Customer Satisfaction in Bank Muscat

A Study on Customer Satisfaction in Bank Muscat

With special reference to Bank Muscat – Ruwi Branch

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Customer Satisfaction in Bank Muscat

Contents

Sl No Contents Page No
Chapter One – Introduction to the Study 6
1.1 Introduction 6
1.2 Aims and Objectives of the Study 7
1.3 Scope of the Study 7
1.4 Rationale of the Study 7
1.5 Research Questions 8
1.6 Oman Banking Sector and Bank Muscat 8
1.7 Bank Muscat 10
1.8 Chapter Scheme 10
Chapter Two – Literature Review 12
2.1 Introduction 12
2.2 Meaning of Customer in banking perspective 12
2.3 Customer Satisfaction 13
2.4 Measuring Customer Satisfaction 14
2.5 Importance of Customer Satisfaction 15
2.6 Tools for measuring customer satisfaction 16
2.7 Literature Review 18
2.8 Conclusion 21
Chapter Three – Research Methodology 22
3.1 Introduction 22
3.2 Type of Research 22
3.3 Data Collection 22
3.4 Primary Data 22
3.5 Sampling 23
3.6 Secondary data 23
3.7 Tools for analysis 24
3.8 Limitations of the Study 24
Chapter Four – Data Analysis 25
4.1 Introduction 25
4.2 Profile of Respondents 25
4.3 Facilities or Features leading to customer satisfaction 27
4.4 Rating of Bank Muscat 29
4.5 Quality of Services – Updating customers on product 30
and services
4.6 Rating on Customer Service Staff 31
4.7 Evaluation of Various Elements of Customer 32
Satisfaction

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4.8 Timeliness in product delivery and services 33

4.9 Behavior and Mannerism of Service Staff 34
4.10 Value added services provided by the bank 35
4.11 Ambience of bank environment 36
4.12 Knowledge and expertise of Staff 37
4.13 Facilities in terms of ATMs, number of branches, 38
proximity to major locations etc.
4.14 Suggestions for improvement 39
4.15 Conclusion 39
Chapter Five – Findings, Suggestions and 41
Conclusion
5.1 Findings 41
5.2 Recommendations 42
5.3 Conclusion 43
Reference 44
Appendix One – Questionnaire 46

List of Tables

Table Title Page No

No
1 Gender of Respondents
2 Age of Respondents
3 Type of Account
4 Facilities or Features leading to customer satisfaction
5 Rating of Bank Muscat
6 Quality of Services - Updating customers on product
and services
7 Rating on Customer Service Staff
8 Timeliness in product delivery and services
9 Behavior and Mannerism of Service Staff
10 Value added services provided by the bank
11 Ambience of Bank Environment
12 Knowledge and Expertise of the Staff
13 Facilities of the Bank
14 Bank Muscat – Number One bank in Oman

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List of Figures

Figure Title Page No

No
1 Gender of Respondents
2 Age of Respondents
3 Type of Account
4 Facilities or Features leading to customer satisfaction
5 Rating of Bank Muscat
6 Quality of Services - Updating customers on product
and services
7 Rating on Customer Service Staff
8 Timeliness in product delivery and services
9 Behavior and Mannerism of Service Staff
10 Value added services provided by the bank
11 Ambience of Bank Environment
12 Knowledge and Expertise of the Staff
13 Facilities of the Bank
14 Bank Muscat – Number One bank in Oman

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Customer Satisfaction in Bank Muscat

Chapter One

Introduction to the Study

1.1. Introduction

Customer Satisfaction is termed as a measure of how products and services supplied by a

company meet or surpass customer expectation. Customer Satisfaction is a key requirement
for organization’s success and growth. In this modern corporate world characterized by
intensified competition, globalization and opening up of market, attracting and retaining
customers is not a trouble-free process, but should be carried out after understanding
customer requirements in the best possible manner. Customers in modern days posses wide
knowledge and has often provided with wide range of products and services to select with.

Customers decide the future of business. The banking sector in Sultanate of Oman is not an
exception to this. Banks exist in a very competitive market environment in Oman,
composed of local banks, foreign banks and other financial institutions. The survival of
banks depends on how well it satisfies the customer requirements, by converting it to well
defined products and services. Tarawneh (2006) noted regarding banking sector that the
increasing competition in the national and international banking markets, the change over
towards monetary unions and the new technological innovations, herald major changes in
banking environment, and challenge all banks to make timely preparations in order to enter
into new competitive financial environment.

The term customer satisfaction is defined by Business Dictionary as “the degree of

satisfaction provided by the goods or services of a firm as measured by the number of
repeat customers1” Oliver (1980) described customer satisfaction “as the full meeting of

1
Definition of Customer Satisfaction, retrieved from http://www.businessdictionary.com/definition/customer-
satisfaction.html

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one's expectations”. It is the feeling or attitude of customer towards a product or service

after it has been used. Normally customer satisfaction is the result of pre-purchase
expectations and post purchase feeling. Customer satisfaction is a major outcome of
marketing activity whereby it serves as a link between the various stages of customer
buying behavior.

This study is descriptive in nature, explores the customer satisfaction towards Bank Muscat,
a leading commercial bank in Sultanate of Oman. The bank is the leading bank in Sultanate
of Oman, in terms of market capitalization and with widest number of branches and
ATM’s. The bank has the largest network of 126 branches, 371 ATMs, 116 CDMs and
4500 PoS terminals2.

1.2 Aims and Objectives of the Study

The study basically describes customer satisfaction in Bank Muscat. The main objectives of
the study include;

 To identify various elements of customer satisfaction of customers of Bank Muscat.

 To evaluate the level of satisfaction of customers towards bank services.

 To suggest remedial measures to improve customer satisfaction, if any

The study uses Bank Muscat Ruwi branch as a case study.

1.3 Scope of the Study

The study focused on evaluating customer satisfaction in Bank Muscat. For the purpose of
study, Bank Muscat – Ruwi branch is selected.

1.4 Rationale for the study

Customer Satisfaction is increasingly becoming a corporate goal in modern days as more

and more companies strive for quality in their products and services, to meet the customer
expectations. Management is always interested in understanding the key elements of
customer satisfaction and converting it into specific products and services, to meet the
customer expectations. The researcher is working in Bank Muscat as Branch Manager, and

2
http://www.bankmuscat.com/en-us/Pages/default.aspx

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interested to know what exactly motivates customers to deal with a specific bank. The study
is useful for the researcher as it can provide useful information on customer satisfaction.
The information is also useful for the bank as it can critically differentiate between the
satisfiers and dis-satisfiers as far as bank’s product and services are concerned. This study
is useful for the researcher in particular and the Bank in general, to generate an
understanding on the current level of customer satisfaction and the measures that can be
implemented to improve the customer satisfaction in the bank.

Customer Satisfaction is the key to access. As an employee working in the Bank Muscat,
the researcher intends to critically review the practices and approaches followed in the
bank, to maintain and improve the customer satisfaction. There are many antecedents of
customer satisfaction including service quality, customer expectations, desires,
performances, affect and equity, etc to name a few. The study is useful as it can highlight
the major determinants of customer satisfaction, which the bank can consider while taking
decisions on products and services. Customer satisfaction is considered as the essence of
success in today’s highly competitive world of business. Hence the topic can be considered
as very important and time relevant one.

1.5 Research Questions

The study is based on a number of research questions.

1. Whether the customers of Bank Muscat are really satisfied with the products and
services offered by the bank?

2. What are the major determinants of customer satisfaction?

3. Whether the elements of customer satisfaction are well incorporated in bank’s

strategies?

These questions provide the outline for the research and the research is an attempt to find
answers to these questions.

1.6 Oman Banking Sector and Bank Muscat

The banking sector is an important factor in maintaining financial equilibrium and

economic stability. The Omani-banking sector, which comprises the Central Bank of Oman

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(CBO) and various commercial and specialized banks operating in the Sultanate, is stable,
highly efficient and able to respond to regional and international developments, including
the growing trend towards freeing up financial services within the framework of the World
Trade Organization (WTO)3. Central Bank of Oman governs the banking sector. As at the
end of 2009, there are 19 banks out of which 7 are local banks, 10 foreign banks and 2
specialized banks, operating with a total of 451 branches in the country. It indicates the
competitive pressure in the market. The total population of the country as per 2009 data is
3.4 million. All banks are striving hard to gain a larger customer base, hence customer
satisfaction is an important strategic objective which banks always want to achieve.

Oman’s financial system is dominated by the banking sector. A report by International

Monetary Fund on Oman’s banking sector showed that the commercial banks accounts for
93% of the financial system assets, while the share of specialized banks, insurance
companies and other financial companies is 1.5%, 2% and 4% respectively . Among the
commercial banks, Bank Muscat is the leading bank in terms of market capitalization and
market coverage. The Sultanate has made significant progress in implementing the new
capital Adequacy criteria laid down in the Basel-II Accord. The adoption of Basel II would
transform the current approaches and tools of supervision of the CBO as well as the audit
and risk management practices of banks.

Services Organizations in general and financial services in particular are considered to be

the key factor for growth and success of projects in both industrial and developing
countries. However, the commercial banks take pride in offering customers a full range of
superior international banking services inside and outside of Oman. The major objective for
Omani commercial banks is to concentrate on trade services and cash management. In fact,
Oman has always had nation-wide development policy that was careful to achieve a wider
geographic distribution of investment to ensure that all the different regions in Oman could
share the benefits and any gap in the standard of living could be narrowed. Regional
development was also highlighted as one of the goals within the Oman vision 2020 which
aiming at the diversification of Oman's economy, calls for a greater involvement of the
private sector especially the commercial banks.

3
http://www.omanet.om/english/commerce/banking.asp?cat=comm

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1.7 Bank Muscat

Bank Muscat (BKMB), currently the largest bank in Oman based on total assets, was
established as the Oman Overseas Trust Bank in 1982. It merged with Al Ahli Bank in
1993 and acquired the Commercial Bank of Oman in 1999. Two other major acquisitions,
of the Industrial Bank of Oman and ABN Amro’s Bahraini operations took place in 2001
and 2002, respectively.

Bank Muscat is the leading financial institution in Sultanate of Oman. Other than the
normal banking activity of accepting deposits and lending, the bank entered in to other
financial services including insurance, merchant banking, brokerage services etc. The total
assets of the bank worth USD 15 million. The bank occupies strong competitive edge in
corporate banking, retail banking, investment banking, treasury, private banking and asset
management activity. The bank has both domestic and international operations. The
international operations consists of a branch in Riyadh (Saudi Arabia), Kuwait and a
Representative Office in Dubai (UAE). Bank Muscat owns 49% of BMI Bank B.S.C, an
independent bank of Bahrain.

Bank Muscat holds the rare distinction of being voted the ‘Best Bank in Oman’ for seven
years by The Banker, FT London; nine years in a row by Global Finance and Euromoney.
Bank Muscat is the recipient of the prestigious Hewitt recognition as the Middle East’s Best
Employer 2009. The Bank was declared an Investor in People (IiP) organization in January
2007, becoming the first banking organization in the MENA region to be awarded the
prestigious global recognition. In 2004, Bank Muscat became the first bank in the Middle
East to be completely ISO 9000:2000 certified4.

1.8 Chapter Scheme

The study is divided into five chapters.

Chapter One: Introduction

The chapter introduces the subject “Customer Satisfaction in Bank Muscat”. The chapter
explains the various objectives of the study, rationale for the study and research questions.

4
http://www.bankmuscat.com/en-us/AboutUs/Pages/default.aspx

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A brief note on the Omani banking sector and Bank Muscat is also provided. The chapter
ends with providing information on the chapter scheme.

Chapter Two: Literature Review

The chapter two is Literature Review. The review is done in two parts. Academic literature
explaining Customer Satisfaction is stated initially. The recent literature available on
Customer Satisfaction with special reverence to banking sector is given in the second part.

Chapter Three: Research Methodology

The chapter three is research methodology. The chapter gives details of techniques
employed for collecting data and analysis of data. The research limitation is also included
in this chapter.

Chapter Four: Data Analysis

The chapter four is data analysis. The data collected through primary sources is analyzed in
this section.

Chapter Five: Findings, Recommendation and Conclusion

The chapter concludes the report. The major findings are given in the chapter. The chapter
provides recommendations based on the analysis.

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Chapter Two

Literature Review

2.1 Introduction

The modern business environment is highly competitive. To gain competitive edge, it is

imperative for organizations to satisfy customers and retain them with organization. It has
become a necessity for an organization for its survival in any industry so that customer
satisfaction plays important role in each and every product life cycle. In simple words,
customer satisfaction means the extent to which a customer expectations or product quality,
service quality and price are met. Customer Satisfaction is an important measure of
organization success. The products and services should match the customer expectations in
terms of quality, price and other features. If it does to fit to customer expectations,
customers will be dissatisfied and it will lead to failure of business.

According to Levesque, et al (1996), a major reason why customers switch service

providers is unsatisfactory problem resolution. When customers face a problem, they may
respond by exiting (switching to a new supplier), voicing (attempting to remedy the
problem by complaining) or loyalty (staying with the supplier anticipating that “things will
get better”)5. This chapter reviews the literature available on customer satisfaction.
Literature is grouped under two parts. The first part explains the theoretical background
related to customer satisfaction. The second part elucidates recent literature on customer
satisfaction particularly with reference to banking sector.

2.2 Meaning of Customer in banking perspective

In banking literature, a customer is a person who has “some sort of an account, either
deposit or current account or some similar relation with a bank. To constitute a ‘customer’
from a bank point of view, there must be some recognizable course or habit of dealing in
the nature of regular banking business.

5
Levesque, T. McDougall, H.G.(1996), Determinants of Customer Satisfaction in Retail banking,
International Journal of Bank Marketing, pp.1-2.

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In today’s banking environment, the customers mostly express their dissatisfaction by

switching over from a bank to other bank. Hence it is important to maintain a proper service
quality and customer relationship management, to improve the customer satisfaction. The
Omani banking sector is highly competitive; hence, customer satisfaction plays a major role
in developing the prospects of the bank. Customer Satisfaction is not the duty of a single
department, but covers the efforts of the entire department in the organization. For example,
the service quality is determinant in gaining customer satisfaction, along with the quality of
the product or service, innovativeness of the product or service, customer relationship
management, etc.

2.3 Customer Satisfaction

Satisfaction is the person’s feelings of pleasure or disappointment resulting from comparing

a product’s perceived in relation to his or her expectations. In general, if performance of the
products matches the expectations, the customer is said to be satisfied. Customer
satisfaction, a business term, is a measure of how products and services supplied by a
company meet or surpass customer expectations.

There are various definitions available on academic literature on Customer Satisfaction.

Kotler (2000) defined satisfaction as: “a person’s feeling of pleasure or disappointment
resulting from comparing a product’s perceived performance (or outcome) in relation to his
or her expectations6”. Hoyer and McInnis (2001) further noted that satisfaction can be
associated with feelings of acceptance, happiness, relief, excitement, and delight7.

Customer satisfaction measurement helps to promote an increased focus on customer

outcomes and stimulate improvements in the work practices and processes used within the
company. Customer expectations are the customer-defined attributes of a product or
service. Major attributes of customer satisfaction can be summarized as:

Product quality

Keeping delivery commitments

Price

6
Kotler, P (2000), Marketing Management. 10th edition, New Jersey, Prentice-Hall Publications.
7
Hoyer, W. D. & MacInnis, D. J., 2001, Consumer Behavior. 2nd ed., Boston, Houghton Mifflin Company.

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Responsiveness and ability to resolve complaints and reject reports

Overall communication, accessibility and attitudes.

In a competitive marketplace where business complete for customers, customer satisfaction

is seen as a key differentiator and increasingly has become a key element of business
strategy. If performance exceeds expectations, the customer is said to be highly satisfied or
delighted. If the performance falls short of expectations, the customer is said to be
dissatisfied.

2.4 Measuring customer satisfaction

Organizations are increasingly interested in retaining existing customers while targeting

non-customers. The measurement of customer satisfaction provides an indication of how
successful the organization is at providing products and/or services to the marketplace.
Customer satisfaction is an ambiguous and abstract concept and the actual manifestation of
the state of satisfaction will vary from person to person and product/service to
product/service. The state of satisfaction depends on a number of psychological and
physical variables. Customer satisfaction is also a function of comparison of the product
an/or services with other product and/or services.

Customer satisfaction for service organizations is directly related to the service quality.
Unlike a manufacturing product quality that can be readily assessed, service quality is an
elusive and abstract construct that poses definition and measurement obstacles. The service
quality can be literally termed as the difference between the customer expectations and the
service provider’s performances and their evaluation of the services they received.
In the case of banking industry, there are certain aspects, which guide the customer
perceptions about service quality. Johnson (1995)8 examined 18 variables in the banking
sector that affects the customer perception of service quality and thereby the customer
satisfaction. It includes;
1. Access
2. Aesthetics
8
Ba and Johannason (2005), An Exploratory Study of the Impact of e-Service Process on Online Customer
Satisfaction, pp-1-2.

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3. Attentiveness/Helpfulness
4. Availability
5. Care
6. Cleanliness/Tidiness
7. Comfort
8. Communication.
9. Commitment
10. Competence
11. Courtesy
12. Flexibility
13. Friendliness
14. Functionality
15. Integrity
16. Reliability
17. Responsiveness, and
18. Security

Service quality has become important in many ways for most organizations. But the general
view is that most organizations do not take it too seriously. According to Zeithaml and Bell
(1990)9 nothing is as common as today as the organization committed more to lip service
than customer service; more interested to advertise than actions. Capodgali and Jackson
(1998)10 point in the same direction “All too many companies seem to consider customers
as nothing more than a necessary nuisance”

2.5 Importance of customer satisfaction

Customer is the king in modern business. A larger customer base is often the greatest asset
an organization posses. Organizations are always under pressure to maintain and retain
customers so that their business objectives can be met efficiently. Zairi (2000) remarked on
the importance of customer satisfaction that “Customers are the purpose of what we do and
rather than them depending on us, we very much depend on them. The customer is not the

9
Zeithmal, Bell (1990), Service Marketing, Principles and Practices, Prentice Hall Publications.
10
http://titania.emeraldinsight.com

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source of a problem, we shouldn’t perhaps make a wish that customers ‘should go away’
because our future and our security will be put in jeopardy”11.

Alan Wolf (2009) 12 did a study on effect of customer satisfaction and found that there is a
direct correlation between customer satisfaction and future success of a business. They
found that companies with increasing satisfaction scores faired significantly better in the
downturn last year than those with declining scores. Companies with increasing satisfaction
scores only lost 30% of their market value, against companies with decreasing customer
satisfaction which lost 57% value on average. That's a huge discrepancy completely
outweighing the investment needed to boost satisfaction scores, and is an important
reminder we need to all focus on delighting our customers, even in the tough times of a
recession. Building on a loyal customer or user base is the best and easiest way to grow
business. If customers are satisfied with the product and/or services, they will retain their
preferences with the product and/or services. The studies show that it costs approximately
five times more to acquire new customers than it costs to keep a customer.

Customer satisfaction is the key outcome of the marketing process. According to Hoffmann
and Bateson (2002)13, the justification for customer satisfaction comes from three broad
sources: the cost of new versus old customers, the competitive demand for satisfaction, and
the life cycle value of customers. It is an end in itself, but it is also the source of word of
mouth recommendations and thus can stimulate further purchases.

2.6 Tools for measuring Customer Satisfaction

Researches on customer satisfaction have largely relied on the disconfirmation paradigm,

which views satisfaction with products and brands as a result of two cognitive variables:
pre-purchase expectations and disconfirmation. According to Peter and Olson (1996)14, Pre-
purchase expectations are beliefs about anticipated performance of the product;

11
Zairi, M., 2000, Managing Customer Dissatisfaction Through Effective Complaint Management Systems,
The TQM Magazine, 12 (5), pp. 331-335.
12
Alan Wolf (2009), Retail Stock Prices Correlate With Customer Satisfaction: Study, retrieved from
http://mobile.twice.com/article/258173-
_Retail_Stock_Prices_Correlate_With_Customer_Satisfaction_Study.php
13
Hoffman, Batterson (2002), Service Marketing, 2nd Edition, Mcgraw Hill Publications.
14
Peter, P.J. and Olson, J.C. (1996), Consumer Behaviour and Marketing Strategy, 4th ed., Irwin, Chicago,
IL.

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disconfirmation refers to the differences between pre-purchase expectations and post-

purchase perceptions. Thus, if the perceived performance exceeds a customer’s
expectations (a positive disconfirmation) then the customer feel satisfied. On the other
hand, if perceived performance of the product falls short of a customer’s expectations (a
negative disconfirmation) then the customer feels dissatisfied.

There are various ways or techniques which organizations normally adopt to measure
customer satisfaction. It includes;

Complaint and Suggestion Systems: A customer-centered organization makes it easy for

customers to register suggestions and complaints. Companies can also using web sites and
e-mails for quick and effective two-way communication to register their suggestions. Many
companies request customers to give their opinions regarding the product and/or services
they provide.

Customer Satisfaction Survey: Another way to measure customer satisfaction is through

conducting customer satisfaction surveys at periodical intervals.

Guest Shopping: Companies hire people to pose as potential buyers to report on strong and
weak points experienced in buying the company’s and competitor’s products. These
shoppers can even test the company’s sales personnel handle various situations.

Lost Customer Analysis: Companies should contact customers who have stopped buying or
who have switched to another supplier to learn why this happened.

Focus Groups: Focus groups can be held on an informal or formal basis. On an informal
basis, consider having a group of users meet for coffee or lunch to discuss their satisfaction
with services being evaluated. On a more formal basis, a facilitator with experience in
leading focus groups can work with personnel to plan questions and activities to elicit
perception of value and satisfaction from participants.

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Jamal and Naser (2002)15 studied on customer satisfaction and retail banking. The study
focuses on antecedents and outcomes of customer satisfaction. The authors remarked that
service quality, expectations, disconfirmation, performance, desires, affect and equity as
important antecedents of customer satisfaction. The study undertook a survey which looked
into the impact of service quality dimensions and customer expertise on satisfaction. A
sample of 167 respondents took part in this study. The findings indicate that both core and
relational dimensions of service quality appear to be linked to customer satisfaction.
Another major finding of the study is that expertise is negatively related to satisfaction. The
paper discusses implications for bank managers and concludes that customer satisfaction is
an important criterion for bank’s growth and success in market.

Ba and Johnson (2005)16 did an exploratory study of the impact of e-services on online
customer satisfaction. Corporate websites have become an important point of contact with
customers for many companies. Service has been described as one of the most important
attributes for online business to influence traffic and sales. However, more research is
needed to understand how web-based technological capabilities of the services affect
customer evaluations of service value and how to determine the technological capabilities
embedded in the e-service for customer satisfaction. In this paper, the researchers proposed
an interface between online buyers and sellers through the lens of service management in
order to identify and explain possible determinants of online customer satisfaction. A
company’s website is considered its electronic Service Delivery System (eSDS). The
researchers looked at this eSDS from its process point of view and examine how an eSDS
affects customer satisfaction. The findings indicate that as the eSDS process improves, a
customer’s perception of the website’s ease of use increases, leading to increased service
value and perceived control over the process, which increases customer satisfaction. The
research provides evidence that the technological capabilities embedded in the website

15
Jamal A and Naser K (2002), Customer satisfaction and retail banking: an assessment of some of the key
antecedents of customer satisfaction in retail banking, International Journal of Bank Marketing 20/4 [2002]
146±160
16
Ba and Johannason (2005), An Exploratory Study of the Impact of e-Service Process on Online Customer
Satisfaction, pp-1-2.

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processes are an important factor in determining service quality and ultimately online
customer satisfaction.

Jacobson and Mizik (2009)17 studied on “Assessing the Value-Reference of Customer

Satisfaction” in stock market outlook. The study used the efficient markets hypothesis as a
starting point for analysis. The researchers used an approach for assessing financial value-
relevance of marketing metrics, by investigating the association between information
contained in the American Customer Satisfaction Index (ACSI) customer satisfaction
metric and stock market performance. The findings differed from earlier researchers in that
the methodological approach they applied, while nesting other models, incorporated a
number of efficient market considerations, e.g., issues ranging from unmodeled
autocorrelation, to risk adjustments, to using the unanticipated component of a series in
financial market analysis. The researchers found that there is significant incremental value-
relevance to accounting measures only for firms in the computer/Internet sector. For other
sectors, i.e., the majority of firms in the sample, unanticipated changes in satisfaction do not
provide statistically significant incremental information to accounting measures in
explaining stock returns.

Boselie, Hesselink, Wiele (2001)18, studied the relationship between Customer Satisfaction
and Business Performance. This paper focused on the analysis of empirical data on
customer satisfaction and the relationship with hard organizational performance data. The
organization is a Flex company with its headquarters in The Netherlands, but also operating
in other countries in Europe. The empirical data on customer satisfaction and business
performances stem from 1998 and 1999. Based on the empirical data it is concluded that it
is possible to find evidence for the hypothesis that there is a positive relationship between
customer satisfaction and organizational performance indicators, although the relationship
is not very strong. Various factors might influence the time lag between a change in
customer satisfaction and an expected effect in sales, margin, or other output indicators.
However, the analyses do give answers to questions related to the quality dimensions as
17
Jacobson R and Mizik N (2009), Assessing the Value-Relevance of Customer Satisfaction, National Bureau
of Economic Research (NBER), retrieved from www.ssrn.com
18
Boselie P, Hesselink M, Wiele T (2001), Empirical Evidence for the Relation between Customer
Satisfaction and Business Performance, ERIM Report Series Reference No. ERS-2001-32-ORG, retrieved
from http://papers.ssrn.com.

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underlying factors behind the items in the customer satisfaction questionnaire and some
indications for the changing behavior of the customer in relation to his perception.

Aykac, Aydin, Ates M and Cetin A (2009) 19 studied the Effects of Service Quality on
Customer Satisfaction and Customer Loyalty A Case Study on Marmara University
Hospital. The researchers employed six dimensions of service quality scale that is
developed by Carman (2000) and Kara et al. (2005) to better understand the factors
underlying healthcare customers' perceptions of service quality. These dimensions
investigated are namely tangibility, reliability, responsiveness, assurance, courtesy and
empathy. Sampling has been conducted at the Marmara University Hospital between June
1st and July 15th 2007. Purposive convenient sampling has been employed to 183
inpatients. Through a 5 point Likert-type scale, healthcare customers' expectations of a
perfect service provider has been compared with the practices Marmara University Hospital
to determine if there are any gaps. Quality of the Marmara University Hospital's healthcare
services has been analyzed together with its effects on customer satisfaction and customer
loyalty through a regression analysis.

Gritti, Foss N (2007)20 studied Customer Satisfaction and Competencies using Econometric
tools in an Italian Bank. The objective was to know how customer satisfaction and loyalty
in the banking industry may affect profitability. The study was focused to identify the
strategy and competencies necessary to benefit from customer relationships which are
important sources for improved performance in the banking. The researchers' analyzed data
collected on 2,105 customers of 118 branches of one of the biggest banks of an Italian
banking group. The study found that customer satisfaction impacts loyalty, which in turn
has a direct effect on financial and non-financial customer value/total customer
value/complex customer value. Moreover, loyalty is a mediator between financial and not-
financial customer value and two sources of customer satisfaction, namely relationships
with the front office and the branch, on the one hand, and the products offered, on the other.

19
Aykac D, Aydin S, Ates M and Cetin A (2009), Effects of Service Quality on Customer Satisfaction and
Customer Loyalty: Example of Marmara University Hospital, International Congress on Performance and
Quality in Health (Uluslararasi Saglikta Performans ve Kalite Kongresi), March 19-21, 2009, Antalya,
Turkey, retrieved from www.ssrn.com
20
Gritti P, Foss N (2007), Customer Satisfaction and Competencies: An Econometric Study of an Italian
Bank, SMG Working Paper No. 10/2007, retrieved from www.ssrn.com

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2.8 Conclusion

From the literature, it is evident that Customer Satisfaction is an important factor that
affects the survival of business in modern days. Banking Sector in Oman is highly
competitive; hence the need for maintaining and retaining customers is of considerable
importance. The study hence is useful as it can provide detailed view on the level of
customer satisfaction and various factors that are important in determining the customer
satisfaction towards the bank.

Chapter Three

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Customer Satisfaction in Bank Muscat

Research Methodology
3.1 Introduction

Research in common parlance refers to search for knowledge. The Advance Learner’s
Dictionary of Current English defined research as “a careful investigation or inquiry
especially through search for new facts in any branch of knowledge”. The purpose of
research is many, including discovering, interpreting and development of methods and
systems for advancement of human knowledge on different branch of knowledge.

The study “Customer Satisfaction in Bank Muscat” is an attempt to evaluate various aspects
of customer satisfaction and critically review whether the customer’s of Bank Muscat are
satisfied with the products and/or services offered by the bank. This research follows a
clearly defined research methodology.

3.2 Type of Research

To accomplish the objective of the study, descriptive research design is adopted. As Kothari
(2004) mentioned, the main purpose of descriptive research is description of state of affairs
as it exist at present21. The descriptive study is typically concerned with determining
satisfaction level of customers with the product and/or services offered by Bank Muscat.

3.3. Data Collection

The study requires both primary data and secondary data. Primary data refers to the data
which is collected for the first time by the researcher for the specific purpose. The
secondary data is already collected data, collected for some other purpose. The secondary
data should be used only after proper validation and necessary changes. The collection of
primary data requires time, effort and financial resources, while the collection of secondary
data does not require time, effort and financial resources in comparison to primary data.

3.4 Primary Data

21
Kothari CR (2004), Research Methodology – Methods and Techniques, Second Edition, New Age
International Publishers,

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Customer Satisfaction in Bank Muscat

The study requires primary data relates to customer satisfaction in Bank Muscat. For the
present study, the data is collected from the customers of Bank Muscat. As mentioned,
customer means any person who availed some services from Bank or has an account in the
Bank.

Primary data is collected mainly using questionnaire. Questionnaire indicates a list of

questions prepared by the investigator and send to the respondent through some means.
Questionnaire is found effective in this study since it facilitates collection of information
from a large group of respondents in less time, compared to any other methods of data
collection. Interview is conducted with the management to get more insight in to the bank’s
initiatives to make the customers satisfied with the products and/or services of the bank.

3.5 Sampling

“Sampling may be defined as the selection of an aggregate or totally on the basis of which a
judgment of reference about the aggregate of totally is made. “Sampling is used in
conducting surveys and in studying various problems concerning production management,
time and motion studies, market research, various areas of accounting and finance and the
like.

Sample size:

The customer of Bank Muscat, Ruwi Branch is the population for the study. The study
made use of a sample study. For the project 50 customers were taken into consideration and
they were selected on the random basis. 50 samples were selected since it represents an
adequate sample for the study. Questionnaires were distributed to the samples, to get their
feedback on satisfaction with Bank Muscat.

Method of sampling:

A random sampling technique is applied to select sample for the study.

3.6 Secondary Data:

The secondary data is collected from various sources available with in the organization like,

Organizational web site

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Customer Satisfaction in Bank Muscat

Bank’s publications.

Library books

Internet

Annual reports

Consulting administrative staff.

Consulting marketing Managers

3.7 Tools for analysis

Statistical techniques are to obtain findings and average information in logical sequence
from the raw data collected. After tabulation of data researcher have used the following
quantitative technique.

Summary Tables

Charts

Microsoft Excel package is used to present the data in tabular form and to make charts.
Statistical tools were applied on the data collected to generate inferences. The study made
use of tools like percentages, averages, weighted average etc to undertake analysis.

3.8 Limitations of the Study

a) The study is based on sample study. All the inherent limitations of sample study
are also present for this study. The sample should be representative so that the
results will be true for the population as well.

b) The study focuses on one branch of Bank Muscat. The information collected
from the branch is taken as the basis for generalizing the level of customer
satisfaction in Bank Muscat as a whole.

c) There are some information which are confidential in nature than cannot be
availed for the purpose of study.

d) Some respondents have not responded to some questions in the questionnaire.

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Customer Satisfaction in Bank Muscat

Even though these limitations are present in the study, the researcher overcomes these
limitations by applying a well defined research methodology. The researcher selected
sample design which is appropriate for the study, utilized statistical design to satisfy the
stated objectives of the study. Samples were selected randomly and views were collected
through providing a well designed questionnaire.

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Customer Satisfaction in Bank Muscat

Chapter Four
Data Analysis

4.1 Introduction

In this section, the data collected through questionnaire is analyzed. The questionnaire is
distributed to fifty customers in Bank Muscat – Ruwi Branch. The samples’ were taken
randomly from the customer records in the Bank. The data collected were summarized in
tables and figures, and then statistical tools were applied to derive conclusions from the
data.

4.2 Profile of Respondents

1. Gender

The gender of sample respondents is given below;

Table No. 1: Gender of Respondents

Gender Number Percentage

Male 32 64.00
Female 18 36.00
Total 50 100.00
Figure No.1: Gender of Respondents

Gender of Respondents

36%

64%

Male Female

As can be inferred from the above, 36% of the respondents are female, while 64% of the
respondents are male customers. The variable indicates that the samples possess

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characteristics of population and is distributed similarly the way population is distributed as

well with respect to gender.

2. Age

The age of respondents is summarized below

Table No. 2: Age of Respondents

Age Number Percentage

Less than 20 3 6.00
20 years – 35 years 23 46.00
35 years – 50 years 14 28.00
More than 50 years 10 20.00
Total   50 100.00
Figure No. 2: Age of Respondents

Age of Respondents

6%
20%

46%
28%

Less than 20 20 years – 35 years 35 years – 50 years More than 50 years

The above table and figure shows that 46% of the respondents are within the age group 20-
35 years. The second largest group is between 35-40 years, constitute 28% of the total
respondents. The respondents spread across all age group, hence constitute a appropriate
sample for the purpose. It allows the researcher to collect views of group of people in all
ages who deal with Bank Muscat. Hence results can be viewed as the result of the
population as well.

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3. Type of Account

Another demographic variable relating to the respondents is the type of account they held in
the bank. The data is summarized in the following table and figure.

Table No.3: Type of Account

Type of Account Number Percentage

Deposit Account 20 40.00
Loan Account 19 38.00
Current Account 11 22.00
Total 50 100.00
Figure No.3: Type of Account

Type of Account 20 19

20
11
Resp o n d en t

15
Number of

10

0
Deposit Loan Account Current
Account Account
Type of Account

40% of the respondents have deposit account with Bank Muscat, while 38% of the
customers hold loan account and 22% of the respondents have current account in the bank.
The above table and figure shows that the respondents are evenly distributed among the
different type of accounts. The sample is appropriate as it enable the researcher to collect
feedback on customer satisfaction regarding various services offered by the bank, not
limiting to a particular service only.

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4.3 Facilities or Features leading to customer satisfaction

There are various facilities which the customer would like to see in bank, which have direct
impact on their level of satisfaction. Respondents were asked to rate the features or
facilities that they would like to see in bank. The purpose is to evaluate the facilities that
banks should concentrate so that the level of customer satisfaction can be improved.

The researcher summarized various features and noted it in the questionnaire. The
responses of the customers are summarized in the following table. A weighted average
score is worked out to determine the factor that respondents consider more important,
leading to customer satisfaction.

The total preference of customers towards each factor is multiplied by respective weightage
to find the combined effect of ranking on each factor. A percentage taking into
consideration all weightings is worked out and is shown below.

Table No. 4: Facilities or Features leading to customer satisfaction

Factors Number Percentage

Proximity to the town/ main road 8.50 17.00
Large networks in term of ATM/Deposit Machines 11.64 23.29
Widest range of bank services 9.79 19.57
Number of Staffs in bank’s counters 9.11 18.21
A pleasing bank environment 4.29 8.57
Qualified Staff with generous attitude 6.68 13.36
Total 50.00 100.00
Figure No. 4: Facilities or Features leading to customer satisfaction

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Customer Satisfaction in Bank Muscat

13% 17%

9%

23%
18%

20%

Proximity to the town/ main road

Large networks in term of ATM/Deposit Machines
Widest range of bank services
Number of Staffs in bank’s counters
A pleasing bank environment
Qualified Staff with generous attitude

As can be seen from the above, there is no single factor that exclusive leads to customer
satisfaction. Banks should deploy variety of features or facilities to attract the customers.
23.29% of respondents ranked large networks in terms of ATM/Deposit machines as the
main reason for customer satisfaction. It is inferred that more number of ATM/Deposit
machines attracts more customers towards the bank. The second important factor is widest
range of bank services, according to 19.57% of the total respondents. 18.21% commented
that number of staffs in the bank branches to take care of the customer requirements is an
important indicator that influences the customer satisfaction level. 17.00% of the customers
responded that proximity to town/main road is an important factor that leads to customer
satisfaction. Thus, the banks should concentrate on all these factors to improve the level of
customer satisfaction.

4.4 Rating of Bank Muscat

The respondents are asked to rate Bank Muscat in terms of its services. The following table
and figure highlight the summary of result.

Table No.5: Rating of Bank Muscat

Rating Number Percentage

Excellent 4 8.00
Very Good 22 44.00

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Customer Satisfaction in Bank Muscat

Good 18 36.00
Average 5 10.00
Poor 1 2.00
Total 50 100.00
Figure No.5: Rating of Bank Muscat

Rating of Bank Muscat

10% 2% 8%

36% 44%

Excellent Very Good Good Average Poor

The analysis shows that 44% of respondents rated Bank Muscat as Very Good based on its
services. 36% of the respondents rated Bank Muscat as good. 8% of the respondents rated
Bank Muscat as Excellent.

4.5 Quality of Services – Updating customers on product and services

An important aspect that positively affects customer satisfaction is the interaction of bank
regarding the products, services and various offers. The respondents were asked whether
the bank provides up-to-date information on the product, services and various offers. The
responses are summarized in the following table and figure.

Table No. 6: Quality of Services - Updating customers on product and services

Remarks Number Percentage

Yes, all times 27 54.00
Yes, some times 20 40.00
No 3 6.00
Total 50 100.00
Table No. 6: Quality of Services - Updating customers on product and services

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Customer Satisfaction in Bank Muscat

Updating Customers reg. product/services

6%

40% 54%

Yes, all times Yes, some times No

Based on the above summary table and figure, it is clear that 54% of customers agreed that
bank provides information at all times regarding the products and or services. According to
them, this is done through advertisement, mobile messages, pamphlets at bank counters,
etc. 40% of the respondents commented that bank provides up-to-date information at some
times. 6% of the respondents refutes and states that the bank did not provide up-to-date
information on the product and/or services to them.

It is suggested based on the above that the bank should take measures to improve the
dissemination of information to customers at all times.

4.6 Rating on Customer Service Staff

Customer service staff projects the image of the organization. A good, pleasing and helpful
customer service counter generates less customer complaints and more satisfied group of
customers. The respondents were asked to rate the customer service staff in bank based on
the quality of their services. The responses were summarized and are given below;

Table No.7: Rating on Customer Service Staff

Rating Number Percentage

Excellent 15 30.00
Very Good 19 38.00
Good 9 18.00
Average 5 10.00

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Customer Satisfaction in Bank Muscat

Poor 2 4.00
Total 50 100.00
Figure No.7: Rating on Customer Service Staff

Rating of Customer Service Staff

4%
10%
30%

18%

38%
Excellent Very Good Good Average Poor

30% of respondents rated the bank’s customer service staff as excellent. According to them,
the staffs are proactive in providing information to satisfy the requirements of customers.
They mentioned that the staff’s are co-operative, pleasing and holds up-to-date information
on various aspects covering customer queries. 38% of the respondents rated bank’s
customer service staff as very good. 18% rated them as good while 10% and 4% of
respondents rated the customer service staff as average and poor respectively. The goal of
organization should be to convert 100% of the customers satisfied with their services.

4.7 Evaluation of Various Elements of Customer Satisfaction

Now an attempt is done to evaluate various elements of customer satisfaction. The

researcher identified various elements as shown below which affects the level of customer
satisfaction in bank. The various elements evaluated include;

Timeliness in product delivery and services

Behavior and Mannerism of Service Staff

Speed of processing transactions and other requests

Value added services provided by the bank

Ambience of bank environment

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Customer Satisfaction in Bank Muscat

Attitude of Bank Staff

Transparency of bank proceedings

Knowledge and expertise of the staff

Query handling

Networking of branches

Frequency and quality of contact

Proximity of ATM’s

Overall satisfaction of bank services

A customer will be satisfied if the bank provides these facilities positively. For example, if
customer queries were settled at the earliest, customers will be satisfied. More number of
branches, ATMs, cash deposit machines, etc are factors that influence customer satisfaction.
The responses of customers in each of these factors are discussed below.

4.8 Timeliness in product delivery and services

Timeliness in product delivery and services attract customer’s to deal with the bank again
and again. A delay in providing services, long queue etc leads to customer dissatisfaction.
The respondent’s were asked to rate whether bank follow timeliness in providing products
and services.

Table No.8: Timeliness in product delivery and services

Rating Number Percentage

Highly Satisfied 19 38.00
Satisfied 16 32.00
Neither Satisfied nor dissatisfied 9 18.00
Dissatisfied 4 8.00
Highly Dissatisfied 2 4.00
Total 50 100.00
Figure No.8: Timeliness in product delivery and services

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Customer Satisfaction in Bank Muscat

Timeliness in product delivery and services

4%
8%

38%
18%

32%

Highly Satisfied Satisfied Neither Satisfied nor dissatisfied Dissatisfied Highly Dissatisfied

38% of the respondents commented that they are highly satisfied with the timeliness of
delivery of product and services. 32% of the respondents were satisfied, while 18% of the
respondents commented that they are neither satisfied nor dissatisfied with the delivery of
product and services. As, the timeliness of delivery of product and service is an important
indicator affecting level of satisfaction, the bank should take adequate measures to improve
the same.

4.9 Behavior and Mannerism of Service Staff

As mentioned before, service quality is very important in financial service sector. Service
quality is assessed in terms of timeliness of delivery of product and services, behavior and
mannerism of service staff etc. The respondent’s remarks on the behavior and mannerism of
service staff in the bank is summarized here.

Table No.9: Behavior and Mannerism of Service Staff

Rating Number Percentage

Highly Satisfied 15 30.00
Satisfied 14 28.00
Neither Satisfied nor dissatisfied 12 24.00
Dissatisfied 7 14.00
Highly Dissatisfied 2 4.00
Total 50 100.00
Figure No.9: Behavior and Mannerism of Service Staff

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Customer Satisfaction in Bank Muscat

Behavior and Mannerism of Service Staff

19
16
20

Respondents
15 9
Number of
10 4
2
5

0
Highly Satisfied Neither Dissatisf ied Highly
Satisfied Satisfied nor Dissatisfied
dissatisfied

Level of Satisfaction

30% of the respondents commented that the mannerism and behavior of staff is highly
satisfactory for the respondents. 28% of respondents are satisfied with the behavior of staff
while 24% of the respondent did not give any comments. The bank should improve the
quality of service staff by providing them adequate training, recruiting more qualified and
experienced staff, etc.

4.10 Value added services provided by the bank

The changing customer demands and market requirements necessitated banks to add value
added products and services to its service portfolio. It includes electronic fund transfer,
online payment systems, etc. The respondents were asked to rate the level of satisfaction
with the value added services of the bank. It is summarized below;

Table No.10: Value added services provided by the bank

Rating Number Percentage

Highly Satisfied 22 44.00
Satisfied 18 36.00
Neither Satisfied nor dissatisfied 3 6.00
Dissatisfied 5 10.00
Highly Dissatisfied 2 4.00
Total 50 100.00
Figure No.10: Value added services provided by the bank

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Customer Satisfaction in Bank Muscat

Satisfaction level on Value added services provided by the bank

22
25 18
20

Respondents
Number of 15
5
10 3 2
5
0
Highly Satisfied Neither Dissatisfied Highly
Satisfied Satisfied nor Dissatisfied
dissatisfied

Level of Satisfaction

44% of the respondents commented that they are highly satisfied with the value added
services provided by the bank. They put additional comments that Bank Muscat is the
leading financial institution in Oman that provides more value added services. 36% of the
respondents commented that they are satisfied with the valued added services provided by
the bank. While 10% of the respondents rated the value added services as average, while
4% of respondents rated it as poor.

4.11 Ambience of bank environment

The facilities in the bank’s branches and its ambience are very important in determining the
level of satisfaction of the customers. Often customers prefer to see a pleasing, spacious
bank environment, sufficient to cater the requirements of the customers. The respondent’s
comments in this regard are summarized in the following table and figure.

Table No.11: Ambience of Bank Environment

Rating Number Percentage

Highly Satisfied 26 52.00
Satisfied 17 34.00
Neither Satisfied nor dissatisfied 0 0.00
Dissatisfied 5 10.00
Highly Dissatisfied 2 4.00
Total 50 100.00
Figure No.11: Ambience of Bank Environment

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Customer Satisfaction in Bank Muscat

Ambiece of Bank Environment

52.00
60
50 34.00
Percentage of
Respodents
40
30
10.00
20 4.00
0.00
10
0
Highly Satisfied Neither Dissatisfied Highly
Satisfied Satisfied nor Dissatisfied
dissatisfied

Level of Satisfaction

52% of the respondents commented that they are highly satisfied with the ambience in the
bank environment. 34% of the respondents are satisfied, while 10% of the respondents are
dissatisfied with the ambience in the bank environment. In service organizations, the quality
of service and facilities available should match to the customer expectations.

4.12 Knowledge and expertise of Staff

Another important determinant of service quality is the knowledge possessed by the bank
staff. Adequate knowledge enables the staff to discharge the functions effectively and leads
to satisfied customers. Hence the management should make sure that staffs are trained and
adequately qualified for the work assigned. The respondents were asked to comment
whether they are satisfied with the quality, knowledge and expertise of the staff. Their
responses are summarized in the following table and figure.

Table No.12: Knowledge and Expertise of the Staff

Rating Number Percentage

Highly Satisfied 26 52.00
Satisfied 17 34.00
Neither Satisfied nor dissatisfied 0 0.00
Dissatisfied 5 10.00
Highly Dissatisfied 2 4.00

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Customer Satisfaction in Bank Muscat

Total 50 100.00
Figure No.12: Knowledge and Expertise of the Staff

Knowledge and Expertise of the Staff

4.00
10.00
0.00

52.00
34.00

Highly Satisfied Satisfied Neither Satisfied nor dissatisfied Dissatisfied Highly Dissatisfied

52% of the respondents commented that they are highly satisfied with the knowledge and
expertise of staff. They mentioned that the bank staff possesses adequate knowledge and
expertise so that they can discharge their functions effectively and efficiently. 34% of the
respondent commented that they are satisfied with the knowledge and expertise of the staff
while 10% of respondents are dissatisfied with the knowledge and expertise of the staff.

4.13 Facilities in terms of ATMs, number of branches, proximity to major locations

etc.

The respondents are asked to comment whether they are satisfied with the facilities of the
bank in terms of ATMs, number of branches, proximity to major locations etc. These are
criteria’s which banks are concentrated on, particularly Bank Muscat. Bank Muscat is
recognized as the leading bank in terms of ATMs, number of branches, etc. The responses
are summarized below;

Table No.13 Facilities of the Bank

Rating Number Percentage

Highly Satisfied 32 64.00
Satisfied 17 34.00

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Customer Satisfaction in Bank Muscat

Neither Satisfied nor dissatisfied 0 0.00

Dissatisfied 1 2.00
Highly Dissatisfied 0 0.00
Total 50 100.00
Figure No. 13: Facilities of the Bank

Facilties of the Bank

2%0%
0%

34%

64%

Highly Satisfied Satisfied Neither Satisfied nor dissatisfied Dissatisfied Highly Dissatisfied

64% of respondents remarked that they are highly satisfied with the facilities of the bank in
terms of number of branches, ATMs, cash deposit machines etc. 34% of the respondents are
satisfied with the facilities of the bank. In nutshell, the largest network of Bank Muscat has
enabled it to increase it customer base and their level of satisfaction in the bank.

4.14 Suggestions for improvement

The respondents are asked to comment the areas that Bank require improvement. Majority
of the customer did not entered any response to the question, rather commented that the
bank provides everything to meet the customer requirements. It shows the reputation the
bank has gained in the market.

4.15 Conclusion

To conclude, the respondents were asked whether Bank Muscat is the number one bank in
Oman in terms of its customer satisfaction level. The remarks of the respondents were
summarized below;

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Table No.14: Bank Muscat – Number One bank in Oman

Comments Number Percentage

Yes 45 90.00
No 5 10.00
Total 50 100.00
Figure No.14: Bank Muscat – Number One bank in Oman

Bank Muscat - No. 1 Bank in Oman

10%

90%

Yes No

90% of the respondents commented that Bank Muscat is the number one banking institution
in Sultanate of Oman. This shows that majority of customers were satisfied with the
services of Bank Muscat.

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Customer Satisfaction in Bank Muscat
\

Chapter Five
Findings, Recommendation and Conclusion

5.1 Findings

The findings based on data analysis are explained here. Data is collected through
questionnaire from 50 customers selected randomly. Based on the data analysis, the
following findings were derived.

1. It is found from the study that large networks in terms of ATM/Deposit Machines
etc, is the major reason for customer satisfaction. This is according to 23.29% of
respondents. 19.57% of respondents stated that widest range of bank services is the
major reason for customer satisfaction. Number of staffs in the ban counters and
proximity to major town/main road are other leading factors, according to 18.21%
and 17% of the respondents, respectively.
2. 44% of the respondents rated that Bank Muscat is very good commercial banking
institution in terms of quality of its services. 36% of the respondents rated it as good
while 8% rated it as excellent.
3. 54% of respondents agreed that the bank provides up-to-date information on its
various product and services. 40% of respondents commented that the bank provides
up-to-date information not always, but sometimes.
4. 30% of the respondents rated customer service staff in Bank Muscat as excellent,
while 38% of the respondents rated them as very good. 14% of the respondents were
not satisfied with the customer service staff.
5. 38% of the respondents are highly satisfied with the delivery of products and
services of Bank Muscat. 32% of the respondents were satisfied with the delivery of
product and services. 18% of the respondents did not give any opinion, while 12%
are not satisfied with the delivery of products and services.
6. 30% of the respondents were highly satisfied with the behavior and mannerism of
service staff. 28% of respondents were satisfied with the behavior and mannerism of
service staff, while 18% were not satisfied with behavior and mannerism of service
staff.

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7. 44% of respondents were highly satisfied with the value added services of the bank.
36% of respondents were satisfied while 14% were not satisfied with the value
added services provided by the bank.
8. 52% of the respondents commented that they are highly satisfied with the ambience
in the bank environment. 34% of the respondents are satisfied, while 10% of the
respondents are dissatisfied with the ambience in the bank environment. In service
organizations, the quality of service and facilities available should match to the
customer expectations.
9. 52% of the respondents commented that they are highly satisfied with the
knowledge and expertise of staff. They mentioned that the bank staff possesses
adequate knowledge and expertise so that they can discharge their functions
effectively and efficiently. 34% of the respondent commented that they are satisfied
with the knowledge and expertise of the staff while 10% of respondents are
dissatisfied with the knowledge and expertise of the staff.
10. 64% of respondents remarked that they are highly satisfied with the facilities of the
bank in terms of number of branches, ATMs, cash deposit machines etc. 34% of the
respondents are satisfied with the facilities of the bank. In nutshell, the largest
network of Bank Muscat has enabled it to increase it customer base and their level
of satisfaction in the bank.

These are the various findings from the study.

5.2 Recommendations

No specific recommendations are provided based on the study since majority of customers
were satisfied with the performance of the bank. The bank is the leading commercial bank
in Sultanate of Oman, with widest range of services, branches, ATMs and cash deposit
machines. Above this, the quality of service staff is a major determinant affecting customer
satisfaction. Bank should consider this aspect and continuously invest on its human
resources, so that customer requirements can be met at the most effective manner.

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5.3 Conclusion

Customer satisfaction is one of the main objectives of any organization. Every organization
tries to know the customer satisfaction about their products. So a study on customer
satisfaction helps the organization as well as me to gain a vast knowledge over the real
world tastes and preferences of customer. In general satisfaction is a person’s feelings of
pleasure or disappointment resulting from comparing a products perceived performance in
relation to his or her expectations. As this definition makes clear, satisfaction is a function
of perceived performance and expectations. If the performance falls short of expectations,
the customer is dissatisfied. If the performance matches the expectations, the customer is
satisfied. If the performance exceeds expectations, the customer is highly satisfied or
delighted.

This study is carried out with the objective to understand the level of customer satisfaction
in Bank Muscat. The study utilized Bank Muscat- Ruwi branch as a case study. The study is
carried out to know whether the customers are satisfied with the performance of the bank.
Also, it is intended to evaluate the various factors leading to customer satisfaction. The
study is done using a sample study, 50 respondents were selected randomly from the bank.
Questionnaire is distributed to the staff and responses were collected.

The data collected were summarized and tables and figures were made. Based on the data
analysis, it is found that the customers are satisfied with the bank’s product and services.
The factors that are important in satisfying customer includes number of bank branches,
qualified staff, friendliness in the customer service department, timeliness in delivery of
product and services, etc. It is found from the responses that Bank Muscat provides its
services to suit the customer requirements, hence, leads to customer satisfaction.

Based on the study, it is concluded that success of any organization depends mainly on its
ability to maintain satisfied list of customers. Satisfied customers are ambassadors for
organizations and this is true for Bank Muscat, the leading commercial bank in Sultanate of
Oman.

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Reference
1. Tarawneh M (2006), A Comparison of Financial Performance in the Banking
Sector: Some Evidence from Omani Commercial Banks, International Research
Journal of Finance and Economics, Issue 3 (2006).
2. Definition of Customer Satisfaction, retrieved from
http://www.businessdictionary.com/definition/customer-satisfaction.html.
3. Oliver, R.L. (1980), ``Cognitive model of the antecedents and consequences of
satisfaction decisions’’, Journal of Marketing Research, Vol. 17, November, pp.
460-9.
4. http://www.bankmuscat.com/en-us/Pages/default.aspx
5. http://www.omanet.om/english/commerce/banking.asp?cat=comm
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7. Levesque, T. McDougall, H.G.(1996), Determinants of Customer Satisfaction in
Retail banking, International Journal of Bank Marketing, pp.1-2.
8. Kotler, P (2000), Marketing Management. 10th edition, New Jersey, Prentice-Hall
Publications.
9. Hoyer, W. D. & MacInnis, D. J., 2001, Consumer Behavior. 2nd ed., Boston,
Houghton Mifflin Company.
10. Ba and Johannason (2005), An Exploratory Study of the Impact of e-Service
Process on Online Customer Satisfaction, pp-1-2.
11. Zeithmal, Bell (1990), Service Marketing, Principles and Practices, Prentice Hall
Publications.
12. http://titania.emeraldinsight.com
13. Zairi, M., 2000, Managing Customer Dissatisfaction Through Effective Complaint
Management Systems, The TQM Magazine, 12 (5), pp. 331-335.
14. Alan Wolf (2009), Retail Stock Prices Correlate With Customer Satisfaction: Study,
retrieved from http://mobile.twice.com/article/258173-
_Retail_Stock_Prices_Correlate_With_Customer_Satisfaction_Study.php

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Customer Satisfaction in Bank Muscat

15. Hoffman, Batterson (2002), Service Marketing, 2nd Edition, Mcgraw Hill
Publications.
16. Peter, P.J. and Olson, J.C. (1996), Consumer Behaviour and Marketing Strategy, 4th
ed., Irwin, Chicago, IL.
17. Jamal A and Naser K (2002), Customer satisfaction and retail banking: an
assessment of some of the key antecedents of customer satisfaction in retail
banking, International Journal of Bank Marketing 20/4 [2002] 146±160
18. Ba and Johannason (2005), An Exploratory Study of the Impact of e-Service
Process on Online Customer Satisfaction, pp-1-2.
19. Jacobson R and Mizik N (2009), Assessing the Value-Relevance of Customer
Satisfaction, National Bureau of Economic Research (NBER), retrieved from
www.ssrn.com
20. Boselie P, Hesselink M, Wiele T (2001), Empirical Evidence for the Relation
between Customer Satisfaction and Business Performance, ERIM Report Series
Reference No. ERS-2001-32-ORG, retrieved from http://papers.ssrn.com.
21. Aykac D, Aydin S, Ates M and Cetin A (2009), Effects of Service Quality on
Customer Satisfaction and Customer Loyalty: Example of Marmara University
Hospital, International Congress on Performance and Quality in Health (Uluslararasi
Saglikta Performans ve Kalite Kongresi), March 19-21, 2009, Antalya, Turkey,
retrieved from www.ssrn.com
22. Gritti P, Foss N (2007), Customer Satisfaction and Competencies: An Econometric
Study of an Italian Bank, SMG Working Paper No. 10/2007, retrieved from
www.ssrn.com
23. Kothari CR (2004), Research Methodology – Methods and Techniques, Second
Edition, New Age International Publishers,

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Customer Satisfaction in Bank Muscat

Appendix 1

Questionnaire
Customer Satisfaction in Bank Muscat
Dear Sir/Madam,
This questionnaire is prepared as part of the requirements of curriculum, to complete a
project on “Customer Satisfaction in Bank Muscat”. Your response to the questions is
appreciated. The information provided will be used for academic purpose.

Thanking you
Gender : Male () Female ()

Age : Less than 20 ()

20 years – 35 years ()
35 years – 50 years ()
More than 50 years ()

1. Type of Facility Availed:

Deposit Account ()
Loan Account ()
Current Account ()

2. Rank the features that you prefer to see in a bank

Proximity to the town/ main road ()
Large networks in term of ATM/Deposit Machines ()
Widest range of bank services ()
Number of Staffs in bank’s counters ()
A pleasing bank environment ()
Qualified Staff with generous attitude ()

3. How do you rate Bank Muscat in terms of its services?

Excellent ()
Very Good ()
Good ()
Average ()
Poor ()

4. Do you feel that the bank provides up-to-date information on their products and
services?
Yes, all times ()
Yes, some times ()
No ()

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Customer Satisfaction in Bank Muscat

5. How do you rate the customer service staff in Bank ?

Excellent ()
Very Good ()
Good ()
Average ()
Poor ()

6. Please rate your satisfaction level in the following;

Highly Satisfied 1
Satisfied 2
Neither Satisfied nor dissatisfied 3
Dissatisfied 4
Highly Dissatisfied 5

Criteria 1 2 3 4 5
1 Timeliness in product delivery and services
2 Behavior and Mannerism of Service Staff
3 Speed of processing transactions and other requests
4 Value added services provided by the bank
5 Ambience of bank environment
6 Attitude of Bank Staff
7 Transparency of bank proceedings
8 Knowledge and expertise of the staff
9 Query handling
10 Networking of branches
11 Frequency and quality of contact
12 Proximity of ATM’s
13 Overall satisfaction of bank services

7. Comment on the following statements;

No Statements Yes No
1 Bank Muscat is the number one bank in Oman
2 The bank often updates its products to meet increased customer
requirements.
3 Bank Muscat is the most customer friendly bank in Oman
4 The bank’s staff’s are supportive in attending customer queries
and providing necessary information to the customers.
5 The bank’s staff is accessible at all times
6 There is no delay in availing services as far as Bank Muscat is
concerned.

8. Suggest the areas that needs improvement,

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Customer Satisfaction in Bank Muscat

Banks’ product and services ()

Knowledge of banks’ staff ()
More number of bank ATM/deposit machines ()
Customer Service Department ()

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