SERVICE QUALITY & OPERATIONAL PERFORMANCE OF TOUR OPERATORS IN KENYA Doreen Nanyama Inyo Quality Assurance Officer University of Nairobi

Outline Abstract Background Problem Statement Literature Review Research Methodology Findings Conclusion Questions As you well know, quality improvement has become a major concern for both public and private organizations across the world. However, despite all efforts to improve quality in tourism, there seem to be an increasing number of customer dissatisfaction and many tourism enterprises such as tour operators have to deal with countless number of customer complaints on a daily basis. The question we need to ask ourselves is: is it due to lack of awareness of managers on importance of quality or is it the improper systems of quality improvement that are being implemented by these firm?

Abstract Significance of service quality components Effects on operational performance of firms This study explored the relative importance of service quality components and how these affect the operational performance of firms in the tourism industry.

Corporate Image (company identity) Functional Quality (how it is delivered) Technical Quality (what is delivered) Corporate Image (company identity) The study used Gronroos Model of service quality which has three service quality components. Technical quality – what customer receives e.g. knowledge and skills, employees technical ability, technical solutions of products, company reputation and credibility. Functional quality – employee attitudes and behavior, consumer contacts, service mindedness, accessibility and flexibility, reliability and trustworthiness, and service recovery. Corporate image – location, facilities, employee attitudes, and service of the firm Significant variables in Gronroos Model

Background Service quality - how well service level delivered matches customer expectations Operational performance - how efficiently a firm meets the needs and wants of customers Service quality – determinant of operational competitiveness According to Gronroos Model, operational performance of a firm is highly determined by the service quality components that a firm employs.

Service Quality In Tourism Industry Consumers evaluate quality of service using service dimensions There are a number of service quality models that describe how customers perceive actual service performance and service delivery system. For instance, the SERVQUAL Model by Parasuraman (1988), Gronroos Model (1982) etc. In tourism industry, customers use service attributes such as tangibles, reliability, assurance etc to evaluate service quality hence managers should know the service quality components that are significant to consumers when selecting services and therefore, impact on the operational competitive position of a firm.

Problem Statement Managers – know service quality components impact - competitive position of a firm The main purpose of the study was to examine the importance of service quality components in Gronroos Model and how these affect the operational performance of firms.

Research Questions Should firms improve on all the three service quality components in order to achieve operational competitiveness? Which service quality component significantly affect operational performance in Kenya’s tourism industry?

Research Objective How operational performance can be achieved using service quality in tourism enterprises in Kenya Relationships between service quality components and operational performance of firms

Literature Review Quality in Tourism Operations Corporate Image and Perceived Service Quality Service Quality & Operational Performance Quality in Tourism Operations A study by Augustyn (1998) reveals that quality problems in tourism do not result from lack of quality awareness or interest but from improper systems of quality improvement being implemented. Lack of quality control in tourism industry contributes to the increasing number of tourist dissatisfaction with their total tourism experience (Augustyn, 1998). Corporate Image and Perceived Service Quality Image is defined as the ‘overall impression’ created in the minds of customers about an organization (Nguyen, 2006). According to Kandampully and Suhartanto (2000), an organization’s image is an important variable that positively or negatively influences the customers’ perception of service quality and thus determines customer satisfaction. Service Quality & Operational Performance Gronroos (1988) proposed a model that describes technical quality and functional quality components used by consumers to measure the quality of services. Parasuraman et al. (1991) proposed SERVQUAL model and suggested that service quality can be measured through five functional dimensions which include; tangibles, reliability, responsiveness, assurance, and empathy. The findings indicate that though tourism firms perceive quality as the key success factor in operational performance, the level of its actual implementation is very low in tourism industry than other sectors.

Service Quality Perception Operational Performance Conceptual Framework Technical Quality Functional Quality Image Service Quality Perception Operational Performance Source: Researcher, 2013 H5 H6 H1 H2 H4 H3 Independent variables: technical and functional quality Dependent variables: corporate image, service quality perception, and operational performance

Research Methodology Research Design: descriptive research design Unit of analysis: Service quality components that firms use to achieve operational performance Target Population and Sample Size: 342 tour operations companies based in Nairobi region Descriptive research study – so as to describe the characteristics of variables of the study in a situation

Cont. Sample size: 98 tour operators from the list of KATO Stratified random sampling: to select respondents Data Collection: structured questionnaire Respondents: operations managers of tour operations enterprises

Cont.. Data Analysis: response rate was 88% Analytical techniques: mean scores, standard deviations, and correlations Philosophical assumptions: deductive approach to empirically test the theory using primary data collected. The study adopted the underlying positivism epistemology for testing a theory in this case, the service quality theory and its influence on the operational performance of a firm. Hypotheses were formulated and tested.

Findings Hypotheses indicates positive relationships among variables Correlation analysis – all variables correlate significantly Strong correlations - functional quality, service quality perception and operational performance The findings of this study prove that there are significant relationships among the variables under study. The results suggest that both technical quality and functional quality need to be enhanced, with functional quality demanding high priority.

Summary Both technical and functional quality are significant Functional quality – more influential on customers’ service perception Focus - technical quality aspects than functional quality Although functional quality is more influential on how customers perceive the quality of service, most tourism firms focus on improving on technical quality aspects than functional quality features such as employee attitudes and behavior, service mindedness, consumer contacts, appearance, accessibility, internal relations

Cont.. Corporate image – technical and functional quality Corporate Image influences how consumers perceive service quality yet majority of tourism firms in Kenya are yet to realize its importance. Corporate image of a firm can only be achieved through technical and functional quality (a firm gains good reputation and image from its customers). Image influences the firm’s ability to satisfy customer’s desires and perception of quality service because services are difficult to evaluate. Image attributes include: good location, employee attitudes, facilities, services offered.

Conclusion Service firms – improve on service quality components to remain competitive Operations managers – monitor new developments Three service quality components - crucial for operational performance Service operation managers should strive to improve service quality components that would satisfy their consumers so as to remain competitive in the market. It is also important to note that relationships among the variables are dynamic in nature. Therefore, operations managers should continuously monitor new developments in the market so as to improve the quality of their offerings.

Limitations & Further Research Generalization Primary data Other business firms Replication The study focused on assessing the service quality components among tour operators enterprises in Kenya. Hence generalization may not be adequately be extended to other enterprises The study used relied on primary data, which are the collection of views of respondents. Hence there could be some inaccuracies and favoritism of some responses. Further research 3. A broad study on other tourism firms or business enterprises is recommenced to ascertain the significant service quality components that enable firms to achieve operational competitiveness 4. A similar study should be replicated after a few year to assess whether the aspects have changed or not.

Service Quality & Operational Performance of Tour Operators in Kenya Prompt Quizs: What motivated you to do this study? I wanted to find out whether the operations managers who work in the tourism industry understands the key service quality components that enable them achieve operational competitiveness. Why Gronroos Model? The model suggests that a firm can achieve operational performance either by improving either of the three service components: technical, functional quality or corporate image. 3. Why focus on tour operators? One most important aspect that confronts many tourism managers and other key players in the industry is how to achieve operational competitiveness using service quality by establishing the key service attributes that are most important to many tourists and other visitors that choose Kenya as their preferred tourist destination Service Quality & Operational Performance of Tour Operators in Kenya

University of Nairobi Contacts Doreen Nanyama Inyo Quality Assurance Officer Deputy Vice Chancellor (Academic Affairs) Office University of Nairobi Cell Phone No: +254 724 485 028 Email: nanyama@uonbi.ac.ke nanyamainyo@gmail.com

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