(Luận văn) affective and instrumental commitment, a special referece to self service technologies in domestic and foreign banks

UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business --- Hoang Thi Bich Chi AFFECTIVE AND INSTRUMENTAL COMMITMENT: A SPECIAL REFERENCE TO SELF-SERVICE TECHNOLOGIE

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UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business -

Hoang Thi Bich Chi

AFFECTIVE AND INSTRUMENTAL COMMITMENT:

A SPECIAL REFERENCE TO SELF-SERVICE TECHNOLOGIES IN DOMESTIC AND FOREIGN BANKS

MASTER OF BUSINESS (Honours)

Ho Chi Minh City- Year 2014

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UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business -

Hoang Thi Bich Chi

AFFECTIVE AND INSTRUMENTAL COMMITMENT:

A SPECIAL REFERENCE TO SELF-SERVICE TECHNOLOGIES IN DOMESTIC AND FOREIGN BANKS

ID: 22120043

MASTER OF BUSINESS (Honours) SUPERVISOR: Dr LE NHAT HANH

Ho Chi Minh City- Year 2014

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ACKNOWLEDGEMENT

Firstly, I would like to express my gratefulness to my supervisor Dr Le Nhat Hanh for her professional guidance, intensive support, valuable suggestions, instructions and continuous encouragement during the time of research and writing this thesis

I would like to express my deepest appreciation to ISB Research Committee for their valuable time as their insightful comments and meaningful suggestions were contributed significantly for my completion of this research

My sincere thanks also go to all of all of my lecturers at International Business School- University of Economics Ho Chi City for their teaching and guidance during my Master course

Last but not least, I would like to thanks my family, whom were always supporting

me and encouraging me with their best wishes

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ABSTRACT

The purpose of this research is to investigate the factors that influence customer satisfaction and their commitment with self-service banking technologies In particular, this field study conducted in Vietnam focuses on making a comparison on customer satisfaction and commitment of foreign banks and domestic banks with self-service banking technologies The research indicated perceived usefulness, perceived convenience, privacy and security positive effect customer satisfaction As result, such positive effects lead to a significantly affective and instrumental commitment of customer with banks in Vietnam However, there are some differences between domestic banks and foreign banks Based on the findings presented, this study will provide bankers and policy makers with a greater understanding of customer assessment to compose the appropriate future strategies

Key words: Self-service banking technologies, customer satisfaction, affective commitment, instrumental commitment

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TABLE OF CONTENTS

CHAPTER 1: INTRODUCTION 1

1.1 Research background 1

1.2 Research gap 3

1.3 Research objectives 5

1.4 Research methodology and research scope 5

1.5 Research contribution 6

1.6 Research structure 6

CHAPTER 2: LITERATURE REVIEW 8

2.1 Expectation-confirmation model in the context of IT (ECM-IT) 8

2.2 Self-service banking technologies 9

2.3 Customer satisfaction 9

2.4 Affective commitment 10

2.5 Instrumental commitment 11

2.6 Hypotheses development 12

2.6.1 Perceived usefulness 12

2.6.2 Perceived convenience 13

2.6.3 Security and privacy 14

2.6.4 Overview on customer satisfaction and commitment 15

2.7 The conceptual model and hypotheses of the research 16

CHAPTER 3: RESEARCH METHODOLOGY 17

3.1 Research process 17

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3.2 Questionnaire design 18

3.3 Sample 21

3.4 Data collection 21

3.5 Data analysis method 22

CHAPTER 4: DATA ANALYSIS 23

4.1 Respondents’ demographics 23

4.2 Reliability Analysis 25

4.3 Exploratory Factor Analysis (EFA) 30

4.3.1 EFA for independent variables 30

4.3.2 EFA for Dependent variables 32

4.4 Regression Analysis 33

4.4.1 Simple Regression analysis 34

4.4.2 Multiple Regression Analysis 38

CHAPTER 5: CONCLUSION, IMPLICATIONS, AND LIMITATIONS 47

5.1 Conclusion 47

5.2 Managerial Implications 48

5.3 Limitations and future research 50

REFERENCES 52

APPENDICES 64

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LIST OF FIGURES

Figure 2.1: A theoretical model 16

Figure 3.1: Research Process 17

Figure D1: Histogram of Customer Satisfaction (Domestic/Foreign/Overall) 76

Figure D2: Normal Plot of Customer satisfaction (Domestic/Foreign/Overall) 77

Figure D3: Scatter Plot of Customer satisfaction (Domestic/Foreign/Overall) 78

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LIST OF TABLES

Table 3.1 Source of measurement scale 18

Table 4.1 Respondent’s characteristics 23

Table 4.2 Reliability test result 28

Table 4.3 KMO and Bartlett’s Test of Independent Variables 30

Table 4.4 Rotated Component Matrix of Independent Variables 31

Table 4.5 KMO and Bartlett’s Test of Independent Variables 32

Table 4.6 Rotated component Matrix of Dependent variables 32

Table 4.7 Model summary of simple regression analysis 34

Table 4.8 ANOVA of simple regression analysis 35

Table 4.9 Coefficients of simple regression analysis 35

Table 4.10 Model summary of simple regression analysis 36

Table 4.11 ANOVA of simple regression analysis 37

Table 4.12 Coefficients of simple regression analysis 37

Table 4.13 Correlations matrix 40

Table 4.14 Model summary of multiple regression analysis 41

Table 4.15 ANOVA of multiple regression analysis 42

Table 4.16 Coefficients of multiple regression analysis 42

Table 4.17 Summary of hypothesis testing result 45

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CHAPTER 1: INTRODUCTION

This chapter presents the introduction to the study It contains the research background, research gap, research objective, research methodology, research scope, contribution of research and research structure

1.1 Research background

“Today fast-paced world is becoming increasingly characterized by facilitated transactions” (Meuter et al., 2000, p.50) Customers tend to interact with technology to complete given task instead of interacting with a customer service employee According to Meuter et al., (2000) self-service technologies (SSTs) are technological interfaces that allow customers to offer their own service independent of interaction with a firm’s service personnel through the use of technology SSTs represent

technology-a vtechnology-ariety of different services, rtechnology-anging from the common technology-automtechnology-ated teller mtechnology-achines (ATMs), online book tickets, automated hotel checkout, banking by telephone To illustrate, most recently, a 24-hour ATM sells cupcakes on street in New York City, America and Egold services which you can by gold via internet has just been launching

by TP Bank in Vietnam at the beginning of this year

The rapid development of SSTs in recent years means that customers have changed the way in which they deal with many services, including banking services (Bobbitt &

Dabholkar, 2001) Since the mid-1990s, there has been a fundamental change in banking service channels toward using SSTs such as ATMs These days, with the adoption of technologically enhanced service delivery methods, an increasing number of financial institutions are using technology in order to facilitate their services A large and growing number of consumers interact with these Self-service banking technologies (SSBTs) that include online banking, ATMs, electronic funds transfer at the point of sale, mobile banking, telephone banking, SMS banking, which are so prolific

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Affected by global economy crisis since 2008, economy of Vietnam has been facing various challenges and the banking industry is not an exception According to General Statistics Office, a lot of companies have had to shut down in this year

Therefore, the demand of loans and capital of those companies is shrunk resulting in the reduction in the revenue of banking industry To solve this problem, banks have to develop their non-credit services in order to balance and diversify their sources of revenue

In addition, integration into WTO has also boosted Vietnamese economy to develop remarkably A significant amount of inflows of investment has been poured into the market by foreign investors Many foreign companies have taken part in different industries including banking The globalization of banking industry has encouraged many developing countries including Vietnam into opening their markets to foreign banks and built up the industry infrastructure to international standards Those foreign banks own various advantages in terms of not only capital and effective management system but also high technology The foreign banks perform better than domestic banks because of their ownership advantages (Claessens, 2001; Harylchyk & Jurzyk, 2011) On the other hand, due to the benefit of local market knowledge and longevity, domestic banks, especially the state owned commercial banks dominate the market (Nahm, 2008) However, this situation will change when the market opens freely Therefore, to become more competitive, domestic banks have to focus on improving their own service quality such as professionalism of services provided and modernization in equipment and tools

In today’s business environment, customers have become the center of all business decisions right from the conception of product to the delivery of product In the highly competitive banking industry, service becomes one of the most important elements for gaining a sustainable competitive advantage in the market place Understanding the potential impacts these SSBTs facilities may have on consumers’ satisfaction and their ongoing commitment is the challenge for service managers and researchers

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Hence, it seems more and more important to determine the customer ongoing commitment to the bank in this study

In general, commitment is considered as the customers' retention, advocacy after experiencing the quality, after self-service, shared value and trust of the vendor (Morgan

&Hunt, 1994) This implies that customer commitment to the service supplier would be of vital importance to their loyalty in service industries, particularly in banking service

Noticeably, commitment is a multidimensional construction which includes not only the two afore mentioned components but also a wide range of others; and the effect of various type of commitment on customer loyalty may not be equivalent in both magnitude and direction (Fullerton, 2003) In marketing field, commitment is complicated and consists of

at least two following components: affective commitment and instrumental commitment (Gundlach et al., 1995), which will be discussed in detail in current study More

specifically, affective commitment is an attitudinal component which signalizes the durable intention to thrive and maintain a permanent relationship in the long term;

instrumental commitment expresses an affirmative action taken by the vendor to make customer interested in staying with them (Gundlach et al., 1995 as cited in Beatson, Coote

& Rudd, 2006) Nevertheless, in this study extent, affective commitment and instrumental commitment are the two components discussed in more detail

1.2 Research gap

The number of customers that are using SSBTs is increasing day by day Vietnam Banks Association (2014) stated that 40 banks have announced deployment of internet banking system at different level Especially, about using card services, as of 31th December 2013, the total number of cards issued by 50 issuers of more than 66.2 million cards- up more than 20% compared with 2012; total sales of more than 1,206,704 card payment billion, up 23.37% compared with 2012 On infrastructure for payment card transaction has installed approximately 15.300 ATMs and 130.000 POS (Vietnam Banks Association, 2014).Vietnam is expected to share common characteristics such as huge

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population Moreover, according to eMarketer’s latest report as cited in Finance Journal (2014), Vietnam has about 5.3 million internet subscribers, penetration rate reached 35.6%; and 121.7 million mobile subscribers, of which 30% are smart phones These notable figures are not only a good sign for the technology application industry, but also a great opportunity for the development of SSBTs which is one of the key business

segments of banks today

In the literature, there were a lot of researches about SSBTs (Pikkarainen et al., 2004; Cheng et al., 2006; Guriting & Ndubisi, 2006; Farzianpour et al., 2014) From the point of view, most of these study focus on determining the factors that directly affect customer satisfaction, customer intention to use some basic kind of SSBTs and some studies also briefly mentioned about their continued behavioral intention in generally

Most of these studies on SSBTs in Vietnam have investigated popular SSBTs such as ATMs, internet banking, mobile banking of a particular bank Meanwhile, this research will focus on finding about general SSBTs of banking system in Vietnam To the best of our knowledge, there were only few studies that have been conducted for examining the effect of customer satisfaction on two specific dimensions of commitment (i.e., affective and instrumental) In this study, by categorizing commitment into two components, the investigation on the linkage between customer satisfaction and commitment becomes clearer and more specific SSBTs have been widely applied in developed countries, however it is considered as an ongoing innovation in Vietnamese banks, and there are still limited studies about SSBTs, customer satisfaction, and commitment in Vietnam More specifically, the research of Wang (2012) indicated that perceived convenience and perceived usefulness of SSBTs have positive impact on customer satisfaction and their commitment to the bank Moreover, the research’s finding of Pikkarainen et al (2004) had showed that security and privacy impact significantly on customer satisfaction of using SSBTs Therefore, this research tries to test the effect of perceived convenience, perceived usefulness and security and privacy of SSBTs on customer satisfaction and their commitment to the banks

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In addition, the performance of foreign bank in Vietnam has been known a little until now because of the lack of data and information, thus this study aims to examine how domestic banks differ from foreign banks in the same market about customer satisfaction and commitment with banks after using SSBTs

1.3 Research objectives

The overall objective of this research is to examine some factors influencing customer satisfaction and then affective and instrumental commitment, differences between domestic banks and foreign banks about customer satisfaction and commitment, particularly the following relationships are explored:

- The relationship between perceived convenience and consumer satisfaction with SSBTs

- The relationship between perceived usefulness and consumer satisfaction with SSBTs

- The relationship between security & privacy and consumer satisfaction with SSBTs

- The relationship between consumer satisfaction and affective commitment with banks

- The relationship between consumer satisfaction and instrumental commitment with banks

1.4 Research methodology and research scope

The present study used questionnaire to collect data for an in depth investigation

The structured unbiased questionnaire is originally conducted in English and then translated into Vietnamese for survey The questionnaire will be pre-tested on 10 respondents and minor modifications will be made to the questionnaire on the basis of pre-testing Data collected from survey will be descriptively analyzed by using Statistical Package for the Social Science (SPSS) version 22.0 The analysis of data firstly will be tested the reliability of the measurement scale by using Cronbach’s Alpha After that, an

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Exploratory Factor Analysis will be used to check the validity of the measurement scale

Finally, single and multi linear regression will be employed as the main method for investigating the relationships among factors in the research model In consequently, this result will be used for explaining the relationship among factors, and the analysis will also describe the meaning of model when applying in Vietnam SSBTs

Samples for the study based upon availability of respondents The target population of this study is customers who are using any kind of SSBTs of either domestic

or foreign banks in Vietnam

1.5 Research contribution

The research investigates customer satisfaction and commitment in the case of SSBTs in Vietnam This study contributes to current and future research by comparing and contrasting related literature Especially, we hope to provide application to investigate customer satisfaction and commitment with banks in Vietnam The finding of this

research with clear understanding of customer satisfaction and commitment with bank in using SSBTs can be served as a guideline for policymakers and leaders of banks in Vietnam to satisfy their customer and maintain their commitment In addition, it is also necessary for the new coming banks, who want to join into this kind of modern service of banking industry in Vietnam market

1.6 Research structure

This research contains five chapters The first chapter introduces an outline of this study It presents background of the research, researcher’s motivation and objective of doing research In addition, the introduction chapter also presents the practical

contributions as well as the methodology and scope of collecting data when doing this research Chapter two mainly introduces the theories in the literature related to each of factors in the research model, including perceived usefulness, perceived convenience, security & privacy, customer satisfaction, affective commitment and instrumental commitment The next chapter presents brief description of research methodology used

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for the research The results of data analysis will be discussed in chapter four Finally, chapter fine will summarize the main finding of research, and also mention about the limitation of research

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CHAPTER 2: LITERATURE REVIEW

In this chapter, the theoretical framework related to the scope of this study will be discussed in more details This chapter will describe the research model and proposed hypotheses This review also explores the six factors related to the model and research model of the study The first parts of this review of literature will introduce the concept of SSBTs

2.1 Expectation-confirmation model in the context of IT (ECM-IT)

The proposed model of this study is based on Expectation-Confirmation Model in the context of IT (ECM-IT) which provided a theoretical background for explaining customer satisfaction with technology Traditionally, customer satisfaction is explained

by the expectancy-confirmation paradigm (Oliver, 1993) Based on that, Confirmation Model in the context of IT was developed by Bhattacherjee (2001) and has been centered on the target online and mobile technology domain (Kang et al., 2009)

Expectation-Bhattachcherjee (2001) argued that perceived usefulness is the most consistent antecedent

of individuals’ IT adoption intention, so it is proposed as a surrogate for post-usage expectation in ECM-IT Moreover, the hypothesized model extends the original ECM-IT

by adding two unique characters and important incentives in the SSBTs context including perceived convenience and security & privacy

In addition, another attempt of this study is to test the ways in which customer satisfaction may impact on consequence behavior, such as customer commitment, which has linked together in previous research (Garbarino & Johnson, 1999) This attention also provides managers with insights into how to address customer satisfaction and

commitment with banks from a post-usage SSBTs expectation perspective

Therefore, this study proposed and empirically validated the extended ECM-IT in order to reflect the uniqueness of SSBTs

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2.2 Self-service banking technologies

“Self-service technologies (SSTs) are technological interfaces that enable customers to produce a service independent of direct service employee involvement”

(Maeuter et al., 2000, p.50) SSTs has changing the way interaction between suppliers and buyers, the customer can use these services by themselves, without any direct contact with any employees of the firm (Eriksson & Nilsson, 2006) SSTs have been playing an important role in enabling the way consumers perform service delivery themselves

Therefore, using SSTs can bring a lot of benefits from the perspective of both the firm and customers (Meuter et al., 2000)

The development of advanced SSTs set the standards for SSBTs Most of financial institutions has transformed from the traditional approach of brick-and-mortar into click-and-mortar (Ho & Ko, 2008) SSBTs represent a variety of different services, ranging from the common automated teller machines (ATMs), online banking, mobile banking, SMS banking, telephone banking, queue management systems

as a fully measure of service quality and which lead to the continuous behavior relationships with the service supplier (Rust & Chung, 2006) as well as dominating SST success (Chen et al., 2009) Prabhakaran (2003) stated that the customer is the king so the

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higher customer satisfaction the higher commitment they are According to Kumar et al

(2009), high quality services reach high customer satisfaction and increases customer loyalty or customer commitment as well So understanding the determinants that lead to the customer satisfaction are important for SSBTs success in retail banking

2.4 Affective commitment

Customer satisfaction is manifested through their commitment to the providers

Commitment can be defined as an aspiration to sustain the valued relationship between customers and suppliers in the long term (Moorman et al., 1992) The more satisfied consumers are with product or service received, the higher probability they commit to maintain a stable long-term relationship with the organization (Heskett et al., 1994;

McQuitty, Finn & Wiley, 2000; Singh & Sirdeshmukh, 2000; Szymanski & Henard, 2001)

Affective commitment is one of fundamental components to the success of an organization It is considered as a psychological element of consumers when experiencing the good quality of products or feeling satisfied with the services offered by the providers, therefore, they themselves desire to continue the relationship with the organization

without any external force (Beatson, Coote & Rudd, 2006) If customers feel satisfied with what they received from the SSTs such as perceived usefulness or convenience, they volunteer to keep using the service without any exterior influence

In order to build the customers' affective commitment toward a retail bank, there are two exchanges taking place between the banker and the customer needed considering carefully Firstly, that is the exchanges of bank's products and services; moreover, it is very requisite to dignify the role of usefulness, enjoyment and convenience that SSTs brings to customers as well as the risk they have to face when using these services offered

by a bank The other is an interaction between bankers and customers which Menon &

O'Connor (2007, p.162) called "interpersonal dimension" Reality shows the essential role

of interpersonal dimension of customers-bankers interaction in maintaining the affective

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commitment, this role was mentioned in many previous research as well Menon &

O'Connor (2007) suggested that while the core bank service is the main reason leading to the interaction between customers and bankers, interpersonal interaction seems to be the most vital element contributing to the customer satisfaction which ensures their affective commitment

In other words, in an accelerating pace of globalization and competitiveness, customers' loyalty and desire of involving in an organization plays an important role in the development and success of that corporation The bank managers must take right action to raise the effective commitment of customers through achieving a positive answer from them to the question: "Do I want to maintain my membership in and patronage of the co-operative?" (Jussila, Byrne & Tuominen, 2012, p.2)

2.5 Instrumental commitment

The second commitment dimension is instrumental commitment In this type of commitment, if consumers leave or do not want to continue using products or services of

an organization, they must incur perceived costs which can be economic or psychological

in nature, it means to be real or perceived (Morgan & Hunt, 1994 as cited in Beatson, Coote & Rudd, 2006) Namely, the cost may be time or expenditure spent to find a new employer with the same quality as the current one (Allen & Meyer, 1990 as cited in Beatson, Lings & Gudergan, 2008) or irritation and risks when changing service providers (Beaton et al, 2006) Therefore, when there is a perception of a lack of potential

alternative employer, customers tend to stay with their organization However, Menon and O'Connor (2007) suggested that if customers do not display good fit with company offerings and the company cannot meet the needs of customers, but they do not

discontinue their membership due to perceived costs, the company should proactively direct the customers to more suitable organization, this action reflects a concern for the customers and may likely to bring a positive attitude from them to the company

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According to Hung et al (2012) instrumental commitment based on a theory in which an organization strived to convince its members to continue to involve by giving them an inducement for contribution Menon & O'Connor (2007) divided this inducement into two types - extra-role social bonds and intra-role social bonds The former can be an event or workshop that makes providers and customers closer The latter, for example, providing customers with subscriptions to internal magazines, personal invitation to social events Customers will continue participate in the organization as long as the inducement meet or exceed the benefit held by them The more the spread between inducement and contribution increases, the less the tendency of an individual to leave is (Penley & Gould,

1988 as cited in Hung et al., 2012) and vice versa

2.6 Hypotheses development 2.6.1 Perceived usefulness

The importance of perceived usefulness has been widely recognized in the SSBTs

Usefulness is the subjective probability that using the technology would improve the way

a person could finish their given task (Davis et al., 1989) Perceived usefulness is defined

as “the degree to which a person believes that using particular system would enhance his

or her job performance” (Davis, 1989, p.320) According to this definition, user context will be more emphasized by asking customers to focus on perceived benefits, regardless

of the properties of the SSBTs themselves Customers will not perceive SSBTs as useful

if they do not provide benefit According to Guriting & Ndubisi (2006), perceived usefulness is strongly associated with productivity It suggests that using technology would improve the way a user completes a given task Perceived usefulness is the key driver of consumer attitudes toward SSBTs usage Many researchers (Gerrard &

Cunningham, 2003; Cheng et al., 2006) have found that perceived usefulness strongly impact on customers’ intention to use any application Perceived usefulness has been seen

as a primary motivator of SSBTs acceptance In addition, perceived usefulness refers to consumers’ perceptions regarding the outcome of the experience (Davis et al., 1992)

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When SSTs meet customers’ needs, they are able to enjoy the benefits Pikkarainen et al

(2004) found perceived usefulness as a determinant of actual behavior which encouraged the user of the twenty-first century banking to use more innovative and user friendly SSTs that give them greater autonomy in performing banking transactions, in obtaining

information on financial advices, and in purchasing other financial products So, if consumers see the usefulness of SSBTs, they are more willing to use the SSBTs Based

on above argument, the following hypothesis is developed:

Hypothesis 1: Perceived usefulness is positively related to customer satisfaction 2.6.2 Perceived convenience

Customer decision about whether to adopt the SSTs or not depend on many factors, including convenience, risk, security and prior technological knowledge Among these elements, convenience seems to have the most significant impact on using or

rejecting SSTs, particularly perceived convenience Even in the study of Eastin (2002), he concluded that perceived convenience is the strongest predictor of SSTs usage

Perceived convenience is defined as a degree to which a customer can use the service whenever and wherever they need and it is clarified through an answer for the question: "Is the service easy to access anywhere and anytime?" (Susanto & Goodwin,

2010, p.65)

In the banks’ perspective, perceived convenience is an element contributing to fostering the quality of SSTs Collier & Sherrel (2010) anticipated that perceived convenience is a movement to force banker to improve and upgrade; thus, result in a faster transaction for customers If an ATM machine, which is contained in SSTs is located in an inappropriate place or overcrowded environment that may prevent the customers from fully interacting with the technology, these factors can lead to a reduction

in transaction speed because of the impact from outside By reducing the time and effort

in looking for and facilitating the service transaction, perceived convenience contributes

to the quicker transaction for customers

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From the users’ point of view, perceived convenience influences their possibility

of discovery and raises their evaluation trust (Collier & Sherrel, 2010) Ahn et al (2007) asserted that the convenience of technology will heighten the willingness to explore numerous feature offered by the technology instead of the strain to complete the transaction as fast as possible By offering customers more options on when and where to enact a transaction, the banker implies the credibility and quality of their offering (Yang

et al., 2006) When customers perceived the convenience in finding and facilitating a service transaction, the easiness in carrying out a transaction can reduce some of potential risks, subsequently influenced the trust placed on the service bankers (Collier & Sherrel, 2010)

self-Being aware of the importance of perceived convenience, banking managers should concentrate on this advantage factor in promoting SSTs (Susanto & Goodwin, 2010) Hence, we proposal the following hypothesis

Hypothesis 2: Perceived convenience is positively related to customer satisfaction 2.6.3 Security and privacy

The importance of security and privacy in banking services has been mentioned in many researches (Hemandez & Mazzon, 2007; Chen & Barnes, 2007) The role of security and privacy in the decision to adopt SSBTs is increased because customers perform their transactions with no face-to-face contact with the supplier’s personnel and

no cash on hand Customers are always concerned about potential financial risks and threats for privacy and personal information lost (Yiu et al., 2007) The challenges in terms of security and trust play the main role with using the public network to perform transactions (Ganesan & Vivekanandan, 2009) Therefore bank should play their roles in order to influence their customer’s perception of SSBTs security and privacy through training and promotion strategies

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According to Maenpaa et al (2008) security and privacy stands for the reliability

of an innovation and a belief on the part of the customer that most of banking transaction can be completed confidentially and safely The result of the study by Rogers, Gilbert &

Cabrera (1997) which surveyed eight none-users on their potential concerns about using ATMs, indicated that safety was the most important This result is almost similar to Sathye (1999) study which also showed that privacy and security were found to be significant obstacles to the acceptance of online banking in Australia Thus, we can build following conceptual hypothesis:

Hypothesis 3: Security and privacy is positively related to customer satisfaction 2.6.4 Overview on customer satisfaction and commitment

Customer satisfaction is a fundamental marketing concept (Fournier & Mick, 1999) and is defined as an affective state or overall emotional reaction to a service experience (Giese & Cote, 2000) Moorman et al., defines commitment as “an enduring desire to maintain a valued relationship” (1992, p 316) and considers it as an essential ingredient for successful long-term relationships (Morgan & Hunt, 1994) It is proposed that customer commitment in this study is conceptualized as a multidimensional construct with two dimensions: affective commitment and instrumental commitment, which have been identified in previous research on commitment (Gundlach et al., 1995)

Customer satisfaction has linked with customer commitment (Garbarino &

Johnson, 1999) and generally considered as influential in the formation and development

of customer commitment (Johnson et al., 2008) Szymansky & Henard (2001) argue that the more satisfied customers are with the service experience, the more likely they are to commit to a relationship with the service supplier And Bansal et al (2004) also states that customer satisfaction is a primary antecedent of affective commitment, the stronger the customer satisfaction, the stronger the commitment in customer service The previous study has concluded that customer satisfaction have positive relationship with customer

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commitment (Thurau, 2004) Based on previous research, the two following hypotheses are developed:

Hypothesis 4: Customer satisfaction is positively related to affective commitment

And

Hypothesis 5: Customer satisfaction is positively related to instrumental

commitment

2.7 The conceptual model and hypotheses of the research

Based on above literature reviews, the following model is proposed (see Figure 2.1)

Figure 2.1: A theoretical model

The hypotheses developed for this research include:

H1: Perceived usefulness is positively related to customer satisfaction H2: Perceived convenience is positively related to customer satisfaction H3: Security and privacy is positively related to customer satisfaction H4: Customer satisfaction is positively related to affective commitment H5: Customer satisfaction is positively related to instrumental commitment

Perceived Usefulness

Perceived Convenienc

e

Consumer satisfaction

Affective commitment

Instrumental commitment Security

and Privacy

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CHAPTER 3: RESEARCH METHODOLOGY

This chapter presents brief description of research methodology used for the research At first, research process is present step by step Then, it describes the measurement scales which are used in designing and developing questionnaire After that, sample description is conducted, followed by data collection and data analysis method

3.1 Research process

Figure indicates the progress and structure of this study

Figure 3.1: Research Process

Research gap Research objective Research contribution

LITERATURE REVIEW

Research model

& Hypotheses

Questionnaire development

Validity testing (EFA)

Hypothesis testing (Regression)

Conclusion and implication

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Firstly, by defining research problem and identifying research objective and questions, research contribute was seen as the goal of this study Then, this study conducted a literature review to introduce the theories relate to each factors to find out the suitable one for the research model of this study Based on that, a preliminary

questionnaire was formed After that, collected data was processed by Statistical Package for Social Science (SPSS) version 22.0 using entering method with various statistical tests

3.2 Questionnaire design

In this study, the questionnaire was divided into two sections to obtain the major information The first section explored respondent’s demographics detail information such as gender, age, income level Such basic information, we can classify and compare group of participants

About the second section, ordinal scale is used as a measurement with multiple choices, which were developed by previous researchers, to adequately capture the domain

of the constructs It was developed as a valid and reliable scale created Perceived usefulness (4 items), Perceived Convenience (4 items), Security and privacy (4 items), customer satisfaction (3 items), Affective commitment (6 items), Instrumental

commitment (6 items) To avoid response bias, all concepts’ names was eliminated from the questionnaire, total 26 questions were displayed continuously in one table 3.1

Table 3.1 Source of measurement scale

PERCEIVED USEFULNESS

Using the SSBT allows me to improve my service transaction ability Wang, (2012) Using the SSBT enhances my effectiveness in

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my service transaction Using the SSBT is useful in handling my service transactions

Using the SSBT increases my productivity of handling my service transactions

PERCEIVED CONVENIENCE

Using the SSBT is a convenient way to conduct service transactions

The SSBT allows me to conduct service transactions whenever I choose

Using this SSBT makes my service transaction less time consuming

The SSBT allows me to save time on service transactions

Wang, (2012)

SECURITY AND PRIVACY

I am not worried about the security of SSBT

Using SSBT is financially secure

I trust in the technology a SSBT is using

I trust in the ability of a SSBT to protect my privacy

Pikkarainen

et al., (2004)

CONSUMER SATISFACTION

Overall, I am satisfied with the SSBT offered

The SSBT offered by the bank exceeds my

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expectations The SSBT offered by the bank close to my ideal SSBT

AFFECTIVE COMMITMENT

I feel a sense of belonging to SSBTs service of this bank

I am loyal to this bank

I am committed to my relationship with this bank

I would like to develop a long-term relationship with this bank

I feel strongly attached to this bank

I feel more attached to this bank than other banks

Beatson et al., (2006)

INSTRUMENTAL COMMITMENT

It would be difficult for me to find another bank of equal standard

I do not have a good alternative to this bank

It would cost me a great deal to use SSBT of another bank

I would concerned about what would happen if

I used SSBT of another bank Moving to another bank is not worth the effort

In general it would be inconvenient to change banks

Beatson et al

(2006)

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3.3 Sample

The respondents of this survey were recruited from among current SSBTs customers in Vietnam either domestic or foreign banks, who has income and had experience with any kind of SSBTs The sample of the survey questionnaire in the present research has conducted by using a non probability sampling technique These collected data has expected to analyze and then build the theoretical relationship

About the sample size, consequential research requires the size of sample big enough to ensure statistical significant According to Hair et al (2009) minimum sample size used in statistical analysis should be equal to or greater than five times of number of variables, but not less than 100 to generate reliable results

n>=100 and n>= 5k (where k is the number of variables)

This research consisted of 26 variables, as result, the necessary sample size required to run EFA should be: 26*5=130 observations

In addition, Nunnally & Burstein (as cited in Nguyen, 2011) emphasized that the minimum sample size in case of standard multiple regression should be:

N > 50 + 8m (where m is the number of independent variables)

Apply this formula for 3 independent variables in this study, we have the minimum sample size necessary for multilinear regression as follow: N> 50 + 8*3 = 74

Summarily, with 26 variables and 3 independent variables, this study needed 130 observations at least for each group to take EFA and regression

3.4 Data collection

In this research, we used the reliability and validity questionnaire items from previous researchers The questionnaire designed was originally designed in English and then translated into Vietnamese To ensure the correct meaning of the translated version,

an English expert was asked to review the transcribed copies in English and Vietnamese

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Before launching, this questionnaire was pre-tested by face to face interviewing around

10 people who are working in self-service technologies related Department of Banks and customers with long experience with SSBTs to make sure that they understood clearly about the scale or not with the aim to modify the measurement scale more suitable when applying to the research in Vietnam Based on that, the final version of questionnaire was launched the main survey (see Appendix A and B)

Except the demographic section, the section B was designed as a five-point Likert scale, with higher scores represent greater agreement with each statement, anchor points including “strong disagree” ( =1), “disagree” ( =2), “neutral” ( =3), “agree” ( =4), and

“strong agree” ( =5) to determine customer’s agreement

As mentioned in previous section, this study needed 130 respondents in minimum for each of two samples 350 questionnaires were distributed using email, facebook and directly using paper to respondents

3.5 Data analysis method

The collected data was analyzed by SPSS version 22.0 in which Cronbach’s alpha reliability analysis, EFA, simple and multiple regression analysis function were enabled

to support this research Firstly, descriptive analysis was used to describe general view of the sample characteristics Secondly, the reliability of measurement scales was examined

by using Cronbach’s Alpha analysis Then, Exploratory Factor Analysis (EFA) was used

to determine the number of factors affecting the measures and strengthen of the relationship between each factor By doing this way, any items which were not satisfied the conditions of reliability and validity would be deleted Finally, Multiple Linear Regression method was used to test the research model and hypotheses, to identify the correlation and measure the impact level

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CHAPTER 4: DATA ANALYSIS

The research methodology in the previous chapter to examine scale validation provided the baseline for data-gathering In this part of research, the collected data will be analyzed by using SPSS- Statistical software package and then the results of hypotheses testing would be shown

Firstly, respondents’ demographic to provide the general information of respondents were analyzed

Secondly, Cronbach’s Alpha and Exploratory Factor Analysis (EFA) are used to assess the reliability of measurement scales and the validity of sample size In the next step, simple regression and multiple regression is used to test the hypotheses of this study

Finally, results of hypotheses testing were discussed The proposed model was multiple-sample (the domestic bank sample and the foreign bank sample) compared as well as the overall sample pooled by the two individual samples Hence, all the statistical tables in this chapter using “slash signs” to show the results of three groups (domestic, foreign, overall)

4.1 Respondents’ demographics

According to the survey response, respondents were asked about their gender, age and income The basic information was described in order to evaluate the adequacy of the samples This subsection summarized background characteristics of respondents

Demographic analysis included description of respondent characteristics, presenting ratio

of each sample segment, including gender, generation and income The respondents’

characteristics were showed in the table 4.1

Table 4.1 Respondent’s characteristics

Domestic/ Foreign/ overall

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Demographic

Male 86/62/148 48.86/47.69/48.37 Total 176/130/306 100.00/100.00/100.00

26-35 95/77/172 53.98/59.23/56.21 36-45 5/17/22 2.84/13.08/7.19

Total 176/130/306 100.00/100.00/100.00

Income per month (million VND)

Less than 5 61/16/77 34.66/12.31/25.16 5-10 69/27/96 39.20/20.77/31.37 10-15 18/28/46 10.23/21.54/15.03 More than 15 28/59/87 15.91/45.38/28.43 Total 176/130/306 100.00/100.00/100.00

In the sample characteristics table, we recognized that the number of female respondents from two sample groups (90 people, 51.14% and 68 people, 52.31%) took part in the research survey were dominant while male only sized 48.86% for domestic banks respondent group and 47.69% for foreign banks respondent group, in which they were distributed in many kinds of job More than haft of them who joined in this survey were in the age of 26-35 with 53.98% of first group and 59.23% of the second one In the sample group of customer who use SSBTs of domestic banks, around half of them were 18-25 years old, with 39.20%, which is 27.69% of total customers whom are the customer

of foreign banks In addition, in foreign customer sample, there is 13.08% respondents were between 36-45 years old, most of them were leaderships and got high income

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Income was another key characteristic which was concerned in this research First,

in group of customer whom used SSBTs of domestic banks, 71.86% respondents revealed that they earned less than 10 million VND per month On the other hand, 66.92%

customer from foreign banks group was rather high, fluctuated more than 10 million VND every month

4.2 Reliability Analysis

Cronbach’s alpha which is the most common measure of scale reliability was conducted as an indicator for examining the reliability of variables in the questionnaire to make sure all the items in one scale were reliable in measuring the research concept that they belonged to In generally, Cronbach’s Alpha value above or at least equal 0.6 is acceptable for scale reliability (Nunnally & Burnstein, as cited in Nguyen, 2011) In addition, the corrected Item- Total Correlation has had to consider in this case The values of Corrected Item-Total Correlation are the correlations between each item and the total score from the questionnaire In a reliable scale all items should correlate with the total So our duty was looking for items that don’t correlate with the overall score from the scale If the Corrected Item- Total correlation of each quite high or higher than 0.3 (Nunnally & Burnstein, as cited in Nguyen, 2011), such item is encouraging On the other hand, if any of these value was less than about 0.3, it means that a particular item does not correlate very well with the scale overall It’s necessary to drop the item in terms of

wording problems and conceptual appropriateness (Leech et al., 2005)

Table 4.2 shows the results of reliability test for each construct in the model

Based on reliability test result in Table 4.2, all the tested item scales including perceived usefulness, perceived convenience, security and privacy, customer satisfaction, affective commitment, instrumental commitment of domestic banks customer sample, foreign banks customer sample and overall have the Crobach’s alpha coefficient significantly high or very high In addition, most of the Corrected Item-Total Correlation values of three samples were over 0.3, exposed significant values for most items of six

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measurement scales of the questionnaire Particularly, the Corrected Item-Total Correlation value of Instrumental commitment item number 5 of both three samples are lower than 0.3 In this case, this item has had to delete essentially

Therefore, after deleted the instrumental commitment item number 5, the measurement scales designed in this research were meaningful in statistic and had the necessary reliability It also means that, these measures have enough conditions to be used

in linear regression analysis later to test the research hypotheses

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28

Table 4.2 Reliability test result

Observed Variable Scale Mean if

Item Deleted

Scale Variance if Item Deleted

Corrected Item- Total Correlation

Cronbach’s Alpha if Item Deleted

Perceived Usefulness (PU): Alpha= 0.797/0.834/0.812 PU1

PU2 PU3 PU4

12.8286/12.6462/12.7508 12.7543/12.6923/12.7279 12.6914/12.7308/12.7082 12.7257/12.8154/12.7639

3.097/4.013/3.484 3.198/3.734/3.416 3.525/3.888/3.668 3.350/4.136/3.674

.632/.706/.653 673/.713/.691 537/.642/.584 598/.600/.595

.736/.773/.753 715/.767/.735 781/.801/.786 752/.818/.781 Perceived Convenience (PC): Alpha=.679/.759/.744

PC1 PC2 PC3 PC4

12.0914/13.0310/12.4901 11.8971/13.1240/12.4178 11.8286/12.9380/12.2993 11.9257/13.2558/12.4901

2.785/3.218/3.175 2.380/3.000/3.003 2.488/3.012/3.003 2.391/2.848/3.010

.381/.593/.524 486/.552/.543 498/.698/.622 485/.448/.476

.662/.689/.694 597/.704/.682 591/.637/.641 598/.784/.725 Security and Privacy (SP): Alpha=.875/.898/.886

SP1 SP2 SP3 SP4

10.0743/10.6000/10.2984 9.8457/10.3462/10.0590 9.6914/10.0000/9.8230 9.7657/10.1538/9.9311

6.460/7.715/7.039 6.867/9.236/7.911 6.973/9.349/7.982 6.790/8.891/7.696

.690/.805/.744 733/.760/.745 771/.816/.790 748/.744/.748

.861/.862/.862 840/.874/.857 827/.859/.843 834/.879/.855

Customer satisfaction (CS): Alpha= 860/.753/.798 CS1

CS2 CS3

6.9143/6.7308/6.8361 7.2114/7.4154/7.2984 7.1429/6.9154/7.0459

2.021/2.803/2.355 1.857/2.539/2.151 1.801/2.373/2.051

.710/.562/.629 732/.601/.641 764/.588/.662

.826/.694/.741 806/.647/.727 775/.667/.705

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29

Affective commitment (AC): Alpha=.938/.931/.935 AC1

AC2 AC3 AC4 AC5 AC6

16.9713/17,3256/17.1221 16.9770/17.4729/17.1881 17.0517/17.4961/17.2409 16.9713/17.2558/17.0924 16.9885/17.3643/17.1485 16.8506/17.2713/17.0297

16.803/17.331/17.002 16.254/15.595/15.981 16.535/15.596/16.131 16.340/16.411/16.336 15.803/16.733/16.180 17.110/16.996/17.049

.757/.702/.734 844/.823/.831 851/.869/.856 851/.853/.850 875/.797/.842 723/.748/.734

.934/.930/.932 924/.915/.920 923/.909/.917 923/.911/.918 920/.918/.919 938/.924/.932 Instrumental Commitment (IC): Alpha= 823/.690/.767

IC1 IC2 IC3 IC4 IC5

12.2471/10.9766/11.7086 12.4080/11.5234/12.0331 12.1667/11.2734/11.7881 12.2644/11.2109/11.8179 12.1552/10.7969/11.5795

9.309/10.999/10.387 8.636/9.559/9.188 9.539/10.200/9.982 9.352/10.514/10.083 11.669/14.179/13.142

.704/.525/.615 772/.620/.704 660/.537/.606 728/.561/.654 271/.054/.162

.763/.609/.699 739/.557/.660 776/.598/.699 757/.591/.684 881/.790/.841

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4.3 Exploratory Factor Analysis (EFA)

In this step, the researcher conducted the exploratory factor analysis (EFA) to clarify the validity of measurement scales EFA is used to help investigators a large number of relationships among interval variables (Leech et al., 2005) By running EFA, the researcher can determine how a large set of items, “hang together” as a group under a cluster (Leech et al., 2005) In this research, exploratory factor analysis was used to conduct with Varimax rotation KMO (Kaiser-Meyer-Olkin) test and Barlett test were also used to measure the compatibility of sample In this case, the KMO measure of sampling adequacy value should be greater than 0.70 indicating sufficient items for each factor (Leech et al., 2005)

4.3.1 EFA for independent variables

Table 4.3 revealed that the KMO values of all factors of three samples were bigger than 0.7 indicated that sufficient items to measure each construct And the Barltett’s Test significance of those were also significant indicated that the variables were correlated highly enough to become a good basic for factor analysis In summary, observed variables had the correlation with each other and EFA factor analysis was appropriate because of both acceptances for diagnostic tests

Table 4.3 KMO and Bartlett’s Test of Independent Variables

Kaiser-Meyer-Olkin Measure of Sampling Adequacy 790/.885/.865 Bartlett’s Test of Sphericity Approx Chi-Square 786.836/839.519/1550.679

The following table described the factor distribution after EFA analysis

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Table 4.4 Rotated Component Matrix of Independent Variables

Component

Security and Privacy

SP1 822/.858/.836 SP2 849/.821/.834 SP3 836/.872/.850 SP4 842/.827/.838 Perceived

Refer to Appendix C, there three factors were extracted, they could explain 63.32

%; 69.95 % and 66.22 % of the information for three sample groups contained in three dependent variables It means that more than a half or variance were accounted for by the first three factors

The Rotated Component Matrix (see Table 4.4) presented that there were actually three factors underlying this construct in which the standard of factor loadings was almost more than 0.5 This indicated that the items cluster into these three groups defined by high loading or well conceptualized

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4.3.2 EFA for Dependent variables

Table 4.5 KMO and Bartlett’s Test of Independent Variables

Domestic/ Foreign/

overall

Kaiser-Meyer-Olkin Measure of Sampling Adequacy 895/.865/.901

Bartlett’s Test of Sphericity Approx Chi-Square 1772.700/1006.692/2595.711

Table 4.6 Rotated component Matrix of Dependent variables

Domestic/ Foreign/ overall

Component

Customer Satisfaction

CS1 CS2 CS3

.824/.607/.762 798/.648/.737

.794/.816/.802

Affective commitment

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AC3 AC4 AC5 AC6

.787/.827/.808 846/.870/.858 838/.787/.825 715/.859/.791

Instrumental commitment

IC1 IC2 IC3 IC4

.803/.604/.713 822/.794/.829 829/.819/.840 815/.832/.814

As shown in Table 4.6, which represented the items and factor loading for factors after rotation for three sample groups including domestic banks, foreign banks and overall, with the satisfaction standard of factor loading was more than 0.5 It means that the items of each construct were very well conceptualized

4.4 Regression Analysis

Through the results from EFA and Crobach’s Alpha reliability analysis, the measurement scales of the research model were tested and confirmed as valid and reliable After that, Regression analysis considers as a tool to justify the relationship among factors in the research model Linear regression analysis was a statistical technique that examined the impact of the independent variable on a dependent variable To test Hypothesis 4 and 5, the relationship between customer satisfaction and affective commitment, instrumental commitment, simple regression analysis was employed Multiple regression analysis was implemented to test hypothesis 1 to 3, the relationship between perceived usefulness, perceived convenience, security and privacy and customer satisfaction In consequently, this results was used for describe the relationship among factors, especially the meaning of model when applying in Vietnam SSBTs

Tiêu đề	Affective And Instrumental Commitment, A Special Reference To Self-Service Technologies In Domestic And Foreign Banks
Tác giả	Hoang Thi Bich Chi
Người hướng dẫn	Dr. Le Nhat Hanh
Trường học	University of Economics Ho Chi Minh City
Chuyên ngành	Business
Thể loại	Thesis
Năm xuất bản	2014
Thành phố	Ho Chi Minh City

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