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International Journal of Contemporary Business Studies Vol: 4, No: 6 JUNE, 2013 ISSN 2156-7506 Available online at http://w w w.akpinsight.webs.com services to satisfy the needs of their customers. It is now a key variable in maintaining customer satisfaction. These banks are introducing internet banking as an assurance to their customers that they will be able to maintain a competitive quality of service in the future, in efforts to avoid losing their customers (Rod et al. 2009). Offering internet banking is no longer regarded as a competitive advantage but a competitive necessity (Gan et al., 2006, as cited in Rod et al. 2009). The main purpose of this study was to investigate the customers‟ perceptions towards online service quality offered by a leading bank in Malaysia. Page | 71 2.0 LITERATURE REVIEW 2.1 Service Quality Service quality is generally perceived to be a tool that can be used to create a competitive advantage and therefore, substantial research into service and service quality has been undertaken in the last 20 years. Bitner et al. (1990) define service quality as “the consumers‟ overall impression of the relative inferiority/superiority of the organization and its services.” The most common definition of service quality is the discrepancy between consumer‟s expectations and perceptions of the service received. Accordingly, service quality is defined as how well a delivered service level matches customer‟s expectation. Parasuraman et al. (1988, 1991) identified more detailed dimensions of service quality and developed a well-known instrument, called SERVQUAL, to measure customer‟s perceptions and expectations from service. The SERVQUAL instrument consists of five underlying dimensions, with two sets of 22 item statements for the „expectation‟ and „perception‟ sections of the questionnaire. Perceived service quality is measured by subtracting customer perception scores from customer expectation scores, both for each dimension and overall. The five dimensions of SERVQUAL are (Parasuraman et al., 1988, 1991): (1) Tangibles, which pertain to the physical facilities, equipment, personnel and communication materials. (2) Reliability, which refers to the ability to perform the promised services dependably and accurately. (3) Responsiveness, which refers to the willingness of service providers to help customers and provide prompt service. (4) Assurance, which relates to the knowledge and courtesy of employees and their ability to convey trust and confidence. (5) Empathy, which refers to the provision of caring and individualized attention to customers. Since the SERVQUAL was developed in 1988, various researchers have recognized that both the instrument itself and the conceptualization of service quality may benefit from further refinement (for example, Finn and Lamb 1991, Lee and Hing 1995). They have argued that the SERVQUAL instrument needs to be customized to the specific service area. Cronin and Taylor (1992) have developed instruments to measure service quality based only on customer perceptions. After many studies have examined the suitability of SERVQUAL in measuring service quality in different types of service, they tried to adapt the original SERVQUAL items to various service contexts by slightly changing the original items. The SERVQUAL, however, does not embrace the unique facets of online service quality, such as customer-to-Web-site interactions, since this instrument was constructed based mainly on customer-to-employee interactions (Cai and Jun, 2003). C opyright © 2 0 13. A cademy of Knowledge P rocess
International Journal of Contemporary Business Studies Vol: 4, No: 6 JUNE, 2013 ISSN 2156-7506 Available online at http://w w w.akpinsight.webs.com Despite SERVQUAL as an instrument to measure quality has been widely accepted and several studies have attempted to address the key attributes of services quality, many researchers express the need that the SERVQUAL should be customized to the specific service area (Han and Beak, 2004). 2.2 Online Service Quality During the past several years, some conceptual and empirical studies have attempted to address the key attributes of service quality directly or indirectly related to online service and, SERVQUAL has been widely accepted and used in measuring Information System service quality (Van Dyke et al., 1999). Yang & Jun (2002) redefined the traditional service quality dimensions in the context of online services, and suggested an instrument consisting of seven online service dimensions (reliability, access, ease of use, personalization, security, credibility, and responsiveness). In addition, Barnes & Vidgen (2002) introduced a method for assessing the service quality of e-commerce web-sites, called WebQual. Despite the increased aware of online services, but still there is the problem of how the quality of online services is defined, which its determinants are and how it can be actually measured (Kenova and Jonasson, 2006). The quality of e-service is an essential issue to develop a valid scale. The growth of e-commerce in the global and regional markets creates a special interest in the measuring of e-service quality and also in the investigation of the dimensions of e-service (Mekoves et al., 2007). Page | 72 Considerable studies have been conducted focusing on the measurement and evaluating online service quality. Despite the valuable contribution of these scales, the SERVQUAL scale developed by Parasuraman, Zeithaml and Berry has received a considerable attention. Yang (2001) argues that the primary value of SERVQUAL lies on its powerful benchmarking, diagnostic and perspective tools. As stated earlier, the SERVQUAL scale does not best fit the online services and therefore many studies have tried to extend its conceptualization to the electronic context. Lee and Lin (2005) maintain that most research on e-service quality measurement has focused on rewording the SERVQUAL scale items. 2.3 E-Banking The concept of electronic banking has been defined in many ways. Daniel (1999) defines electronic banking as the delivery of banks' information and services by banks to customers via different delivery platforms that can be used with different terminal devices such as a personal computer and a mobile phone with browser or desktop software, telephone or digital television. Pikkarainen et al (2004) define internet banking as an "internet portal, through which customers can use different kinds of banking services ranging from bill payment to making investments". With the exception of cash withdrawals, internet banking gives customers access to almost any type of banking transaction at the click of a mouse (De Young, 2001). Indeed the use of the internet as a new alternative channel for the distribution of financial services has become a competitive necessity instead of just a way to achieve competitive advantage with the advent of globalization and fiercer competition (Flavián et al, 2004; Gan and Clemes, 2006). Banks use online banking as it is one of the cheapest delivery channels for banking products (Pikkarainen et al, 2004). Such service also saves the time and money of the bank with an added benefit of minimizing the likelihood of committing errors by bank tellers (Jayawardhena and Foley, 2000). Robinson (2000) believes that the supply of internet banking services enables banks to establish and extend their relationship with the customers. There are other numerous C opyright © 2 0 13. A cademy of Knowledge P rocess
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