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CUSTOMER CARE AND SATISFACTION IN PUBLIC SERVICE DELIVERY; A CASE STUDY OF ELECTRICITY COMPANY OF GHANA, KWABRE EAST DISTRICT
BY
FLORENCE APPIAH
A THESIS SUBMITTED TO THESCHOOL OF BUSINESS, KWAME NKRUMAH UNIVERSITY OF SCIENCE AND TECHNOLOGY IN PARTIAL FULFILMENT OF THE
REQUIREMENTS FOR THE AWARD OF
COMMONWEALTH EXECUTIVE MASTERS IN PUBLIC ADMINISTRATION
MAY, 2010
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DECLARATION
I hereby declare that this submission is my own work towards the award of Master of Business
Administration and that, to the best of my knowledge, it contains no material previously
published by another person nor material which has been accepted for the award of any other
degree of the University, except where due acknowledgement has been made in the text.
(Student)Florence Appiah ……………………………. ……………….. Signature Date
Supervisor
Mr Adu Gyamfi …………………………….. ……………….. Signature Date
………………. ……………………………… …………………Signature Date
Head of Department
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DEDICATION
This work is dedicated to my husband and children
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ACKNOWLEDGEMENT
I would like to express my sincere and heartfelt gratitude to the Almighty God for his tender
mercies in granting me the wisdom, strength and spiritual support in undertaking this project. I
wish to also thank my supervisor, Mr Adu Gyamfi, for his patience, understanding, suggestions
and support during the entire period of the thesis writing. My gratitude again goes to my
husband for his care and support and funding of the study. The work could also not have been
completed without the support of the officials of ECG in the Kwabre East district and to all
valued customers of ECG who granted me the audience in the collection of data. To all I say,
may the Almighty God richly bless you.
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ABSTRACT
Every business, company or organisation must do everything possible to satisfy its customers.
This is because without the customer, the company wouldn’t exist. A secure and comfortable
customer is one who says that he or she is very satisfied with the service, he or she definitely will
continue to use the service in the future and definitely would recommend the service to others. A
vulnerable customer is one who says he or she is somewhat satisfied or dissatisfied, might or
might not use the service in the future or might not recommend the service to others. Public
service delivery in Ghana has been bedeviled with a lot of problems. In spite of the much talked
about public sector reforms, including the issuing of service charters by public sector agencies,
the quality of public service delivery remains unsatisfactory. The service delivery is described as
very bureaucratic, cumbersome and open to petty corruption. Many private entities and service
providers have succeeded because of the failure of the public sector. The complacency associated
with monopoly has over the years made the ECG very inefficient and sluggish in its management
operations coupled with poorly maintained distribution system.
Many public sector organisations have taken their customers for granted in terms of service
delivery. There have been very little done to improve service delivery to the maximum
satisfaction of customers. It is from this premise that this research was undertaken to assess the
levels of customer satisfaction of these public service organisations using ECG as a case study.
The study applied quantitative research methods in collecting data from 120 respondents in the
Kwabre East district of the Ashanti region.
After the analysis of the data it was realized that customers had a lot of misgivings about service
delivery and quality of service of ECG. The performance of ECG in customer service was rated
as poor, so was the pricing, complaint handling and service quality and delivery. The company
however was rated good in the location of its office and pay points relative to the convenience
and accessibility by customers. However, in terms of general level of satisfaction, the
performance of ECG was rated as dissatisfactory. Because of this level of dissatisfaction, people
in the district maintained that they would not recommend ECG to a friend or do repurchase
themselves if there were alternative service providers.
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TABLE OF CONTENTS
DECLARATION...........................................................................................................................iiDEDICATION..............................................................................................................................iiiACKNOWLEDGEMENT...........................................................................................................ivABSTRACT....................................................................................................................................vTABLE OF CONTENTS.............................................................................................................viLIST OF TABLES........................................................................................................................ixLIST OF FIGURES.......................................................................................................................xCHAPTER ONE............................................................................................................................1GENERAL INTRODUCTION.....................................................................................................1
1.0 Background of the Study.....................................................................................................1
1.2 Statement of the Problem....................................................................................................3
1.3 Research Questions..............................................................................................................4
1.4 Objectives of the Study.......................................................................................................5
1.5 Scope of the Study...............................................................................................................5
1.8 Justification of the Study....................................................................................................6
1.9 Organisation of the Study....................................................................................................7
CHAPTER TWO...........................................................................................................................9REVIEW OF RELATED LITERATURE..................................................................................9
2.0 Introduction.........................................................................................................................9
2.1 Meaning of Customer Satisfaction...................................................................................10
2.2 Components of Customer Satisfaction.............................................................................11
2.3 Determinants of Customer Satisfaction...........................................................................13
2.3.1 Customer Satisfaction and Service Quality..............................................................13
2.3.2 Customer Satisfaction and Complaint Handling.....................................................16
2.4 Customer Satisfaction – a decisive factor in Customer Retention................................17
2.5 Customer Care and Relations...........................................................................................18
2.6 Customer Relations Policy................................................................................................19
2.7 Role of Customer Service in Success of Business............................................................20
2.8 Users of electricity in Ghana.............................................................................................21
2.9 Electricity and population growth....................................................................................23
2.10 Customers at the End of the Line...................................................................................24
2.10.1 Industrial....................................................................................................................25
2.10.2 Commercial................................................................................................................25
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2.10.3 Residential..................................................................................................................25
2.11 The Electric Power Industry...........................................................................................26
2.12 Major Electric Power Issues...........................................................................................27
2.12.1 Consumer issues........................................................................................................27
2.12.2 Residential Customers..............................................................................................28
2.12.3 Non-Residential Customers......................................................................................28
2.12.4 Industrial Customer Special Load Tariff Customers (SLT).................................28
2.13 Electric Power and Economic Development..................................................................28
2.14 Quality of Public Service Delivery in Ghana.................................................................30
CHAPTER THREE.....................................................................................................................333.1 Profile of the Study Area...................................................................................................33
3.2 Population Size and Growth Rates...................................................................................34
3.4 Towns in this district..........................................................................................................35
3.5 Social infrastructure..........................................................................................................35
3.7 Electricity Corporation of Ghana.....................................................................................36
3.8 Type of Research................................................................................................................37
3.9 Sampling Method.............................................................................................................38
3.10 Data Collection technique...............................................................................................38
3.12 Sources of Data.................................................................................................................39
CHAPTER FOUR.......................................................................................................................40ASSESSING CUSTOMER SATISFACTION IN PUBLIC SERVICE ORGANISATIONS.......................................................................................................................................................40DATA ANALYSIS.......................................................................................................................40
4.0 Introduction........................................................................................................................40
4.1 Demographic Characteristics.......................................................................................40
4.2 The ECG Customer...........................................................................................................43
4.3 Customer Relations Policy of ECG..................................................................................46
4.4 Service Delivery of ECG....................................................................................................46
4.5 Needs of the ECG Consumer...........................................................................................51
4.6 Determinants of Satisfaction.............................................................................................52
4.7 Customer Service...............................................................................................................52
4.8 Price of Service...............................................................................................................53
4.9 Complaint Handling..........................................................................................................54
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4.10 Location.............................................................................................................................56
4.11 Service Quality and delivery...........................................................................................57
4.12 Factor Rating of Determinants.......................................................................................58
4.13 Level of Overall Satisfaction with ECG Services..........................................................59
CHAPTER FIVE.........................................................................................................................62SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS....................62
5.0 Introduction.......................................................................................................................62
5.1 Summary of Research Findings...................................................................................62
5.2 Conclusion......................................................................................................................63
5.3 Recommendations.............................................................................................................65
Reference......................................................................................................................................68
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LIST OF TABLES
Table 4.1 Gender of Respondents 37
Table 4.2 Age of Respondents 38
Table 4.3 Level of Education 38
Table 4.4 Occupation of Respondents 39
Table 4.5 Disconnection of Power for non-payment of bills 45
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LIST OF FIGURES
Figure Title Page No.
4.1 Types of Customers 40
4.2 Type of Commercial Activities 40
4.3 Types of Residences 41
4.4 Length of Time as a Customer 42
4.5 Problems Associated with Service Delivery 43
4.6 Cost of Electricity per Month 44
4.7 Respondents’ Ability to Settle Bills 45
4.8 Likelihood of Recommending ECG 46
4.9 Likelihood of Repurchase from ECG 47
4.10 Rating of ECG’s Customer Service 49
4.11 Prices of Services 50
4.12 Customers’ Assessment of ECG’s Complaint Handling 51
4.13 Assessment of ECG’s Location 52
4.14 Customers’ Assessment of Service Quality and Delivery 54
4.15 The Most Preferred Factor/Determinant 55
4.16 Level of Overall Satisfaction with ECG 56
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CHAPTER ONE
GENERAL INTRODUCTION
1.0 Background of the Study
Giftman and McDaniel (2004) defined customer satisfaction as a business term, which is a
measure of how products and services supplied by a company or organisation meet or surpass
customer expectation. Khirallah (2005) defines customer satisfaction as “ A customer's
perception that his or her needs, wishes, expectations, or desires with regard to products and
service have been fulfilled”. Cacioppo (2000) defines Customer satisfaction as the state of mind
that customers have about a company when their expectations have been met or exceeded over
the lifetime of the product or service. Customer satisfaction is seen as a key performance
indicator within businesses and organisations and it is part of the four perspectives of a Balanced
Scorecard. In a competitive marketplace where businesses compete for customers, customer
satisfaction is seen as a key differentiator and increasingly has become a key element of business
strategy (Giftman and McDaniel, 2004).
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 both psychological and physical variables rate. The
level of satisfaction can also vary depending on other options the customer may have for other
products against which the customer can compare the organization’s products.
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It is self evident that companies should try to satisfy their customers. Satisfied customers usually
return and buy more, they tell other people about their experiences, and they may well pay a
premium for the privilege of doing business with a supplier they trust. Statistics are bandied
around that suggest that the cost of keeping a customer is only one tenth of winning a new one.
Therefore, when we win a customer, we should hang on to them (Giftman and McDaniel, 2004).
Public service delivery in Ghana has been bedeviled with a lot of problems. The government
had instituted the public sector reforms, which was in part to see to the effective management
and delivery of public service utilities. In spite of the much talked about public sector reforms,
including the issuing of service charters by public sector agencies, the quality of public service
delivery remains unsatisfactory. It is very bureaucratic, cumbersome and open to petty
corruption. Many private entities and service providers have succeeded because of the failure of
the public sector. The grave dissatisfaction with the many public utility services is compounded
by the fact that they are operating in an environment of monopoly, especially in the area of
electricity generation and supply. The Electricity Company of Ghana (ECG) is the only
distributor of electricity for both domestic and industrial use in the country. The complacency
associated with monopoly has over the years made the ECG very inefficient and sluggish in its
management operations coupled with poorly maintained distribution system. However,
consumers are unable to seek any option or alternative but to cope with the existing service
provided by the country’s only electric power provider.
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1.2 Statement of the Problem
Regular power supply is the prime mover of technological and social development. There is
hardly any enterprise or indeed any aspect of human development that does not require energy in
one form or the other. When electricity goes on and off, it creates serious problems for
manufacturing and industrial sectors. Equipment is damaged by power surges that usually
accompany epileptic power supply and goods at various stages of manufacturing are damaged.
The problem of the study or those addressed by the study are:
1. ECG has a monopoly in the supply of electricity to consumers of electric energy but it is
not taking advantage of the monopoly to satisfy its customers.
2. ECG does not seem to emphasize on consumer care and satisfaction because it has no
competitors.
3. Because ECG is a state monopoly it is not competitive and it is not consumer-oriented.
4. From the view point of many stakeholders including the government, ECG has no
customer focus and the customer is not the central focus of its existence and operations .
5. Despite the huge investment capital injected into ECG by government, its agencies and
consumers made up of diplomatic missions, multinational corporations, domestic and
industrial concerns of the country.
The problem of power supply is traceable to the usual gross inefficiency and bureaucracy that are
evident in most public service agencies. Another problem confronting ECG is the low
investment in power generation over the years. All the plants are very old. This was confirmed at
a press briefing by a joint statement issued by the chief executive of VRA and managing director
of ECG on march 7, 2007, where they said “Our transmission system is not only aging but has
largely reached its capacity limitations and the distribution system which is also stretched to its
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limit in many parts of the country is beset with customer service difficulties, billing problems,
poor collection rates, aged equipment etc”.
Numerous complaints have been lodged with the Public Utility Regulation Commission (PURC)
about the many unannounced outages and their attended problems. Many Ghanaians have
appeared on radio and television programmes and lashed out on the ECG for their poor delivery
of services which has resulted in the PURC publishing of a warning to utility providers that it
will apply the necessary sanctions and penalties if they do not adhere to the highest level of
service delivery to the public. However most of these concerns and trends have not been
investigated to identify causes (Special Press Briefing, 2007). The measurement of satisfaction
has been a relatively new concept to many organisations, especially those delivering public
services. These public service organisations must recognize that the global economy has
changed and with the threat of divestiture and privatization, there is the need for improvement in
services. One sure way of undertaking these reforms is by conducting customer satisfaction study
with the objective of improving service delivery.
In view of the above stated problems, the study sought to address the following research
questions.
1.3 Research Questions
1. When and how will ECG overcome its numerous operational problems so as to be able to
satisfy the needs of its numerous consumers?
2. When will ECG turn its monopoly advantage as state agency into quality service delivery
to its consumers?
3. What factors make the customers of ECG dissatisfied?
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4. What is the current level of customer dissatisfaction?
5. What steps should be taken to ensure improvement in the levels of customer satisfaction
at ECG?
1.4 Objectives of the Study
The objectives of the study are classified into general and specific ones. The general objective of
the study is to assess the level of customer care and satisfaction in service delivery by ECG as a
public service organisation. The specific objectives are:
i. to identify the current level of customer care and satisfaction in electric energy service
delivery .
ii. to identify the causes and effects of poor customer care and satisfaction offered by
ECG.
iii. try to measure the current level of customer satisfaction at ECG.
iv. to determine what need to be improved to increase customer satisfaction
v. to identify solutions which ECG and government can pursue to enable ECG achieve
customer care and satisfaction in electric power service delivery.
1.5 Scope of the Study
The study is geographically delimited to the Ashanti region, and the Kwabre East district to be
specific. The research was aimed at measuring the levels of satisfaction of ECG’s services and
the analysis was done recognizing ECG as a public service organisation.
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Issues discussed in the study included identification of causes and effects of poor customer care
and satisfaction in electric power delivery, levels of current satisfaction and the identification of
solutions which ECG and government can pursue to enable ECG achieve customer care and
satisfaction in electric power service delivery.
1.6 Summary of Research Methodology
This research is designed to collect data from primary and secondary sources. The primary
source is to provide data through the following:
a) Administration of questionnaires to sampled respondents.
b) Interview with a cross section of consumers of electric energy and providers of electric
service.
c) Observation of consumer – service provider discussions and negotiation process in
respect of application for the service, payment of bills etc.
d) Analysis and comparison of data collected through questionnaires, interviews and
observations.
The population covered in the research consists of the service providers and consumers of
electric power. Sampling will be used to select respondents from the population and
demographic characteristics of the respondents will be determined in relation to responses to be
given by them.
1.8 Justification of the Study
The justification of the study arises from the following facts:
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i. Government invests a lot of capital into ECG without getting the needed returns that will
satisfy the government and consumers; this research is needed to actually identify the
causes why ECG cannot be market-oriented and customer focused.
ii. Consumers want value for money when they pay for electric service delivery to them and
any attempt such as this research which is intended to let consumers have satisfaction and
care is welcome.
iii. The image of most governments in Ghana has gone down due to poor performance of
ECG; if a solution can be provided by research such as this to enhance the performance
of ECG and improve the image of government the better.
iv. ECG itself is looking for a day when it can get some recommendations from a
consultancy or a research to overcome its operational problems so as to achieve customer
satisfaction and care and this is why this research is justified.
1.9 Organisation of the Study
The study was organised into five chapters. Chapter one provides a brief background to the study
and discusses the research problem, and significance of the study. The chapter also provides the
objectives, justification and limitations of the study. Chapter two reviews previous research on
customer satisfaction and public service operations. Chapter three presents the methodology that
was adopted in the study. Chapter four is devoted to the presentation of the findings from the
study and finally, chapter 5 was used to summarise, draw conclusions and provide
recommendations.
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1.10 Limitations of the Study
i. The study was limited to only customer care and satisfaction and in public service
delivery because of the limited time available for the research.
ii. Another limitation encountered by the researcher was the lack of cooperation from the
ECG officials in responding to the issues put to them.
iii. The third limitation was that there was difficulty in identifying respondents who were
ready and willing to be interviewed.
iv. Perhaps the most arresting limitation was the lack of finance in undertaking the research.
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CHAPTER TWO
REVIEW OF RELATED LITERATURE
2.0 Introduction
Customer satisfaction refers to the extent to which customers are happy with the products and
services provided by a business. Gaining high levels of customer satisfaction is very important to
a business because satisfied customers are most likely to be loyal and to make repeat orders and
to use a wide range of services offered by a business. Gitman and McDaniel (2004) define
customer satisfaction as a business term, which is a measure of how products and services
supplied by a company meet or surpass customer expectation. It is seen as a key performance
indicator within business and is part of the four perspectives of a Balanced Scorecard. They
maintain that in a competitive marketplace where businesses compete for customers, customer
satisfaction is seen as a key differentiator and increasingly has become a key element of business
strategy
Studies carried out by some companies have found very high levels of customer satisfaction. It is
not surprising because these companies emphasize market research and marketing as the tools to
find out what customers want. Knowing what your customer wants then makes it possible to
tailor everything you do to pleasing the customers e.g. providing the goods that customers want,
in the packaging that they want, in retail outlets which are convenient to use and well placed.
There are many factors which lead to high levels of customer satisfaction. They include products
and services which are customer focused and thence provide high levels of value for money;
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customer service giving personal attention to the needs of individual customers; after sales
service - following up the original purchase with after sales support such as maintenance and
updating (for example in the updating of computer packages).
What is clear about customer satisfaction is that customers are most likely to appreciate the
goods and services that they buy if they are made to feel special. This occurs when they feel that
the goods and services that they buy have been specially produced for them or for people like
them. This relates to a wide range of products such as razors that are designed for ease of use and
good quality finish, petrol products that are environmentally friendly and customised to meet the
needs of particular types of engines, etc.
2.1 Meaning of Customer Satisfaction
Khirallah (2005) defines customer satisfaction as; “A customer's perception that his or her needs,
wishes, expectations, or desires with regard to products and service have been fulfilled”. Again,
it is an attitude or behavior that customers vocalize or exhibit. The implication is that the
financial institution is consciously and proactively able to meet the myriad expectations of its
many customers. Unfortunately, customer satisfaction is no guarantee of retention or loyalty.
Customer Retention is the ability to hold on to customers over time.
Unlike customer loyalty and customer satisfaction, which measure aspects of the relationship
from the customer's perspective, customer retention is a direct measure of the institution's ability
to maintain relationships with customers. Because the concept of customer satisfaction is new to
many companies, it's important to be clear on exactly what is meant by the term. Cacioppo
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(2000) defines Customer satisfaction as the state of mind that customers have about a company
when their expectations have been met or exceeded over the lifetime of the product or service. In
summary, Customer Satisfaction is the meeting of customer’s expectation after a product or
service has been used.
2.2 Components of Customer Satisfaction
Customer satisfaction is generally described as the full meeting of a customer’s expectations.
Customer satisfaction is the feeling or attitude of a customer towards a product or service after it
has been used. A review of the existing literature indicates that there can be potentially many
antecedents of customer satisfaction, as the dimensions underlying satisfaction judgments are
global rather than specific (Taylor and Baker, 1994; Patterson and Johnson, 1993; Rust and
Oliver, 1994). The customer satisfaction literature has paid a great deal of attention to the
confirmation paradigm, which concerns the comparison of product or service performance
expectations and evaluations (Goode and Moutinho, 1995). The confirmation model treats
satisfaction as a meeting of customer expectations (East, 1997; Oliver 1989) and is generally
related to habitual usage of products (East, 1997). However, research on customer satisfaction
has moved towards the disconfirmation paradigm which views satisfaction with products and
brands as a result of two cognitive variables: pre-purchase expectations and disconfirmation
(Churchill and Surprenant, 1982; Peter and Olson, 1996).
According to Peter and Olson (1996), "pre-purchase expectations are beliefs about anticipated
performance of the product; disconfirmation refers to the differences between pre-purchase
expectations and post-purchase perceptions" (p.509). In an earlier study, Churchill and
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Surprenant (1982) reported that disconfirmation positively affected satisfaction. That is, when
subjects perceived the product performing better than expected, they were more satisfied
(Churchill and Surprenant, 1982). Further empirical research supports the notion that satisfaction
is caused by expectations and requires considerable cognitive effort on the part of customers
(Bearden and Teel, 1983; Moutinho and Goode, 1995; Cadotte et al., 1987). Kristensen, Juhl
and Ostergaard (2001) calculated the relationship between customer satisfaction and customer
loyalty in Danish retailing business using the European Customer Satisfaction Index (ECSI). The
model links customer satisfaction to its drivers (e.g., customer expectation, perceived company‟s
image, perceived quality and perceived value) and, in turn, to its consequences, specifically
customer loyalty.
Al Zaabi (2002) studied customer satisfaction with bill payment actions at Emirates
Telecommunications Corporation, which is identified as Etisalat. The study sample consisted of
individual customers and business customers. The author recognized a set of eleven satisfaction
attributes that were considered vital to Etisalat‟s customers with respect to service bill payment
and related actions. McColl-Kennedy et al. (2003) studied the reactions of over 700 hotel
Reactions to service recovery strategies patrons to videos depicting different scenarios of service
recovery. They found important differences in the perceptions of male and female of how service
recovery should be handled. Female, more than male, required to be capable to voice their
concerns through the service recovery time. There is also some connection between the length of
the customer relationship and satisfaction. In summary, the main components of customer
satisfaction are the customer’s expectation that is pre-purchase expectation (i.e. beliefs about
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anticipated performance of the product) and disconfirmation (differences between pre-purchase
expectation and post-purchase perceptions).
2.3 Determinants of Customer Satisfaction
After reviewing a host of factors corresponding to customer satisfaction in retail banking
discussed in Richens (1983), Lele and Sheth (1988), Levesque and McDougall (1996), Manrai
and Manrai (2007), and Sweeney and Swait (2008), four main items which include subcategories
were reached. The main items are as follows:
(1) Service Quality
(2) Complaint Handling
2.3.1 Customer Satisfaction and Service Quality
In the service literature, strong emphasis is placed on the importance of service quality
perceptions. There is a relationship between customer satisfaction and service quality Bitner
and Hubbert, (1994), Cronin and Taylor (1992); Taylor and Baker (1994); Rust and Oliver,
(1994) confirm that there is a relationship between customer satisfaction and service quality.
Service quality has been described as a form of attitude that results from the comparison of
expectations with performance (Cronin and Taylor, 1992); Parasuraman et al (1985). Gronroos
(1982) argue that customers, while evaluating the quality of a service, compare the service they
expect with perceptions of the services they actually receive. It has been argued that the quality
of service is not a one-dimensional construct. Rather, service quality incorporates various
dimensions that relate to both core and augmented service offerings (Bitran and Lojo, 1993;
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Gronroos, 1984; Lewis, 1993). Parasuraman et al. (1985; 1988) initially described five
dimensions of service quality: reliability, tangibles, responsiveness, assurance and empathy.
Parasuraman et al. (1991a) argued that reliability was mainly concerned with the outcome of
service whereas tangibles, responsiveness, assurance and empathy were concerned with the
service delivery process. The customers not only judge the accuracy and dependability (i.e.
reliability) of the delivered service but they also judge the other dimensions as the service is
being delivered (Parasuraman et al., 1991a). Customer satisfaction can thus be based not only on
the judgment of customers towards the reliability of the delivered service but also on customers'
experiences with the service delivery process.
On the basis of their review of service quality literature, McDougall and Levesque (1994),
however, argued that there were two overriding dimensions to service quality. The first one
being the core or outcome aspects(contractual) of the service, and the second being the relational
or process aspects (customer-employee relationship) of the service. It is generally accepted that
customer satisfaction often depends on the quality of product or service offering (Anderson and
Sullivan, 1993; Levesque and McDougall, 1996). For this reason, research on customer
satisfaction is often closely associated with the measurement of quality (East, 1997). Thus, both
service quality and customer satisfaction share a close relationship, though they are normally
conceptualise as unique (or separate) constructs (Bitner and Hubbert, 1994; Cronin and Taylor,
1992; Patterson and Johnson, 1993; Taylor and Baker, 1994).
There is some empirical evidence suggesting that service quality is a causal antecedent of
customer satisfaction (see for example, Cronin and Taylor, 1992; Woodside et al., 1989).
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However, there is very little empirical research demonstrating the importance of service quality
dimensions in determining customer satisfaction (Fisk et al., 1993; Levesque and McDougall,
1996). In a recent study, Levesque and McDougall 1996 found that the performance of the
service provider on core and relational dimensions of service was an important driver for
customer satisfaction in retail banking for instance, in the UK.
However, in a non-Western context, the link between core and relational dimensions of service
and customer satisfaction is yet to be established empirically. Moreover, the literature dealing
with services outlines some major characteristics of services that make them unique and different
from physical products (Bitran and Lojo, 1993; LeBlanc and Nguyen, 1988; Parasuraman et. al.,
1985; Zeithaml and Bitner, 1996). Services are often characterized by their intangibility,
inseparability, heterogeneity, and perishability. The implications of these characteristics are that
it is often difficult for customers to evaluate services at pre-consumption, consumption and post
consumption stages of the consumer decision-making (Legg and Baker, 1996).
Because of the intangible nature of services, it becomes difficult for an organization to
understand how its customers perceive and evaluate the quality of its services (Parasuraman et.
al., 1985; Zeithaml, 1981). Customers, however, make inferences about the service quality on the
basis of tangibles (the buildings, the physical layout etc.) that surround the service environment.
Support for this argument comes from empirical evidence suggesting that the tangible, physical
surroundings of the service environment can have a significant impact on customer’s affective
responses and their behavioural intentions (Wakefield and Blodgett, 1999). Dabholkar et al.
(1996) reported similar findings that the tangible aspects of department stores do influence
15
customers' perceptions of service quality. Hence, there are reasonable grounds to assume that
customer satisfaction is also related to customers' evaluation of physical surroundings of the
service environment.
In summary, customer satisfaction often depends on quality of products or service offering thus
measurement of quality is often used to determine satisfaction levels. Service quality is not just
about the outcome of the service but also the customer’s experience with the service delivery
process which is contractual and customer – employee relationship respectively.
2.3.2 Customer Satisfaction and Complaint Handling
Since services exist in real time, services are consumed at the very moment when they are made
available to customers. They cannot be stored and checked for their quality like a physical
product. Hence, every service production failure is likely to be experienced by a customer.
Consequently, "dissatisfaction with a service might occupy most of the time over which service
is consumed" (East, 1997). However, customers might not instantly switch their service
providers after experiencing a problem during the service production. This is mainly because of
the fact that the perceived costs of switching are relatively high in retail service sector, especially
when the service provider enjoys a monopoly. Customers, however, might display a passive
response to a problem, which can be in the form of making a formal complaint. Customer
satisfaction in such cases can depend upon the efficient and effective response of the service
provider (Levesque and McDougall, 1996).
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2.4 Customer Satisfaction – a decisive factor in Customer Retention
The positive connection between customer satisfaction and customer retention is a given fact -
more than 20 different studies prove this. The nature of this connection, however, is very
complex. Customer satisfaction does not automatically lead to customer retention; it is, however,
a pre-requisite.
Customers are satisfied when their expectations about a product or service are met. They are
however dissatisfied if the reverse was the case. Customer satisfaction is the result of a
permanent comparative process: subjective experience and perceptions (IS) are compared with
expectations and goals (SHOULD) and this leads to:
• Customer dissatisfaction
• Customer satisfaction
• Customer enthusiasm
What is interesting in this context is the fact that quality expectations of library customers are
influenced very strongly by any previous experience with the institution or by reports from third
parties. The image of the institution, and thus the development of a role model, i.e. corporate
identity and corporate design, plays a key role here. A user who for any reason does not feel right
when using your library's services, is more likely to develop and later spread a lower quality
perception and thus a worse image than a user who can overlook tangible 'errors' thanks to an
obliging atmosphere (Vogt, 2004).
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A high level of quality is achieved when customers are satisfied or expectations are exceeded.
Only this creates “customer enthusiasm,” leading to strong loyalty and causing positive word-of-
mouth propaganda. In 2001, the Bremen city library concluded that: “Word-of-mouth
propaganda attracts lots of customers.” In a survey among new customers, the city library in
Bremen established that word-of-mouth propaganda is the best advertising means by far. Slightly
more than half of those asked revealed that they had been “tempted” into visiting the city library
by friends, acquaintances or family members. The city library in Bremen concluded that:
“Satisfied customers seem to speak positively in family circles and amongst friends about the
city library’s program [...]” (Bremen city library internal paper) (Vogt, 2004).
2.5 Customer Care and Relations
According to an article on Bizhelp 24 (2008) it costs five times more to sell to a new customer
than an existing customer. In that article the writer contend that many businesses are sadly
paying the price because they fail to encourage repeat sales from customers. This is often the
result of poor customer relations / customer care.
One thing that business owners often forget is that customers are the driving force of their
business: without them, they have no future - it is the same for everyone. You may currently feel
that your relations with customers are good, but you can do more (Jody, 2007).
Customer Relations can be considered as a form of marketing- a happy customer will inform five
people: an unhappy customer may inform ten. Unsatisfied customers will then go elsewhere and
consequently, you lose a customer to your competitors and in turn, they may drag others with
18
them. Good customer relations will gives a sense of achievement, satisfied customers and the
improved chance of further promoting your business. Bizhelp (2008) gives some tips as to how a
company can ensure its customers to stay loyal to it. To Bizhelp (2008), it is not a hard and
demanding task.
2.6 Customer Relations Policy
The company must create a customer relations policy instead of just making it up as it goes
along. The policy is a guarantee to the customers that the company is dedicated to achieving
customer satisfaction. The policy may state that the company aim to achieve 100% order
accuracy, 30-day money back guarantee, speedy service, fast corrective action on customer
issues, promise of low prices, free delivery, etc. Each statement may have a few sentences in
small print to explain in more detail the terms, conditions and process. It must be ensured that all
of the staff understands the policy and stick to it at all times. The policy must be displayed in the
workplace so that it can be easily viewed by customers: knowing that the company aims to
achieve customer satisfaction is a welcomed action by the public.
In addition, you could have the company’s policy printed on the back of your till receipts. When
the company advertises its business, where possible, include the company’s policy. Basically, the
policy, can become a marketing tool for the business, but be sure that the company can (and do)
satisfy everything that the company has promised.
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2.7 Role of Customer Service in Success of Business
Business success is dependent on a variety of factors – a realistic business idea, a well thought-
out business plan, an appropriate marketing strategy and great customer service are amongst the
top ones. While customer service is a part of marketing, it can be segregated as a separate field
on its own (King, 2007). King (2007) defines the term customer service as including all aspects
of interaction with a customer and speaking to the organization’s image in the mind of a
customer.
A customer provides an organization with that most organic of all advertising tools – word of
mouth advertising. A happy and satisfied customer is much more likely to send more customers
your way. Further, there is the potential for repeat business, which is the backbone of many
businesses. It is obvious that a customer who has been provided with a product or service that he
or she desired in the ideal way, would build a relationship with the seller.
Further customer relationship management teaches the business where there are flaws in the
system and provides valuable customer feedback. When a business receives feedback, it is able
to see the customer’s image of the organization and the impression of its services. This tool is
invaluable in correcting systems as well as image management for the business. It is also an
outsider’s perspective, which provides the business owner or management a unique insight
(King, 2007).
King (2007) adds that a satisfied customer would be more likely to participate in activities that
help to generate customer preference data. This data goes back to the marketing function in
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assisting the organization to better target and attract it potential customers. In fact, it would not
be a stretch to say that without good customer service, a business would not survive. The old
adage ‘The customer is always right’ has been the foundation of many an organization and what
it really means is that keeping customers happy is the foremost principle of any business. The
reason for the survival of many small businesses in a tough and competitive market is their
ability to provide personalized customer service. It is the human touch that warms and enlivens
an organization in the customer’s mind and goes towards building a relationship. This
relationship is the basis of future growth for a business.
Regular and sustained interaction with a customer ensures that the customer feels connected with
the business. For instance, a small pub owner who chats with his customers and knows them by
name builds a relationship with them. Further, when he makes sure that their regular bartender
makes their drinks and the food is fresh and hot, he is providing customer service. The customers
have a good experience and feel that the establishment treated them well (King, 2007).
2.8 Users of electricity in Ghana
With a customer base of approximately 1.4 million, it has been estimated that 45- 47 percent of
Ghanaians, including 15-17 percent of the rural population, have access to grid electricity with a
per capita electricity consumption of 358 kWh. All the regional capitals have been connected to
the grid. Electricity usage in the rural areas is estimated to be higher in the coastal (27 percent)
and forest (19 percent) ecological zones, than in the savannah (4.3 percent) areas of the country.
In 2004, Ghanaians consumed 5,158 gigawatthours (GWh) of electricity. It is estimated that
about half of this amount is consumed by domestic (or residential) consumers for household uses
21
such as lighting, ironing, refrigeration, air conditioning, television, radio and the like.
Commercial and industrial users account for the rest (Guide, 2005).
The majority of the customers are in service territories of the Electricity Company of Ghana
(ECG) and the Northern Electrification Department (NED). However, there are also deregulated
consumers such as mines, and aluminum companies, which account for one third of total
consumption. One industrial entity, VALCO, can account for most of this amount when it is
operating normally. Residential consumers comprise middle and high-income urban consumers.
This consumer-class typically uses a number of high energy consuming household appliances
and items such as air conditioners, fridges, water heaters, electric cookers in addition to a
substantial amount of lighting equipment and bulbs for the houses. The majority of the rest of the
residential consumers use electric power for lighting (Guide, 2005).
The major characteristic residential arrangement is the “compound house” multi-house
phenomenon – essentially a number of households living in a compound and sharing basic
amenities including one electricity metering system. Apart from residential consumers who are
considered to be “small” users, other consumers whose consumption is not considered large by
virtue of their activities are the non-residential consumers as well as small industrial concerns
which are known as special load tariff customers (SLT’s). Non-residential consumers comprise
offices, banks and other small businesses.
Since the 1980’s, the government has pursued a policy of extending electricity to the rural
communities. The objective of this is to encourage the use of electricity for productive use for
22
cottage industries and eventually the growth of these industries into bigger consumers which will
become a source of employment and economic growth for the communities they are situated in
(Guide, 2005)..
2.9 Electricity and population growth
In Ghana, electricity consumption has been growing at 10 to 15 percent per annum for the last
two decades (Guide, 2005). It is projected that the average demand growth over the next decade
will be about six percent per year. As a result, consumption of electricity will reach 9,300 GWh
by 2010. The projected electricity growth assumption has profound economic, financial, social
and environmental implications for the country. The aspirations of developing countries for
higher living standards can only be satisfied through sustained development of their electric
power markets as part of their basic infrastructure.
Electricity demand will grow much faster than overall economic growth (4-5 percent per year) or
than population growth (which is less than two percent a year) because continuing urbanization
will allow newly urbanized segments of the population to expand their electricity consumption
manifold. Urbanization in Ghana is expected to increase from around 40 percent in 2000 to about
55 percent in 2012 and eventually to 60 percent by 2020. A little more than a third of the urban
population lives in Greater Accra and is expected to reach around 40 percent by 2020. A
considerable percentage of household expenditure goes into energy. Energy sources in urban
areas are more diversified than in rural areas, since access to a variety of commercial fuels and
appliances are higher in the urban areas than in the rural areas. Often the cost of alternatives is
higher in the rural areas than it is in the urban where incomes are lower.
23
Clearly, with the Ghanaian economy growing, increasing urban populations will consume more
electricity. The Energy Commission (EC) estimates that residential demand may reach anywhere
between 7,000 and 13,000 GWh by 2020 depending on the rate of economic growth and
urbanization. The residential sector is not the only segment expected to grow; commercial and
industrial consumption will grow as well to 3,000 to 10,000 GWh by 2020 according to the EC.
If VALCO is fully operational, an additional 2,000 GWh should be expected. In order to meet
this increasing demand, new power generation as well as transmission and distribution facilities
will have to be built. Ghanaian governments have been pursuing a national electrification policy.
Still, more than half of the population remains without access to grid-based electricity. It is very
expensive to build long-distance transmission lines to serve small communities, especially when
these communities are relatively poor and cannot afford to pay rates high enough to cover the
cost of these services. Moreover, there is weak or no evidence of increased economic activity in
communities that benefited from the national electrification scheme. Smaller scale and locally
installed generation systems using solar panels, batteries and the like can be more affordable.
Nevertheless, rural electrification will continue to be a challenge for Ghana (Simons, 2005).
2.10 Customers at the End of the Line
The ultimate customers who consume electricity are generally divided into three categories:
industrial, commercial, and residential. The cost of serving customers depends upon a number of
factors including the type of service (for example, if service is taken at high or low voltage) and
the customer's location with respect to generating and delivery facilities.
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2.10.1 Industrial
Industrial customers generally use electricity in amounts that are relatively constant throughout
the day. They often consume many times more electricity than residential consumers. Most
industrial demand is considered to be base load. As such it is the least expensive load to serve.
Industrial loads are expected to remain within certain levels over time with relatively little
variation. Major industrial customers may receive electricity directly from the transmission
system (rather than from a local distribution system).
2.10.2 Commercial
Commercial loads are similar to industrial in that they remain within certain levels over
intermediate periods of time. Examples of commercial customers are office buildings,
warehouses, and shopping centers.
2.10.3 Residential
According to the Guide to Electric Power Use in Ghana (2005), residential electrical use is the
most difficult to provide because households use much of their electricity in the morning and
evening and less at other times of the day. This is less efficient to provide and therefore a more
expensive use of the utility's generators. Over time as homeowners buy new appliances and
change lifestyles, the expected loads also change. Examples of residential loads are individual
residences.
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2.11 The Electric Power Industry
In Ghana organizations that generate, transmit or distribute electricity are called (public) utilities
due to the fact that they have the capacity to satisfy essential human wants which lead to
enhancement of the quality of life. Utilities may be vertically integrated in which case electric
power generation, transmission and distribution are performed by one organization. The Volta
River Authority (VRA), a government owned utility, is largely responsible for electricity
generation and transmission in Ghana and it can be described as being partially integrated.
Limited generation is also undertaken by a private company, the Takoradi International
Company (TICo), a joint ventureship between VRA and CMS Energy Inc. of the USA. Two
nationally owned utilities are responsible for electric power distribution in the country. These are
the Electricity Company of Ghana (ECG) and the Northern Electricity Department (NED), the
latter being a directorate of the VRA. The Electricity Company of Ghana delivers power to
customers in the southern half of the country comprising Ashanti, Western, Central, Eastern,
Volta and Greater Accra Regions while the Northern Electricity Department has responsibility
for supplying power to customers in the northern half of the country consisting of the Brong
Ahafo, Northern, Upper East and Upper West Regions. There are four electric utilities in the
country, namely VRA, ECG, NED and TICO. The Public Utilities Regulatory Commission
(PURC) and the Energy Commission (EC) are two government agencies that regulate the utilities
for the public good rather than private interests. The PURC is an independent body with primary
responsibility for setting the tariffs that utilities charge their customers. The EC on the other hand
is tasked with licensing and regulating the technical operations of the utilities. Both regulatory
agencies also ensure fair competition in the power market, enforce standards of performance for
the provision of services to customers and protect both customer and utility interests.
26
Electric energy policy formulation is the preserve of the Ministry of Energy while the Energy
Foundation, a nongovernmental agency, has been very active in promoting energy efficiency
measures.
2.12 Major Electric Power Issues
2.12.1 Consumer issues
According to Simons, (2005) the use of electric power has become widespread in Africa; and
Ghana is no exception. Over the last two decades, demand for electricity for various purposes
including domestic and industrial uses has been increasing at a rate of 10-15 percent per annum.
This has significant implications for the rate of economic development. While the use of
electricity for domestic purposes (e.g., lighting, radio, television, ironing) will normally lead to
improvement only in the lives of consuming individuals, productive use of electricity by
industries (all things being equal) will lead to general macroeconomic improvement and a rise in
the standard of living of the populace. The major consideration for Ghana is the ability of the
country to match the rate of electricity demand with adequate supply as well as the proportion of
energy produced which is consumed for productive use. It is estimated that about 50 percent of
electricity produced in Ghana is consumed by domestic users. If this proportionate use can be
changed in favour of industrial use and/or productive use then Ghana stands to gain.
In Ghana electricity customer groups comprise Residential, Non- Residential and Industrial
customers. Each group has its requirements and needs. For most ordinary consumers electricity
has become an important factor in their lives, particularly for lighting purposes. The main issues
for ordinary consumers are (i) the price at which the electricity is bought, i.e., the bill they have
27
to pay and the reliability of the service (ii) the level of tariff price in comparison to reliability,
adequacy and safety of service being provided.
2.12.2 Residential Customers
As a large proportion of residential customers are low-income earners, the cost of electricity is
critical for them. Therefore a pricing arrangement that will ensure that they can enjoy the use of
electricity for their basic needs at an affordable price is important. The current “lifeline tariff”
targets the rural and urban poor whose consumption is less than 50 kWh per month. The life-line
tariff is typically 60-70 percent of the economic cost of supply.
2.12.3 Non-Residential Customers
This comprises major offices, banks and small businesses. For this group, the cost of energy is
also important particularly for small businesses whose electricity cost is a significant component
of their operating cost and who require lower energy costs to be more competitive in the market
place to survive.
2.12.4 Industrial Customer Special Load Tariff Customers (SLT)
The major industries whose operations depend to a large degree on a reliable supply of power are
also concerned about cost and reliability in order to ensure their competitiveness in the markets
within which they operate.
2.13 Electric Power and Economic Development
28
Electricity, like other forms of energy, is a vital ingredient in the economic development of
countries the world over. Not only is it a critical factor and cornerstone of the accelerated
development and growth of any nation, it is also a measure of the standard and quality of life of a
people. Without a safe, sustained, reliable and reasonably affordable supply of electricity to meet
demand, a country can hardly make progress in its economic and social development.
Population growth and economic expansion are the major factors driving growth in the electric
power industry. As the number of households grows and as more and more households add on
electric appliances, electric power generation capacity has to keep up.
At the same time, electricity is an essential input for industrial and economic performance,
although there are other things that are equally or more important. In general, when both
household and economic growth are taken together, they account for most if not all of the net
growth of electric generation capacity. Growth in the electric power industry is also influenced
both directly and indirectly by population growth and general economic performance. The direct
effects come from demand for electricity as households are added or businesses and industries
expand. The indirect effects come from the contribution that electricity makes to our life-styles
and quality of life and technological development.
Electricity costs are important, but so are the costs for land, labor, materials, transportation and
other factors. Usually, employment in electric utility services is only a small portion of total
employment in an economy. However, we also have jobs tied to companies that provide
equipment, materials and services to the electric power industry, and jobs in electric power
29
services outside of the utility companies themselves. Though the electricity supply industry
Ghana contributes only 10 percent of its energy-supply mix, the industry is a key driver of
economic growth and development, powering the country’s industrial, commercial and urban
development. The industrial, agricultural, mining and services sectors of the Ghanaian economy,
which together account for 75 percent of the country’s GDP, rely critically on the electricity
industry for their survival.
The electricity industry accounts for 14.7 percent of total energy share in the industrial sector,
and 32.6 percent energy consumption in the formal manufacturing sector.2 It also contributes 2.8
percent of real GDP and 10.65 percent of industrial GDP. With a customer base of
approximately 1.4 million, it is estimated that 45-47 percent of Ghanaians including 15-17
percent of the rural population have access to grid electricity with a per capita electricity
consumption of 358kWh while the average annual growth rate stands at 9.7 percent. According
to the Ministry of Mines and Energy (1996) rapid growth in domestic demand for electricity,
which averaged 10 percent per annum between 1985 and 1993, increasing further to 15 percent
by 1995 was a result of positive economic growth and the National Electrification Programme
embarked upon by the government during this period led to electricity demand gradually
catching up and eventually surpassing generation capacity (Simons, 2005).
2.14 Quality of Public Service Delivery in Ghana
In spite of the on-going public sector reforms, including the issuing of service charters by public
sector agencies, the quality of public service delivery remains unsatisfactory, being very
bureaucratic and cumbersome and open to petty corruption. According to a study sanctioned by
30
the Private Enterprise Foundation, (PEF), in 2008, it was observed that the quality of public
utility service delivery and government services to the private sector is generally poor and has
resulted increasingly in businesses incurring huge unplanned costs. It was noted also that the
impact of the poor service delivery is multidimensional, having immense financial, economic,
social, legal and political implications for the private sector in particular and therefore the
economy as a whole. For industry in particular, poor and unreliable service delivery by the
public utilities has a very devastating impact, because, it affects profitability and growth of
businesses through loss of production and therefore inability to meet production targets; leads to
frequent breakdown of equipment and corresponding increases in costs of repair, maintenance
and replacement; results in increased operational costs; causes under-utilization of installed
capacity; reduces ability to compete domestically and internationally and also to attract adequate
levels of foreign investment; leads to redundancy, laying-off of staff, and increasingly; leads to
bankruptcy and eventual collapse of small and medium-scale businesses.
Specifically on power supply, the research noted that of 82 industrial enterprises surveyed in
2007, only 7 had constant supply of electricity in 2005; over 73% suffered drastic and 27%
marginal reductions in productivity and turnover; over 75% suffered frequent and 25% marginal
breakdown of equipment; over 63% were unable to meet their production targets; over 80%
suffered drastic increases in operational costs (Diawuo and Anto, 2007).
In fact, these concerns were confirmed by the Public Utility Regulatory Commission (PURC),
when the executive secretary, Mr. Stephen Adu, warned of strict application of sanctions and
penalties if they did not performed satisfactorily. The warning was issued Monday, 23
31
November 2009, at a time there were intermittent outages being experienced in many parts of the
country. Mr. Adu, told the utility providers that the Commission was not pleased with the kind
of service being rendered to the public and that every attempt should be made to ensure that the
consumer, who paid for the service, got value for money. While acknowledging that outages and
shortages cannot be eliminated completely because of the poor state of the utilities, he however,
emphasized that the current situation where lights go off abruptly without any warning or
communication with the public must stop to ensure that the public is not affected adversely. This
comment summarizes the predicament of the Ghanaian public utility consumer (GNA, 2009).
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CHAPTER THREE
METHODOLOGY
3.1 Profile of the Study Area
The purpose of this study is to assess the customer satisfaction in public service delivery by
public agencies, using the Electricity Company of Ghana as a case study. It is to measure and
ascertain the levels of satisfaction of customers who are the direct beneficiaries of the services
provided by the company. This chapter contains a brief description of the study area taking into
consideration its physical, social, infrastructural environment. The chapter also contains
descriptions of the sample population, the procedure used for data collection, the instrumentation
and data analysis. The research design of the study was descriptive which meant it was primarily
concerned with finding out “what was”
Kwabre East district, carved out of the former Kwabre District in 2006, is located almost in the
central portion of the Ashanti region. It is within latitudes 6o 45’ and 6o 50’ North and longitudes
1o 30’ to 1o 35’ West. The District shares common boundaries with Afigya Sekyere District to
the North; Kumasi Metropolitan Area to the South; Ejisu Juaben District to the Southeast;
Atwima District to the West and Offinso District to the Northwest. The District has a total land
area of 246.8 square kilometres constituting about 1.01% of the total land area of Ashanti
Region. Kwabre District is part of the greater Kumasi City region, which is made up of Kumasi
Metropolitan Area and the surrounding Districts. The District capital, Mamponteng, is
approximately 14.5 kilometres from Kumasi to the north east. There are 86 settlements,
administered under 3 paramountcies, 2 parliamentary constituencies, 11 Area Councils and 42
District electoral areas.
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3.2 Population Size and Growth Rates
Figures from secondary sources for the 1960, 1970 and 1984 census reports indicated that the
district’s populations were 43,328, 56,313 and 78,923 respectively. The 2000 Population and
Housing Census put the entire population for the district at 164, 668 (an increase of 33.3% over
the 1995 estimate). Even though Kwabre district is one of the Districts with the least land size in
the Ashanti region, its population of 164,688 ranks fifth among the twenty-one districts in the
region. The high population could be attributed to the proximity of the district to Kumasi
metropolis. Major settlements in the district, especially those at the fringes of Kumasi (such as
Ahwiaa, Afrancho, Atimatim and Kenyasi), appear to have dormitory status to the metropolis,
thus attracting increasing numbers of migrants. This may be responsible for the high growth rate
of 4.6%. The district has a high population density compare with the regional and national
averages. It has an average density of about 666.72 persons per square km as against 147.6
persons per square km and 78.9 for Ashanti region and the nation respectively. The
consequences is overcrowding that has resulted in increasing pressure on infrastructural facilities
like electricity, housing, health etc.
3.3 Household Size and Housing Density
The average urban household size in the district is 8.9 and that for rural areas is 8.8. This shows
an increase of three (6 – 9), from 1995 to 2001. However, there are variations in the household
size distributions in the district, ranging between single households to 20 persons per household.
In terms of density, the average number of persons per house in the district is 20.7 with urban
areas having 28.5 persons in a house and rural areas having an average of 14.5 persons in a
house. The average number of rooms per house is 8.3 while rural parts of the district have an
34
average of 6.9 rooms in a house and urban areas have an average number of 10.0 rooms in a
house.
3.4 Towns in this district
Towns in the district include Ahwiaa, Atimatim, Mamponteng, Aboaso, Ntonso, Kenyasi,
Afrantwo, Abira, Kasaam, Ankaase, Meduma, Old Asonomaso, Adanwomase, Adwumakase-
Kese, Nkukua Bouho, New Asonomaso, Antoa, Safo, Fawoade, Sokora Wonoo, Kenyase,
Ahwiaa, Bamang, Antoa, Wadie, Adwumakase, Ntiribuoho, Kodie and Afrancho
3.5 Social infrastructure
There are about 23.5 kilometres of first class roads in the district and about six kilometres of
second class roads, while third class roads make up the remaining 81.6% of the total road
network of 160.5 kilometres.There is only one financial institution in the Kwabre District and
this is the Sekyere Rural Bank, which has agencies (branches) in Ntonso, Ahwiaa and
Mamponteng.
This bank serves as a channel for paying salaried workers, operates saving accounts and provides
loans for agriculture, trade and commerce as well as small-scale industrial activities. The district
has 24 nursery schools, 56 kindergartens, 84 primary schools, 41 junior secondary schools. On
the average, the teacher / pupil ratio in the Kwabre District is 1:21. There are two private
hospitals in the district owned and run by religious missions. There are also 10 level “A” primary
health centres and two level “B” primary health centres. The district’s inhabitants derive their
water supply through the pipe-borne system, boreholes, wells and streams. In all, eight
35
communities have access to pipe-borne water. Electricity reaches 35 settlements in the district.
Other sources of energy used in the district are kerosene, firewood and charcoal.
3.6 Structure of the Local Economy
Production activities in the district have been categorized into three major sectors namely,
agriculture, industry and service. The agriculture sector is dominated by crop farming, which is
mostly done on subsistence basis and employs rudimentary production techniques. the industrial
sector consists of a wide range of micro, small and medium scale manufacturing and processing
activities, including agro-processing wood-based, textiles based, metal based, quarrying,
construction and other activities. Trading, personal services such as hairdressing and barbering,
drinking and ‘chop bar’ operations, transport, tourism and other services are the dominant
services rendered in the district.
3.7 Electricity Corporation of Ghana
The Electricity Corporation of Ghana (ECG) was established in 1967 by a decree
(NLC Decree No. 125) of the National Liberation Council government, which overthrew the
Nkrumah government. ECG replaced the defunct Electricity Department, which had been
operating under the Ministry of Works and Housing. ECG was charged with the bulk purchase of
electricity from VRA for distribution throughout the country to all categories of consumers, with
the exception of VALCO, the Akosombo Township, and the Mines.
The decree establishing the ECG also required it to conduct its affairs on “sound commercial
basis”. In 1987, ECG’s distribution activities were restricted to the six southern regions of the
country following the establishment of the NED. Currently, ECG provides services to about
36
400,000 consumers in the southern part of the country. Under the provisions of the Statutory
Corporations (Conversion to Companies) Act, 1993 (Act 461), ECG has since February 1997,
been converted into a limited liability company called Electricity Company of Ghana to take
over the assets and operations of the Corporation. The government of Ghana is the sole
shareholder and financier of the company.
A government-appointed Board of Directors governs ECG, which is responsible for formulating
policies. ECG’s Managing Director, as well as the Chief Executive of VRA, are members of the
Board. Over the past decade, ECG has been supported by foreign power utilities through
performance contracts with ESB Consultants of Ireland on organizational restructuring and
development which has been ongoing since the mid-1980s and more recently a consortium of
Electricity de France (EdF) and SAUR to establish and operationalize the ECG’s Directorate for
Customer Services.
3.8 Type of Research
This is a study of customer satisfaction in public service organizations in Ghana using the
Electricity Company of Ghana (ECG) as a case study. This is a descriptive research that sought
to ascertain the levels of customer satisfaction enjoyed by the clients of ECG in the Kwabre East
district of the Ashanti region. The study adopted the quantitative technique in research, where
statistical tools like frequencies, graphs and charts were used to analyze the data collected. Such
statistical softwares as Excel and Statistical Package for Social Sciences (SPSS) were used in the
analysis of data that was collected. Statistical tools such as frequency tables, bar graphs and pie
charts were used in presenting the results the data analysis.
37
3.9 Sampling Method
The research applied both the simple random sampling methods and the purposive sampling
methods. The purposive sampling method was used in the selection of specific commercial
consumers in a random manner to be included in the survey. Another method of sampling used
in the study was the convenience sampling. In a convenient manner, the researcher positioned
herself at the ECG paypoints in the various communities involved in the study. Out of the 33
communities in the district, six were randomly selected. Towns selected included Ahwiaa,
Antoa, Kenyasi, Adwumakase, Nkukua Bouho and Mamponteng the district capital. 20
respondents were selected from each of these communities. The total sample size used in the
study numbered up to 120. In applying the simple random sampling, every fifth customer that
visited the paypoint was interviewed. This was done at the beginning of the month when most
consumers had to pay for the previous month’s consumption for credit meter users or buy new
credits for that month for pre-paid meter users.
3.10 Data Collection technique
The study used both quantitative and qualitative data collection techniques. The research
adopted three data collection techniques to collect data. These are:
a. Administration of questionnaires
b. Interviews
c. Observation and analysis
The questionnaires were well-structured and closed-ended with most of them needing ‘Yes’ or
‘No’ answers. One hundred and twenty questionnaires were. Twenty questions were well
designed for respondents to answer with full explanations to establish links between
38
questionnaire responses and interview answers. The observation method was used in handling of
complaints, payments of bills etc.
3.11 The Population of the Study
The population of the study consisted of the following:
a. Officials, technicians and operatives of ECG in the study area.
b. Contractors who are contracted to lay cables and distribute metres.
c. Contractors responsible for maintenance.
d. Industrial, commercial and domestic/residential consumers.
3.12 Sources of Data
The sources of data for this research came from both primary and secondary sources. The
primary data was derived from interviews with customers of the Electricity Company of Ghana,
while the secondary data was obtained from documents from the library, journals and the internet
on theories about customer satisfaction, electricity use and problems of electricity generation,
distribution and service delivery.
39
CHAPTER FOUR
ASSESSING CUSTOMER SATISFACTION IN PUBLIC SERVICE ORGANISATIONS
DATA ANALYSIS
4.0 Introduction
Chapter four of the study is devoted to the analysis of data collected. In this chapter the
demographic characteristics of the respondents are analyzed so are the perceptions and of the
respondents about the services they receive from ECG.
iv.1 Demographic Characteristics
Respondents were classified into the following demographic characteristics:
i. Sex and gender
ii. Age
iii. Occupation
iv. Type of customer
v. Educational attainment
In is the view of the researcher that these demographic characteristics have so much bearing on
responses given by the respondents on consumer satisfaction of ECG. In all, the study involved
120 respondents from six communities in the district. The communities were Ahwiaa, Antoa,
Kenyasi, Adwumakase, Nkukua Bouho and Mamponteng. 20 respondents were selected from
each of the community visited. Of the 120, 80 of them, representing 66.7% of the total sample
size of the study were males. The remaining 40, representing 33.3% were females (Table 4.1).
40
The females represented in the study were those who were household heads and were responsible
for utility bills.
Table 4.1 Gender of Respondents
Frequency Percent
Cumulative
Percent
Male 80 66.7 66.7
Female 40 33.3 100.0
Total 120 100.0
Source: Field Survey, 2010
In table 4.2, the age distribution of the respondents is presented. From the table, majority of the
respondents constituting 60.8% were those between the ages of 31 – 50 years. Other age groups
represented in the study included those between 21 – 30, 20.8%, and those above 51years who
constituted 18.3%.
Table 4.2 Age of Respondents
Frequency PercentCumulative
Percent
21 – 30 25 20.8 20.8
31 – 50 73 60.8 81.7
51 years and above 22 18.3 100.0
Total 120 100.0
Source: Field Survey, 2010
In terms of education, the residents of the study area were quite literate. About 38.3% and 21.7%
had had secondary and tertiary education respectively. 26.7% had acquired basic education, with
only 13.3% having no education at all (Table 4.3). This level of literacy enhanced the research,
especially during the data collection. This was because most of the respondents could
understand the issues that the research was seeking to unravel.
Table 4.3 Level of education
41
Frequency Percent
Cumulative
Percent
None 16 13.3 13.3
Basic 32 26.7 40.0
Secondary 46 38.3 78.3
Tertiary 26 21.7 100.0
Total 120 100.0
Source: Field Survey, 2010
Another demographic characteristics interrogated by the research was the occupation of
respondents collected revealed that as many of the respondents representing 36.7% were artisans.
They included masons, carpenters, welders, kente weavers etc. Other occupations were farmers,
19.2%, traders constituted 24.2%, followed by farmers, teachers, civil servants and the
unemployed in that order (Table 4.4).
Table 4.4 Occupation of Respondents
Frequency PercentCumulative
Percent
Farmer 23 19.2 19.2
Teacher 11 9.2 28.3
Trader 29 24.2 52.5
Artisan 44 36.7 89.2
Unemployed 4 3.3 92.5
Civil Servant 9 7.5 100.0
Total 120 100.0
Source: Field Survey, 2010
4.2 The ECG Customer
42
The customers of ECG in the district cuts across all age groups with the majority of them
however within the 31 – 50 yrs age group. This age group according to Ghana’s demographic
characteristics is the active working group. This therefore indicates that those who pay for the
services of ECG are those within the working class. Of the 120 customers interviewed, 38
representing 31.7% were using the services of ECG for commercial purposes, while the majority
of 68.3% used it for domestic purposes (Fig. 4.1). Electric power according to the respondents
was used for such purposes as lighting, ironing, refrigeration, air conditioning, television, radio
and the like.
Fig. 4.1 Type of customer
Source: Field Survey, 2010
The 31.7% of the respondents, who used the services of ECG for commercial purposes, were
engaged in such activities as welding, cold store business, food processing, and retail shops (Fig.
4.2). However, this section of respondents did not use electricity exclusively for commercial
purposes since they all had homes and used electricity there too.
Fig. 4.2 Type of commercial activity
43
For those who used the services for domestic purposes, 45.1% were residents of compound
houses, 24.3% lived in flats and the remaining 30.4% lived in ‘self-contained’ houses. This is
presented in Fig. 4.3. According to the respondents, even though there is a pricing
arrangement that ensures that they enjoyed the use of electricity for their basic
needs at an affordable price, through the “lifeline tariff” arrangement, the
reverse is the case. This is because considering the number of households in a
compound house, the aggregate consumption rate far exceeds the life line. The
poor consumers actually pay more than the well-to-do who lived in their own
houses.
Fig. 4.3 Types of Domestic residence
44
Source: Field Survey, 2010
The researcher tried to establish how long respondents had been doing business with ECG. The
reason being that one is always in a better position to assess the performance of service provider
if that individual had had the opportunity of a longer relationship. In this regard therefore,
respondents were asked how long they had been doing business with ECG. The responses
indicated in Fig. 4.4 were that majority of the respondents (77.7%) had been doing business with
ECG for the past 5years and above. The remaining 23.3% had however been doing business only
between the past 1 – 4 years. Respondents were therefore in a very good position to assess the
performance of ECG.
Fig. 4.4 Length of time as customer
45
Source: Field Survey, 2010
4.3 Customer Relations Policy of ECG
The ECG in the district does not have any concrete well spelt out customer relations policy,
except for their mission statement that stated ‘to achieve a step change in quality service to our
customers. Apart from this mission statement, they also had the value statement. In the statement
they envisage to be passionate about their customers, they wanted the best, value each other and
they could be trusted. All these were summed up in their vision statement ‘achieve customer
delight’.
4.4 Service Delivery of ECG
The main service that the ECG delivers as a public utility service company is the distribution of
electricity across the country. This is a service solely undertaken by ECG. The company
therefore enjoys absolute monopoly in its area of operation. Consumers were to a large extent
stuck with this company. The lack of competition in the supply of electricity had resulted in
complacency, inertia and operational inefficiencies on the part of ECG which are paid for by the
consumer. When respondents were asked about the specific problems encountered by them,
46
mention were made of unannounced outages, power fluctuations and over billing (high tariffs)
(Fig 4.5). When respondents were asked if they enjoyed uninterrupted electricity supply, all
respondents answered in the negative. They contended that about 99% of the outages
experienced were unannounced. According to the respondents officials of the company lacked
the decency to even apologize or engage customers when these intermittent unannounced
outages took place. The effects of these unannounced outages and power fluctuations had had on
them included damage to electrical and electronic appliances, decrease in lifespan of bulbs and
total inconvenience. For commercial users, respondents complained about decrease in income as
a result of low productivity, damage to expensive equipment and sometimes fire outbreaks.
According to all respondents interviewed, they had always been at the losing end. The company
had publicly offered explanations for such operational inefficiencies, paid compensations or even
apologize for the inconvenience caused.
Fig. 4.5 Problems Associated with Service Delivery
Source: Field Survey, 2010
Another problem shown in Fig. 4.5 was the issue of tariffs. As indicated in Fig. 4.6, majority of
the respondents (56.7%) paid Gh.¢20.00 and above every month as cost of electricity.
47
Fig. 4.6 Cost of Electricity per Month
Source: Field Survey, 2010
According to the respondents the charges by ECG were very high considering the unsatisfactory
service being rendered to them. However, 65% of the respondents said they could still afford the
high bills because they did not have any other option. The remaining 35% however said they
most at times found it difficult to settle bills (Fig. 4.7)
48
Fig. 4.7 Respondents’ Ability to Settle Bills
Source: Field Survey, 2010
When respondents were asked if there had ever been a time that their electricity supply had been
disconnected because they could not settle their bill, 40% of them answered in the affirmative
(Table 4.5) This situation according to them occurred at times when very questionable bills had
been issued.
Table 4.5 Disconnection of Power for Non-payment of bills
Frequency Percent
Cumulative
Percent
Yes 48 40.0 40.0
No 72 60.0 100.0
Total 120 100.0
Source: Field Survey, 2010
About 60% of the respondents who used the pre-paid meters complained that even though tariffs
had not been increased officially, they were paying more for the same number of units than they
did a couple of years ago. They felt that their tariffs should only go up when new electrical
gadgets were added and consumption had gone up. However, their complaints were that with the
49
same number of electrical gadget, the same pattern of electricity use, the amount of credits that
was supposed to last a month got finished in two weeks.
A secure and comfortable customer is one who says that he or she is very satisfied with the service,
definitely will continue to use the service in the future and definitely would recommend the service
to others. A vulnerable customer is one who says he or she is somewhat satisfied or dissatisfied,
might or might not use the service in the future or might not recommend the service to others.
On the basis of these assumptions, respondents were asked if they would recommend ECG to a friend
if there were other electric power service providers. In response, only 28.3% said they would. The
majority of the respondents, representing 71.7% however said they would not recommend ECG to
friend if there were other service providers (Fig. 4.8)
Fig. 4.8 Likelihood of Recommending ECG
Source: Field Survey, 2010
Furthermore, results for the question of how likely respondents were going to repurchase services
from ECG if there were other service providers were also significant. As indicated in Fig. 4.9, 45%
of the respondents mentioned that their chances of repurchasing from ECG were poor. As many as
50
15% also were indifferent. This is an indication that if there were other service providers in the
district as many as over 60% of ECG’s present customers in the district would switch to ECG’s
competitor.
Fig. 4.9 Likelihood of Repurchase from ECG
Source: Field Survey, 2010
4.5 Needs of the ECG Consumer
In the minds of ECG consumers, their needs and expectations from ECG were listed by
respondents as follows:
i. Provision of 24hr electric energy supply
ii. Affordable prices, reasonable billing
iii. Provision of better after sales service
iv. Better handling of complaints
v. Better communication and inter-personal relationship
51
vi. Avoidance of bureaucracy in service provision
4.6 Determinants of Satisfaction
In assessing the levels of satisfaction by consumers of the services or products of a company,
five major factors are normally used. In this study therefore these factors have been used as the
determinants of satisfaction. They are customer service, price of the services rendered,
complaints handling, location of offices, and service delivery quality. Customers were asked
about their levels satisfaction based on these five factors as they are collectively linked to the
extent to which customers would be satisfied with the services they receive from service
providers.
4.7 Customer Service
Business success is dependent on a variety of factors – a realistic business idea, a well thought-
out business plan, an appropriate marketing strategy and more importantly, great customer
service are amongst the top ones. While customer service is a part of marketing, it can be
segregated as a separate field on its own. King (2007) defines the term customer service as
including all aspects of interaction with a customer and speaking to the organization’s image in
the mind of a customer. Because of the nature of the services rendered by ECG, there is regular
interaction of customers with the company, at least once every month. Customers visit either the
district office or paypoints to purchase credits or pay their monthly bills. Other services included
fixing of meters, repair or replacements, fixing of broken lines etc. The research therefore sought
to assess the levels of performance of ECG in their customer service care. The result as
presented in Fig. 4.10, indicate that performance in this area is nowhere near excellent or very
good. A majority of 38.3% rated ECG as just fair, and 33.3% also rated ECG as good. A
52
considerable section who constituted 18.3% rated ECG service delivery quality as poor. The
reasons adduced by customers for this rating were that customers normally waited a long time
for new services to be rendered, especially in the supply of meters for new customers to be
connected. According to the survey, of 65% of respondents who are consumers said, they had to
part with money to induce speedy processing of documents, otherwise they would have to wait
for a long time to get to their turn. The major excuse according to respondents is unavailability of
metres.
Fig. 4.10 Rating of Customer service by Respondents
Source: Field Survey, 2010
4.8 Price of Service
Price of a product or service is another important factor that determines how customers will or
will not be satisfied with the product or service if it is compared to the quality of that service.
According to Parasuraman, et al (1991), customers will not complain if they paid higher prices for
53
high quality service. According to the respondents, the price of the services of ECG in itself was
not important. Their contention was that when it was compared with the quality of the services
that they received, they were paying too much. In many cases in the country, concerns of
customers about the quality of services had been a constraint factor in how tariffs are increased
by ECG. In assessing the price levels by respondents, the general response was that the cost of
electricity was high considering the very poor services rendered by the company. According to
60.8% of the respondents the price levels of the services of ECG was rated poor, with 26.2%
rating it as fair (Table 4.11).
Fig. 4.11 Price of service
Source: Field Survey, 2010
4.9 Complaint Handling
Since services exist in real time, they are consumed at the very moment when they are made
available to customers. They cannot be stored and checked for their quality like a physical product.
Hence, every service production failure is likely to be experienced by a customer. Consequently,
54
"dissatisfaction with a service might occupy most of the time over which service is consumed" (East,
1997). However, customers might not instantly switch their service providers after experiencing a
problem during the service production. This is mainly because of the fact that the perceived costs of
switching are relatively high, and also the fact that there is no alternative service provider in the
electricity section of the energy sector. Customers, however, might display a passive response to a
problem, which can be in the form of making a formal complaint. Customer satisfaction in such cases
can depend upon the efficient and effective response of the service provider (Levesque and
McDougall, 1996). In the study area however, customers had not presented formal complaints of
poor services to management. They however contended that customers across the country on daily
basis complained about the poor services of ECG. They added that the Public Utility Regulatory
Commission (PURC) had organized forums at which complaints had been made, yet services were
not improved. There was a general feeling of resignation and indifference by respondents on this
issue. Most customers expressed the view that they were fed up with the excuse of obsolete
equipment made by management of ECG for failing to offer improved services despite the huge
tariffs. Respondents were asked to assess the performance of ECG on this issue. The result, indicated
in Fig. 4.12, shows that as many as 45% of the respondents were of the view that the handling of
customer complaints by ECG has been generally poor.
Table 4.12 Customers Assessment of ECG’s Complaint Handling
55
Source: Field Survey, 2010
4.10 Location
The location of the offices of a company or organization contributes to the levels of satisfaction
of the services rendered to customers. A convenient location means customers can easily do
business with their service providers on a regular basis (Levesque and McDougall, 1996).
Accessibility is also a related factor which, while acting together with convenience, enables
customers to deal with their service providers more easily (Levesque and McDougall, 1996). The
more a location is convenient and accessible, the higher the perceived customer satisfaction level.
On the assessment by respondents of this determinant, responses were very favourable towards ECG.
As shown in Fig. 4.13, majority of the respondents said they had easy access to the office of ECG.
According to the respondents apart from the main office which was easily accessible, there were
paypoints located in every community where customers paid their monthly bills.
56
Fig. 4.13 Assessment of ECG’s Location
Source: Field Survey, 2010
4.11 Service Quality and delivery
In the service industry, strong emphasis is placed on the importance of service quality perceptions
and the relationship between customer satisfaction and service quality. Researchers like
Parasuraman, Levesque and McDougall (1996) argued that customers, while evaluating the quality of
a service, compare the service they expect with perceptions of the services they actually receive.
Customers not only judge the accuracy and dependability (i.e. reliability) of the delivered service but
they also judge the other dimensions such responsiveness, assurance and empathy, as the service is
being delivered. Customer satisfaction can thus be based not only on the judgment of customers
towards the reliability of the delivered service but also on customers' experiences with the service
delivery process. On this basis therefore, respondents were asked to assess the service quality and
the delivery process of ECG’s services. The respondents were unanimous in their responses.
Majority of the respondents who constituted 68% of the total sample size indicated that the
performance of ECG in the area of service quality and delivery was poor. Respondents were
57
incensed about the fact that ECG does not empathize or even apologize for the poor services they
render them.
Fig. 4.14 Customers’ Assessment of Service Quality and Delivery
Source: Field Survey, 2010
4.12 Factor Rating of Determinants
In determining the most important satisfier, respondents were asked to identify among the five
determinants which of them was the most important or their preferred factor that satisfies or will
satisfy them most. From Fig. 4.15, the most preferred factor, or the most important determinant
of customer satisfaction was service quality and delivery. The next preferred factor was
customer service, followed by location and price. The least preferred according to the
respondents was complaint handling. The reason given for the choice were that better services in
the form of reliable and constant electricity supply supersede every other thing and that they
58
would not mind paying more for such service. They believed that if services were better and the
company offers better customer services, there would be very little or nothing to complain about.
Fig. 4.15 The Most Preferred Factor/Determinant
Source: Field Survey, 2010
4.13 Level of Overall Satisfaction with ECG Services
Based upon all the considered issues, the researcher wanted to know consumers’ overall
satisfaction with the services provided by ECG considering all the discussed points regardless.
Respondents were asked to assess on the scale of 1 – 5, with 1 being extremely satisfied, 2 being
satisfied, 3, indifferent, 4 dissatisfied and 5 being extremely dissatisfied. The graph (Fig. 4.16)
indicates that as many as 60% of the consumer respondents are dissatisfied with service delivery
quality of ECG while only 8% were satisfied with the company’s service delivery quality.
59
Fig. 4.16 Level of Overall Satisfaction with ECG
Source: Field Survey, 2010
However, the counter argument put across by officials of ECG about inefficiency and lack of
customer satisfaction was that Ghana’s population growth, urbanization and economic growth
have surpassed operational growth of ECG. According to officials of ECG, the current capacity
of ECG is such that it can ensure customer satisfaction of a:
a. Given population (x)
b. Given urban development (y)
c. Given economic growth (z)
Based on x,y,z, ECG is efficient, ECG ensures customer satisfaction, ECG cannot be blamed.
ECG’s alleged inefficiency is a perception because it is over-whelmed by the current population
and the growing economy. In other words population and economic growth of the country have
outclassed operational capability and ability of ECG. In that context ECG is not inefficient. In
60
the same context, lack of customer care and satisfaction are over-emphasized statements.
Officials also contended if quality services to be provided, economic prices should be paid for
services rendered. However, the economic situation and poverty levels pertaining in the country
makes it almost impossible for economic prices to be paid.
61
CHAPTER FIVE
SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS
5.0 Introduction
This chapter is the final chapter of the study and it presents the summary of the research findings,
conclusion and also suggest recommendations to the problems based on the results of the
analysis of the data in the previous chapter.
5.1 Summary of Research Findings
After analysis of the data collected, the following are the summary of research findings.
i. Majority of the customers of ECG in the Kwabre East District used electricity for
domestic purposes. Electricity was used mainly for lighting, refrigeration, ironing,
television, radio and air conditioning. However, those who used it for commercial
purposes were those in the retail business and small-scale enterprises.
ii. Majority of the domestic power users were those living in compound houses. Despite the
availability of the life-line tariff regime those who cannot afford flats and ‘self-contained’
houses, paid higher tariffs.
iii. It was also found that ECG does not have a clear cut customer service policy in place.
iv. The major problems confronting consumers in the district are unannounced outages, over
billings, power fluctuations and wrongful disconnections. It was also found that despite
these major problems Kwabre South ECG does not management never empathized with
their consumers or even apologized for the many inconveniences, destructions to
equipment and appliances and sometimes fire outbreaks caused to them.
62
v. It was revealed that a section of the customers, who sometimes could nor settle bills were
disconnected despite pleas, even though there could be over-billing.
vi. Majority of the customers would not recommend ECG to a friend if there were other
service providers.
vii. Many of the customers would not repurchase or do business with ECG should there be an
alternative power service provider. They would immediately switch to ECG’s competitor
if there should be one.
viii. Customers assessed ECG’s customer service as fair; price of service was rated as poor. In
terms of compliant handling, people in the district rated ECG’s performance as poor. The
ECG’s performance in the area of location of their offices was however rated as good
since there was accessibility and convenience in doing business with ECG. ECG’s
performance in service quality and delivery was rated as poor.
ix. Among all the factors that determine satisfaction, customers rated service quality and
delivery as the most important satisfier followed by customer service, price, location and
complaint handling in that order.
x. In terms of overall level of satisfaction customers were dissatisfied with the performance
of ECG.
5.2 Conclusion
Business success is dependent on a variety of factors – a realistic business idea, a well thought-
out business plan, an appropriate marketing strategy and more importantly, great customer
service are amongst the top ones. While customer service is a part of marketing, it can be
segregated as a separate field on its own. King (2007) defines the term customer service as
63
including all aspects of interaction with a customer and speaking to the organization’s image in
the mind of a customer.
Public service delivery in Ghana has been bedeviled with a lot of problems. The government
had instituted the public sector reforms, which was in part to see to the effective management
and delivery of public service utilities. In spite of the much talked about public sector reforms,
including the issuing of service charters by public sector agencies, the quality of public service
delivery remains unsatisfactory, being very bureaucratic and cumbersome and open to petty
corruption. Many private entities and service providers have succeeded because of the failure of
the public sector. The grave dissatisfaction with the many public utility services is compounded
by the fact that they are operating in an environment of monopoly, especially in the area of
electricity generation and transmission. The Electricity Company of Ghana (ECG) is the only
distributor of electricity for both domestic and industrial use in the country. The complacency
associated with monopoly has over the years made the ECG very inefficient and sluggish in its
management operations coupled with poorly maintained distribution system. However,
consumers are unable to seek any option or alternative but to cope with the existing service
provided by the country’s only electric power provider.
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 both psychological and physical variables rate. The
level of satisfaction can also vary depending on other options the customer may have and other
products against which the customer can compare the organization’s products.
64
It seems self evident that companies should try to satisfy their customers. Satisfied customers
usually return and buy more, they tell other people about their experiences, and they may well
pay a premium for the privilege of doing business with a supplier they trust. Statistics are
bandied around that suggest that the cost of keeping a customer is only one tenth of winning a
new one. Therefore, when we win a customer, we should hang on to them.
A secure and comfortable customer is one who says that he or she is very satisfied with the
service, definitely will continue to use the service in the future and definitely would recommend
the service to others. A vulnerable customer is one who says he or she is somewhat satisfied or
dissatisfied, might or might not use the service in the future or might not recommend the service
to others. On the basis of the research findings therefore one could conclude that the customers
of public service organizations are not satisfied with the services rendered as has been shown by
the research findings on the Electricity Company of Ghana using the ECG of the Kwabre East
district of the Ashanti region.
5.3 Recommendations
i. ECG as a service company must develop well structured customer service and relations
policy and ensure that the every bit of it is adhered to by employees, especially their front
desk personnel.
ii. Considering the strategic importance of the energy sector in socio- economic
development of the country and with the attendant problems that have characterised it, it
appears that public- private partnership (PPP) in virtually all aspects of electric power
generation, transmission and distribution should be considered.
65
iii. In doing so, competition and appropriate regulatory framework which are prerequisites to
achieve better services delivery must be put in place. Competition should be promoted by
introducing functional segmentation by separating transmission companies; the
establishment of a number of competing privately owned generation companies from
existing ECG generation facilities and the opening of a number of distribution and
marketing companies.
iv. Provision of uninterrupted power supply should be seen as part and parcel of social
services provided by government to the masses with affordability as the watchword.
v. There should be an effective communication with the public on power cuts and outages to
enable consumers save equipment that can be lost through the intermittent interruptions.
vi. The government should provide adequate resources (financial and equipment) to the
public utility service providers, especially ECG to improve their performance
considerably. In that regard, the involvement of banks and other financial institutions in
pre-financing or co-financing utility and other development projects to ease the financial
burden on Government should also be considered.
66
vii. The Public Utilities Regulatory Commission (PURC) has to apply the necessary
sanctions and penalties if public utility providers do not adhere to the highest level of
service delivery quality to the public.
67
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Taylor, S.A., Baker, T.L. (1994), "An assessment of the relationship between service quality and customer satisfaction in the formation of consumers' purchase intentions", Journal of Retailing, Vol. 70 No.2, pp.163-78.
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COLLEGE OF ART AND SOCIAL SCIENCES
KWAME NKRUMAH UNIVERSITY OF SCIENCE AND TECHNOLOGY
SCHOOL OF BUSINESS
QUESTIONNAIRE
This questionnaire seeks to collect data about the thesis topic, ‘Assessing Customer Satisfaction
in public service organizations; a case study of the Electricity Company of Ghana, Kwabre
district. The information provided will be used for academic purposes only, and shall be treated
with the strictest confidentiality.
1. Gender: ( 1). Male [ ] (2). Female [ ]
2. Age: (1) Under 20 years [ ] (2) 21- 30 years [ ] (3) 31- 50 years [ ] (4) 51
years and above [ ]
3. Level of Education: (1) None [ ] (2) Basic [ ] (3) Secondary [ ] (4) Tertiary [ ]
4. Marital status: (1) Married [ ] (2) Single (3) Separated [ ]
5. Occupation: (1) Farmer [ ] (2) Teacher [ ] (3) Trader [ ] (4) Unemployed [ ]
6. What type of customer are you? (1) Commercial [ ] (2) domestic [ ]
7. If commercial, what type of activity are you engaged in?
…………………………………………
8. If domestic, what type of residence? (1) Compound house [ ] (2) Flat [ ] (3) Self-
contained [ ]
9. For how long have you been a customer? (1) 1 – 4 yrs [ ] (2) 5 – 10 yrs [ ] (3) 11
yrs and above [ ]
10. Do you enjoy uninterrupted power supply? (1) Yes [ ] (2) No [ ]
11. Are you given prior notice before power outages? (1) Yes (2) No [ ]
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12. How much do you pay for power per month? (1) Gh.¢3 – 5 [ ] (2) Gh. ¢6 – 10 (3)
Gh. ¢11 – 140 (4) Gh. ¢150 – 20 (5) Gh. ¢21 – 24 (6) Gh. ¢25 and above.
13. Which type of metre do you use? (1) Pre-paid metre [ ] (2) Credit metre [ ]
14. Are you able to afford this amount every month? (1) Yes [ ] (2) No [ ]
15. Has there been any time that your power has been disconnected for non-payment of bills?
(1) Yes [ ] ( 2) No [ ]
16. If there were other electric power service providers, would you recommend ECG to a
friend or relative? (1) Yes [ ] (2) No [ ] (3) Not Sure [ ]
17. How likely are you to repurchase services from ECG if there were other competitor (s) ?
Would you say chances are?
1. Excellent [ ]
2. Very Good [ ]
3. Good [ ]
4. Fair [ ]
5. Poor [ ]
6. Indifferent [ ]
18. How would you rate the overall quality of your relationship with ECG, considering all of
your experiences with them?
1. Excellent [ ]
2. Very Good [ ]
3. Good [ ]
4. Fair [ ]
5. Poor [ ]
6. Indifferent [ ]
On a scale of 1 to 5 where; 1 – Extremely satisfied, 2 – Satisfied, 3 – Indifferent, 4 – dissatisfied, 5 – Extremely dissatisfied. How would you rate your level of satisfaction with ECG with regards to the following?
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19. Customer Service
1 2 3 4 5
20. Prize of Service/product
1 2 3 4 5
21. Complaint Handling
1 2 3 4 5
22. Location
1 2 3 4 5
23. Service Delivery/Products
1 2 3 4 5
24. Which of the factors mentioned above would you rate as the most important satisfier? (1)
Customer service [ ] (2) Prize of service/product [ ] (3) Complaint handling [ ] (4)
Location [ ] (5) Service delivery/product [ ]
25. How would you rate your level of overall satisfaction with ECG? (1) Excellent [ ] (2) Very
Good [ ] (3) Good [ ] (4) Fair [ ] (5) Poor [ ] (6) Indifferent [ ]
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