service quality analysis of mcdonald's

Service Quality Analysis of McDonald’s Pakistan

Submitted By:Ammara Anjum (12-BS-R-34)Noraiza Aslam (12-BS-R-16)

Submitted To: Dr. Amani Mozzam

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Abstract

Service quality and customer satisfaction are very essential concepts that organizations must

understand in order to remain competitive in business and to grow. It is very important for

companies to know how to measure these concepts from the consumers’ perspective in order to

develop better understanding and to know their needs to satisfy them. Service quality is

considered very important because it leads to higher customer satisfaction, success, cost-

effectiveness, customer loyalty and tells the organization that how to retain customers.

The purpose of our study is to explore service quality dimensions in fast food restaurant services.

The restaurant we have chosen as our subject is McDonald’s Pakistan. The study examines the

effect of the service dimensions on customer satisfaction and the gap analysis between

expectation and perception within the restaurant. The findings are expected to help the owners of

restaurant to reduce or deal with the gaps and improve satisfaction level of their customers,

thereby bringing about repeat business and improving profits.

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Table of ContentsMcDonald’s Introduction.............................................................................................................................3

McDonald’s Pakistan...............................................................................................................................4

Research Question.......................................................................................................................................4

Research Objective......................................................................................................................................5

Literature Review........................................................................................................................................5

Research methodology..............................................................................................................................11

Type of research....................................................................................................................................12

Focus of research...................................................................................................................................12

Universe of population..........................................................................................................................13

Target population...................................................................................................................................13

Tools for data collection........................................................................................................................13

Sampling size........................................................................................................................................13

Limitations............................................................................................................................................13

Theoretical framework..............................................................................................................................14

Different Theories of Customer Satisfaction.........................................................................................14

Assimilation Theory...........................................................................................................................14

Contrast Theory.................................................................................................................................15

Assimilation-Contrast Theory............................................................................................................16

Negativity Theory..............................................................................................................................18

SERVQUAL Model..............................................................................................................................18

The Gaps Model of Service Quality......................................................................................................19

Data Analysis.............................................................................................................................................19

Gap scores analysis................................................................................................................................23

Department-wise Analysis.....................................................................................................................23

Demographics........................................................................................................................................25

Conclusion.................................................................................................................................................26

Recommendations.....................................................................................................................................27

Quality Criteria..........................................................................................................................................28

Bibliography...............................................................................................................................................29

Appendix...................................................................................................................................................30

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McDonald’s Introduction

McDonald’s Corporation, incorporated on December 21, 1964, operates and franchises

McDonald’s restaurants. McDonald’s global system comprises both Company-owned and

franchised restaurants. The Company manages its business as distinct geographic segments: the

United States (U.S.); Europe, and Asia/Pacific, Middle East and Africa (APMEA). The

Company’s operations in Canada and Latin America, as well as its corporate activities are

reported under Other Countries & Corporate. The Company’s restaurants offer a substantially

uniform menu, although there are geographic variations to suit local preferences and tastes.

McDonald’s franchised restaurants are owned and operated under one of the following

structures: conventional franchise, developmental license or affiliate. Under a conventional

franchise arrangement, the Company owns the land and building or secures a long-term lease for

the restaurant location and the franchisee pays for equipment, signs, seating and decor.

Franchisees are also responsible for reinvesting capital in their businesses over time. The

Company’s typical franchise term is 20 years. Conventional franchisees contribute to the

Company’s revenue through the payment of rent and royalties -based upon a percent of sales,

with specified minimum rent payments, along with initial fees paid upon the opening of a new

restaurant or grant of a new franchise.

Under a developmental license arrangement, licensees provide capital for the entire business,

including the real estate interest. The Company does not invest any capital under a

developmental license arrangement. The Company receives a royalty -based upon a percent of

sales, as well as initial fees upon the opening of a new restaurant or grant of a new license. This

structure is used in over 70 countries with a total of approximately 5,228 restaurants. The largest

developmental licensee operates approximately 2,100 restaurants in 19 countries in Latin

America and the Caribbean.

The Company also has an equity investment in foreign affiliated markets, referred to as

Affiliates. In these markets, the Company receives a royalty -based on a percent of sales. The

largest of these affiliates is Japan, where there are nearly 3,100 restaurants.

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McDonald’s PakistanMcDonald’s first restaurant opened its door to the people of Pakistan in September 1998 in

Lahore. This launch was met with unprecedented enthusiasm from the citizens of Lahore, who

are known for their liveliness, vigor and penchant for quality food. Karachi opened its first

restaurant a week after Lahore. Ever since they opened the doors of our restaurants both in

Karachi & Lahore, they have been proud to provide our customers the same great taste,

outstanding value and superior service that is synonymous with the Golden Arches all over the

world.

There are now 34 restaurants in 8 major cities of Pakistan. (Karachi, Hyderabad, Lahore,

Faisalabad, Kala Shah Kaku, Sialkot, Gujranwala, Islamabad and Rawalpindi)

Today millions of Pakistanis place their trust in McDonald’s to provide them with food of a very

high standard, quick service and value for money. So next time you walk into one of our

restaurants, please remember, McDonald’s Pakistan is here now, to put a smile on your face,

each and every time you visit us.

McDonald’s is firmly committed to giving back to the community where it operates. They are

happy to become involved because they recognize that organizations have a role to play in

helping communities to work successfully. The contribution they enjoy most is the experience of

working together with others in the community to achieve worthwhile benefits for those who

need it most.

Research QuestionResearch Questions The main issues we are addressing in this research are service quality and

customer satisfaction using the SERVQUAL model in the context of fast food restaurant. We are

interested in the dimensions of service quality from the consumer’s perspective through

assessing their expectations and perceptions of service quality. We therefore will like to answer

the following questions in our study:

What are the consumer’s expectations about the service quality of McDonald’s?

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How do consumers perceive service quality in McDonald’s?

Are consumers satisfied with service quality offered by McDonald’s?

Research Objective

The objective of this research is to find out the:

Level of service of McDonald’s pakistan.

Factors that satisfy and dissatisfy the customers related to their services.

Reasons for McDonald’s’s preference.

Reasons for disliking the restaurant.

Factors that need improvement with respect to service quality.

Literature ReviewAccording to Asubonteng (1996), due to strong competition and the unfriendliness of

environmental factors, service quality has become a foundation for marketing strategy for

corporations. This highlights how vital is to improve service quality for organizations for their

survival and development since it could help them deal with these challenges they experience in

the competitive markets. This means that service-based organizations are bound to provide

excellent services to their consumers in order to have a viable competitive advantage. There is a

need for these organizations to understand what sort of service quality is needed in order to attain

their objectives. Service quality is usually defined as the overall valuation of a service by the

consumers, (Eshghi,2008). One of the authors explains it as the degree to which a service meets

customer’s needs or expectations, (Asubonteng,1996) .Service quality is defined as “The

discrepancy between consumers’ perceptions of services offered by a particular firm and their

expectations about firms offering such services” (Parasuraman,1985). If what is perceived is less

than expectation if what is perceived is a smaller amount than expectation, client judges quality

as low and if what's perceived is meets or exceeds expectation then customer sees quality to be

high.

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The Crucial factor of service quality is consumer’s expectation that is seen as what they feel

service provider should offer and this is influenced by his/her personal needs, past experience,

word-of-mouth and service provider’s communications,(Parasuraman,1985).Though, this

meaning of expectation is that of service quality literature which is dissimilar from expectation in

the customer satisfaction literature which defines expectation as forecasts made by consumer

about what is likely to happen during an awaiting transaction. Consumers’ perception of

performance is what he/she experiences (Parasuraman,1988). Usually, it is stimulating to study

expectations and experiences of consumers in different contexts. It is of particular interest to

study these concepts in the context of Fast food restaurant because Fast food restaurant are

playing an instrumental role in the lives of youth for the last few years. Therefore, in this study,

we will define consumer’s expectation as what consumers think should be offered by the ideal

Fast food restaurant while consumer’s perception will be defined as what they experienced in the

Fast food restaurant and this is assessed after the performance. Furthermore, service quality is

predominantly focused on meeting the customer’s needs and also how good the service presented

meets the customer’s expectation of it. It is however challenging according to preceding studies

to measure service quality due to its intangible nature and also because it contracts with

expectations and perceptions of consumers which is challenging as well to determine due to the

complexity of human behavior. The intangible elements of a service that are inseparability,

heterogeneity and perishability are the critical factors influencing service quality perceived by a

consumer. This means that a service must be perfect by the provider in terms of its

characteristics in order to understand how service quality is perceived by consumers. (Douglas &

Connor,2003; Parasuraman,1985; Ladhari,2008) A service could mean an industry, a

performance, yield, contribution or a process and it is defined contrarily in various service

productions. The modifications in service industries are based on the features of service which

include; intangibility, heterogeneity, perishability and inseparability (Johns, 1999).

Intangibility means the product that is enable to be touched , no physical presence, tasted, not

having odor or cannot be heard before being purchased and this means that it is hard for

consumer to understand the nature of what they receive. An example would be a mobile

company offering services to customers; here the consumer makes just calls and does not obtain

any physical product. In Fast food restaurant, it is very challenging to assess intangibility

because their activities are centered on the physical products. This means that service suppliers

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must try to determine the level of intangibility of services and try to contain tangible elements

that could help understanding of expectation from the customer’s perspective (Beamish &

Ashford, 2007).

Heterogeneity means the quality of being diverse and difference in the level of delivery of

service due to the difference in human behavior of those offering services and the consumer.

Example occurs when seller offers assistance to one customer at the counter, that same person

cannot offer exactly the similar thing to the following customer because of differences in

behaviors. This is why it is challenging to determine the quality and level of service provided

because customers and service suppliers are different; the same consumer could act contrarily

with the same service provider (Beamish & Ashford, 2007).

Perishability means that as services are produced and disbursed at the same time implying they

cannot be stored for future usage. If the services are not used then they cannot be used again.

This does not though hold in every service business (Beamish & Ashford, 2007). An example

occurs when a person books a hotel room for a night and does not use it, no other person can use

at that same time. Inseparability means services are consumed as they are bought. This infers that

the consumer is involved in the production and delivery of the service which means he/she takes

distinct note of what is actually made by the service provider (Beamish & Ashford, 2007).These

above mentioned facets of service make it very thought-provoking measure service unlike

product quality which is measured objectively using factors such as resilience and number

defects because of its tangible nature (Parasuraman,1988).

The first model to live service quality is developed by Gronroos. He acknowledged three

elements of service quality; the technical quality cares with what's delivered (outcome), the

practical quality deals with the method of service delivery (how it's delivered) and therefore the

image quality that is known as company image of company ensuing from each technical and

practical qualities of service elements (Gronroos,1982).

The technical quality element of product unlike services is easy to assess as a result of area unit

they’re involved with palpability (services cape) like physical features that are visible to the

buyer. Servicescape is outlined because the physical facilities of a service company and this idea

is expounded to the SERVQUAL model in this the tangible aspects of the physical atmosphere

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are lined within the SERVQUAL model. Servicescape thus plays a good role in this it influences

consumers’ evaluations of alternative factors determining perceived service quality like

sympathy, reliability, responsiveness, and assurances (Reimer & Kuehn, 2004).

Servicescape is a lot of in service setting attributable to the distinctive characteristics of services

(intangibility, perishability, inseparability and heterogeneity) (William &amp ; Dargel,2004).

Summarily, services cape is implausibly important inside the delivery of services and affects

perceived service quality that any leads either consumer satisfaction or not. Service quality may

be a vital space to academicians because of its association to service organizations and then

many researchers have tried to develop varied models to measure it, even if some claim it's

arduous to live because of its intangibility that's powerful to quantify (Eshghi,2008;Stephen

Arnold Douglas &Connor,2003).This is why as services are intangible in nature, evaluating

the customer’s perception of quality may be done through communication with the folks

providing services (Magi &Julander,1996). It is explicit that “The veritable gains of a top

quality revolution return solely from client delight, that once more to an awfully nice extent

depends on the customer’s perceptions of overall service quality”. This is why it's terribly

imperative to grasp that however customers understand service quality and the way these

perceptions might have an effect on their behavior of rebuying things or services as a result of

through this manner firms can be ready to determine that gaps exists or not and may take

corrective actions to enhance their services. During this manner, organizations will implement

appropriate quality systems that might result to client satisfaction. (Sureshchander,2002)

It is tested that if you give smart service quality to customers you'll retain them simply and

afterwards attract new customers by this company’s company image may be increased and it

could lead on towards profitableness (Negi, 2009; Ladhari,2009).

Numerous models are developed to live service quality following these approaches either

behavior-based measures or disconfirmation models. In step with an author Shahin it's vital to

live service quality as a result of it permits the comparisons of before and when changes,

categorizes quality connected issues, and aids in developing clear principles for service delivery.

The SERVPERF model is developed by Cronin & Taylor in 1992 uses the performance

approach methodology that measures service quality supported customer’s overall feeling

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towards service. This model is sweet to live service quality however doesn't give info on

however customers can like service to be so as for service suppliers to create enhancements.

Teas in 1993 developed the Evaluated Performance model that measures the gap between

perceived performance and also the ideal quantity of a dimension of service quality, instead of

the customer’s expectation. This was to unravel a number of the criticism of some previous

models Gronroos, (1984); Parasuraman et al., (1985, 1988).

(Parasuraman ,1985), developed a model of service quality when ending a study on four service

settings: retail banking, MasterCard services, repair and maintenance of electrical appliances,

and long-distance phone phone services.

The SERVQUAL model represents service quality because the inconsistency between a

customer’s expectations of service providing and also the customer’s perceptions of the service

received. This primarily makes a behavior live (Parasuraman,1985). What this model tries to live

specifically is that the client perception of the service quality that is dependable on the

dimensions of the gap between expected service and perceived service that in go, depends on the

gaps beneath the management of the service provider like delivery of service, promoting of your

services etc. (Parasuraman,1985).

This mensuration of service quality relies on each on however client evaluates the service

delivery method and also the outcome of the service. a decent service quality is taken into

account united that meets or exceeds consumer’s expectation of the service (Parasuraman, 1985).

The SERVQUAL model was made from 10 dimensions of service quality once created;

tangibles, responsibility, responsiveness, communication, quality, security, competence,

courtesy, understanding the client, and access, (Parasuraman,1985) however anon these

dimensions were squeeze right down to five as a result of some dimensions were overlapping

and that they enclosed,

Tangibles (physical facilities, equipment, and workers appearance)

Reliability (ability to perform the secure service faithfully and accurately)

Responsiveness (willingness to assist customers and supply prompt service)

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Assurance (knowledge and courtesy of workers and their ability to inspire trust

and confidence)

Empathy- caring, individual attention the firm provides its customers

(Parasuraman,1988)

The higher than dimensions in the main specialize in the human aspects of service delivery

(responsiveness, responsibility, assurance, and empathy) and also the tangibles of service.

According to study administrated by (Ladhari,2009), it's suggested that the SERVQUAL model

may be a smart scale to use once measure service quality in varied specific industries however

that it's acceptable to settle on the foremost vital dimensions of this model that fit that specific

service being measured so as to assure reliable and valid results. We are going to use this model

as a result of it takes into consideration customer’s expectation of a service similarly as

perceptions of the service that is best thanks to live service quality in service sector

(Shahin,2005). Many researchers that have used the SERVQUAL model in varied industries

(retailing, restaurant, banking, telecommunication trade, airline line, government, hotels,

hospitals, and education).

Furthermore service quality has become a very important topic due to its apparent relationship

to prices, profitableness, client satisfaction, client retention and positive word of mouth

and it's wide thought of as a driver of corporate market and monetary performance (Buttle,1996).

In our study, we tend to square measure additional inquisitive about service quality and client

satisfaction by victimization the SERVQUAL model to assess them in alimentation eating place.

Service quality and client satisfaction have received an excellent deal of attention

from each students and practitioners due to their connection and relationship (Eshghi,2008).

The main reason for that specializes in these problems is up overall performance of organizations

(Magi & Julander, 1996).

Customer satisfaction has been studied by some researchers employing a single item scale

(Cronin & Taylor,1992) means that customer’s overall feeling towards a service is asked to

live satisfaction whereas others use a multiple item scale (Parasuraman et al,1985,1988)

satisfaction is measured victimization varied dimensions as an example the SERVQUAL

dimensions.

Customer satisfaction is outlined as a operate of the customer’s expectations and perceptions of

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performance in keeping with the expectation - disconfirmation paradigm (Tse & carpet, 1988)

and it's a construct closely associated with perceived service quality (Magi &

Julander,1996) varied studies that centered on a link between satisfaction and quality argued for

various views in terms of relationship. This shows that there's some link between service quality

and client satisfaction that highlights that importance of client fulfillment as process of quality

(Wicks & Roethlein,2009).

This ensure a relationship between service quality and client satisfaction however in keeping

with (Asubonteng,1996) there's no agreement on the precise reasonably relationship between the

two constructs and points of out that almost all researchers agree that service quality and

client satisfaction have attributes that square measure measurable. This is why we tend to shall

use the SERVQUAL instrument with its dimensions to live these ideas (service quality

and client satisfaction) and for the very fact that service quality results in client satisfaction we

'll build that assumption in our research in order to measure customer satisfaction.

Research methodologyThe overall objective of this research study is to establish the Gap Analysis between the

Perception and Expectation scores for all the customers of McDonald’s Pakistan. Figure 1

illustrates the overall research design. A questionnaire already was pre-designed. A review of the

literature showed a previous scale measuring this construct.

The questionnaire which will be been tested is a world renowned scale known as SERVQUAL.

The authors of this SERVQUAL framework are Valerie Zeithaml, Parasuraman, and Mary Jo

Bitner. Thus the primary objective of this phase was to describe the appropriateness, reliability,

and validity of using the SERVQUAL questionnaire items (questions). In addition, annotated

questionnaire was constructed by merely adjusting the questions towards a restaurant scenario.

The sampling frames that will be used are the respondents based on rules as set in its respective

section ‘sampling’ mentioned under.

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Type of researchThis study has been conducted on the basis of descriptive research design. Descriptive

studies involve a one-time interaction with a group of people (cross-sectional study) or a

study may possibly follow individuals over time (longitudinal study). The ultimate objective of

this research study is to analyze the Perception scores for all the customers of the fast food

restaurant McDonald’s. This section includes a discussion of the research’s objectives.

The questionnaires are tested in a world renowned scale known as SERVQUAL. The authors of

this SERVQUAL framework are Valerie Zeithaml, Parasuraman, and Mary Jo Bitner. Thus the

primary objective of this phase was to describe the appropriateness, reliability, and validity of

using the SERVQUAL questionnaire. In addition, questionnaire was constructed by adjusting the

questions towards restaurant scenario.

Focus of researchResearch focuses on the service quality of the restaurant, customer satisfaction and the gaps

between expectations and perception. This can provide invaluable information regarding the

service quality of the restaurants so evaluation can be done.

Data Analysis

Data Collection

Pre-testing of Questionnaire

Sample Selection

Annotation of Instrument (SERVQUAL Questionnaire)

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Universe of populationThe people of Pakistan are fond of dinning in fast food restaurants so a huge crowd visits the fast

food restaurants per day. But this research will target the university going students because a

large percentage of those people are students and it would convenient for us to target a particular

rather than everyone.

Target populationThe target population of this research is basically the youth or university going students who are

habitual of visiting restaurants more than any other. So they can better evaluate the service

quality of the restaurants. The target population relates to faculty of management of University

of The Punjab Quaid-e-Azam campus Lahore.

Tools for data collectionThe questionnaire will request respondents to evaluate the service quality of the restaurants.

There are total 16 questions that were needed by customer to answer.

Sampling sizeWe selected a sample size of 150 respondents to fill the questionnaire because the population

was unknown to us so taking the time limitation into account we opted the minimum requirement

of questionnaires i.e. 150 by using simple random sampling method. So that the estimate is

accurate and the margin of error can be tolerated.

LimitationsThere are some hurdles that came in a way of research:

1) It was hard to find people who have visited all the three restaurants.

2) People are less willing to fill the questionnaire.

3) Time limitations were also another factor.

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Theoretical frameworkTheoretical frameworks are also significant in descriptive studies, a descriptive study is

one within which data is collected without changing the surroundings (i.e., nothing is

manipulated). Generally these are referred to as “correlational” or “observational” studies.

There are two motives why theoretical frameworks are vital here. First, no matter how slight you

think you know about a subject, and how unprejudiced you reason you are, it is difficult for a

human being not to have defined notions, even if they are of a very broad nature. The theoretical

framework is a structure that identifies and defines the major elements, variables, or constructs of

the research. It is used to hypothesize, understand, or give sense to the relationships between the

elements that impact, affect, or predict the events or outcomes we specify. A theoretical

framework guides the researcher that which variables should be measured and what statistical

relationships he/she should look for.

Different Theories of Customer Satisfaction Consistency theories suggest that when the expectations and the actual product performance do

not match the consumer will feel some degree of tension. In order to relieve this tension the

consumer will make adjustments either in expectations or in the perceptions of the product’s

actual performance. Four theoretical approaches have been advanced under the umbrella of

consistency theory:

(1) Assimilation theory

(2) Contrast theory

(3) Assimilation-Contrast theory

(4) Negativity theory

Assimilation Theory Assimilation theory is based on Festinger’s (1957) dissonance theory. Dissonance theory posits

that consumers make some kind of cognitive comparison between expectations about the product

and the perceived product performance. This view of the consumer post-usage evaluation was

introduced into the satisfaction literature in the form of assimilation theory. According to

Anderson (1973), consumers seek to avoid dissonance by adjusting perceptions about a given

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product to bring it more in line with expectations. Consumers can also reduce the tension

resulting from a discrepancy between expectations and product performance either by distorting

expectations so that they coincide with perceived product performance or by raising the level of

satisfaction by minimizing the relative importance of the disconfirmation experienced.

Assimilation Theory – Criticism: Payton et al (2003) argues that Assimilation

theory has a number of shortcomings. First, the approach assumes that there is a

relationship between expectation and satisfaction but does not specify how

disconfirmation of an expectation leads to either satisfaction or dissatisfaction. Second,

the theory also assumes that consumers are motivated enough to adjust either their

expectations or their perceptions about the performance of the product. A number of

researchers have found that controlling for actual product performance can lead to a

positive relationship between expectation and satisfaction. Therefore, it would appear

that dissatisfaction could never occur unless the evaluative processes were to begin with

negative consumer expectations.

Contrast Theory Contrast theory was first introduced by Hovland, Harvey and Sherif (1987). Dawes et al (1972)

define contrast theory as the tendency to magnify the discrepancy between one’s own attitudes

and the attitudes represented by opinion statements. Contrast theory presents an alternative view

of the consumer post-usage evaluation process than was presented in assimilation theory in that

post-usage evaluations lead to results in opposite predictions for the effects of expectations on

satisfaction. While assimilation theory posits that consumers will seek to minimize the

discrepancy between expectation and performance, contrast theory holds that a surprise effect

occurs leading to the discrepancy being magnified or exaggerated. According to the contrast

theory, any discrepancy of experience from expectations will be exaggerated in the direction of

discrepancy. If the firm raises expectations in his advertising, and then a customer’s experience

are only slightly less 94 than that promised, the product/service would be rejected as totally un-

satisfactory. Conversely, under-promising in advertising and over-delivering will cause positive

disconfirmation also to be exaggerated.

Contrast Theory – Criticism: Several studies in the marketing literature have

offered some support for this theory. The contrast theory of customer satisfaction

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predicts customer reaction instead of reducing dissonance; the consumer will magnify

the difference between expectation and the performance of the product/service.

Assimilation-Contrast Theory Assimilation-contrast theory was introduced by Anderson (1973) in the context of post-exposure

product performance based on Sherif and Hovland’s (1961) discussion of assimilation and

contrast effect. Assimilation-contrast theory suggests that if performance is within a customer’s

latitude (range) of acceptance, even though it may fall short of expectation, the discrepancy will

be disregarded – assimilation will operate and the performance will be deemed as acceptable. If

performance falls within the latitude of rejection, contrast will prevail and the difference will be

exaggerated, the produce/service deemed unacceptable.The assimilation-contrast theory has been

proposed as yet another way to explain the relationships among the variables in the

disconfirmation model.This theory is a combination of both the assimilation and the contrast

theories. “This paradigm posits that satisfaction is a function of the magnitude of the discrepancy

between expected and perceived performance. As with assimilation theory, the 95 consumers

will tend to assimilate or adjust differences in perceptions about product performance to bring it

in line with prior expectations but only if the discrepancy is relatively small.

Assimilation-contrast theory attempts illustrate that both the assimilation and the contrast theory

paradigms have applicability in the study of customer satisfaction.

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Assimilation-Contrast theory suggests that if performance is within a customer’s range of

acceptance, even though it may fall short of expectation the discrepancy will be disregarded –

assimilation will operate and the performance will be deemed as acceptable. If performance falls

within the latitude of rejection (no matter how close to expectation), contrast will prevail and the

difference will be exaggerated, the product deemed unacceptable.

Assimilation-Contrast Theory – Criticism: Anderson (1973) argues that

Cardozo’s (1965) attempt at reconciling the two earlier theories was methodologically

flawed. The attempts by various researchers to test this theory empirically have brought

out mixed results. Olson and Dover (1979) and Anderson (1973) found some evidence to

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support the assimilation theory approach. In discussing both of these studies, however,

Oliver (1980) argues that only measured expectations and assumed that there were

perceptual differences between disconfirmation or satisfaction.

Negativity Theory This theory developed by Carlsmith and Aronson (1963) suggests that any discrepancy of

performance from expectations will disrupt the individual, producing ‘negative energy’.

Negative theory has its foundations in the disconfirmation process. Negative theory states that

when expectations are strongly held, consumers will respond negatively to any disconfirmation.

“Accordingly dissatisfaction will occur if perceived performance is less than expectations or if

perceived performance exceeds expectations. This theory developed by Carlsmith and Aronson

(1963) suggests that any discrepancy of performance from expectations will disrupt the

individual, producing “negative energy.” Affective feelings toward a product or service will be

inversely related to the magnitude of the discrepancy

SERVQUAL ModelThe SERVQUAL instrument has been widely applied in a variety of service industries, including

tourism and hospitality. The instrument was used to measure hotel employee quality as

well.Parasuraman, Zeithamal and Berry (1988) built a 22-item instrument called SERVQUAL

for measuring consumer perceptions of service quality. SERVQUAL addresses many elements

of service quality divided into the dimensions of tangibles, reliability, responsiveness, assurance,

and empathy. A number of researchers have applied the SERVQUAL model to measure service

quality in the restaurant industry, with modified constructs to suit specific hospitality situations.

According to the SERVQUAL model, service quality can be measured by identifying the gaps

between customers’ expectations of the service to be rendered and their perceptions of the actual

performance of service. SERVQUAL is based on five dimensions of service:

1.Tangibility: Tangibility refers to the physical characteristics associated with the service

encounter.

2.Reliability: The service provider’s ability to provide accurate and dependable services;

consistently performing the service right. The physical surroundings represented by objects (for

example, interior design) and subjects (for example, the appearance of employees).

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3. Responsiveness: A firm’s willingness to assist its customers by providing fast and efficient

service performances i.e. the willingness that employees exhibit to promptly and efficiently solve

customer requests and problems.

4. Assurance: Diverse features that provide confidence to customers (such as the firm’s specific

service knowledge polite and trustworthy behavior from employees).

5. Empathy: The service firm’s readiness to provide each customer with personal service.

The Gaps Model of Service Quality Khan and Dutt cited that Parasuraman (1985) developed a model which depicts how various gaps in the service process may affect the customer’s assessment of the quality of the service. The foundation of the model (see Figure 1) is a set of four gaps which are the major contributors to the service quality gap which customers may perceive:

Gap 1 (Consumer Expectation – Management Perception Gap): In formulating its service

delivery policy, management does not correctly perceive or interpret consumer expectations.

Gap 2 (Management Perception – Service Quality Specification Gap): Management does not

correctly translate the service policy into rules and guidelines for employees.

Gap 3 (Service Quality specification – service delivery Gap): Employees do not correctly

translate rules and guidelines into action.

Gap 4 (Service Delivery – External Communications Gap): External communications –

promises made to customers – do not match the actual service delivery.

Data Analysis

STATEMENTS McDonald’s

PERCEPTI EXPECTATI GAP

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ON

SCORE

ON SCORE

P E P - E

TANGIBLES

1 Restaurant shall/has modern equipment. 3.78 4.18 -0.4

2 Physical facilities will/are visually appealing. 3.66 4.14 -0.48

3 Employees shall be/are dressed properly and

appear neat.

3.92 4.39 -0.47

4 Physical environment will be/is clean 3.94 4.6 -0.66

Overall Score 3.82 4.32 -0.5

RELIABILITY

1 When customer has a problem, restaurant show

a sincere interest

3.54 4.44 -1.04

2 Restaurant should perform/performs service

right first time.

3.44 4.23 -0.79

3 Should perform services at the time they

promised to do so.

3.71 4.45 -o.74

4

Should keep their records accurately.

3.59 4.06 -0.47


RESPONSIVENESS

1 Employees should make information easily

obtainable by the customers

3.61 4.03 -0.42

2 Employees should give prompt to customers 3.62 4.23 -0.61

3 Employees should always be willing to help

customers

3.68 4.25 -0.57

4 Employees in restaurants should/are never be 3.40 4.17 -0.77

21

too busy to respond to customers.


ASSURANCE

1 Behavior of employees in restaurants should

instill confidence in customers

3.46 4.10 -0.64

2 Customers should be able to feel safe in their

transactions with employees in the restaurants

3.79 4.26 -0.47

3 Employees should be polite 4.09 4.27 -0.18

4 Employees of the restaurant should have the

knowledge to answer customers' questions

3.58 4.31 -0.73


EMPATHY

1 Restaurant should give customers individual

attention

3.42 3.95 -0.53

2 Their operating hours should be convenient to

all their customers

3.8 4.27 -0.47

3 They should have their customers best interest

at heart

3.67 4.10 -0.43


Product

1 Restaurant should have enough variety of

products

3.9 4.27 -0.37

2 The products in restaurants should be of good

quality

3.76 4.48 -0.72

22


MEAN SCORES OF THE QUALITY DETERMINANTS

# SERVICE

QUALITY

DETERMINANTS

McDonald’s

PERCEPTION

SCORE

EXPECTATION

SCORE

GAP

P E P - E

1 TANGIBILITY 3.82 4.32 -0.5

2 RELIABILITY 3.57 4.29 -0.72

3 RESPONSIVENESS 3.57 4.23 -0.66

4 ASSURANCE 3.73 4.23 -0.5

5 EMPATHY 3.63 4.10 -0.47

6 Product 3.83 4.32 -0.49

Overall Mean Score 3.69 4.24

Gap scores analysis

23

The gap score analysis is to enable us find out how consumers perceive service quality in

McDonald’s and try to identify what dimensions of service quality they are satisfied with.

According to (Parasuraman,1985) the higher (more positive) the perception (P) minus

expectation (E) score, the higher the perceived service quality and thereby leading to a higher

level of customer satisfaction. In this regard, the gap scores were calculated based on the

difference between the consumers’ perceptions and expectations of services offered by

McDonald’s. In general, it was found that, customers’ perceptions of service quality offered by

McDonald’s did not meet their expectations (all gaps scores the dimensions are negative).

Dimensions that reported larger mean gaps were reliability (-0.72), responsiveness (-0.66) and

assurance (-0.5) while smaller mean gaps obtained were products (-0.49), tangibles (-0.5) and

empathy (-0.47). These values show that the perception of performance in Monalds' is less than

the expected level of service quality.

Department-wise Analysis

Institute of Administrative Sciences (IAS)

Serial no. Factors Perceptions Expectation GAPP E P-E

1 Tangibles 3.83 4.29 -0.462 Reliability 3.53 4.27 -0.743 Responsiveness 3.5 4.15 -0.654 Assurance 3.73 4.27 -0.545 Empathy 3.61 4.14 -0.536 Product 3.76 4.47 -0.71

Institute of Business Administration (IBA)


24


Institute of Business and Information Technology (IBIT)



We have taken the faculty of management of University of the Punjab, Quaid-e-Azam campus as our target population. According to the students of IAS the gap in tangible factors (physical facilities, uniform, and machinery) was the most as compared to other factors which means their expectations were high and what they perceived was low. On the other hand the scores of respondents of IBIT and IBA showed that the gap in empathy was high as compare to other factors.

25

Demographics

157%

243%

Gender

Male=1 Female=2

195%

25%

Age

1=18-24 years 2=25-30 years

26

185%

213%

31%

41%

Income

1=0-1000, 2=1000-2000, 3=2000-3000, 4=3000 and above

Conclusion

Gap analysis of McDonald’s has been done in this project by using the Servqual Model Gap

Analysis. According to the perception and expectations score there are improvements needed.

From the gap score analysis carried out, it was found that, the overall service quality is low as

perceived by consumers in McDonald’s and hence no customer satisfaction. Consumers have

higher expectations than what they actually receive from McDonald’s even though the difference

is not wide. To answer our research questions which are; how consumers perceive service quality

and are consumers satisfied with service offered by McDonald’s, the gap scores analysis carried

out provided answers to these questions. The overall perceived service quality is low as

expectations exceed perceptions meaning consumers desired more than what was offered to

them. As a result of this gap, it is clear that consumers are not satisfied. Evaluating the

perceptions and expectations of consumers, it can be seen that no dimension of service quality

brings customer satisfaction.

27

As we have taken faculty of Management as our sample so the trends were seen the same in all

three departments IAS, IBA and IBIT. In all the departments perception score was lower than the

expectations score so ultimately the satisfaction level was lower as well.

Evidence from the study show that, McDonald’s have to improve performance on all the

dimensions of service quality in order to increase customer satisfaction since consumers expect

more than what is been offered by it. This will enable them maintain high level of

competitiveness.

It has been found that the Average Perception Score of the Reliability among 6 quality

determinants is the highest and because of that the customers consider it the best for dinning.

Average Perception score of the factor 'responsiveness' is slightly lower than that of reliability

then comes tangibility and assurance at same level and in the end product and empathy which

needs highest improvement among all.

McDonald’s is preferred by customers due to their facilities and reliability in the Pakistani

Restaurant Industry. Customers would like to dine in a hygienic, reliable and reputable

restaurant.

According to the scores McDonald’s need to improve the product quality and need to bring more

variety in its existing product line. And also they lack individual attention to the customers'

which is making customers less comfortable.

Recommendations

Bring innovations in the menu.

Dining area should always be comfortable enough for the customers like the tables need to

be spaced far enough apart that you don’t feel you are being eavesdropped in your

conversation.

Should provide a calm dining atmosphere, it doesn’t need to be crammed so full that the

noise level becomes intolerable.

Quick service should be the main focus.

28

Provide discounts and special deals.

Should do more advertising to remain in the minds of the customers and to show they care

for their customers.

Must assist customers and empathize them when they face any problem.

Must give their regular customers special rewards or discounts. This can be done if they

keep a record of them.

Employees should have scheduled training and their behavior should be noted and

compared with their future performance.

Telephone operators and call centers should be more active and must immediately answer

customer’s calls and take orders.

Customer satisfaction has to be improved by giving customer’s quick response from

placing the order till delivering it.

Friendly workforce should be available to assist customer queries.

Quality Criteria

In our study, which is using a cross-sectional design, the external validity would be weak

because we did not apply a probability sampling technique meaning our results could not

be generalized to a larger population.

Our study could be consider credible because we tried at all cost to obtain unbiased

answers from our respondents and we analyzed exactly what we had as data from them

with doing any additional to primary data on our part. This means a high degree of honesty

was applied in the study.

29

Bibliography1. Parasuraman, Valarie A. Zeithaml and Leonard Berry (1988) “SERVQUAL: A Multiple Item

Scale for Measuring Customer Perceptions of Service Quality”

2. Christopher H. Lovelock (2005) “Services Marketing in Asia: Managing People, Technology and

Strategy”

3. Jin – Woo Park, Rodger Robertson and Cheng – Lung Wu “The Effects of Individual Dimensions

of Restaurant Service Quality: Findings from Australian Domestic Air Customers”

4. Robert E. Miller, Bill Hardgrave and Thomas W. Jones “The Impact of Presentation Order on

Service Quality Dimensions”

5. Anthony Perrone and Antony Ward “Enhancing the Gronroos Model of Service Quality”

6. Sanjay K. Jain and Garima Gupta “Measuring Service Quality: SERVQUAL VS SERVPERF

Scale”

7. Dr. M. Naveed Khan and Vippan Raj Dutt. “Consumer Expectations, Perceptions and Gaps

Model in Service Quality”

8. Fareena Sultan and Merlin C .Simpson “International Service Variants: Restaurant

Customer Expectations and Perceptions of Service Quality”

9. Simon Nyeck, Miguel Morales, Riadh Ladhari and Frank Pons “10 Years of Service Quality

Measurement: Reviewing the Use of the SERVQUAL Instrument”

10. John Gountas and Robin N. Shaw “Personality, Quality and Satisfaction in Restaurant Services”

11. Philemon Oyewole , Muthulakshmi Sankaran, , Pravat Choudhury “ Marketing

Restaurant Services in Malaysia: A Customer Satisfaction Orientation Approach

12. http://shodhganga.inflibnet.ac.in/bitstream/10603/4835/13/13_chapter%204.pdf

30

Appendix

Questionnaire

We are the students of BS (hons) Management from IAS and carrying out a study that what students

expect and how they perceive service quality of McDonald’s. We request you to fill the

questionnaire with relevant answers . Thank you.

The questionnaire is in two parts, expectations and experience.

Demographic questions

Gender: Male Female

Age: 18-24 25-30

Department __________________

Level of Education: Undergraduate Masters Others

How much do you spend in restaurants monthly?

0 – 1000PKR 1001 – 2000PKR 2001 – 3000PKR above 3000PKR

You should rank each statement as follows; strongly Disagree=1, disagree=2, Neutral=3, Agree=4,

Strongly Agree =5, Put a cross (X) on your choice of answer.

Expectations: This section deals with your opinion of restaurants. Please, show the extent to which you

think restaurants ‘should’ possess the following features. We are interested in knowing your expectations

from ideal restaurants service.

Statement Scores

T1. Ideal restaurants should have modern equipment. 1 2 3 4 5

Tang

ible

s

31

T2. Their physical facilities (shelves, counters, fridges,

computers, lights) should be visually appealing.

1 2 3 4 5

T3. Their employees should be well dressed and appear

neat.

1 2 3 4 5

T4. The physical environment of the restaurants should

be clean.

1 2 3 4 5

RL1. When a customer has a problem, restaurants should

show a sincere interest in solving it.

1 2 3 4 5

RL2. Restaurants should perform the service right the

first time.

1 2 3 4 5

RL3. They should provide their services at the time they

promise to do so.

1 2 3 4 5

RL4. They should keep their records accurately. 1 2 3 4 5

RN1. Employees should make information easily

obtainable by the customers.

1 2 3 4 5

RN2. Employees should give prompt service to

customers.

1 2 3 4 5

RN3. Employees should always be willing to help

customers.

1 2 3 4 5

RN4. Employees in restaurants should never be too busy

to respond to customers' requests.

1 2 3 4 5

A1. The behavior of employees in restaurants should

instill confidence in customers

1 2 3 4 5

A2. Customers should be able to feel safe in their

transactions with employees in the restaurants.

1 2 3 4 5

A3. Their employees should be polite. 1 2 3 4 5

Relia

bilit

y (R

L)Re

spon

siven

ess (

RN)

Assu

ranc

e

32

A4. Employees of restaurants should have the knowledge

to answer customers’ questions.

1 2 3 4 5

E1. Restaurants should give customers individual

attention.

1 2 3 4 5

E2. Their operating hours should be convenient to all

their customers.

1 2 3 4 5

E3. They should have their customers' best interest at

heart.

1 2 3 4 5

P1. Restaurants should have enough variety of products 1 2 3 4 5

P2. The products in restaurants should be of good quality 1 2 3 4 5

Actual Experience: The following statements deal with the perceptions of service experienced in

restaurants. Please, show the extent to which these statements reflect your perception of service in

restaurants in Pakistan.

Strongly Disagree=01 to Strongly Agree =5, Put a cross (X) on your choice of answer.

Statement scores

T1. Restaurants have up-to-date equipment. 1 2 3 4 5

T2. Physical facilities (like shelves, fridges) are 1 2 3 4 5

Tang

ible

sEm

path

yPr

oduc

t

33

visually appealing

T3. Employees are well dressed and appear neat 1 2 3 4 5

T4. The physical environment of the restaurants is

clean

1 2 3 4 5

RL1. When a customer has a problem, they show a

sincere interest in solving it

1 2 3 4 5

RL2. Restaurants perform the service right the first

time

1 2 3 4 5

RL3. Restaurants provide the service at the time they

promised to do so

1 2 3 4 5

RL4. Restaurants keep their records accurately 1 2 3 4 5

RN1. Employees make information easily obtainable

by customers

1 2 3 4 5

RN2. Employees give prompt service to customers. 1 2 3 4 5

RN2. Employees are always willing to help

customers.

1 2 3 4 5

RN4. Employees are never too busy to respond to

customers 76 requests.

1 2 3 4 5

RN5. The behavior of employees instill confidence in

customers

1 2 3 4 5

A1. Customers feel safe in their transactions with

employees in the restaurants.

1 2 3 4 5

A2. Employees are polite with customers. 1 2 3 4 5

A3. Employees of restaurants have the knowledge to

answer customers’ questions.

1 2 3 4 5

E1. Restaurants give customers individual attention. 1 2 3 4 5

Relia

bilit

y (R

L)Re

spon

siven

ess (

RN)

Assu

ranc

eEm

path

y

34

E2. Their operating hours are convenient to all their

customers.

1 2 3 4 5

E3. Restaurants have their customers' best interest at

heart.

1 2 3 4 5

P1. Restaurants have enough variety of products. 1 2 3 4 5

P2. The products of restaurants have good quality 1 2 3 4 5

Empa

thy

Prod

uct

service quality analysis of mcdonald's

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