1 Customer Satisfaction on Core Banking and Service Quality in CBE (A case study of Leghar Branch) Student's Name Institutional Affiliation Professor Course Date 2 Abstract Since technological advancements have increased the importance of the banking sector in the economy, we can no longer consider a banking system's success without considering its reliance on information and communication technology (ICT) since It's now easier than ever to conduct financial transactions and make payments swiftly. Competitive financial markets favour banks with the most up-to-date technology and processes, allowing them to produce more and more revenue, resulting in increased profitability. CBE (Ledger branch) are still lagging because they offer poor customer service on the core banking system and service quality. Additionally, this study will focus on the problem statement and propose ways to improve the problem in my case study. To get enough data on both quantity and quality, I employed sampling techniques and a plan that included stratified sampling, interviews and questionnaires. Random sampling was used to choose clients from each bank's many customer groups (strata) based on their account types, such as current account holder, savings account holder, and one-time customer. To that end, I want to create a series of surveys in which I solicit input from bank personnel in questions and possible solutions. 3 Introduction The business environment has grown more competitive and tough than ever. Most businesses re-engineer their products and processes to satisfy globalization's demands and improve service quality while remaining competitive. Customer service is important in all industries and has a major impact on an organization's long-term success (Dawit & Adem, 2018). Corporations are rethinking their collaboration strategies in light of internet-related technology breakthroughs. Due to the intangible nature of services, it has been difficult to demonstrate a correlation between customer contentment and various service characteristics across diverse industries. Due to the intangibility of services, CBE (Ledger branch) has been struggling to ascertain how customers perceive and evaluate the desired outcome of service excellence. CBE (the Ledher branch) has consistently trailed behind other banks regarding customer satisfaction and service quality, leaving many people dissatisfied. As a result, this study evaluates the relationship between the quality of CBE's service and client satisfaction (Ledher branch) and attempt to ascertain the root cause of the problem that hangs over excellent service and propose realistic remedies to the discovered issues. Statement of the problem The CBE (Ledher branch) is experiencing significant difficulties due to growing competition. As a result, several strategies have been developed to retain clients, and improving service quality has been identified as a major success factor. In banking, service quality is vital because it ensures a high level of client satisfaction, a critical competitive advantage in the market (Abebe, 2014). Service quality is currently attracting much attention due to its direct correlation to expenses, financial performance, customer satisfaction, and customer loyalty. Numerous industry leaders are regarded as having extremely exceptional 4 customer service, as customer happiness is also contingent on the quality of the service provided. Apart from higher income, they've retained a sizable portion of their customer base. Network outages and system interruptions have harmed most banks in Ethiopia, particularly the ledger branch, forcing consumers to wait for extended periods on the bank's premises. Only a few studies on customer satisfaction and service quality have been conducted in the banking industry, although several studies on service quality and customer satisfaction have been conducted. Taye (2016) discovered that CBE has various challenges, particularly in service quality, and he recommended in his article that additional research be conducted in this area to extend the scope of the issues confronting CBE. As a result, the investigator sought to ascertain whether or not CBE clients were satisfied with the service they received (ledher branch). Literature review Customer service and service quality According to Tesfaye (2015), customer satisfaction is the customer’s assessment of the outcome of an evaluation process in which the service or commodity is delivered compared to the customer’s expectations. Service quality is established as a result of a longterm analysis of performance and a customer’s overall opinion of the service. Customer satisfaction and service excellence are inextricably linked. While some believe customer, pleasure is intrinsically tied to perceived service quality, others believe service quality is intrinsically linked to customer contentment (Shewabe, 2018). When it comes to establishing quality in a customer-centred strategy, client preferences are important. Service quality can be defined as the amount to which a business meets or exceeds its customers’ expectations and can be viewed as a comprehensive customer review of a specific service and the extent to which it does so. Consumer dissatisfaction is created by a perceived discrepancy between 5 expectations and actual performance; customer contentment, on the other hand, is caused by an actual discrepancy (Embiale, 2016). According to Abebe (2014), management must compare their company’s performance to that of its consumers and other companies in the same industry to conduct a thorough appraisal Service quality Service quality is necessary for success in today's highly competitive corporate environment. Service quality is critical to a business's capacity to compete. Since there is no guarantee that a bank's excellent service will continue to be appropriate in the future, banks should constantly try to improve their service. As a result, banks must devise novel tactics to retain their clients' loyalty and maintain a competitive edge (Dawit & Adem, 2018). The quality of its customer service primarily determines a company's capacity to differentiate itself from its competitors. Service quality is critical for businesses because it gives enterprises that strive to improve their service quality and boost customer happiness a competitive edge. There are no commonly accepted criteria for measuring and evaluating customer service quality. According to Embiale (2016), individual's definition is unique, moulded by their own life experiences. Academics, practitioners, and the services marketing literature have placed a premium on customers' overall perceptions of a service's quality. According to Shewabe (2018), businesses would give better service by establishing service quality. Therefore, it is important to realize the service's intangibility, heterogeneity, and inseparability to comprehend its quality since this would simplify the process of determining the quality of service offered. 6 Methodology Sources of Data and Type The study's objective was qualitative, and thus the research was conducted qualitatively. I decided to use a qualitative methodology to get first-hand information from the bank's employees—some of the methods that I used during the research include; questionnaires and interviews. Primary Data Source Questionnaire Structured questionnaires were prepared in English and translated into Amharic to collect primary data. The questionnaires are divided into the following sections: The survey's initial component elicited information about respondents' personal lives. The survey's second component assesses consumer satisfaction with the bank's service performance. The third and final sections of the questioner's query focused on the quality of service and customer satisfaction. Key informant interview The study used key informant interviews. I identified several bank employees who had first-hand knowledge about the bank, its relation with customers, and the quality of services they offer. This helped me get first-hand information from the bank, and I was able to lay down strategies that might help the bank foster a positive relationship with customers. Method of data collection The questionnaire was used as the major data-gathering strategy to accomplish the study's aims. Customers of branch banks who responded to the study were contacted and handed the questionnaire while obtaining service at a particular branch. The questionnaires 7 featured closed-ended questions to make them more understandable to respondents. This variable was quantified using a Likert scale with five response alternatives. It's self-evident that I am on the wrong side of this debate. Procedure of Data Collection This investigation incorporated both primary and secondary data. Secondary data analysis involved a comprehensive review of pertinent literature and the administration of a survey questionnaire, which served as the major data collection method for this study. Following that, a survey questionnaire was created and distributed to randomly selected CBE (Ledger branch) consumers. After the data has been acquired, it must be examined using statistical procedures. The survey findings were analyzed and visualized using SPSS. Ethical considerations Permission was obtained from clients because the data was gathered via a questionnaire and then used by the researchers. Respondents were instructed not to include their names on the questionnaire and were assured that their responses would be kept confidential and used purely for academic purposes. The introduction questionnaire parts were designed to persuade people to engage and provide important information about their firm of interest, allowing the researchers to make educated study decisions. Finally, participants were included in the study only if they volunteered. Other writers' writings cited in this study included a reference page outlining the sources from which they drew their information. Findings Regarding service quality measurements, certain items such as carefulness and politeness have a high frequency and mean value. As indicated by these statistics, most bank clients were dissatisfied with these characteristics. Customer satisfaction with the aesthetic 8 appeal, greeting, and appearance of facilities and staff was lower in this dimension (Hailu & Belachew, 2016). Among the reliability dimension items, maintaining accurate customer records has the highest frequency and mean score, followed by the lowest scorers' items such as delivering service on time and advising the branch of any problems in advance. The majority of customers expressed dissatisfaction with their purchases in this area. Most responsiveness elements have high mean and frequency values, indicating that a portion of the client base is satisfied with the service (Shewabe, 2018). Employees are prompt, courteous, and capable of maintaining a safe atmosphere for consumers, all of which contribute to a pleasant customer experience. While customers may be satisfied with certain aspects of responsiveness, this does not mean they are satisfied with all of them. Discussion Factors affecting service quality and satisfaction in the bank According to Taye (2016), the product, presentation, atmosphere, and time period all have an effect. Additionally, departments responsible for manufacturing the product, such as those responsible for raw materials, can achieve a certain level of quality by adhering to a set of service quality measures and a monitoring system. According to Shewabe (2018), the bank's internal and external environments can also affect it. When analyzing Leghar’s branch appearance, variables such as equipment (heating, air conditioning), cleanliness, employee apparel, customer service, and timeliness of service were not in the premises hence that gave employees of the bank a hard time in managing the banks operations. Once interviewee emphasized the point that clients dislike waiting for extended periods of time. He continued by stating that there are two types of customers: those with high expectations and those who do not. If the bank is located in a business neighbourhood, customers will be more demanding. Customers' expectations will be lower if the bank is isolated without access to 9 other financial institutions (Taye, 2016). Regardless of the physical environment (cleanliness, air conditioning, and seating arrangement), the time of the transaction or the employee dress code, the customer's relationship with the CSR is critical. Another interviewee outlined that both categories (quality and happiness) are influenced by external factors such as brand or company image and customer experience. “Customers may be satisfied or dissatisfied with us, but we can easily gauge the loyalty effect if we constantly give a great experience (Hailu & Belachew, 2016: p.45).” Additionally, these categories are influenced by customer service, service performance, speed, and cleanliness, as well as the physical environment and surroundings, according to the fourth respondent (such as temperature, drinks, sweets, etc.). All of these variables are significantly influenced by service provider conduct in particular. According to Tesfaye (2015), price, availability, client comprehension, and the environment in which services are provided are significant. Managing the workforce According to the first respondent, service quality will suffer if underperforming and not managed effectively. The second interviewee emphasized the necessity of finding a career that fulfills them. Unsatisfied employees are incapable of operating at their full potential or demonstrating any commitment to the assignment. Job satisfaction cannot be achieved until policies are in place to ensure that the work is performed to a high standard (Shewabe, 2018). Job rotation plans were offered as a way to avoid these types of events by rotating or relocating staff. He continued by stating that motivating aspects can be used to manage personnel efficiently. Managers must constantly cultivate and enhance their employees' interests in order to keep them engaged. According to the third interviewee, establishing service standards is insufficient to improve quality standards through staff oversight. "I assume that personnel should arrive on time; I assume they dress appropriately 10 and act appropriately," he remarked. There is no need to inform them of this." All that matters are coaching and comments. The fourth interviewee stressed the need of dealing with and managed one's people efficiently. Without its people, the company would be nothing. The best aspect is that if they have a favourable view of the firm, they will deliver excellent service. "As a manager," she continued, "I make it a point to listen carefully to my employees' issues and challenges." I'll always be available to assist them if they require assistance." She underlined the critical nature of listening to employees to ascertain the true nature of the issue. How you handle them has a lot riding on it. Successful personnel management is crucial for a business to maintain high-quality standards, but it also comes at a cost (Abebe, 2014). According to her, the value of labour management extends beyond simply increasing service quality. According to this expert, quality is not the most critical component in employee performance. She asked businesses to consider other priorities before investing in this. Problem improvement strategy Promote Financial Literacy Through Customer Education Consumers may contact in-branch financial advisors who can guide them through various scenarios, including purchasing a first home or planning for retirement, and online instructional tools via their mobile banking app (Abebe, 2014). Financial literacy courses can be produced with the assistance of community organizations and credit unions by collaborating on educational seminars with schools and universities. This third item benefits both younger generations and banks by enabling them to make more informed financial decisions and engage with potential clients in the future. Customers continue to appreciate face-to-face interaction, and firms must seize every opportunity to connect with them in this manner (Embiale, 2016). The bank’s customer service can be enhanced by implementing a 11 financial literacy program that acts as an excellent introduction for people who are unfamiliar with the concept. Make Contextual Data a Core Component of Your Customer Service Strategy Contextual data, which comprises more information, provides context for a person or event. CBE (Ledher branch) may leverage contextual data to identify trends and correlations in consumer behaviour, which they can subsequently leverage to enhance the customer experience. As illustrated by the banking industry, a bank's customer service can be enhanced by leveraging contextual data to provide goods and services tailored to the unique demands of each individual customer (Tesfaye, 2015). Provide Customers with Self-Service Opportunities According to Taye (2016), 74% of customers have already used a self-service help site, and an additional 81% have attempted to resolve issues without contacting a live service professional. Despite their obvious benefits, the financial services industry has lagged behind other industries in adopting self-service capabilities and best practices. As a result, banks miss out on significant opportunities to minimize call centre congestion, provide 24-hour service, and enhance the banking client experience (Hailu & Belachew, 2016) Banks and credit unions are not ignoring the benefits of mobile banking in an age when consumers are almost fully reliant on their mobile phones. Conclusion In today's world, providing superior customer service is a winning strategy. By delivering superior customer service, a business can obtain a competitive edge in the industry. Businesses adopt a range of strategies to suit their customers' expectations, and they are constantly striving to enhance their quality standards to ensure smooth service delivery. Customers' worth and pleasure can be effectively judged only when organizations understand 12 how quality influences customer happiness, its role, and the associated expenses. This findings indicate that consumer expectations and perceptions of service quality are influenced by consumer demands and word of mouth, resulting in overall satisfaction or dissatisfaction with the service. While word of mouth might influence a customer's perception and expectations of service, a customer's need drives the purchase. Businesses are attempting to close gaps between management, employees, and customers to better align their performance systems. By efficiently coordinating activities, conducting research, and arranging the workforce, it is possible to close the gap in service quality management. Additionally, database analysis, general customer mapping, and capacity planning are required to stay current with market movements. 13 References Abebe, E. (2014). Assessing the impact of Core Banking and service quality on Customer Satisfaction in Commercial Bank of Ethiopia (A case of Bishofftu Branch). ABC Research Alert, 2(2), Ethiopia-Ethiopia. Dawit, J. B., & Adem, U. (2018). The Effect of Perceived Service Quality on Customer Satisfaction in Private Commercial Banks of Ethiopia: The Case of Selected Private Commercial Banks at Dire Dawa Administration. Business and Economics Journal, 9(2), 1-4. Embiale, Y. (2016). The effect of automatic teller machine service quality on customer satisfaction: the case of commercial bank of Ethiopia in hawassa city. Journal of Engineering and Economic Development, 3(2), 1. Hailu, S., & Belachew, M. (2016). Core Banking System Implementation Framework: the Case of Ethiopia. HiLCoE Journal of Computer Science and Technology, 3(2), 57-64. Shewabe, Y. (2018). Assessing the effect of core banking on service quality and customer satisfaction: the case study of commercial bank of Ethiopia north Addis Ababa district (Doctoral dissertation, St. Mary's University). Taye, E. (2016). Core Banking System Effectiveness in Ehiopia: The Case of Buna international Bank (BIB). International journal of Management Research & Review, 267-276. Tesfaye, B. (2015). The Impact of Service Quality on Customer Satisfaction the Case of Commercial Bank of Ethiopia (Doctoral dissertation, St. Mary's University).