Impact of Total Quality Management and Service Quality in the Banking Sector

Abstract

After the successful implementation of TQM in manufacturing it is now being extensively applied in service sectors including banks, to improve business performance. Keeping this in view, the purpose of this paper is to present a detailed overview of the role of service quality and Total Quality Management (TQM), and its critical dimensions in the banking sector. A detailed review of the literature on TQM and service quality concepts was carried out in context of the banking sector. The study further explored the experience of TQM implementation in banks adopting this approach. The findings indicate that to ensure successful implementation of TQM in the banks, there are certain critical dimensions which needs to be addressed, viz: management commitment and support towards TQM, motivating and training of employees, and monitoring of customers' requirement through feedback. Beside this, it was also found that service quality is an important construct in banking sector and identifies four broad conceptual categories related to service quality. The finding will provide an understanding of the role of TQM and service quality in banking sector and it also provides useful direction for future research.

Impact of Total Quality Management on the Performance of Service Organizations in Pakistan

“…If TQM practices are implemented effectively more quality benefits will be achieved (sajjad and amjad, 2012). The significance of TQM in manufacturing has motivated to a number of organizations to see its benefits and impact on service organizations performance (Talib et al, 2012). After the great success of TQM in manufacturing organizations, service organizations have started to follow it.…”

The Total Quality Management in Banking

“…Adding to that, the huge development in the technology sector makes it necessary to focus on the continuous improvements of electronic and online services. The concept of banking service quality includes many other aspects, but all of them can be divided into four conceptual categories: customer service, banking services, electronic services, and automated services [2]. It is important to realize the relationship between the customer and employee perceptions about TQM in banking sector in order to decrease the distance between them.…”

“…Customers have a wide range from banks and they would only choose the banks that provide best services in terms of quality, reliability, and profitability and bank which is at par with international standards. [2].…”

“…[8] The TQM is extremely important to achieve the quality, providing a best service can be considered as pre-requisite to survive and success of banking sector since the performance of banks is significantly and positively linked with the service quality. [2] A. Service quality in banking Quality of service is considered as critical issue in preserving and propagates business in the competitive marketplace.…”

“…Therefore, the Banks have to commit towards continuous improvement of their service that provided to customers. There are three conceptual categories related to internet banking service quality [2] [10]:  Customer service quality  Banking service product quality  Online/internet/e-service quality…”