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1.1    Background to the study

The global markets have become very competitive with intense rivalry among market players. In this competitive market, one of the most important factors is the achievement of customer satisfaction and quality of service. Even though the concept of customer satisfaction is not entirely new, the relationship between customers and company’s product and services has been changing on a regular basis (Malhotra, 2004). Customers are becoming the absolute entity for corporations as the final decision makers for business deals and purchases of products. Successful organizations of the future will be those that can provide goods and services to the customers who want it, where they want it and in the quantity and at the price they want it, thereby delighting rather than merely satisfying customers (Parker and Mathews, 2001). Customer delight will lead to loyalty, which is one of the critical indicators used to measure the success of a marketing strategy.

The success or failure of a service provider is largely dependent on the quality of its relationship with its customers (Panda, 2003), which helps determine customer satisfaction (Lymperopoulos et al., 2006). Almost all organizations compete on how their service is being delivered to customers.

Service delivery in any organization is important as it position the organization in the right way with the ability to supply its customers what they want and need. This is achieved with effective management of customer perceptions and expectations (Ocloo and Dzisah, 2013).

Ocloo and Dzisah (2013) further stated that there is often a difference between customer perception and customer expectations. Before the service is experienced, customer expectations are formed from a company’s communication, which is the information provided in commercials, word of mouth from other service consumers, their experiences of the service from other organizations, and their personal needs. Service providers have to ensure that they deliver what is promised in their marketing communication, since perceived service must equal expected service. Anything short of this would lead to an unsatisfactory service experience (Hinson, 2004).

Githiri (2015) opined that quite a number of companies have come to the realization that satisfied customers can have a positive effect on the firm’s profits. This has led many organizations to reorganize their marketing distribution, manufacturing and research and development departments so as to give the customers what they want, at the time they want and the way they want it (Githiri, 2015). This approach is customer focused which is a philosophy that aims to deliver the services sought by customers and to keep remote customers close so as to increase the firm’s profits and market share (Bradley and Naylor, 2006). Senior executives must have a forceful commitment to customer focus so that this philosophy can be a success. In addition, it is important to acknowledge that employees whose positions mean that they are directly dealing with customers are in a better position to ensure that a customer oriented marketing plan is a success (Githiri, 2015). Innovative companies motivate such employees by empowering them to solve the customer’s needs and problems on the spot. To some extent, customers are able to evaluate the performance of the firm’s products and services by the level of satisfaction they feel from the firm’s customer service. Customers who experience a higher level of satisfaction are more loyal to the company which often leads to higher long term profits for the firm (Bradley and Naylor, 2006).

1.2    Statement of problems

For a long time, businesses did not put too much importance to service delivery (Githiri, 2015). Currently, the modern customer expects to be treated as an equal partner with courtesy and efficiency thus the need of organizations to make the customer feel the value of using their products or services is greater than the price the customer is paying (Bradlley, 2006).

Many organizations have realized the benefit of effective service delivery practices which is aim at instilling, nurture, and maintain a healthy balance between the organisation and its customers and do everything possible not to sour such existing relationships. The process promotes customer satisfaction and investment which are the final goal of the customer retention (Kerstetter, 2001; Reinartz & Kumar, 2002; Winer, 2001). The relationship can be built through observing the cultural dimension of each customer and providing excellent communication and service. The practice has become such an important standard in modern business that it is common for businesses to establish some loyalty incentives and programmes for maintenance, nurturing and keeping a healthy customer relationship (Kotler, 2002).

The advent of technology has not only increased the pressure to attain corporate goals, but also to deliver customer expectations in any organization. The need; to improve staff efficiency through training, to develop effective dispute resolution mechanism, to motivate employees, for quick turnaround of request of customers, and to improve on service delivery through technology has grown over time. No doubt, this has led to intense competition in a customer-focused market economy, where organizations are obliged to provide high-quality services that promotes customer satisfaction, loyalty, enlarge market share and improve their performance results (Pantouvakis, 2010). In services setting, customer satisfaction mainly depends on the process of service delivery a fact that highlights the important role of the front-line employees.

These employees constitute an essential source of information for guiding the formation of services based on customer needs and have a key responsibility in increasing the customers’ perception of value during the moment of truth (Yap and Sweeney, 2007).

The above shows the importance of service delivery in any organization. This is why the study will embark on examining the Impact of effective service delivery on customer satisfaction in the shipping development department of Nigerian Maritime Administration and Safety Agency (NIMASA).

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