the quality of services provided to customers. This service evaluation method
has been proven consistent and reliable by some authors (Brown et al. 1993).
They held that, when perceived or experienced service is less than the expected
9
service; it implies less than satisfactory service quality; and when perceived
service is more than expected service, the obvious inference is that service
quality is more than satisfactory (Jain et al., 2004). From the way this theory is
presented, it seems the idea of SERVQUAL best fits the evaluation of service
quality from the customer perspective. This is because when it is stated
“perceived” and “expected” service, it is very clear that this goes the person,
who is going to or is consuming the service; who definitely is the
consumer/customer.
The original study by Parasuraman et al., (1988) presented ten dimensions of

service quality.
 Tangibles: the appearance of physical artifacts and staff members

connected with the service (accommodation, equipment, staff
appearance, and so on).
 Reliability: the ability to deliver the promised service.
 Responsiveness: the readiness of staff members to help in a pleasant and
effective way.
 Competence: the capability of staff members in executing the service.
 Courtesy: the respect, thoughtfulness, and politeness exhibited by staff
members who are in contact with the customer.
 Credibility: the trustworthiness and honesty of the service provider.
 Security: the absence of doubt, economic risk, and physical danger.
 Access: the accessibility of the service provider
 Communication: an understandable manner and use of language by the
service provider.
 Understanding the customer: efforts by the service provider to know and
understand the customer.
In the first SERVQUAL model that had 22 pairs of Likert-type items, where one
part measured perceived level of service provided by a particular organization
and the other part measured expected level of service quality by respondent
(Kuo Y, 2003). Further investigation led to the finding that, among these 10
dimensions, some were correlated. After refinement, those ten dimensions were
later reduced to the following five dimensions: Tangibility, Reliability,
Responsiveness, Assurance and Empathy.
According to Laroche et al. (2004) customers’ expectations were met through

the outcome dimension (reliability) and exceed it by means of the process
dimensions (tangibility, assurance, responsiveness, and empathy).
To confirm the validity of SERVQUAL model in the evaluation of service quality,

Zeithaml et al (2006), stated that “service quality is a focused evaluation that
10
reflects the customer’s perception of reliability, assurance, responsiveness,
empathy, and tangibles.” They added that among these dimensions, “reliability”
has been shown consistently to be the most important dimension in service
quality.
2.5.1. Determinants of service quality

Service organization can measure their service quality in light those
dimensions by getting feedback from customers. The feedback can be obtained
from customers through dealing with individual customers or structured
survey depending on the types of the organization.
 Reliability or Dependability is keeping the promise to satisfy customer’s

needs. It refers to long-term citizen loyalty. Dependable or high quality
service is based on service foundation. Managers of high reliable service
organization develop (promote) a strong sense of appreciation for people
within their organization. The primary goal in developing dependable
service is to stand behind what is promised. To do this, the organization
has to develop knowledgeable personnel, provide employee training and
feedback performance for front line service providers.
 Responsiveness: willingness to help customers and provide prompt
service. It rests on the foundations of good service principles and
requires simplicity and specialization. If the organization design and
service is simple, it is easier to be responsive and successful. This help to
build rapid service management system of the organization. For an
organization to be responsive and establish quality service management
system, it has to understand what business it is in and then develop the
capacity to do it. Both the management and front line personnel have to
understand the capacity of their system and what the service users
expect from it.
 Tangibles: Physical facilities, equipment and appearance of personnel.
Service companies can try to demonstrate their service quality through
physical evidence and presentation. Suppose a bank wants to position
itself as the “fast” bank. It could make this positioning strategy tangible
through any number of marketing tools:
i. Place-the exterior and interior should have clean lines. The layout
of the desks and the traffic flow should be planned carefully.
Waiting lines should not get overly long.
ii. People-Employees should be busy, but there should be a sufficient
number to manage the workload.
iii. Equipment-Computers, copy machines, Note counting machines,
desks, and ATMs should look like, and be, state of the art.
11
iv. Communication material-Printed materials text and photos should
suggest efficiency and speed.
v. Symbols-The bank’s name and symbol could suggest fast service.
vi. Price-The bank could advertise that it will deposit birr 5 in the
account of any customer who waits in line more than five minutes.
Service marketers must be able to transform intangible services in to concrete

benefits an a well-defined experience (Kotler. P, 2012)
 Assurance: Knowledge and courtesy of employees and their ability to

inspire trust and confidence i.e. Employees who instill confidence in
customers, making customers feel safe in their transactions, employees
who are consistently courteous and having the knowledge to answer
customer questions
 Empathy: Caring attention the firm provides to its customers i.e. giving
individualized attention, having convenient operating hours, giving
personal attention, having the best interests at heart, and understanding
specific needs of customers
2.6. Factors considering for the study

The information gathered from customers combined with the knowledge of
business objectives and institutions’ capabilities, will give bankers a starting
point in developing effective service quality programs. The following are factors
that affect service delivery.
1. Training
The primary goal in developing dependable service is to stand behind what is

promised. To do this, the organization has to develop service knowledgeable
personnel and manager through providing employee training for service
providers.
Organizations are finding that yesterday’s competitive advantage is

becoming the minimum entrance requirement for staying in business. This
puts tremendous pressure on organizations to learn how best to improve
and stay ahead of competitors. It is therefore important for organizations to
enhance and nurture employees’ capability to learn. (Kreitneret al. 2005) A
critical step towards service excellence is investing in the skills and
knowledge development of servers, giving them the preparation to serve and
in so doing, stoking their desire to serve. The training/learning should focus
on understanding why service excellence is important to both the
organization and the individual employees, not just how and what needs to
be done. The combination of developing skills, on the job knowledge, and
12
initializing organizational goals should be the key purpose of the employee
training. It can stimulate their enthusiasm about their work and new
challenges to satisfy customer expectations.
High performance banks are shifting from a focus on the organization to a

focus on process. The primary emphasis on the process is how the work is
to be done in order to satisfy customers’ needs or a large market.
Consequently it reflects the customers’ point of view, rather than the
organization’s point of view (Kleiner et al., 2006)
Service excellence is the ultimate differentiator for future success. The most
important way to achieve this service excellence is through people
empowered employees who can improve their knowledge and skills for
customer satisfaction and build up relationship banking.
2. Communication
Communication as the exchange of information between a sender and a

receiver and inference (perception) of meaning between the individuals
involved. External communication of service providers is the key
determinant of a customer’s expectation. Promises made by a service
company through its media advertising sales force and other
communication raise expectations, which serve as the standard against
which customers assess service quality.
Zeithmal et al. (1990) indicates that a discrepancy between actual service

and the promised service has an adverse effect on a customer’s perception
of service quality. They further argue that in addition to the bank’s unduly
elevating expectations through exaggerated claims, customers are not
always aware of everything done behind the scenes to service them well.
Therefore if an organization neglects to inform customers of such behind-
the-scenes effort, it can influence customer’s service perceptions
unfavorably.
According to Murphy (2000) external and internal customers need to have

easy access to a listener. He distinguished between internal and external
customers as follows. Internal customers have team leaders and managers.
If there is a routine way of communicating between them, something similar
should be provided for external customers to communicate with the
organization. As with internal customers, this should be easily accessible
and the information distribution should be managed.
13
What the customer says is what governs the work done by employees.
Whether the communication is between customers and the organization, or
between people within the organization, it should be easy to understand.
3. Management as a Determinants of Service
Kreitner et al. (2005) has defined management as the process of working with
and through others to achieve organizational objectives efficiently and ethically.
Bennett and Brown (2007) agree that the problem is not with training, it is with
managing. Creating a successful sales and service organization requires a
systematic change in the behavior of people throughout the bank. Far too often
senior managers assume that only a training program will cause their
employees to change their attitudes and to start behaving differently. Managers
decline to be involved in linking the training to their own priorities. However
the best training programs in the world will fail if managers do not reinforce
sales and service in daily interaction with their staff.
Sales and service excellence is a journey. Without question, management is the

driving force behind it. Managers not only set the direction but also provide the
power to get things started and keep them rolling. According to Bennet and
Brown (2007) employees respond to the following signals from their managers:
 What their managers tell them they want.

 What their managers pay attention to.
 What they praise and reward them for.
 What they hold them accountable for.
For example, new tellers are taught that “good customer service” is their prime
responsibility, but back on the job, they quickly learn that balancing out is the
most important objective of all. A teller is more likely to be fired for being out of
balance than for serving customers poorly. Also, during training sessions
tellers are taught to take time to talk with their customers, but back in the
branch they are pressured to keep the lines moving with a maximum waiting
time of five minutes for each customer! (Bennet and Brown, 2007).
4. Teamwork
Service work is frequently demanding and stressful. Having many customers to

serve, in a busy bank office, can be mentally and physically exhausting. Some
customers are unpleasant, cross, or worse. Control over the service is often
dispersed among different organizational units that function without
cooperation, frustrating contact employees’ ability to effectively serve their
14
customers. It is common for employees to be so stressed by the service role
that they become less caring, less sensitive, and less eager to please.
The presence of service “teammates” is an important dynamic in sustaining

servers’ motivation to serve. Coworkers who support each other and achieve
together can be an antidote to service burnout. Team involvement can be
rejuvenating, inspirational, and fun. According to L. Berry (1994) service
performance shortfalls are highly correlated with the absence of teamwork.
Service team building should not be left to chance. The chain of internal
services required to offer the end service normally spans multiple functions.
Companies must actively work at fostering teamwork across these functions,
not just within them. This may involve frequent meetings of the functions and
other communications: shared performance goals, measurements, and cross-
training employees in various facets of the service chain.
5. Performance Management
Performance management is a process that enables employees to perform their

roles to the best of their abilities with the aim of achieving or exceeding
established targets and standards that are directly linked with the
organizations objectives. It can be regarded as a strategic management
technique that supports the overall business goals of the firm through linking
each individual’s work goals to the overall mission of the firm (David G.Collings
and Geoffrey Wood 2009).
According to D. Torrington, L. Hall, and S. Taylor (2008), a typical performance

management system, include both development and reward aspects.
One of the most important aspects in managing service excellence is to define

specific service objectives and standards as a basis for measuring performance
levels. Employees are encouraged to exceed the minimum level of standards set
out of the desire to meet and exceed service user’s expectation.
6. Employee Attitudes
Excellent service companies know that positive employee attitudes will promote
stronger customer loyalty. Instilling a strong customer orientation in employees
can also increase their job satisfaction and commitment, especially if they have
high customer contact. Employees thrive in customer-contact positions when
they have an internal drive to:- pamper customers, accurately read customer
needs, develop a personal relationship with customers, and deliver quality
service to solve customers’ problems. Given the importance of positive
15
employee attitudes to customer satisfaction, service companies must attract
the best employees they can find. They need to market a career rather than
just a job. They must design a sound training program and provide support
and rewards for good performance. They can use the intranet, internal
newsletter, daily reminders, and employee roundtables to reinforce customer
centered attitudes. Finally, they must audit employee job satisfaction regularly.
7. Delegation of Authority
Delegation is the process of assigning tasks to others. Armstrong (1996)

identifies the following advantages of delegation: it reduces delay in decision
making as long as authority is delegated close to the point of decision, it allows
decision to be taken at the level where the details are known and it develops
the capacity of staff to make decisions, get things done and take responsibility.
2.7. Service excellence

Banking has changed. An increasingly innovative and aggressive financial
services environment together with deregulation has created more competition
and a seemingly endless variety of products. These forces of change have led to
banks moving toward customer-orientated strategies, so that it is the quality of
service that becomes the ultimate factor which differentiate one organization
from another, and indeed determines whether or not it will survive (Kleiner and
Kim, 1996).Management in each case has recognized the definite need to adapt
itself to a changing environment and to provide employees with a vision of
service quality; these empowered employees share this vision and improve their
knowledge for better customer service. Alongside this, application of
technology, such as automated teller machines (ATMs) networks and electronic
data warehouse system help the banks to improve the efficiency of their
operating processes. This in turn provides the bank with more and better
information on customers, increasing the opportunities for service quality. The
effect of this service excellence is to make the banks more profitable.
What do the banks actually do, to reinvent themselves to cope with these
changes, and what lessons are transferable to other businesses and industry
sectors? Interesting results of detailed research done by Kleiner and Kim (1996)
on Bank of America, City Bank and one valley Bank in West Virginia are that
these three high performing banks share common elements of service
excellence such as:
 A clear banking culture provided by committed management,

 Employment empowerment by enhancing knowledge and skills, and
 Improvement of operating processes with technological applications.
16
2.8. Managing Service Quality and its Effectiveness
Service quality is difficult to define and judge as a product quality because
there is no clear cut measurement of a service quality. However, customers can
make judgment about service quality, and service providers want to know
customers’ expectations for designing effective service. Customer’s satisfaction
with service quality can be defined by comparing perception of service received
with expectations of service desired. When expectations exceed, service is
perceived to be of exceptional quality and surprising while the service quality
that does not meet expectations is assumed as unacceptable.
Customer can be satisfied if they get their expectations from the service
provider on time. Therefore, the key of managing service quality of the office is
to deliver high quality service consistently as expected by customers or service
users (Kotler, 2003). He suggested customers’ complaints satisfying system to
be done using service recovery program which involves three steps:
 Make it easy for dissatisfied customers complain by providing

suggestions and complaints forms and others.
 Employees of companies who receive complaints must be trained in order
to be able to solve customers’ problems firstly and with great
satisfactions.
 Companies should find the main causes of problems beyond satisfying
particular customers
2.9. Customer Service Delivery in the Banking Industry

Bloemer et al. (2008) were on the view that most models in the banking
industry of customer evaluations of services focus on the comparative
judgment of expectations versus perceived performance resulting in the two
major evaluative judgments of perceived service quality and customer
satisfaction. For example:
 Customers access service delivery by comparing their expectations prior

to their service encounter with a bank (employee).
 Customers also, develop perceptions during the service delivery process
and then compare their perceptions with the actual service received from
the bank’s employee.
Thus, customer expectations are unique prior to a service. They influence

customer’s evaluation of service performance and customer satisfaction.
Customer services, by definition, are intangible and easily duplicated. They can
be divided into high-touch or high-tech services.
 High-touch services are mostly dependent on people in the service

process producing the service.
17
 Whereas high-tech services are predominantly based on the use of
automated systems, information technology and other types of physical
resources.
However, one should always remember that high-touch also includes physical
resources and technology based system that have to be managed and
integrated in to the service process in a customer oriented fashion (Gronroos,
2001). Consequently, electronic banking services include both high-tech and
high-touch services. For example, high-tech services include online banking,
mobile banking, ATM machines, etc. whereas high-touch services consist of
instructions and personnel assistance in using the services. Customer service
delivery is differentiable and stem from the expectations of customers. Hence, it
is necessary to identify and prioritize expectations for customer service and
incorporate these expectations in to a process for improving customer service
delivery (Kassim and Bojei, 2001). Implementing and evaluating customer
service is a very complex process. Zeithmal and Bitner (1996) reported that two
aspects need be taken in to consideration when evaluating customer service:
Content and delivery customers may be in the best position to evaluate the
quality of service delivery, while the service providers are the best judges of the
content of the message. Though there is a number of different aspects of
services involved.
According to Parasuraman et al. (1985), the study of customer service delivery

has gained interest just after the concern on improving the quality of products
appeared, and services are increasingly important in the global economy
(regarding the participation in the GNP and job creation figures) for instance,
like machines transformed the agricultural economy in to an industrial one,
the information technology nowadays changes the industrial economy in such
a way that it becomes characterized as based on services (Fitzsimmons, 2005).
The banking sector has already been depicted (Parasuraman et al,1993, and
Mukherjee et al, 2003) as exhibiting little market orientation and fulfilling
services with little regard to customer needs, as well as including branches
dissimilar in efficiency (Berger A, 2003). According to Mattos, (2005) the most
frequent problems in using banking services are:
 Long lines.
 Limited time for customer servicing.
 Transaction errors due to the banks personnel.
 Excessive bureaucracy.
However, contemporary factors like more demanding and informed customers,

the emergency of new technologies, and the competition increase (Cooke, 2003)
18
modified the relationship between banks and customers, and strategies for
survival and business expansion started to approach this seriously. In fact,
customers determine the frequency of their contacts with banks based on the
experiences they have with the services, and this exerts substantial impact on
the profitability of banks in the long run (Bhat, 2005). Although, customers
who are satisfied with service delivery are less likely to shift to other banks,
therefore increasing such things as loyalty and retention (Al-Hawari et al,
2005).
Moreover, in as much as the customers want to be sure that they choose a

bank perceived as being the best manager for their money, equally they also
want a polite servicing and a trustworthy process. Barnes(1977) already said
that no any service industry seems to be more interested in setting up relations
with customers than the banking industry; however, the increasing deployment
of ICT(information communication technology) in financial transactions
reduced the contact between bank and customers, modifying quite remarkably
the general aspect of the relationship in fact, with the ICT having lowered
information costs, customers were able to compare portfolios of investments
between banks, or even invest directly (Cooke, 2003).
Thus, various issues related to the branches are another concern when dealing
with the customer service delivery in the banking industry. For instance,
access to the facilities (e.g., parking lot attributes and the mobility of people
inside the branches), safety and convenience of location make customers
access service delivery on a tangible basis. The branches external and internal
architectures may mediate the perception of service delivery; while ATMs inside
the branches simplify the customers procedures and lowers personnel costs,
the number of human attendants is also important and vary according to
demand, especially for reducing waiting times for certain services, providing
human interaction and servicing elder and less informed customers, who still
seem to prefer people instead of machines as interfaces for their transactions
(Dick, 2003). Advertisingpractices and the banks institutionalized reputation
within the community may be related to customer service delivery as well.
2.10. Conceptual Framework

After reviewing literatures, the researcher developed the following conceptual
framework.
Based on the theories abovedelivering quality service for customers is the life-
blood of an organization. It has been proven that perceived service quality is a
component of customer satisfaction (Zeithaml et al. 2006). Other researchers
had proven also that there is a relationship between customer satisfaction and
service quality (Liang and Zhang, 2009). Moreover, the SERVQUAL model has
19
been proven to be the best model to measure service quality in service sectors
especially from the customer perspective. Thus, for its survival service
rendering organizations need to continuously identify those factors that can
affect the process of delivering quality service for customers and improve it
accordingly.Considered factors are training, communication, performance
management, employee attitudes and delegation of authority, the human
resource practices and organizational structure.
Thus, to determine factors of delivering quality service in CBE the following

conceptual framework has been developed.
Conceptual framework
Service quality
dimension
Reliability
Responsiveness
Assurance
Empathy
Tangibles
Quality service delivery
Considered factors
Training
Communication
Management
Teamwork
Performance management
Employee attitudes
Delegation of authority
20
CHAPTER THREE
3. Research methodology
3.1. Introduction
Research methodology is the philosophy or general principle which guides the
research (Dawson, 2002). Moreover, it is concerned with the way by which the
researcher collects data to answer the research questions. Accordingly the
research design, sampling technique, sampling frame, sample size, data
sources, and data analysis are the issue to be discussed.
3.2. Research Design

Descriptive survey method was applied because it ensures complete description
of the situation, making sure that there are minimum bias in the collection of
data and finding out the what and how of a phenomenon (Kothari, 2008).
3.3. Sampling Technique

The researcher used simple random sampling technique for customer
respondents and multi- stage cluster sampling techniques for employees to
conduct this study. Questionnaires were randomly distributed to customers
and employees of the Bank who are target respondents for the research.
3.4. Sampling Frame

Currently CBE has millions of customers which are served in 15 districts and
more than 1160 branches throughout the country. Among the 15 districts 11
of them are found outside of Addis Ababa and the remaining 4 are located in
Addis Ababa. Assuming that these four districts are homogeneous in delivering
services for the customers of the Bank, South Addis Ababa district was chosen
randomly. 80 branches and around 2204 employees who are working in
different branches of South Addis Ababa district were the target population for
the study.
3.5. Sample Size

Sample size determination is an important element in any survey research. According
to Krejcie& Morgan (1970), for a population greater than 1000,000 and confidence
level of 95%, the sample size should be 384. Another possible way of determining the
required sample size is by using the slovin’s formula. Tejada and Punzalan (2012)
indicated that Slovin’s formula is applicable when the confidence coefficient is 95% &
the population proportion is suspected to be close to 0.5. The formula is given by n =
N/1+Ne² Where, n = required sample size, N = population size and e = margin of error
Many researchers suggested for a sample size to be determined with confidence level of
95% and margin error of 5%. With 95% confidence level and 5% margin error, the
sample size for a population between 2.5 million and 10 million should be 384. Even if
21
many researchers agreed up on the margin error of 0.05, in this study the researcher
used margin error of 0.07 and confidence level of 93% because of considering different
factors. The staffs and the customers of the bank have more or less the same
understanding about the bank service (homogeneity of the respondents) and the other
factors are time constraint and other resources at hand. The time available often
affects this decision (Hair et al 2002). Thus, considering the above factorsthe
researcher used 150 customer respondents and 250 employee respondents
which correspond to the targeted population of 2204. Therefore, the number of
respondents selected for the study was 400.
3.6. Data Source and Types

The pertinent data required were collected by the use of primary
sources.Primary data were gathered through the use of self-administered
standardized closed and open ended questionnaires. According to Kothari
(2008), primary data is collected afresh and for the first time, and thus happen
to be original in character.
3.6.1. Validity and Reliability Evaluation

Validity is a measure of the trustfulness of a measuring instrument. It
indicates whether the instrument measures what it claims to measure (Sherri
L. j., 2009). To raise the validity of the research, the researcher undertaken the
following:
 As an attempt to use valid and reliable data collection instrument,

standardized questionnaires were used to collect data from employees
and customers.
 To further refine the accuracy of the instrument, necessary adjustment
was made based on the invaluable comments of the research advisor.
 The questionnaire were distributed and collected by the researcher
herself
 An extensive literature review was undertaken to define and clarify the
scales and measures used in this research
Reliability refers to the extent to which the data collection techniques or

analysis procedures will yield consistent findings (Mark S.et al 2009). To make
sure that thedata collection methods were error free and to minimize the
instruments’ biases the researcher undertaken the following:
 Some important questions were re-asked in different places in a different

order.
 The researcher, when collecting the questionnaires, tried to make sure
that it was the respondents who had completed the questionnaire
through having an informal conversation where ever possible.
22
3.7. Response rate
Response rate is the number of questionnaires returned or completed divided
by the number of eligible people who were asked to participate in the survey
(Mark S, et al, 2009). From a total of 400 questionnaires of which 250
questionnaires distributed for employees and 186were returned back from this
178 of them were usable. And among 150 questionnaires distributed for
customers 134 were returned back of these 128 of them were usable for the
analysis purpose. Thus, the researcher obtained a total of 306(178+128) usable
questionnaires. Therefore, the response rate for this research was
306/400=0.76 which is 76%. This was obtained by giving ample time (20 days)
for the respondents to return the questionnaire, assuring respondents that all
the information they provide will be treated confidentially and using close
ended questionnaires can be considered as the reason for achieving high
response rate.
3.8. Data analysis

Descriptive statistics is the most appropriate statistic, since the nature of the
study objectives and research questions are to explore and describe factors of
delivering quality service. Therefore, the data gathered from primary sources
were summarized quantitatively. Tables, frequency distributions, percentages,
and numerical measures by the help of SPSS (Statistical packages for social
Sciences) are used to give a condensed picture of the quantitative data. The
summarized data was analyzed in brief vis-à-vis the theoretical frame work of
the study to arrive at a meaningful conclusion.
23
CHAPTER FOUR
4. DATA PRESENTATION AND ANALYSIS
4.1. Data Analysis of Employees’ Response
Data collected from customer and staff respondents are organized, analyzed
and presented under this chapter. Data were collected through two types of
questionnaires for employees and customers. Out of 400 questionnaires
distributed to respondents (150 questionnaires to customers and 250
questionnaires to staffs of CBE)320(134 from customers and 186 from
employees) were returned back from this 306 (128 from customers and 178
from employees) of them are usable.
Table 1: Staff Respondents General Information
No. Indicators Category No %

1 Sex Male 114 64.0
Female 64 36.0
Total 178
100
2 Educational High School - -

Level College Diploma 6 3.4
University Degree 168 94.4
Master’s Degree & Above 4 2.2
Total 178
100
3 Current Position CSO 118 66.3
SCSO 10 5.6
Senior Controller 8 4.5
Accountant 4 2.3
CSM 18 10.1
CRO 20 11.2
Total 178
100
4 Service Year Less than 1 year 28 15.7
1 to 3 years 98 55.1
4 to 6 years 27 15.2
7 years and above 25 14.0
Total 178
100
Source: Survey, 2017
From table 1, the researcher realized the following facts. About 114 (64.0%) of
the employee respondents were male and the rest 64 (36.0%) were female.
24
168(94.4%) of staff respondents are first degree holders, 6(3.4%) are diploma
holders and the rest 4(2.2%) are master’s degree holders. Item number 3 of
table 1 shows that 118(66.3%) Customer service officers (CSO), 10 (5.6%)
Senior Customer Service Officers (SCSO), 8(4.5%) Senior Controllers, 4(2.3%)
Accountant, 18(10.1%) Customer Service Managers (CSM) and 20(11.2%)
Customer Relationship Officers (CRO) were involved as a respondent for this
study. Moreover, 150 (84.3%) of staff respondents have been working for CBE
for more than a year and the rest 28 (15.7%) of the respondents serve the bank
for less than one year. The researcher assumed that, these proportions of
respondents in terms sex, level of education, job position, and service year
having such mix of respondents can improve the reliability of the research.
Therefore, the information they provide have contribution to the quality of this
research.
Table 2: Staff training

Response Total
SD D Neutral A SA
Item
Mean
C % C % C % C % C % C %
1 My work 27 15. 34 19.1 38 21. 56 31. 23 12.9 178 100 3.1

load is 2 3 5
fair
compared
to the
work load
of other
colleague
s
2 I feel that 45 25. 55 30.9 21 11. 36 20. 21 11.8 178 100 2.6
I have 3 8 2
been well
trained
by the
bank on
how to
interact
effectively
with
customer
s
3 I got 47 26. 53 29.8 30 16. 38 21. 10 5.6 178 100 2.5
adequate 4 9 3
training
on the
Bank’s
new
25
products
4 I am well 13 7.3 17 9.6 23 12. 70 39. 55 30.9 178 100 3.8

versed 9 3
with new
software
implemen
ted in
banking
operation
s
5 The bank 11 6.2 28 15.7 27 15. 78 43. 34 19.1 178 100 3.5
seems to 2 8
hire
competen
t and
capable
people to
work in
branches
Table 2 shows that 56 (31.5%) and 23 (12.9%) of the respondents either agree
or strongly agree that their load is fair when compared to other colleagues
while significant number 61 (34.3%) of respondents’ did not agree on the
fairness of their work load.For item number 2 of the same table 45 (25.3%) and
55 (30.9%) of employee respondents either disagree or strongly disagree on the
issue that they have been well trained by the Bank on how to interact
effectively with customers. Moreover, more than 56% of respondents revealed
that they disagree with the indicator that “I got adequate training on the Bank’s
new products.” These are also supported by the respective mean scores 2.6 and
2.5 which are less than the average mean score (3.0), implies that employees
did not get adequate training on how to interact with customers. However,
125(70.2%) of employee respondents agreed on that they are well trained on
new software implemented in banking operations. The same table shows that
more than 62% of the respondents agree with the issue CBE hire competent
and capable people to work in branches.
26
Table 3: Staff Communication
Response Total
SD D Neutral A SA
Item
Mean
C % C % C % C % C % C %
1 Managers 8 4. 1 6.2 1 8.4 10 57. 4 23. 17 10 3.

communica 5 1 5 2 3 2 6 8 0 9
te well and
give me
clear
instruction
s about
service
delivery
2 The team 1 8. 1 5.6 3 16. 80 44. 4 24. 17 10 3.
spirit with 5 4 0 0 9 9 3 2 8 0 7
other
colleagues
assisted me
to provide
quality
service
3 Everyone in 1 5. 1 10. 3 19. 74 41. 4 23. 17 10 3.
our branch 0 6 9 7 4 1 6 1 0 8 0 7
contributes
to a team
effort to
deliver
quality
service for
customers
Service deliver is affected by communication between the manager and the

subordinates or among staff members. Tasks will be implemented easily when
the subordinates get clear work instructions from their superiors. The
existence of team spirit among staff members enables staff to work
cooperatively to achieve organizational goals and to satisfy customers. As item
number 1 of table 3 shows, 144(80.9%) of staff respondents agreed that their
managers communicates well and gives clear instructions but 19(10.7%) of
them disagreed. 123(69.1%) of respondents agreed that the team spirit with
other colleagues assisted them to provide quality service. Moreover, 115(64.6%)
27
of indicated their agreement on every staff have contribution to team effort to
deliver quality service for customers. The mean scores of the items 3.9, 3.7,
and 3.7 also indicates that the existence of favorable communication system
which can enhance quality service delivery.
Table 4: Materials and Office Facilities
Response Total
Mea
SD D Neutral A SA
n
C % C % C % C % C % C %
1 CBE has 4 24. 3 21. 2 13. 4 27. 2 13. 17 10 2.
office 4 7 8 3 4 5 9 5 3 0 8 0 8
arrangement
s suitable for
delivering
quality
service
2 CBE 4 27. 5 33. 2 13. 3 19. 1 6.8 17 10 2.
provides me 9 5 9 1 4 5 4 1 2 8 0 4
the
necessary
working
equipment &
materials
3 Distribution 4 26. 4 26. 3 18. 4 24. 8 4.5 17 10 2.
of equipment 7 4 7 4 2 0 4 7 8 0 5
& materials
is done
based on
requirement
of the job
4 Technologica 5 30. 6 35. 1 6.2 3 21. 1 6.2 17 10 2.
lly up-to- 5 9 3 4 1 8 3 1 8 0 4
date
equipment
&physical
facilities are
available
Office facilities and equipment are among others that have impact on the
delivery of quality service. Employees can perform better if they are provided
with the necessary equipment, materials as well as with well-arranged and
28
clear office. Table 4 above presents the perception of CBE employees with
regard to material and equipment facilities.
For item number 1 of this table, 82(46%) of staff respondent disagree on the
indicator that CBE has office arrangements suitable for delivering quality
service. While significant portion 72(40.5%) agreed that CBE’s office
arrangement is suitable for delivering quality service. However, the mean score
2.8 implies that the existing office arrangement is not suitable for delivering
quality service.
For item number 2 of table 4, only 46(25.9%) of staff respondents agreed that
CBE provide them with the necessary working equipment and materials needed
to carry out their jobs. While majority of the respondents 108(60.6%) disagreed
on the provision the necessary working equipment and materials for their
work, this is supported by the mean score 2.4 which is far less than the
average or expected mean score 3.0.
Similarly, for item number 3 of the above table 94(52.8%) of the respondents
express their disagreement with “working equipment and materials are
distributed based on the requirement of the work”. Among the total
respondents only 52(29.2%) expressed their agreement that materials and
equipment are distributed based on requirement of the job. The mean score 2.5
indicates that working equipment and materials are not distributed based on
the requirement of the work.
Respondents were also asked to express their level of agreement on the

availability of technologically up-to-date equipment and physical facilities.
Thus, 118(66.3%) of the respondents revealed their disagreement. While a few
of respondents 49(27.5%) shown their agreement on availability of
technologically up-to-date equipment and physical facilities adequacy. The
mean score is 2.4 which imply lack of adequate technologically up-to-date
physical facilities.
Network failure and frequent power disruptions are also external barriers to
deliver quality service for customers as per respondents’ reflection for the open
ended question.
29
Table 5: Performance Management system of the Bank
Response Total
Mea
Item SD D Neutral A SA
n
C % C % C % C % C % C %
1 CBE has 6 38. 6 34. 1 6.2 3 18. 6 3.4 17 10 2.
PMS where 8 2 1 2 1 2 0 8 0 1
performan
ce is
evaluated
2 My 5 28. 7 39. 1 7.3 3 20. 8 4.5 17 10 2.
performan 1 7 0 3 3 6 2 8 0 3
ce
evaluation
is done
based on
indicators
which are
agreed
upon with
the
managers
3 CBE has 3 21. 7 43. 1 8.4 2 14. 2 11. 17 10 2.
conducive 8 4 8 8 5 6 6 1 8 8 0 5
work
environme
nt to
utilize my
knowledge
& skills in
the job
4 There is a 5 30. 7 39. 2 11. 2 11. 1 6.2 17 10 2.
system 5 9 0 3 1 8 1 8 1 8 0 2
that can
handle my
complaints
in the
bank
5 Branch 4 25. 5 33. 2 11. 4 23. 1 6.2 17 10 2.
employees 5 3 9 1 1 8 2 6 1 8 0 5
who do
best job in
serving
customers
are more
likely to be
recognized
30
&
rewarded
for their
efforts
6 Making a 4 26. 4 25. 3 16. 2 14. 2 16. 17 10 2.
special 8 9 5 3 0 9 6 6 9 3 8 0 7
effort to
serve
customers
will result
in more
pay or
recognition
The analysis under this part is connected with one potential challenge in
delivering quality service called performance management which is the process
that enables employees to perform their roles to the best of their abilities with
the aim of achieving or exceeding established targets and standards that are
directly linked with the Bank’s objectives. To grasp important information that
enables the researcher to examine the impact of performance management in
delivering quality service. Employees’ were asked some questions related to
performance management. The analysis of the responses on the variable of
interest is presented as follows. Table 5 contains perception of staff
respondents towards indicators of performance management system. Staffs
were asked to show their level of agreement or disagreement for the indicators.
Majority of the respondents 129(72.4%) disagree with the existence of

performance management system to measure their performance and38(21.4%)
of the respondents agree on that CBE has a performance management system.
As indicated in item number 2 of the same table 121(68.0%) of the respondents

disagree with performance evaluation is made based on indicators agreed up
on with their managers. While 44(24.7%) of the respondents were on the
contrary.
As to the availability of conducive work environment to utilize knowledge and

skills, 116(65.2%) of staff respondents expressed their disagreement. While a
significant percent 47(26.4%) of them agree with that they are able to utilize
their knowledge and skills.
With respect to complaint handling system, 125(70.2%) disagreed that CBE

has a system that can handle their complaints. Only 32(18.0%) of the
respondents agree with the existence of a system that can handle their
complaints. Item number 5 of the above table presents about Bank’s practice to
31
recognize and reward employees who perform best job in serving customers. In
this indicator, 104(58.4%) of the respondents disagree with the Bank practice
of encouraging their efforts. Moreover, 93(52.2%) of the respondents disagree
with the issue that making a special effort to serve customers will result in
more pay or recognition.
For all indicators as shown in the table 5 the mean scores are below the
expected mean score 3.0 which imply that employee’s responses regarding
performance management were negative.
Table 6: Delegation of Authority
Involving the staff in decision making that require their participation is very
useful to improve their motivation and the implementation of decisions. After
making sure the capacity of the staff to be delegated to carry responsibilities, it
is needed to empower the front line staff to satisfy customers with quality
service delivery. Problems that can raise in relation to delegation could be
solved through trainings and orientations supported by clear procedures and
accountability system.
Item Response Total
Mea
SD D Neutral A SA
n
C % C % C % C % C % C %
1 I 17 9. 21 11. 42 23. 72 40. 26 14. 17 10 3.
participate 6 8 6 4 6 8 0 4
in decision
making
regarding
service
quality
2 There is a 11 6. 34 19. 45 25. 61 34. 27 15. 17 10 3.
well 2 1 3 2 2 8 0 3
established
accountabil
ity system
to failure of
discharging
responsibili
ty
32
Data for item number 1 of table 6 reveals that, 98(55.0%) respondents
participate in decision making regarding service quality and 42(23.6%)
respondents not sure whether they are participating in decision making
regarding service quality.
Item number 2 of the above table presents staff’s responses about the presence
of an accountability system for failures of discharging responsibility. In this
indicator, Majority of respondents, 88(49.4%) agreed there is an established
accountability system to handle failures. Significant number of respondents
45(25.3%) are not agreed about its presence.
Table 7: Employee attitude towards customers
Response Total
Mea
n
C % C % C % C % C % C %
1 I can read 6 3. 1 6. 1 10. 9 54. 4 25. 17 10 3.
& 3 1 2 9 7 7 5 5 3 8 0 9
understan
d the
psychology
of
customers
2 I 9 5. 9 5. 8 4.4 7 39. 8 45. 17 10 4.
understan 1 1 1 9 1 5 8 0 1
d the
meaning of
“Loosing
one
customer”
Source:Survey, 2017
As per item number 1 of table 7, 142(79.8%) of the respondents asserted their

agreement on that they can understand the psychology of customers, only few
17(9.5%) of them are to the contrary of the indicator. Likewise, item number 2
of the same table indicates that 152(85.4%) of the respondents revealed their
agreement with the issue that “I can understand the meaning of loosing one
customer”. 18(10.2%) of the respondents opposed the issue.
33
4.2. Data Analysis of Customers’ Response
Table 8: Customer Respondents General Information
The data regarding customer’s sex, educational level, occupation and years of
relationship with CBE is depicted in the following table
No. Indicators Category No. %

1 Sex Male 73 57.0
Female 55 43.0
Total 128 100

2 Educational level Elementary school completed 10 7.8
High school completed 9 7.0
College diploma 38 29.7
University degree 61 47.7
Master’s Degree & Above 10 7.8
Total 128 100

3 Occupation Student 2 1.6
Gov. Org. Employed 35 27.3
Pvt. Org. Employed 45 35.2
Self Employed 43 33.6
Other 3 2.3
Total 128 100
4 For how long have you Less than 1 Year 24 18.8

been the customer of 1 to 3 Years 38 29.7
CBE 4 to 5 Years 14 10.9
More than 5 Years 52 40.6
Total 128 100
Source:Survey, 2017
Customer respondent’s sex Distribution shows that 73 (57.0%) were male

respondents and the remaining 55(43.0%) were female. Table 8; also indicates
respondents educational background and thus, 61(47.7%) of them graduated
with university degree, 38(29.7%) of the respondents have college diploma,
10(7.8%) of the customer respondents replied that their educational level was
Master’s degree or above, 10(7.8%) of them completed elementary school and
the remaining 9(7.0%) completed high school. In terms of their occupation; the
respondents were comprised of: 2(1.6%) student, 35(27.3%) government
organization employed, 45(35.2%) private organization employed, 43(33.6%)
self-employed and 3(2.3%) other. Regardless of customers years of relationship
with CBE; 24(18.8%) customers of the Bank for less than a year, 38(29.7%) of
34
them are customers of the Bank for 1 to 3 years, 14(10.9%) of them are served
by the Bank for 4 to 5 years, and the remaining 52(40.6%) of respondents are
customers of CBE for more than 5 years. The researcher believed that these
combination of respondents were good enough in revealing accurate
information about the issues under investigation i.e. these mix of educational
background, occupational status and relationship with the Bank; can yield
more reliable information on customer service delivery events.
Table 9: Reliability – The ability to perform the promised service

dependably and accurately
Item Response Total
Mea
SD D Neutral A SA
n
C % C % C % C % C % C %
1 CBE is 7 5.5 19 14. 2 21. 47 36. 27 21. 12 10 3.5
providing 8 8 9 7 1 8 0
me its
service as
promised
2 CBE’s 4 3.1 10 7.8 2 18. 76 59. 15 11. 12 10 3.7
staffs 3 0 4 7 8 0
have the
knowledg
e to
answer
all my
questions
.
3 ATM 13 10. 28 21. 4 33. 34 26. 10 7.8 12 10 3.0
service 1 9 3 6 6 8 0
provided
by CBE
is reliable
From the figures in table 9 it could be seen that 74(57.8%) of the respondents
revealed their agreement on CBE is providing its service as promised.
26(20.3%) of them expressed their disagreement. The remaining 28(21.9%)
were neutral. Even though above average percent of respondents expressed
their agreement on the Bank’s provision of service as promised still it is
required to improve delivery of its service to make it more reliable.
Regarding the staff knowledge to respond customers’ request, 91(71.1%) agreed

that CBE staffs have the knowledge to answer customers’ questions. 23(18.0%)
35
were neutral and the remaining 14(10.9%) replied that the Bank staffs do not
have the knowledge to answer all their questions.
To analyze the extent to which ATM service provided by CBE is reliable

customer respondents were asked to indicate their level agreement. Accordingly
41(32.0%) of the respondents asserted that the ATM service is not reliable,
43(33.6%) were neutral and the remaining 44(34.4%) replied that ATM service
of the Bank is reliable. The result shows that ATM service provided by the Bank
needs to be further improved.
Table 10: Responsiveness – willingness to help customers and

provide prompt service.
Response Total
Mea
n
C % C % C % C % C % C %
1 Employee 3 2.4 2 16. 2 16. 5 44. 2 20. 12 10 3.
s of CBE 1 4 1 4 7 5 6 3 8 0 6
tell you
exactly
the time
the
services
will be
performed
.
2 CBE’S 3 24. 2 22. 2 16. 2 21. 1 14. 12 10 2.
staff gives 1 2 9 7 1 4 8 9 9 8 8 0 8
me
prompt
service.
3 Staffs of 7 5.5 1 7.8 1 12. 7 55. 2 18. 12 10 3.
CBE are 0 6 5 1 4 4 8 8 0 7
always
willing to
assist me
4 Employee 4 3.1 1 9.3 2 18. 6 47. 2 21. 12 10 3.
s of CBE 2 3 0 1 7 8 9 8 0 7
are willing
to respond
to my
request.
5 Staffs of 4 3.1 1 13. 2 22. 5 39. 2 21. 12 10 3.
CBE 7 3 9 6 0 1 8 9 8 0 6
always
inform me
about the
36
alternative
s and new
products
whenever
I got a
service
Item number 1 of table 10 reveals that 83(64.8%) of customer respondents

agreed that employees of CBE tell them the exact time when the service will be
performed, 21(16.4%) were indifferent, whereas, 24(18.8%) of the respondents
replied that employees do not tell them the time of service performance.
47(36.7%) of the respondents asserted that CBE’S staffs give them prompt
service, 21(16.4%) were neutral, and 60(46.9%) expressed their disagreement
with the statement that CBE staffs provide them on time service. The mean
score 2.8 is also below the average mean score 3 shows majority of the
respondents did not agree on the statements CBE’s staffs give prompt service.
Regarding, whether staffs of CBE are always willing to assist customers or not.
Majority 95 (74.2%) of the respondents agreed that staffs are willing to help
customers. 16(12.5%) were indifferent, and the remaining 17(13.3%) expressed
their disagreement.
Item number 4 of the above table is designed to assess whether employees of

CBE are willing to respond to customer requests or not. Accordingly,
89(69.6%), 23(18.0%), and 16(12.4%) of the respondents replied agree, neutral
and disagree to the statement respectively. Out of the total respondents
78(61.0%), 29(22.6%), 21(16.4%) replied agree, neutral, and disagree to the
statement staffs inform customers about the alternatives and new products
whenever upon getting the service respectively.
Table 11: Assurance – Knowledge and courtesy of employees and

their ability to convey trust & confidence
Response Total
Mea
n
C % C % C % C % C % C %
1 CBE’s staff 2 1. 2 1.6 3 24. 6 53. 2 18. 12 10 3.
behavior 6 1 2 9 9 4 7 8 0 9
implants
confidence in
me
2 I feel safe in - - - - 1 8.6 5 43. 6 48. 12 10 4.
my 1 5 0 2 4 8 0 4
transactions
37
with CBE
3 Employees of 9 7. 1 14. 2 22. 4 37. 2 18. 12 10 3.
CBE are 0 9 8 9 7 8 5 3 0 8 0 4
polite/courteo
us with me.
To assess courtesy of employees and their ability to convey trust and

confidence towards the customers’; respondents were asked to indicate their
level of agreement. Thus, as shown on the above table, a significant number
93(72.6%) were agreed that CBE’s staff behavior embeds confidence in item on
their transaction with the Bank, 31(24.2%) were indifferent, and the remaining
4(3.2%) replied that they disagree on staff’s behavior to put on their confidence.
117(91.4%) of customer respondents agree that they feel safe in their
transaction with the Bank. The remaining 11(8.6%) were indifferent, such
customers’ confidence on the staffs and the Bank is in line with CBE’s mission
“….public confidence is the base for the success of the Bank.” To evaluate
customers’ level of agreement customer respondents were asked that whether
employees of CBE are polite or not. Accordingly, 71(55.5%) agreed that
employees are polite and courteous with them, 29(22.7%) were neutral and the
remaining 28(21.8%) disagreed that employees are polite/courteous with them.
This is an indication that employees need to be well trained on how to behave
towards customers.
Table 12: Empathy- The provision of carrying, individualized

attention to customers.
Response Total
Mea
n
C % C % C % C % C % C %
1 CBE 3 2. 2 18. 2 16. 5 44. 2 18. 12 10 3.
staffs give 3 3 0 1 4 7 5 4 8 8 0 6
me
individual
attention
2 CBE show 4 3. 1 10. 2 16. 6 48. 2 21. 12 10 3.
a keen 1 4 9 1 4 2 5 7 1 8 0 8
interest in
solving
my
problems
3 CBE has 5 3. 1 12. 2 20. 5 43. 2 20. 12 10 3.
my best 9 6 5 6 3 5 0 6 3 8 0 6
interest at
heart
38
4 CBE’s 1 7. 1 10. 1 7.8 5 45. 3 28. 12 10 3.
working 0 8 3 2 0 8 3 7 9 8 0 8
hour is
convenien
t to me
Items in table 12 were designed to investigate the provision of carrying,

individualized attention to customers. As indicated on item one, 81(63.3%)
replied that staffs of CBE give individual attention for the customers, 21(16.4%)
were neutral, and the remaining 26(20.3%) affirmed that staffs did not give
them individual attention. On item 2 of the same table customers were asked
whether CBE shows them keen interest in solving their problems. Accordingly,
89(69.6%) asserted their agreement CBE is interested to solve their problems,
21(16.4%) were indifferent and a few respondents 18(14.0%) responded that
CBE is not eager in solving their problems.
Item number 3 is about CBE fulfills customers’ best interest or not. In this
regard 81(63.3%) responded that CBE is can satisfy their best interest at heart,
26(20.3%) were not sure whether it can satisfy their best interest or not and
only 21(16.4%) replied to the contrary. As per item number 4 of the same table
95(74.2%) of the respondents agreed that CBE’s working hour is convenient for
them, whereas 23(18.0%) affirmed that CBE’s working hour is not convenient,
and the remaining 10(7.8%) were indifferent. As shown on the table the mean
score of the four items 3.6, 3.8, 3.6 and 3.8 respectively are more than the
expect mean. These show customer’s response regarding empathy was positive.
As pointed out in the literature, empathy is one of service quality dimension,

which could be achieved by ensuring care, personalized attention given by the
Bank to the customers.
Table 13: Tangibles
Response Total
Mea
n
C % C % C % C % C % C %
1 CBE has 14 10. 36 28. 33 25. 31 24. 14 10 128 100 3.
modern 9 2 8 2 .9 0
office
equipment
2 CBE’s 14 10. 41 32. 28 21. 38 29. 7 5. 128 100 2.
physical 9 0 9 7 5 9
facilities are
visually
appealing
39
3 CBE 14 10. 37 28. 21 16. 42 32. 14 10 128 100 3.
arranged 9 9 4 9 .9 0
suitable
waiting area
for me until
the service is
provided
4 Materials 3 2.3 5 3.9 6 4.7 78 61. 36 28 128 100 4.
associated 0 .1 1
with the
service like
withdrawal/
deposit
vouchers,
brochures
etc. located
in
convenient
places.
5 CBE staffs 5 3.9 21 16. 12 9.4 62 48. 28 21 128 100 3.
are available 4 4 .9 7
on time to
serve me
6 Interior 12 9.4 42 32. 26 20. 36 28. 12 9. 128 100 3.
decoration of 8 3 1 4 0
the Bank is
very
impressive
7 CBE’s ATM 7 5.5 24 18. 32 25. 55 42. 10 7. 128 100 3.
machines 8 0 9 8 3
are located
in a
convenient
areas.
The analysis under this part is concerned with the other service quality
dimension called tangibles which is the appearance of physical facilities,
equipment, personnel, and communication materials. To grasp important
information that enables the researcher to examine the basis of customers’
quality service delivery evaluation of the Bank. Customers’ were asked some
questions related to this service quality dimension. The analysis of the
responses on those variables of interest is presented as follows. Item number 1
of table 13 indicates that 45(35.1%) of the respondents replied that CBE has
modern office equipment, 33(25.8%) were indifferent, and 50(39.1%) replied
that CBE do not have modern office equipment. The mean score 2.9 implies the
40
lack of modern office equipment in the Bank which ultimately affect the service
delivery. From the literature point of view if organization lacks modern office
equipment which can enhance delivery of quality service, it will be difficult for
the staffs and the Bank to meet or exceed customer’s service expectations. Item
two is about whether CBE’s physical facilities are visually appealing or not. Out
of the total respondents, 45(35.2%), 28(21.9%), 55(42.9%) replied agree,
neutral, and disagree to the statement respectively. For item number three,
51(39.8%) of the respondents asserted their disagreement with the statement
that CBE arranged suitable waiting area until the service is provided,
21(16.4%) were indifferent, and 56(43.8%) claimed the Bank arranged suitable
waiting area till the service is provided. This indicates that there are branches
that do not have ample waiting area for the customers.
Item number 4 of the above table revealed whether materials associated with
service delivery like vouchers, brochures etc. located in convenient places or
not. Accordingly, 114(89.1%) agreed that those materials are found easily in
convenient places, 6(4.7%) were indifferent for the statement, and the
remaining 8(6.2%) do not agree on the statement. For the statement for item
number 5 of the same table, 90(70.3%) agreed that staffs are staffs are
available on time to serve them, 12(9.4%) were neutral, and 26(20.3%) revealed
that staffs are not available on time. Regarding whether the interior decoration
of the Bank is impressive or not, of the total respondents’ 54(42.2%), 26(20.3%)
and 48(37.5%) disagree, neutral and agree respectively for item number 6 of
the above table. This implies that emphasis has to be given for branches
interior design and decoration including its odor. As per item number 7 of table
13 above, 65(50.7%) of the respondents agreed that CBE’s ATM machines are
located in a convenient areas, 32(25.0%) were indifferent, and another
31(24.3%) disagreed on the convenience of ATM location.
41
CHAPTER FIVE
5. SUMMARY OF FINDINGS, CONCLUSION, AND
RECOMMENDATION
This chapter is devoted to summarizing of the research findings, conclusions,
and the possible remedies for the problem or gaps identified in delivering
quality service.
5.1. Findings
Based on the data analysis presented in chapter four, summary of different
findings are presented here. Analysis of the data resulted in both positive and
negative findings. The positive findings from employees’ perspectives are:
employees are familiar with the new software implemented in the Bank,
competent and capable people are employed, communication between manager
and employee or among staffs, team efforts to deliver quality service,
participation of employees to make decision regarding service quality, and
having an accountability system to failure of discharging responsibility were
among the areas where CBE is good at and expected to further strengthen
them.
From customers’ point of view: Reliability – the ability of the Bank to perform
the promised service dependably and accurately, Responsiveness – willingness
to help customers and provide prompt service, Assurance – knowledge and
courtesy of CBE’s employees and their ability to convey trust & confidence and
Empathy – the provision of carrying, individualized attention to its customers
are service quality dimensions that CBE is currently performing well and need
further improvement.
Whereas, the negative results obtained indicate the challenges of delivering

quality service which demands attention from all management bodies of the
Bank and need to be improved as far as possible. Thus, more emphasis was
given to summarize the weak areas as they deserve some possible
recommendations.
5.1.1. Findings from Employees’ Response

 More employees claimed that they were not well trained by the Bank on
how to interact effectively with customers.
 Employees asserted that, they didn’t get adequate training on the Bank’s
new products
 Employee respondents replied that, CBE’s branch office arrangement is
not suitable for delivering quality service.
42
 Employees revealed that the necessary working equipment and materials
are not provided properly.
 Majority of respondents agreed that distribution of equipment &
materials is not made based on requirement of the work.
 It was identified by more employee respondents that there is lack of
technologically up-to-date equipment and physical facilities.
 Respondents affirmed that, some of the tools and equipment do not

assist them for delivering quality service.
 It was recognized by majority of respondents that, CBE do not have PMS
where performance is evaluated.
 It was identified by ore respondents that employees and their
supervisors did not mutually agree on performance measure parameters.
 It was identified by more respondents that, performance evaluation is
not based on indicators which are agreed upon with the managers.
 Respondents asserted that, CBE’s branch work environment is not too
much helpful to utilize their knowledge and skills in the job.
 Employees claimed that, there is no system that can handle their
complaints in the Bank.
 Respondents affirmed that, employees who do best job in serving
customers are unlikely to be recognized and rewarded for their efforts.
 Employees acknowledged that, making a special effort to serve
customers will not result in more pay or recognition
5.1.2. Findings from Customers’ Response

 Customers claimed, they are waiting for a longer time to receive the
service.
 Majority of customer respondents revealed that CBE’s staffs do not give
prompt service.
 Customer respondents recognized that, CBE’s physical facilities are not
visually appealing.
 It was identified by customer respondents that, CBE do not have modern
office equipment.
 Customers replied that, CBE did not arrange a suitable waiting area till
the service is provided.
 Customers affirmed that, interior decoration of the Bank is not very
impressive
43
5.2. Conclusion
Based on the findings; the following conclusions are drawn by the researcher.
CBE is keeping its promise in order to satisfy the needs of customers i.e.
according to the response obtained from sample respondents CBE’s ability to
perform the promised service dependably and accurately is good. Customers’
also revealed that employees of CBE tell when the service to be performed,
staffs are willing to assist them and employee of CBE are willing to respond to
customers’ requests. CBE is also good at the knowledge and courtesy of
employees and their ability to convey trust and confidence on customers.
Moreover, CBE is currently performing well on the provision of carrying and
individualized attention to its customers.
On the other hand; result of the analysis indicates that customers are obliged
to wait for a longer time in order to receive the required service, customers did
not get a prompt service, there is lack of modern office equipment in CBE
branches, physical facilities are not visually appealing and lack of customers
waiting area till the service if provided.
Positive response was obtained from employee respondents regarding:-

familiarity with the new software implemented in the Bank, competency and
capability of employees, communication between manager and employee or
among staffs, team efforts to deliver quality service, participation of employees
to make decision regarding service quality, and having an accountability
system to failure of discharging responsibility.
According to employees response the following are major challenges of

delivering quality service in the context of the study area. These are: lack of
training on the Bank’s new products and service delivery, improper office
arrangement to deliver service, shortage of the necessary working equipment
and materials, problem on the allocation of physical facilities, lack of
technologically up-to-date physical facilities, unfavorable Bank
climate/working environmentto effectively utilize knowledge and skills, delayed
maintenance for working materials, lack of performance management system,
lack of employees complaint handling system and lack of recognition for
employees who do best job in serving customers.
5.3. Recommendations
The above results move the researcher to offer the following recommendations:
 In order to strengthen its dependable service; CBE needs to invest on

training of employees:-training them on the overall Banking operations,
Bank’s new products, and customer handling system is crucial,
regardless of whether employees are highly skilled professionals or low-
44
skilled workers. Better-trained personnel can exhibit competence,
courtesy, credibility, reliability, responsiveness, and communication.
 Invest to well equip the office with modern and adequate service
rendering materials/facilities such as photo copy machines, printers,
counting machines, generators, etc. to minimize their impact on the
delivery of quality service.
 Promoting and awareness creation on the different banking channels
(such as ATMs, Internet banking, mobile banking) of CBE can help to
reduce the waiting time.
 Employees can perform better if they are provided with the necessary
materials. Thus, allocation of working materials needs to be based on
requirement of the job.
 Office layout needs to be in a way that can facilitate quality service
delivery, pleasant, safe working environment and ample waiting area for
customers till the service is provided is required
 Employees need to be well informed on how to resolve their complaint
through the complaint handling system of the Bank.
 Employee’s participation is very important element for successful

performance management system. Thus, the Bank needs to create a
platform through which employees participate in performance planning
process. Performance planning should not be a sole activity of managers,
rather active involvement of employees needs to be encouraged.
 CBE need to identify and give recognition for those employees who are
performing best job in serving customers. Identifying and providing
feedback or training on customer handling is required for those who
deviate from the expected behavior and results in serving customers.
45
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Kleiner, B.H. and Kim, S. 2006. Service excellence: Lessons from the Banking
Industry.
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India: Prentice Hall.
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47
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48
Dear Employees,
This research conducted as a post graduate study in partial fulfilment of the

requirements for the award of a Masters of business administration degree of
St. Mary University.
This questionnaire is intended to assess service quality in CBE specifically on

customers’ account and transaction service (CATS).
I kindly request your participation in this study by filling up this questionnaire.

I would also like to inform you that, your response which will be kept
confidential has a significant contribution for the accomplishment of the study.
So, your frank response is vital for the success of the study.
BirhaneGebre Tel. 0912-008489
General instruction
 No need to write your name

 Please put a tick mark // or write your opinion on the space provided
Part I: General information: The purpose of this part is to obtain general

information related to you as a respondent to this research
1 Sex: Male  Female 

2 Please indicate your highest educational level
High school  College Diploma  University Bachelor’s Degree
Master’s Degree or above Other, please specify……………………………
3 Please indicate your current position
CSO  SCSO  Senior controller  Accountant 
CSM  Manager  Other, Please specify………………………………..
4 Please indicate your service year(s) in CBE
1
Less than one year  1 to 3 years  4 to 6 years  More than 6
years
Part II: Dear Respondent!

The following items are assumed to describe the degree of service quality in CBE
specificallyon Customers’ Account and Transaction Service(CATS). For each statement,
please tick () in the box that best reflects your level of agreement.
S.
Disagree
Strongly
Strongly
disagree
Neutral
Agree
agree
N
1 Managers communicate well and give me clear instructions about

service delivery
2 The team spirit with other colleagues assisted me to provide quality
service
3 I participate in decision making regarding service quality
4 There is well-established accountability system to failure of

discharging responsibility
5 CBE has performance management system where performance is
periodically evaluated
6 My performance evaluation is done based on indicators which are
agreed upon with the managers
7 My work load is fair compared to the work load of other colleagues
8 I am able to utilize my knowledge and skills in the job
9 There is a system that can handle my complaints in the bank
10 CBE has office arrangements suitable for delivering quality service
11 CBE provides me the necessary working equipment and materials
12 The distribution of equipment and materials is done based on

requirement of the work
13 I feel that I have been well trained by the bank on how to interact
effectively with customers
14 I got adequate training on the bank’s new products
15 The bank seems to hire competent and capable people to work in

branches
16 Branch employees who do best job in serving customers are more
likely to be recognized and rewarded for their efforts
17 Making a special effort to serve customers will result in more pay or
recognition
18 Everyone in our branch contributes to a team effort to deliver quality
service for customers
19 Technological up-to-date equipment and physical facilities are
adequately available
20 I am well versed with new software implemented in banking
operations
21 I can read and understand the psychology of customers
2
22 I understand the meaning of ”Loosing one customer”
From your practical experiences what are the major challenges which holds you back
from delivering quality service for the
customers?...............................................................................................................
…………………………………………………………………………………………
…………………………………………………………………………………………
What kind of improvements do you suggest in order to deliver quality service for
customers in CBE? ..................................................................................................
……………………………………………………………………………………..
……………………………………………………………………………………..
Thank you very much for your cooperation!
3
Dear Customers,
This research conducted as a post graduate study in partial fulfilment of the

requirements for the award of a Masters of business administration degree of
St. Mary University.
This questionnaire is intended to assess service quality in CBE specifically on

customers’ account and transaction service (CATS).
I kindly request your participation in this study by filling up this questionnaire.

I would also like to inform you that, your response which will be kept
confidential has a significant contribution for the accomplishment of the study.
So, your frank response is vital for the success of the study.
BirhaneGebre Tel. 0912-008489
General instruction
 No need to write your name

 Please put a tick mark // or write your opinion on the space provided
Part I: General information: The purpose of this part is to obtain general

information related to you as a respondent to this research
1 Sex: Male  Female 

2 Please indicate your highest educational level
High school  College Diploma  University Bachelor’s Degree
Master’s Degree or above Other, please specify……………………….
3 Occupation
1
Student government organization employedSelf employed
Private organization employedIf other, Please specify……………………
4 For how long have you been the customer of CBE?
Less than one year  1 to 3 years  4 to 5 years  More than 5
years
Part II: Dear Respondent!
The following items are assumed to describe the degree of service quality in CBE specifically on
Customers’ Account and Transaction Service (CATS). For each statement, please tick () in the
box that best reflects your level of agreement.
S.
Disagre
Neutral
disagre
Strongl
y agree
Agree
N
e
Reliability- The ability to perform the promised service dependably and
accurately
1 CBE is providing me its service as promised
2 CBE provides its services at the time it promises to do so
3 CBE’s staff have the knowledge to answer all my questions
4 ATM services provided by CBE is reliable
Responsiveness- Willingness to help customers and provide prompt service
5 Employees of CBE tell you exactly the time the services will be performed
6 CBE’s staff gives me prompt service
7 Staffs of CBE are always willing to assist me
8 Employees of CBE are willing to respond to my requests
9 Staffs of CBE always inform me about the alternatives and new products
whenever I got a service
Assurance- Knowledge and courtesy of employees and their ability to
convey trust and confidence
10 CBE’s staff behavior implants confidence in me
11 I feel safe in my transactions with CBE
12 Employees of CBE are polite/courteous with me
13 Empathy- The provision of caring, individualized attention to customers
14 CBE show a keen interest in solving my problems
15 CBE has my best interest at heart
16 Employees of CBE understand my specific needs
17 CBE’s working hour is convenient to me
Tangibles- the appearance of physical facilities, equipment, personnel, &

communication material
18 CBE has modern office equipment
2
19 CBE’s physical facilities are visually appealing
20 CBE’s arranged a suitable waiting area for me until the service is provided
21 Materials associated with the service like each withdrawal vouchers, cash
deposit vouchers, local transfer vouchers, pamphlets, brochures, are located in
convenient places at CBE branches
22 Interior decoration of the bank is very impressive
23 CBE’s ATM machines are located in a convenient areas
Please use the space below if you have any comment or additional information..........
…………………………………………………………………………………………
…………………………………………………………………………………………
Thank you very much for your cooperation!
3
በ ደ ን በ ኛ ውየ ሚሞላ መጠይ ቅ
መጠይ ቅ ዓ ላ ማበ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ የ ደ ን በ ኞ ች ሂ ሳ ብ አ ገ ል ግ ሎ ት አ ሰ ጣጥ ን ለ መመዘ ን እ ና ያ ሉ ት ን ች ግ ሮ ች ለ ማ
ጥ ና ት ነ ው፡ ፡ የ እ ር ስ ዎ አ ስ ተ ያ የ ት አ ና ሀ ሳ ብ ለ ጥ ና ቱ ውጤታ ማነ ት ወ ሳ ኝ ነ ው፡ ፡ በ መሆ ኑ ም በ አ ገ ል ግ ሎ ት አ ሰ ጣጡ
ላ ይ የ ሚሠ ጡት ሃ ሳ ብ እ ና አ ስ ተ ያ የ ት ለ ጥ ና ቱ አ ገ ል ግ ሎ ት ብ ቻ የ ሚወ ል ስ ለ ሆ ነ በ ሚስ ጥ ር እ ን ደ ሚያ ዝ እ የ ገ ለ ጽ ሁ ለ
ሚደ ረ ግ ል ኝ ቀ ና ት ብ ብ ር በ ቅ ድ ሚያ አ መሠ ግ ና ለ ሁ ፡ ፡
ማስ ታ ወ ሻ
 በ መጠይ ቁ ላ ይ ስ ም መፃ ፍ አ ያ ስ ፈ ል ግ ም
 አ ስ ተ ያ የ ት ዎ ን ከ ጥ ያ ቄ ውፊ ት ለ ፊ ት ባ ለ ውቦ ታ ላ ይ የ በ ማድ ረ ግ ይ ግ ለ ፁ ፡ ፡
ክ ፍ ል አ ን ድ ፤ የ መጠይ ቁ መላ ሾ ች መረ ጃ
1. ፆ ታ ፤
ወን ድ ሴት
2. የ ት ም ህ ር ት ደ ረ ጃ ፣
እ ስ ከ 10ኛ ክ ፍ ል ያ ጠና ቀ ቀ ች የ መጀ መሪ ያ ዲ ግ ሪ
ከ 10ኛ እ ስ ከ 11ኛ ክ ፍ ል ያ ጠና ቀ ቀ ች ማስ ተ ር ስ ዲ ግ ሪ ና ከ ዚ ያ በ ላ ይ
ዲ ፕ ሎማ ሌላ ከ ሆነ ይ ጥቀ ሱ
3. ሥራ
ተ ማሪ በ ግ ል ሥራ
የ መን ግ ሥት ሠ ራ ተ ኛ ሌላ ከ ሆነ ይ ጥቀ ሱ
የ ግ ል ድ ር ጅ ት ተ ቀ ጣሪ
4. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ደ ን በ ኞ ች ከ ሆ ኑ ስ ን ት ጊ ዜ ሆ ኖ ት ?
ከ 1 ዓ መት በ ታ ች ከ 1 እ ስ ከ 3 ዓ መት
ከ 4 ዓመትእስከ 5 ዓመት ከ 5 ዓመትበላይ
1
ክፍልሁለትቀጥሎየተዘረዘሩትየኢትዮጵያንግድባንክየደንበኞችሂሳብአገልግሎትአሠጣጥንይገልፃሉተብለውየተገመቱናቸው፡፡በእ
ርስዎአስተያየትበአገልግሎትአሰጣጡላይያለዎትንሰምምነትበተሰጡትአማራጮችየምልክትበማስቀመጥይግለፁ
ተ .ቁ
በ ጣምእ ስ ማ
አ ል ስ ማማም
እ ስ ማማለ ሁ
ስ ቸግ ረ ኛ ል
ፍ ፁ ምአ ል ስ
ለ መወ ሰ ን ያ
ማማም
ማለ ሁ
1. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ የ ሚጠበ ቅ በ ት ን አ ገ ል ግ ሎ ት በ መስ ጠት ላ ይ ይ ገ ኛ ል ፡ ፡
2. ከ ባ ን ኩ ጋ ር ያ ለ ኝ ን ግ ን ኙ ነ ት በ ሕ ግ ከ ተ ፈ ቀ ደ ላ ቸ ውአ ካ ላ ት በ ስ ተ ቀ ር ሚስ ጥ ራ ዊ አ
ድር ጎ ይ ይዛ ል
3. ከ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ አ ስ ፈ ላ ጊ ውን አ ገ ል ግ ሎት በ ተ ገ ቢ ውጊ ዜ አ ገ ኛ ለ ሁ ፡ ፡
4. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ የ ሚሰ ጠ ውአ ገ ል ገ ሎ ት ከ ስ ህ ተ ት የ ፀ ዳ ነ ው፡ ፡
5. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ሠ ራ ተ ኞ ች የ ም ፈ ል ገ ውን የ ባ ን ክ አ ገ ል ግ ሎ ት በ ተ መለ ከ ተ ለ
ማነ ሳ ቸ ውጥ ያ ቄ ዎ ቸ መል ስ ለ መስ ጠት በ ቂ እ ውቀ ት ና ክ ህ ሎ ት አ ላ ቸ ው
6. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ የ ሚሰ ጠ ውየ ATMአ ገ ል ግ ሎ ት አ ስ ተ ማማኝ ነ ው
7. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ሠ ራ ተ ኞ ች የ ም ፈ ል ገ ውን አ ገ ል ገ ሎ ት የ ት እ ና መቼ አ ገ ል ገ ሎ
ቱ ን እ ን ደ ማገ ኝ በ ግ ል ፅ ያ ሳ ውቁ ኛ ል
8. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ሠ ራ ተ ኞ ች ፈ ጣን እ ና ቀ ል ጣፋ አ ገ ል ግ ሎ ት ይ ሠ ጣሉ
9. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ሠ ራ ተ ኞ ች የ አ ገ ል ግ ሎ ት ፈ ላ ጎ ቴ ን ለ ማሟላ ት ፍ ቃ ደ ኛ ና ቸ ው
10. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ሠ ራ ተ ኞ ች የ ባ ን ኩ ን ሌ ሎች አ ማራ ጭና አ ዳ ዲ ስ አ ገ ል ገ ሎ ቶ ቸ
ያ ስ ረ ዱኛ ል
11. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ላ ይ አ መኔ ታ አ ለ ኝ
12. የ ኢት ዮ ጵ ያ ን ግ ድባ ን ክ ሠራ ተ ኞ ች ት ሁት እ ና ፈ ገ ግ ታን የ ተ ላ በ ሱና ቸ ው
13. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ሠ ራ ተ ኞ ች የ ም ጠይ ቃ ቸ ውን ጥ ያ ቄ በ ጥ ሞና ያ ዳ ም ጡኛ ል
14. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ሠ ራ ተ ኞ ች ከ ባ ን ኩ አ ገ ል ገ ሎ ቶ ች ጋ ር በ ተ ያ ያ ዘ ለ ሚያ ጋ ጥ መ
ኝ ች ግ ር በ ቅ ን ነ ት መፍ ት ሄ ይ ሰ ጡኛ ል ፡ ፡
15. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ የ ኔ ን የ ባ ን ክ የ አ ገ ል ገ ሎ ት ፍ ላ ጎ ት የ ሚያ ሟላ ባ ን ክ ነ ው፡
፡
16. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ የ ሥራ ሰ ዓ ት ለ እ ኔ አ መቺ ነ ው፡ ፡
17. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ በ ዘ መና ዊ አ ገ ል ገ ሎ ት መስ ጫመሣ ሪ ያ ዎ ቹ አ ቅ ር ቦ ቱ የ ተ ሟላ
ነ ው፡ ፡
18. የ ባ ን ኩ አ ገ ል ገ ሎ ት መስ ጫቁ ሳ ቁ ሶ ች እ ይ ታ ን የ ሚስ ቡ እ ና ማራ ኪ ና ቸ ው
19. የ ባ ን ኩ አ ገ ል ግ ሎ ት መስ ጫእ ን ደ የ ገ ቢ ና የ ወ ጪማዘ ዣዎ ች የ ቼ ክ ማስ ገ ቢ ያ ና ሃ ዋ ላ መ
ላ ኪ ያ የ መሳ ሰ ሉ ት ለ እ ይ ታ አ መቺ በ ሆ ነ ቦ ታ ላ ይ ይ ገ ኛ ሉ ፡ ፡
20. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ደ ን በ ኞ ች አ ገ ል ገ ሎ ት አ ስ ከ ሚያ ገ ኙ ድ ረ ስ በ ቂ ማረ ፊ ያ ቦ ታ
አለው
21. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ሠ ራ ተ ኞ ች በ ሥራ ሰ ዓ ት በ አ ገ ል ግ ሎ ት መስ ጫቦ ታ ላ ይ ይ ገ ኛ ሉ
22. የ ኢ ት ዮ ጵ ያ ን ግ ድ ባ ን ክ ቅ ር ን ጫፎ ች የ ውስ ጥ ገ ጽ ታ ማራ ኪ ነ ው፡ ፡
23. ባ ን ኩ የ ተ ከ ላ ቸ ውየ ATMአ ገ ል ግ ሎ ት መሰ ጫማሽ ኖ ች አ መቺ በ ሆ ኑ ቦ ታ ዎ ች ላ ይ ይ ገ ኛ
ሉ፡ ፡
ለባ ን ኩ አ ገ ል ግ ሎ ት አ ሰ ጣጥ መስ ተ ጓ ጎ ል ም ክ ን ያ ት ይ ሆ ና ሉ ብ ለ ውየ ሚያ ስ ቡ ት ን ቢ ገ ል ፁ
እ ባ ክ ዎ ን ለ ተ ጨማሪ ሃ ሳ ብ ና አ ስ ተ ያ የ ት ይ ህ ን ን ቦ ታ ይ ጠቀ ሙ
ይ ህ ን ን መጠይ ቅ በ መሙላ ት ስ ለ ተ ባ በ ሩ ኝ እ ጅ ግ በ ጣም አ ድ ር ጌ አ መሰ ግ ና ለ ሁ !

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Assessment on Service Quality in Commercial

Bank of Ethiopia: Emphasis on Customers’

A Thesis submitted to St. Mary’s University Graduate

Prepared by: BirhaneGebre

Advisor: Ato Simon Tareke

St. Mary’s University

A Thesis submitted to St. Mary’s University Graduate

Addis Ababa Ethiopia

Assessment on Service Quality in Commercial Bank of

Dean, Graduate Studies Signature Date

_______________________ _________ _______

Thesis Advisor Signature Date

_______________________ _________ _______

Internal Examiner Signature Date

_____________________ ________ _______

External Examiner Signature Date

______________________ ________ _______

Ato Simon Tareke (Asst .Professor) ----------------------------

St.Mary’s University. AddisAbaba ---------------------------

Birhane Gebre Date Signature

Ato Simon Tareke Date Signature

Next I am greatly grateful to my Advisor Ato. Simon Tareke (Asst. Professor)

CATS: - Customers’ Account and Transaction Service

SERVQUAL: - Service Quality

PM: - Performance Management

PMS: - Performance Management System

ICT: - Information Communication Technology

BPR: - Business Process Re-engineering

BSC: - Balanced Scored Card

E-Banking: - Electronics Banking

POS: - Point of Sales

SPSS: - Statistical package for social science

Appendix II: - Questionnaire for Customers of CBE in English

Appendix III: - Questionnaire for Customers of CBE in Amharic

Key word:Quality Service (SERVQUAL), Commercial Bank of Ethiopia (CBE),

The industry is facing a rapidly changing market, new technologies, economic

Perceived service quality determinants tend to play an important role in high

Commercial Bank of Ethiopia (CBE) accounts a major portion of financial

As the success of today’s competing organizations have dependency on their

Thus, this research tried to identify major challenges of delivering quality

1.2. Background of the organization (CBE)

 Depositing customers’ financial and non- financial assets.

Vision, Mission and Values of CBE

To become a World-Class commercial bank by the year 2025

We are committed to best realize stakeholders’ needs through enhanced

1.3. Statement of the problem

In our country the banking industry is slow-growing in many aspects such as

 What do employees of CBE perceives as key elements for delivering

1.4.1. General objective

1.4.2. The specific objectives are to:

1.5. Significance of the study

1.6. Scope of the study

1.7. Limitation of the study

 The sample study had been restricted to some selected branches of

1.8. Organization of the Study

2.2. What is Service?

2.3. What is Quality?

Kotler(2003) also defines quality as “the totality of features and characteristics

2.4. Service Quality

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