CUSTOMER CARE AND SATISFACTION IN PUBLIC SERVICE DELIVERY; A CASE

STUDY OF ELECTRICITY COMPANY OF GHANA, KWABRE EAST DISTRICT

BY

FLORENCE APPIAH

A THESIS SUBMITTED TO THESCHOOL OF BUSINESS, KWAME NKRUMAH

UNIVERSITY OF SCIENCE AND TECHNOLOGY IN PARTIAL FULFILMENT OF THE
REQUIREMENTS FOR THE AWARD OF

COMMONWEALTH EXECUTIVE MASTERS IN PUBLIC ADMINISTRATION

MAY, 2010

i
 DECLARATION

I hereby declare that this submission is my own work towards the award of Master of Business

Administration and that, to the best of my knowledge, it contains no material previously

published by another person nor material which has been accepted for the award of any other

degree of the University, except where due acknowledgement has been made in the text.

(Student)
Florence Appiah ……………………………. ………………..
Signature Date

Supervisor

Mr Adu Gyamfi …………………………….. ………………..

Signature Date

………………. ……………………………… …………………

Signature Date
Head of Department

ii
 DEDICATION

This work is dedicated to my husband and children

iii
 ACKNOWLEDGEMENT

I would like to express my sincere and heartfelt gratitude to the Almighty God for his tender

mercies in granting me the wisdom, strength and spiritual support in undertaking this project. I

wish to also thank my supervisor, Mr Adu Gyamfi, for his patience, understanding, suggestions

and support during the entire period of the thesis writing. My gratitude again goes to my

husband for his care and support and funding of the study. The work could also not have been

completed without the support of the officials of ECG in the Kwabre East district and to all

valued customers of ECG who granted me the audience in the collection of data. To all I say,

may the Almighty God richly bless you.

iv
 ABSTRACT

Every business, company or organisation must do everything possible to satisfy its customers.
This is because without the customer, the company wouldn’t exist. A secure and comfortable
customer is one who says that he or she is very satisfied with the service, he or she definitely will
continue to use the service in the future and definitely would recommend the service to others. A
vulnerable customer is one who says he or she is somewhat satisfied or dissatisfied, might or
might not use the service in the future or might not recommend the service to others. Public
service delivery in Ghana has been bedeviled with a lot of problems. In spite of the much talked
about public sector reforms, including the issuing of service charters by public sector agencies,
the quality of public service delivery remains unsatisfactory. The service delivery is described as
very bureaucratic, cumbersome and open to petty corruption. Many private entities and service
providers have succeeded because of the failure of the public sector. The complacency associated
with monopoly has over the years made the ECG very inefficient and sluggish in its management
operations coupled with poorly maintained distribution system.

Many public sector organisations have taken their customers for granted in terms of service
delivery. There have been very little done to improve service delivery to the maximum
satisfaction of customers. It is from this premise that this research was undertaken to assess the
levels of customer satisfaction of these public service organisations using ECG as a case study.
The study applied quantitative research methods in collecting data from 120 respondents in the
Kwabre East district of the Ashanti region.

After the analysis of the data it was realized that customers had a lot of misgivings about service
delivery and quality of service of ECG. The performance of ECG in customer service was rated
as poor, so was the pricing, complaint handling and service quality and delivery. The company
however was rated good in the location of its office and pay points relative to the convenience
and accessibility by customers. However, in terms of general level of satisfaction, the
performance of ECG was rated as dissatisfactory. Because of this level of dissatisfaction, people
in the district maintained that they would not recommend ECG to a friend or do repurchase
themselves if there were alternative service providers.

v
 TABLE OF CONTENTS

CUSTOMER CARE AND SATISFACTION IN PUBLIC SERVICE DELIVERY; A CASE

STUDY OF ELECTRICITY COMPANY OF GHANA, KWABRE EAST DISTRICT................i
DECLARATION.............................................................................................................................ii
DEDICATION................................................................................................................................iii
ACKNOWLEDGEMENT .............................................................................................................iv
I would like to express my sincere and heartfelt gratitude to the Almighty God for his tender
mercies in granting me the wisdom, strength and spiritual support in undertaking this project. I
wish to also thank my supervisor, Mr Adu Gyamfi, for his patience, understanding, suggestions
and support during the entire period of the thesis writing. My gratitude again goes to my
husband for his care and support and funding of the study. The work could also not have been
completed without the support of the officials of ECG in the Kwabre East district and to all
valued customers of ECG who granted me the audience in the collection of data. To all I say,
may the Almighty God richly bless you.........................................................................................iv
ABSTRACT.....................................................................................................................................v
Every business, company or organisation must do everything possible to satisfy its customers.
This is because without the customer, the company wouldn’t exist. A secure and comfortable
customer is one who says that he or she is very satisfied with the service, he or she definitely will
continue to use the service in the future and definitely would recommend the service to others. A
vulnerable customer is one who says he or she is somewhat satisfied or dissatisfied, might or
might not use the service in the future or might not recommend the service to others. Public
service delivery in Ghana has been bedeviled with a lot of problems. In spite of the much talked
about public sector reforms, including the issuing of service charters by public sector agencies,
the quality of public service delivery remains unsatisfactory. The service delivery is described as
very bureaucratic, cumbersome and open to petty corruption. Many private entities and service
providers have succeeded because of the failure of the public sector. The complacency associated
with monopoly has over the years made the ECG very inefficient and sluggish in its management
operations coupled with poorly maintained distribution system. ..................................................v
Many public sector organisations have taken their customers for granted in terms of service
delivery. There have been very little done to improve service delivery to the maximum
satisfaction of customers. It is from this premise that this research was undertaken to assess the
levels of customer satisfaction of these public service organisations using ECG as a case study.
The study applied quantitative research methods in collecting data from 120 respondents in the
Kwabre East district of the Ashanti region. ...................................................................................v
After the analysis of the data it was realized that customers had a lot of misgivings about service
delivery and quality of service of ECG. The performance of ECG in customer service was rated
as poor, so was the pricing, complaint handling and service quality and delivery. The company
however was rated good in the location of its office and pay points relative to the convenience
and accessibility by customers. However, in terms of general level of satisfaction, the
performance of ECG was rated as dissatisfactory. Because of this level of dissatisfaction, people
in the district maintained that they would not recommend ECG to a friend or do repurchase
themselves if there were alternative service providers. .................................................................v
TABLE OF CONTENTS...............................................................................................................vi
LIST OF TABLES..........................................................................................................................ix
LIST OF FIGURES.........................................................................................................................x

vi
CHAPTER ONE..............................................................................................................................1
GENERAL INTRODUCTION........................................................................................................1
1.0 Background of the Study...................................................................................1
1.2 Statement of the Problem.................................................................................3
1.3 Research Questions...........................................................................................4
1.4 Objectives of the Study....................................................................................5
1.5 Scope of the Study...........................................................................................5
1.8 Justification of the Study..................................................................................6
1.9 Organisation of the Study..................................................................................7
CHAPTER TWO.............................................................................................................................9
REVIEW OF RELATED LITERATURE.......................................................................................9
2.0 Introduction...................................................................................................... 9
2.4 Customer Satisfaction – a decisive factor in Customer Retention...................17
2.5 Customer Care and Relations..........................................................................18
2.6 Customer Relations Policy ..............................................................................19
2.7 Role of Customer Service in Success of Business............................................20
2.8 Users of electricity in Ghana............................................................................21
2.9 Electricity and population growth....................................................................23
2.10 Customers at the End of the Line..................................................................24
2.10.1 Industrial.................................................................................................25
2.10.2 Commercial.............................................................................................25
2.10.3 Residential.............................................................................................. 25
2.11 The Electric Power Industry...........................................................................26
2.12 Major Electric Power Issues...........................................................................27
2.12.1 Consumer issues.....................................................................................27
2.12.2 Residential Customers.............................................................................28
2.12.3 Non-Residential Customers.....................................................................28
2.12.4 Industrial Customer Special Load Tariff Customers (SLT)........................28
2.13 Electric Power and Economic Development...................................................28
2.14 Quality of Public Service Delivery in Ghana...................................................30
CHAPTER THREE.......................................................................................................................33
3.1 Profile of the Study Area..................................................................................33
3.2 Population Size and Growth Rates...................................................................34
3.4 Towns in this district........................................................................................35

vii
 3.5 Social infrastructure........................................................................................35
3.7 Electricity Corporation of Ghana......................................................................36
3.8 Type of Research ............................................................................................37
3.9 Sampling Method...........................................................................................38
3.10 Data Collection technique.............................................................................38
3.12 Sources of Data.............................................................................................39
CHAPTER FOUR..........................................................................................................................40
ASSESSING CUSTOMER SATISFACTION IN PUBLIC SERVICE ORGANISATIONS......40
DATA ANALYSIS........................................................................................................................40
4.0 Introduction.....................................................................................................40
Demographic Characteristics ...............................................................................40
4.2 The ECG Customer..........................................................................................43
4.3 Customer Relations Policy of ECG...................................................................46
4.4 Service Delivery of ECG...................................................................................46
4.5 Needs of the ECG Consumer..........................................................................51
4.6 Determinants of Satisfaction ..........................................................................52
4.7 Customer Service............................................................................................52
4.8 Price of Service.............................................................................................53
4.9 Complaint Handling.........................................................................................54
4.10 Location.........................................................................................................56
4.11 Service Quality and delivery..........................................................................57
4.12 Factor Rating of Determinants .....................................................................58
4.13 Level of Overall Satisfaction with ECG Services............................................59
CHAPTER FIVE...........................................................................................................................62
SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS..........................62
5.0 Introduction....................................................................................................62
Summary of Research Findings.............................................................................62
Conclusion............................................................................................................. 63
5.3 Recommendations..........................................................................................65
Reference.......................................................................................................................................68

viii
 LIST OF TABLES

Table 4.1 Gender of Respondents 37

Table 4.2 Age of Respondents 38

Table 4.3 Level of Education 38

Table 4.4 Occupation of Respondents 39

Table 4.5 Disconnection of Power for non-payment of bills 45

ix
 LIST OF FIGURES

Figure Title Page No.

4.1 Types of Customers 40

4.2 Type of Commercial Activities 40

4.3 Types of Residences 41

x
4.4 Length of Time as a Customer 42

4.5 Problems Associated with Service Delivery 43

4.6 Cost of Electricity per Month 44

4.7 Respondents’ Ability to Settle Bills 45

4.8 Likelihood of Recommending ECG 46

4.9 Likelihood of Repurchase from ECG 47

4.10 Rating of ECG’s Customer Service 49

4.11 Prices of Services 50

4.12 Customers’ Assessment of ECG’s Complaint Handling 51

4.13 Assessment of ECG’s Location 52

4.14 Customers’ Assessment of Service Quality and Delivery 54

4.15 The Most Preferred Factor/Determinant 55

4.16 Level of Overall Satisfaction with ECG 56

xi
 CHAPTER ONE

GENERAL INTRODUCTION

1.0 Background of the Study

Giftman and McDaniel (2004) defined customer satisfaction as a business term, which is a

measure of how products and services supplied by a company or organisation meet or surpass

customer expectation. Khirallah (2005) defines customer satisfaction as “ A customer's

perception that his or her needs, wishes, expectations, or desires with regard to products and

service have been fulfilled”. Cacioppo (2000) defines Customer satisfaction as the state of mind

that customers have about a company when their expectations have been met or exceeded over

the lifetime of the product or service. Customer satisfaction is seen as a key performance

indicator within businesses and organisations and it is part of the four perspectives of a Balanced

Scorecard. In a competitive marketplace where businesses compete for customers, customer

satisfaction is seen as a key differentiator and increasingly has become a key element of business

strategy (Giftman and McDaniel, 2004).

Customer satisfaction is an ambiguous and abstract concept and the actual manifestation of the

state of satisfaction will vary from person to person and product/service to product/service. The

state of satisfaction depends on a number of both psychological and physical variables rate. The

level of satisfaction can also vary depending on other options the customer may have for other

products against which the customer can compare the organization’s products.

1
It is self evident that companies should try to satisfy their customers. Satisfied customers usually

return and buy more, they tell other people about their experiences, and they may well pay a

premium for the privilege of doing business with a supplier they trust. Statistics are bandied

around that suggest that the cost of keeping a customer is only one tenth of winning a new one.

Therefore, when we win a customer, we should hang on to them (Giftman and McDaniel, 2004).

Public service delivery in Ghana has been bedeviled with a lot of problems. The government

had instituted the public sector reforms, which was in part to see to the effective management

and delivery of public service utilities. In spite of the much talked about public sector reforms,

including the issuing of service charters by public sector agencies, the quality of public service

delivery remains unsatisfactory. It is very bureaucratic, cumbersome and open to petty

corruption. Many private entities and service providers have succeeded because of the failure of

the public sector. The grave dissatisfaction with the many public utility services is compounded

by the fact that they are operating in an environment of monopoly, especially in the area of

electricity generation and supply. The Electricity Company of Ghana (ECG) is the only

distributor of electricity for both domestic and industrial use in the country. The complacency

associated with monopoly has over the years made the ECG very inefficient and sluggish in its

management operations coupled with poorly maintained distribution system. However,

consumers are unable to seek any option or alternative but to cope with the existing service

provided by the country’s only electric power provider.

2
1.2 Statement of the Problem

Regular power supply is the prime mover of technological and social development. There is

hardly any enterprise or indeed any aspect of human development that does not require energy in

one form or the other. When electricity goes on and off, it creates serious problems for

manufacturing and industrial sectors. Equipment is damaged by power surges that usually

accompany epileptic power supply and goods at various stages of manufacturing are damaged.

The problem of the study or those addressed by the study are:

1. ECG has a monopoly in the supply of electricity to consumers of electric energy but it is

not taking advantage of the monopoly to satisfy its customers.

2. ECG does not seem to emphasize on consumer care and satisfaction because it has no

competitors.

3. Because ECG is a state monopoly it is not competitive and it is not consumer-oriented.

4. From the view point of many stakeholders including the government, ECG has no

customer focus and the customer is not the central focus of its existence and operations .

5. Despite the huge investment capital injected into ECG by government, its agencies and

consumers made up of diplomatic missions, multinational corporations, domestic and

industrial concerns of the country.

The problem of power supply is traceable to the usual gross inefficiency and bureaucracy that are

evident in most public service agencies. Another problem confronting ECG is the low

investment in power generation over the years. All the plants are very old. This was confirmed at

a press briefing by a joint statement issued by the chief executive of VRA and managing director

of ECG on march 7, 2007, where they said “Our transmission system is not only aging but has

largely reached its capacity limitations and the distribution system which is also stretched to its

3
limit in many parts of the country is beset with customer service difficulties, billing problems,

poor collection rates, aged equipment etc”.

Numerous complaints have been lodged with the Public Utility Regulation Commission (PURC)

about the many unannounced outages and their attended problems. Many Ghanaians have

appeared on radio and television programmes and lashed out on the ECG for their poor delivery

of services which has resulted in the PURC publishing of a warning to utility providers that it

will apply the necessary sanctions and penalties if they do not adhere to the highest level of

service delivery to the public. However most of these concerns and trends have not been

investigated to identify causes (Special Press Briefing, 2007). The measurement of satisfaction

has been a relatively new concept to many organisations, especially those delivering public

services. These public service organisations must recognize that the global economy has

changed and with the threat of divestiture and privatization, there is the need for improvement in

services. One sure way of undertaking these reforms is by conducting customer satisfaction study

with the objective of improving service delivery.

In view of the above stated problems, the study sought to address the following research

questions.

1.3 Research Questions

1. When and how will ECG overcome its numerous operational problems so as to be able to

satisfy the needs of its numerous consumers?

2. When will ECG turn its monopoly advantage as state agency into quality service delivery

to its consumers?

3. What factors make the customers of ECG dissatisfied?

4
 4. What is the current level of customer dissatisfaction?

5. What steps should be taken to ensure improvement in the levels of customer satisfaction

at ECG?

1.4 Objectives of the Study

The objectives of the study are classified into general and specific ones. The general objective of

the study is to assess the level of customer care and satisfaction in service delivery by ECG as a

public service organisation. The specific objectives are:

i. to identify the current level of customer care and satisfaction in electric energy service

delivery .

ii. to identify the causes and effects of poor customer care and satisfaction offered by

ECG.

iii. try to measure the current level of customer satisfaction at ECG.

iv. to determine what need to be improved to increase customer satisfaction

v. to identify solutions which ECG and government can pursue to enable ECG achieve

customer care and satisfaction in electric power service delivery.

1.5 Scope of the Study

The study is geographically delimited to the Ashanti region, and the Kwabre East district to be

specific. The research was aimed at measuring the levels of satisfaction of ECG’s services and

the analysis was done recognizing ECG as a public service organisation.

5
Issues discussed in the study included identification of causes and effects of poor customer care

and satisfaction in electric power delivery, levels of current satisfaction and the identification of

solutions which ECG and government can pursue to enable ECG achieve customer care and

satisfaction in electric power service delivery.

1.6 Summary of Research Methodology

This research is designed to collect data from primary and secondary sources. The primary

source is to provide data through the following:

a) Administration of questionnaires to sampled respondents.

b) Interview with a cross section of consumers of electric energy and providers of electric

service.

c) Observation of consumer – service provider discussions and negotiation process in

respect of application for the service, payment of bills etc.

d) Analysis and comparison of data collected through questionnaires, interviews and

observations.

The population covered in the research consists of the service providers and consumers of

electric power. Sampling will be used to select respondents from the population and

demographic characteristics of the respondents will be determined in relation to responses to be

given by them.

1.8 Justification of the Study

The justification of the study arises from the following facts:

6
 i. Government invests a lot of capital into ECG without getting the needed returns that will

satisfy the government and consumers; this research is needed to actually identify the

causes why ECG cannot be market-oriented and customer focused.

ii. Consumers want value for money when they pay for electric service delivery to them and

any attempt such as this research which is intended to let consumers have satisfaction and

care is welcome.

iii. The image of most governments in Ghana has gone down due to poor performance of

ECG; if a solution can be provided by research such as this to enhance the performance

of ECG and improve the image of government the better.

iv. ECG itself is looking for a day when it can get some recommendations from a

consultancy or a research to overcome its operational problems so as to achieve customer

satisfaction and care and this is why this research is justified.

1.9 Organisation of the Study

The study was organised into five chapters. Chapter one provides a brief background to the study

and discusses the research problem, and significance of the study. The chapter also provides the

objectives, justification and limitations of the study. Chapter two reviews previous research on

customer satisfaction and public service operations. Chapter three presents the methodology that

was adopted in the study. Chapter four is devoted to the presentation of the findings from the

study and finally, chapter 5 was used to summarise, draw conclusions and provide

recommendations.

7
1.10 Limitations of the Study

i. The study was limited to only customer care and satisfaction and in public service

delivery because of the limited time available for the research.

ii. Another limitation encountered by the researcher was the lack of cooperation from the

ECG officials in responding to the issues put to them.

iii. The third limitation was that there was difficulty in identifying respondents who were

ready and willing to be interviewed.

iv. Perhaps the most arresting limitation was the lack of finance in undertaking the research.

8
 CHAPTER TWO

REVIEW OF RELATED LITERATURE

2.0 Introduction

Customer satisfaction refers to the extent to which customers are happy with the products and

services provided by a business. Gaining high levels of customer satisfaction is very important to

a business because satisfied customers are most likely to be loyal and to make repeat orders and

to use a wide range of services offered by a business. Gitman and McDaniel (2004) define

customer satisfaction as a business term, which is a measure of how products and services

supplied by a company meet or surpass customer expectation. It is seen as a key performance

indicator within business and is part of the four perspectives of a Balanced Scorecard. They

maintain that in a competitive marketplace where businesses compete for customers, customer

satisfaction is seen as a key differentiator and increasingly has become a key element of business

strategy

Studies carried out by some companies have found very high levels of customer satisfaction. It is

not surprising because these companies emphasize market research and marketing as the tools to

find out what customers want. Knowing what your customer wants then makes it possible to

tailor everything you do to pleasing the customers e.g. providing the goods that customers want,

in the packaging that they want, in retail outlets which are convenient to use and well placed.

There are many factors which lead to high levels of customer satisfaction. They include products

and services which are customer focused and thence provide high levels of value for money;

9
customer service giving personal attention to the needs of individual customers; after sales

service - following up the original purchase with after sales support such as maintenance and

updating (for example in the updating of computer packages).

What is clear about customer satisfaction is that customers are most likely to appreciate the

goods and services that they buy if they are made to feel special. This occurs when they feel that

the goods and services that they buy have been specially produced for them or for people like

them. This relates to a wide range of products such as razors that are designed for ease of use and

good quality finish, petrol products that are environmentally friendly and customised to meet the

needs of particular types of engines, etc.

2.1 Meaning of Customer Satisfaction

Khirallah (2005) defines customer satisfaction as; “A customer's perception that his or her needs,

wishes, expectations, or desires with regard to products and service have been fulfilled”. Again,

it is an attitude or behavior that customers vocalize or exhibit. The implication is that the

financial institution is consciously and proactively able to meet the myriad expectations of its

many customers. Unfortunately, customer satisfaction is no guarantee of retention or loyalty.

Customer Retention is the ability to hold on to customers over time.

Unlike customer loyalty and customer satisfaction, which measure aspects of the relationship

from the customer's perspective, customer retention is a direct measure of the institution's ability

to maintain relationships with customers. Because the concept of customer satisfaction is new to

many companies, it's important to be clear on exactly what is meant by the term. Cacioppo

10
(2000) defines Customer satisfaction as the state of mind that customers have about a company

when their expectations have been met or exceeded over the lifetime of the product or service. In

summary, Customer Satisfaction is the meeting of customer’s expectation after a product or

service has been used.

2.2 Components of Customer Satisfaction

Customer satisfaction is generally described as the full meeting of a customer’s expectations.

Customer satisfaction is the feeling or attitude of a customer towards a product or service after it

has been used. A review of the existing literature indicates that there can be potentially many

antecedents of customer satisfaction, as the dimensions underlying satisfaction judgments are

global rather than specific (Taylor and Baker, 1994; Patterson and Johnson, 1993; Rust and

Oliver, 1994). The customer satisfaction literature has paid a great deal of attention to the

confirmation paradigm, which concerns the comparison of product or service performance

expectations and evaluations (Goode and Moutinho, 1995). The confirmation model treats

satisfaction as a meeting of customer expectations (East, 1997; Oliver 1989) and is generally

related to habitual usage of products (East, 1997). However, research on customer satisfaction

has moved towards the disconfirmation paradigm which views satisfaction with products and

brands as a result of two cognitive variables: pre-purchase expectations and disconfirmation

(Churchill and Surprenant, 1982; Peter and Olson, 1996).

According to Peter and Olson (1996), "pre-purchase expectations are beliefs about anticipated

performance of the product; disconfirmation refers to the differences between pre-purchase

expectations and post-purchase perceptions" (p.509). In an earlier study, Churchill and

11
Surprenant (1982) reported that disconfirmation positively affected satisfaction. That is, when

subjects perceived the product performing better than expected, they were more satisfied

(Churchill and Surprenant, 1982). Further empirical research supports the notion that satisfaction

is caused by expectations and requires considerable cognitive effort on the part of customers

(Bearden and Teel, 1983; Moutinho and Goode, 1995; Cadotte et al., 1987). Kristensen, Juhl

and Ostergaard (2001) calculated the relationship between customer satisfaction and customer

loyalty in Danish retailing business using the European Customer Satisfaction Index (ECSI). The

model links customer satisfaction to its drivers (e.g., customer expectation, perceived company‟s

image, perceived quality and perceived value) and, in turn, to its consequences, specifically

customer loyalty.

Al Zaabi (2002) studied customer satisfaction with bill payment actions at Emirates

Telecommunications Corporation, which is identified as Etisalat. The study sample consisted of

individual customers and business customers. The author recognized a set of eleven satisfaction

attributes that were considered vital to Etisalat‟s customers with respect to service bill payment

and related actions. McColl-Kennedy et al. (2003) studied the reactions of over 700 hotel

Reactions to service recovery strategies patrons to videos depicting different scenarios of service

recovery. They found important differences in the perceptions of male and female of how service

recovery should be handled. Female, more than male, required to be capable to voice their

concerns through the service recovery time. There is also some connection between the length of

the customer relationship and satisfaction. In summary, the main components of customer

satisfaction are the customer’s expectation that is pre-purchase expectation (i.e. beliefs about

12
anticipated performance of the product) and disconfirmation (differences between pre-purchase

expectation and post-purchase perceptions).

2.3 Determinants of Customer Satisfaction

After reviewing a host of factors corresponding to customer satisfaction in retail banking

discussed in Richens (1983), Lele and Sheth (1988), Levesque and McDougall (1996), Manrai

and Manrai (2007), and Sweeney and Swait (2008), four main items which include subcategories

were reached. The main items are as follows:

(1) Service Quality

(2) Complaint Handling

2.3.1 Customer Satisfaction and Service Quality

In the service literature, strong emphasis is placed on the importance of service quality

perceptions. There is a relationship between customer satisfaction and service quality Bitner

and Hubbert, (1994), Cronin and Taylor (1992); Taylor and Baker (1994); Rust and Oliver,

(1994) confirm that there is a relationship between customer satisfaction and service quality.

Service quality has been described as a form of attitude that results from the comparison of

expectations with performance (Cronin and Taylor, 1992); Parasuraman et al (1985). Gronroos

(1982) argue that customers, while evaluating the quality of a service, compare the service they

expect with perceptions of the services they actually receive. It has been argued that the quality

of service is not a one-dimensional construct. Rather, service quality incorporates various

dimensions that relate to both core and augmented service offerings (Bitran and Lojo, 1993;

13
Gronroos, 1984; Lewis, 1993). Parasuraman et al. (1985; 1988) initially described five

dimensions of service quality: reliability, tangibles, responsiveness, assurance and empathy.

Parasuraman et al. (1991a) argued that reliability was mainly concerned with the outcome of

service whereas tangibles, responsiveness, assurance and empathy were concerned with the

service delivery process. The customers not only judge the accuracy and dependability (i.e.

reliability) of the delivered service but they also judge the other dimensions as the service is

being delivered (Parasuraman et al., 1991a). Customer satisfaction can thus be based not only on

the judgment of customers towards the reliability of the delivered service but also on customers'

experiences with the service delivery process.

On the basis of their review of service quality literature, McDougall and Levesque (1994),

however, argued that there were two overriding dimensions to service quality. The first one

being the core or outcome aspects(contractual) of the service, and the second being the relational

or process aspects (customer-employee relationship) of the service. It is generally accepted that

customer satisfaction often depends on the quality of product or service offering (Anderson and

Sullivan, 1993; Levesque and McDougall, 1996). For this reason, research on customer

satisfaction is often closely associated with the measurement of quality (East, 1997). Thus, both

service quality and customer satisfaction share a close relationship, though they are normally

conceptualise as unique (or separate) constructs (Bitner and Hubbert, 1994; Cronin and Taylor,

1992; Patterson and Johnson, 1993; Taylor and Baker, 1994).

There is some empirical evidence suggesting that service quality is a causal antecedent of

customer satisfaction (see for example, Cronin and Taylor, 1992; Woodside et al., 1989).

14
However, there is very little empirical research demonstrating the importance of service quality

dimensions in determining customer satisfaction (Fisk et al., 1993; Levesque and McDougall,

1996). In a recent study, Levesque and McDougall 1996 found that the performance of the

service provider on core and relational dimensions of service was an important driver for

customer satisfaction in retail banking for instance, in the UK.

However, in a non-Western context, the link between core and relational dimensions of service

and customer satisfaction is yet to be established empirically. Moreover, the literature dealing

with services outlines some major characteristics of services that make them unique and different

from physical products (Bitran and Lojo, 1993; LeBlanc and Nguyen, 1988; Parasuraman et. al.,

1985; Zeithaml and Bitner, 1996). Services are often characterized by their intangibility,

inseparability, heterogeneity, and perishability. The implications of these characteristics are that

it is often difficult for customers to evaluate services at pre-consumption, consumption and post

consumption stages of the consumer decision-making (Legg and Baker, 1996).

Because of the intangible nature of services, it becomes difficult for an organization to

understand how its customers perceive and evaluate the quality of its services (Parasuraman et.

al., 1985; Zeithaml, 1981). Customers, however, make inferences about the service quality on the

basis of tangibles (the buildings, the physical layout etc.) that surround the service environment.

Support for this argument comes from empirical evidence suggesting that the tangible, physical

surroundings of the service environment can have a significant impact on customer’s affective

responses and their behavioural intentions (Wakefield and Blodgett, 1999). Dabholkar et al.

(1996) reported similar findings that the tangible aspects of department stores do influence

15
customers' perceptions of service quality. Hence, there are reasonable grounds to assume that

customer satisfaction is also related to customers' evaluation of physical surroundings of the

service environment.

In summary, customer satisfaction often depends on quality of products or service offering thus

measurement of quality is often used to determine satisfaction levels. Service quality is not just

about the outcome of the service but also the customer’s experience with the service delivery

process which is contractual and customer – employee relationship respectively.

2.3.2 Customer Satisfaction and Complaint Handling

Since services exist in real time, services are consumed at the very moment when they are made

available to customers. They cannot be stored and checked for their quality like a physical

product. Hence, every service production failure is likely to be experienced by a customer.

Consequently, "dissatisfaction with a service might occupy most of the time over which service

is consumed" (East, 1997). However, customers might not instantly switch their service

providers after experiencing a problem during the service production. This is mainly because of

the fact that the perceived costs of switching are relatively high in retail service sector, especially

when the service provider enjoys a monopoly. Customers, however, might display a passive

response to a problem, which can be in the form of making a formal complaint. Customer

satisfaction in such cases can depend upon the efficient and effective response of the service

provider (Levesque and McDougall, 1996).

16
2.4 Customer Satisfaction – a decisive factor in Customer Retention

The positive connection between customer satisfaction and customer retention is a given fact -

more than 20 different studies prove this. The nature of this connection, however, is very

complex. Customer satisfaction does not automatically lead to customer retention; it is, however,

a pre-requisite.

Customers are satisfied when their expectations about a product or service are met. They are

however dissatisfied if the reverse was the case. Customer satisfaction is the result of a

permanent comparative process: subjective experience and perceptions (IS) are compared with

expectations and goals (SHOULD) and this leads to:

• Customer dissatisfaction

• Customer satisfaction

• Customer enthusiasm

What is interesting in this context is the fact that quality expectations of library customers are

influenced very strongly by any previous experience with the institution or by reports from third

parties. The image of the institution, and thus the development of a role model, i.e. corporate

identity and corporate design, plays a key role here. A user who for any reason does not feel right

when using your library's services, is more likely to develop and later spread a lower quality

perception and thus a worse image than a user who can overlook tangible 'errors' thanks to an

obliging atmosphere (Vogt, 2004).

17
A high level of quality is achieved when customers are satisfied or expectations are exceeded.

Only this creates “customer enthusiasm,” leading to strong loyalty and causing positive word-of-

mouth propaganda. In 2001, the Bremen city library concluded that: “Word-of-mouth

propaganda attracts lots of customers.” In a survey among new customers, the city library in

Bremen established that word-of-mouth propaganda is the best advertising means by far. Slightly

more than half of those asked revealed that they had been “tempted” into visiting the city library

by friends, acquaintances or family members. The city library in Bremen concluded that:

“Satisfied customers seem to speak positively in family circles and amongst friends about the

city library’s program [...]” (Bremen city library internal paper) (Vogt, 2004).

2.5 Customer Care and Relations

According to an article on Bizhelp 24 (2008) it costs five times more to sell to a new customer

than an existing customer. In that article the writer contend that many businesses are sadly

paying the price because they fail to encourage repeat sales from customers. This is often the

result of poor customer relations / customer care.

One thing that business owners often forget is that customers are the driving force of their

business: without them, they have no future - it is the same for everyone. You may currently feel

that your relations with customers are good, but you can do more (Jody, 2007).

Customer Relations can be considered as a form of marketing- a happy customer will inform five

people: an unhappy customer may inform ten. Unsatisfied customers will then go elsewhere and

consequently, you lose a customer to your competitors and in turn, they may drag others with

18
them. Good customer relations will gives a sense of achievement, satisfied customers and the

improved chance of further promoting your business. Bizhelp (2008) gives some tips as to how a

company can ensure its customers to stay loyal to it. To Bizhelp (2008), it is not a hard and

demanding task.

2.6 Customer Relations Policy

The company must create a customer relations policy instead of just making it up as it goes

along. The policy is a guarantee to the customers that the company is dedicated to achieving

customer satisfaction. The policy may state that the company aim to achieve 100% order

accuracy, 30-day money back guarantee, speedy service, fast corrective action on customer

issues, promise of low prices, free delivery, etc. Each statement may have a few sentences in

small print to explain in more detail the terms, conditions and process. It must be ensured that all

of the staff understands the policy and stick to it at all times. The policy must be displayed in the

workplace so that it can be easily viewed by customers: knowing that the company aims to

achieve customer satisfaction is a welcomed action by the public.

In addition, you could have the company’s policy printed on the back of your till receipts. When

the company advertises its business, where possible, include the company’s policy. Basically, the

policy, can become a marketing tool for the business, but be sure that the company can (and do)

satisfy everything that the company has promised.

19
2.7 Role of Customer Service in Success of Business

Business success is dependent on a variety of factors – a realistic business idea, a well thought-

out business plan, an appropriate marketing strategy and great customer service are amongst the

top ones. While customer service is a part of marketing, it can be segregated as a separate field

on its own (King, 2007). King (2007) defines the term customer service as including all aspects

of interaction with a customer and speaking to the organization’s image in the mind of a

customer.

A customer provides an organization with that most organic of all advertising tools – word of

mouth advertising. A happy and satisfied customer is much more likely to send more customers

your way. Further, there is the potential for repeat business, which is the backbone of many

businesses. It is obvious that a customer who has been provided with a product or service that he

or she desired in the ideal way, would build a relationship with the seller.

Further customer relationship management teaches the business where there are flaws in the

system and provides valuable customer feedback. When a business receives feedback, it is able

to see the customer’s image of the organization and the impression of its services. This tool is

invaluable in correcting systems as well as image management for the business. It is also an

outsider’s perspective, which provides the business owner or management a unique insight

(King, 2007).

King (2007) adds that a satisfied customer would be more likely to participate in activities that

help to generate customer preference data. This data goes back to the marketing function in

20
assisting the organization to better target and attract it potential customers. In fact, it would not

be a stretch to say that without good customer service, a business would not survive. The old

adage ‘The customer is always right’ has been the foundation of many an organization and what

it really means is that keeping customers happy is the foremost principle of any business. The

reason for the survival of many small businesses in a tough and competitive market is their

ability to provide personalized customer service. It is the human touch that warms and enlivens

an organization in the customer’s mind and goes towards building a relationship. This

relationship is the basis of future growth for a business.

Regular and sustained interaction with a customer ensures that the customer feels connected with

the business. For instance, a small pub owner who chats with his customers and knows them by

name builds a relationship with them. Further, when he makes sure that their regular bartender

makes their drinks and the food is fresh and hot, he is providing customer service. The customers

have a good experience and feel that the establishment treated them well (King, 2007).

2.8 Users of electricity in Ghana

With a customer base of approximately 1.4 million, it has been estimated that 45- 47 percent of

Ghanaians, including 15-17 percent of the rural population, have access to grid electricity with a

per capita electricity consumption of 358 kWh. All the regional capitals have been connected to

the grid. Electricity usage in the rural areas is estimated to be higher in the coastal (27 percent)

and forest (19 percent) ecological zones, than in the savannah (4.3 percent) areas of the country.

In 2004, Ghanaians consumed 5,158 gigawatthours (GWh) of electricity. It is estimated that

about half of this amount is consumed by domestic (or residential) consumers for household uses

21
such as lighting, ironing, refrigeration, air conditioning, television, radio and the like.

Commercial and industrial users account for the rest (Guide, 2005).

The majority of the customers are in service territories of the Electricity Company of Ghana

(ECG) and the Northern Electrification Department (NED). However, there are also deregulated

consumers such as mines, and aluminum companies, which account for one third of total

consumption. One industrial entity, VALCO, can account for most of this amount when it is

operating normally. Residential consumers comprise middle and high-income urban consumers.

This consumer-class typically uses a number of high energy consuming household appliances

and items such as air conditioners, fridges, water heaters, electric cookers in addition to a

substantial amount of lighting equipment and bulbs for the houses. The majority of the rest of the

residential consumers use electric power for lighting (Guide, 2005).

The major characteristic residential arrangement is the “compound house” multi-house

phenomenon – essentially a number of households living in a compound and sharing basic

amenities including one electricity metering system. Apart from residential consumers who are

considered to be “small” users, other consumers whose consumption is not considered large by

virtue of their activities are the non-residential consumers as well as small industrial concerns

which are known as special load tariff customers (SLT’s). Non-residential consumers comprise

offices, banks and other small businesses.

Since the 1980’s, the government has pursued a policy of extending electricity to the rural

communities. The objective of this is to encourage the use of electricity for productive use for

22
cottage industries and eventually the growth of these industries into bigger consumers which will

become a source of employment and economic growth for the communities they are situated in

(Guide, 2005)..

2.9 Electricity and population growth

In Ghana, electricity consumption has been growing at 10 to 15 percent per annum for the last

two decades (Guide, 2005). It is projected that the average demand growth over the next decade

will be about six percent per year. As a result, consumption of electricity will reach 9,300 GWh

by 2010. The projected electricity growth assumption has profound economic, financial, social

and environmental implications for the country. The aspirations of developing countries for

higher living standards can only be satisfied through sustained development of their electric

power markets as part of their basic infrastructure.

Electricity demand will grow much faster than overall economic growth (4-5 percent per year) or

than population growth (which is less than two percent a year) because continuing urbanization

will allow newly urbanized segments of the population to expand their electricity consumption

manifold. Urbanization in Ghana is expected to increase from around 40 percent in 2000 to about

55 percent in 2012 and eventually to 60 percent by 2020. A little more than a third of the urban

population lives in Greater Accra and is expected to reach around 40 percent by 2020. A

considerable percentage of household expenditure goes into energy. Energy sources in urban

areas are more diversified than in rural areas, since access to a variety of commercial fuels and

appliances are higher in the urban areas than in the rural areas. Often the cost of alternatives is

higher in the rural areas than it is in the urban where incomes are lower.

23
Clearly, with the Ghanaian economy growing, increasing urban populations will consume more

electricity. The Energy Commission (EC) estimates that residential demand may reach anywhere

between 7,000 and 13,000 GWh by 2020 depending on the rate of economic growth and

urbanization. The residential sector is not the only segment expected to grow; commercial and

industrial consumption will grow as well to 3,000 to 10,000 GWh by 2020 according to the EC.

If VALCO is fully operational, an additional 2,000 GWh should be expected. In order to meet

this increasing demand, new power generation as well as transmission and distribution facilities

will have to be built. Ghanaian governments have been pursuing a national electrification policy.

Still, more than half of the population remains without access to grid-based electricity. It is very

expensive to build long-distance transmission lines to serve small communities, especially when

these communities are relatively poor and cannot afford to pay rates high enough to cover the

cost of these services. Moreover, there is weak or no evidence of increased economic activity in

communities that benefited from the national electrification scheme. Smaller scale and locally

installed generation systems using solar panels, batteries and the like can be more affordable.

Nevertheless, rural electrification will continue to be a challenge for Ghana (Simons, 2005).

2.10 Customers at the End of the Line

The ultimate customers who consume electricity are generally divided into three categories:

industrial, commercial, and residential. The cost of serving customers depends upon a number of

factors including the type of service (for example, if service is taken at high or low voltage) and

the customer's location with respect to generating and delivery facilities.

24
2.10.1 Industrial

Industrial customers generally use electricity in amounts that are relatively constant throughout

the day. They often consume many times more electricity than residential consumers. Most

industrial demand is considered to be base load. As such it is the least expensive load to serve.

Industrial loads are expected to remain within certain levels over time with relatively little

variation. Major industrial customers may receive electricity directly from the transmission

system (rather than from a local distribution system).

2.10.2 Commercial

Commercial loads are similar to industrial in that they remain within certain levels over

intermediate periods of time. Examples of commercial customers are office buildings,

warehouses, and shopping centers.

2.10.3 Residential

According to the Guide to Electric Power Use in Ghana (2005), residential electrical use is the

most difficult to provide because households use much of their electricity in the morning and

evening and less at other times of the day. This is less efficient to provide and therefore a more

expensive use of the utility's generators. Over time as homeowners buy new appliances and

change lifestyles, the expected loads also change. Examples of residential loads are individual

residences.

25
2.11 The Electric Power Industry

In Ghana organizations that generate, transmit or distribute electricity are called (public) utilities

due to the fact that they have the capacity to satisfy essential human wants which lead to

enhancement of the quality of life. Utilities may be vertically integrated in which case electric

power generation, transmission and distribution are performed by one organization. The Volta

River Authority (VRA), a government owned utility, is largely responsible for electricity

generation and transmission in Ghana and it can be described as being partially integrated.

Limited generation is also undertaken by a private company, the Takoradi International

Company (TICo), a joint ventureship between VRA and CMS Energy Inc. of the USA. Two

nationally owned utilities are responsible for electric power distribution in the country. These are

the Electricity Company of Ghana (ECG) and the Northern Electricity Department (NED), the

latter being a directorate of the VRA. The Electricity Company of Ghana delivers power to

customers in the southern half of the country comprising Ashanti, Western, Central, Eastern,

Volta and Greater Accra Regions while the Northern Electricity Department has responsibility

for supplying power to customers in the northern half of the country consisting of the Brong

Ahafo, Northern, Upper East and Upper West Regions. There are four electric utilities in the

country, namely VRA, ECG, NED and TICO. The Public Utilities Regulatory Commission

(PURC) and the Energy Commission (EC) are two government agencies that regulate the utilities

for the public good rather than private interests. The PURC is an independent body with primary

responsibility for setting the tariffs that utilities charge their customers. The EC on the other hand

is tasked with licensing and regulating the technical operations of the utilities. Both regulatory

agencies also ensure fair competition in the power market, enforce standards of performance for

the provision of services to customers and protect both customer and utility interests.

26
Electric energy policy formulation is the preserve of the Ministry of Energy while the Energy

Foundation, a nongovernmental agency, has been very active in promoting energy efficiency

measures.

2.12 Major Electric Power Issues

2.12.1 Consumer issues

According to Simons, (2005) the use of electric power has become widespread in Africa; and

Ghana is no exception. Over the last two decades, demand for electricity for various purposes

including domestic and industrial uses has been increasing at a rate of 10-15 percent per annum.

This has significant implications for the rate of economic development. While the use of

electricity for domestic purposes (e.g., lighting, radio, television, ironing) will normally lead to

improvement only in the lives of consuming individuals, productive use of electricity by

industries (all things being equal) will lead to general macroeconomic improvement and a rise in

the standard of living of the populace. The major consideration for Ghana is the ability of the

country to match the rate of electricity demand with adequate supply as well as the proportion of

energy produced which is consumed for productive use. It is estimated that about 50 percent of

electricity produced in Ghana is consumed by domestic users. If this proportionate use can be

changed in favour of industrial use and/or productive use then Ghana stands to gain.

In Ghana electricity customer groups comprise Residential, Non- Residential and Industrial

customers. Each group has its requirements and needs. For most ordinary consumers electricity

has become an important factor in their lives, particularly for lighting purposes. The main issues

for ordinary consumers are (i) the price at which the electricity is bought, i.e., the bill they have

27
to pay and the reliability of the service (ii) the level of tariff price in comparison to reliability,

adequacy and safety of service being provided.

2.12.2 Residential Customers

As a large proportion of residential customers are low-income earners, the cost of electricity is

critical for them. Therefore a pricing arrangement that will ensure that they can enjoy the use of

electricity for their basic needs at an affordable price is important. The current “lifeline tariff”

targets the rural and urban poor whose consumption is less than 50 kWh per month. The life-line

tariff is typically 60-70 percent of the economic cost of supply.

2.12.3 Non-Residential Customers

This comprises major offices, banks and small businesses. For this group, the cost of energy is

also important particularly for small businesses whose electricity cost is a significant component

of their operating cost and who require lower energy costs to be more competitive in the market

place to survive.

2.12.4 Industrial Customer Special Load Tariff Customers (SLT)

The major industries whose operations depend to a large degree on a reliable supply of power are

also concerned about cost and reliability in order to ensure their competitiveness in the markets

within which they operate.

2.13 Electric Power and Economic Development

28
Electricity, like other forms of energy, is a vital ingredient in the economic development of

countries the world over. Not only is it a critical factor and cornerstone of the accelerated

development and growth of any nation, it is also a measure of the standard and quality of life of a

people. Without a safe, sustained, reliable and reasonably affordable supply of electricity to meet

demand, a country can hardly make progress in its economic and social development.

Population growth and economic expansion are the major factors driving growth in the electric

power industry. As the number of households grows and as more and more households add on

electric appliances, electric power generation capacity has to keep up.

At the same time, electricity is an essential input for industrial and economic performance,

although there are other things that are equally or more important. In general, when both

household and economic growth are taken together, they account for most if not all of the net

growth of electric generation capacity. Growth in the electric power industry is also influenced

both directly and indirectly by population growth and general economic performance. The direct

effects come from demand for electricity as households are added or businesses and industries

expand. The indirect effects come from the contribution that electricity makes to our life-styles

and quality of life and technological development.

Electricity costs are important, but so are the costs for land, labor, materials, transportation and

other factors. Usually, employment in electric utility services is only a small portion of total

employment in an economy. However, we also have jobs tied to companies that provide

equipment, materials and services to the electric power industry, and jobs in electric power

29
services outside of the utility companies themselves. Though the electricity supply industry

Ghana contributes only 10 percent of its energy-supply mix, the industry is a key driver of

economic growth and development, powering the country’s industrial, commercial and urban

development. The industrial, agricultural, mining and services sectors of the Ghanaian economy,

which together account for 75 percent of the country’s GDP, rely critically on the electricity

industry for their survival.

The electricity industry accounts for 14.7 percent of total energy share in the industrial sector,

and 32.6 percent energy consumption in the formal manufacturing sector.2 It also contributes 2.8

percent of real GDP and 10.65 percent of industrial GDP. With a customer base of

approximately 1.4 million, it is estimated that 45-47 percent of Ghanaians including 15-17

percent of the rural population have access to grid electricity with a per capita electricity

consumption of 358kWh while the average annual growth rate stands at 9.7 percent. According

to the Ministry of Mines and Energy (1996) rapid growth in domestic demand for electricity,

which averaged 10 percent per annum between 1985 and 1993, increasing further to 15 percent

by 1995 was a result of positive economic growth and the National Electrification Programme

embarked upon by the government during this period led to electricity demand gradually

catching up and eventually surpassing generation capacity (Simons, 2005).

2.14 Quality of Public Service Delivery in Ghana

In spite of the on-going public sector reforms, including the issuing of service charters by public

sector agencies, the quality of public service delivery remains unsatisfactory, being very

bureaucratic and cumbersome and open to petty corruption. According to a study sanctioned by

30
the Private Enterprise Foundation, (PEF), in 2008, it was observed that the quality of public

utility service delivery and government services to the private sector is generally poor and has

resulted increasingly in businesses incurring huge unplanned costs. It was noted also that the

impact of the poor service delivery is multidimensional, having immense financial, economic,

social, legal and political implications for the private sector in particular and therefore the

economy as a whole. For industry in particular, poor and unreliable service delivery by the

public utilities has a very devastating impact, because, it affects profitability and growth of

businesses through loss of production and therefore inability to meet production targets; leads to

frequent breakdown of equipment and corresponding increases in costs of repair, maintenance

and replacement; results in increased operational costs; causes under-utilization of installed

capacity; reduces ability to compete domestically and internationally and also to attract adequate

levels of foreign investment; leads to redundancy, laying-off of staff, and increasingly; leads to

bankruptcy and eventual collapse of small and medium-scale businesses.

Specifically on power supply, the research noted that of 82 industrial enterprises surveyed in

2007, only 7 had constant supply of electricity in 2005; over 73% suffered drastic and 27%

marginal reductions in productivity and turnover; over 75% suffered frequent and 25% marginal

breakdown of equipment; over 63% were unable to meet their production targets; over 80%

suffered drastic increases in operational costs (Diawuo and Anto, 2007).

In fact, these concerns were confirmed by the Public Utility Regulatory Commission (PURC),

when the executive secretary, Mr. Stephen Adu, warned of strict application of sanctions and

penalties if they did not performed satisfactorily. The warning was issued Monday, 23

31
November 2009, at a time there were intermittent outages being experienced in many parts of the

country. Mr. Adu, told the utility providers that the Commission was not pleased with the kind

of service being rendered to the public and that every attempt should be made to ensure that the

consumer, who paid for the service, got value for money. While acknowledging that outages and

shortages cannot be eliminated completely because of the poor state of the utilities, he however,

emphasized that the current situation where lights go off abruptly without any warning or

communication with the public must stop to ensure that the public is not affected adversely. This

comment summarizes the predicament of the Ghanaian public utility consumer (GNA, 2009).

32
 CHAPTER THREE

METHODOLOGY

3.1 Profile of the Study Area

The purpose of this study is to assess the customer satisfaction in public service delivery by

public agencies, using the Electricity Company of Ghana as a case study. It is to measure and

ascertain the levels of satisfaction of customers who are the direct beneficiaries of the services

provided by the company. This chapter contains a brief description of the study area taking into

consideration its physical, social, infrastructural environment. The chapter also contains

descriptions of the sample population, the procedure used for data collection, the instrumentation

and data analysis. The research design of the study was descriptive which meant it was primarily

concerned with finding out “what was”

Kwabre East district, carved out of the former Kwabre District in 2006, is located almost in the

central portion of the Ashanti region. It is within latitudes 6 o 45’ and 6o 50’ North and longitudes

1o 30’ to 1o 35’ West. The District shares common boundaries with Afigya Sekyere District to

the North; Kumasi Metropolitan Area to the South; Ejisu Juaben District to the Southeast;

Atwima District to the West and Offinso District to the Northwest. The District has a total land

area of 246.8 square kilometres constituting about 1.01% of the total land area of Ashanti

Region. Kwabre District is part of the greater Kumasi City region, which is made up of Kumasi

Metropolitan Area and the surrounding Districts. The District capital, Mamponteng, is

approximately 14.5 kilometres from Kumasi to the north east. There are 86 settlements,

administered under 3 paramountcies, 2 parliamentary constituencies, 11 Area Councils and 42

District electoral areas.

33
3.2 Population Size and Growth Rates
Figures from secondary sources for the 1960, 1970 and 1984 census reports indicated that the

district’s populations were 43,328, 56,313 and 78,923 respectively. The 2000 Population and

Housing Census put the entire population for the district at 164, 668 (an increase of 33.3% over

the 1995 estimate). Even though Kwabre district is one of the Districts with the least land size in

the Ashanti region, its population of 164,688 ranks fifth among the twenty-one districts in the

region. The high population could be attributed to the proximity of the district to Kumasi

metropolis. Major settlements in the district, especially those at the fringes of Kumasi (such as

Ahwiaa, Afrancho, Atimatim and Kenyasi), appear to have dormitory status to the metropolis,

thus attracting increasing numbers of migrants. This may be responsible for the high growth rate

of 4.6%. The district has a high population density compare with the regional and national

averages. It has an average density of about 666.72 persons per square km as against 147.6

persons per square km and 78.9 for Ashanti region and the nation respectively. The

consequences is overcrowding that has resulted in increasing pressure on infrastructural facilities

like electricity, housing, health etc.

3.3 Household Size and Housing Density

The average urban household size in the district is 8.9 and that for rural areas is 8.8. This shows

an increase of three (6 – 9), from 1995 to 2001. However, there are variations in the household

size distributions in the district, ranging between single households to 20 persons per household.

In terms of density, the average number of persons per house in the district is 20.7 with urban

areas having 28.5 persons in a house and rural areas having an average of 14.5 persons in a

house. The average number of rooms per house is 8.3 while rural parts of the district have an

34
average of 6.9 rooms in a house and urban areas have an average number of 10.0 rooms in a

house.

3.4 Towns in this district

Towns in the district include Ahwiaa, Atimatim, Mamponteng, Aboaso, Ntonso, Kenyasi,

Afrantwo, Abira, Kasaam, Ankaase, Meduma, Old Asonomaso, Adanwomase, Adwumakase-

Kese, Nkukua Bouho, New Asonomaso, Antoa, Safo, Fawoade, Sokora Wonoo, Kenyase,

Ahwiaa, Bamang, Antoa, Wadie, Adwumakase, Ntiribuoho, Kodie and Afrancho

3.5 Social infrastructure

There are about 23.5 kilometres of first class roads in the district and about six kilometres of

second class roads, while third class roads make up the remaining 81.6% of the total road

network of 160.5 kilometres.There is only one financial institution in the Kwabre District and

this is the Sekyere Rural Bank, which has agencies (branches) in Ntonso, Ahwiaa and

Mamponteng.

This bank serves as a channel for paying salaried workers, operates saving accounts and provides

loans for agriculture, trade and commerce as well as small-scale industrial activities. The district

has 24 nursery schools, 56 kindergartens, 84 primary schools, 41 junior secondary schools. On

the average, the teacher / pupil ratio in the Kwabre District is 1:21. There are two private

hospitals in the district owned and run by religious missions. There are also 10 level “A” primary

health centres and two level “B” primary health centres. The district’s inhabitants derive their

water supply through the pipe-borne system, boreholes, wells and streams. In all, eight

35
communities have access to pipe-borne water. Electricity reaches 35 settlements in the district.

Other sources of energy used in the district are kerosene, firewood and charcoal.

3.6 Structure of the Local Economy

Production activities in the district have been categorized into three major sectors namely,

agriculture, industry and service. The agriculture sector is dominated by crop farming, which is

mostly done on subsistence basis and employs rudimentary production techniques. the industrial

sector consists of a wide range of micro, small and medium scale manufacturing and processing

activities, including agro-processing wood-based, textiles based, metal based, quarrying,

construction and other activities. Trading, personal services such as hairdressing and barbering,

drinking and ‘chop bar’ operations, transport, tourism and other services are the dominant

services rendered in the district.

3.7 Electricity Corporation of Ghana

The Electricity Corporation of Ghana (ECG) was established in 1967 by a decree

(NLC Decree No. 125) of the National Liberation Council government, which overthrew the

Nkrumah government. ECG replaced the defunct Electricity Department, which had been

operating under the Ministry of Works and Housing. ECG was charged with the bulk purchase of

electricity from VRA for distribution throughout the country to all categories of consumers, with

the exception of VALCO, the Akosombo Township, and the Mines.

The decree establishing the ECG also required it to conduct its affairs on “sound commercial

basis”. In 1987, ECG’s distribution activities were restricted to the six southern regions of the

country following the establishment of the NED. Currently, ECG provides services to about

36
400,000 consumers in the southern part of the country. Under the provisions of the Statutory

Corporations (Conversion to Companies) Act, 1993 (Act 461), ECG has since February 1997,

been converted into a limited liability company called Electricity Company of Ghana to take

over the assets and operations of the Corporation. The government of Ghana is the sole

shareholder and financier of the company.

A government-appointed Board of Directors governs ECG, which is responsible for formulating

policies. ECG’s Managing Director, as well as the Chief Executive of VRA, are members of the

Board. Over the past decade, ECG has been supported by foreign power utilities through

performance contracts with ESB Consultants of Ireland on organizational restructuring and

development which has been ongoing since the mid-1980s and more recently a consortium of

Electricity de France (EdF) and SAUR to establish and operationalize the ECG’s Directorate for

Customer Services.

3.8 Type of Research

This is a study of customer satisfaction in public service organizations in Ghana using the

Electricity Company of Ghana (ECG) as a case study. This is a descriptive research that sought

to ascertain the levels of customer satisfaction enjoyed by the clients of ECG in the Kwabre East

district of the Ashanti region. The study adopted the quantitative technique in research, where

statistical tools like frequencies, graphs and charts were used to analyze the data collected. Such

statistical softwares as Excel and Statistical Package for Social Sciences (SPSS) were used in the

analysis of data that was collected. Statistical tools such as frequency tables, bar graphs and pie

charts were used in presenting the results the data analysis.

37
3.9 Sampling Method

The research applied both the simple random sampling methods and the purposive sampling

methods. The purposive sampling method was used in the selection of specific commercial

consumers in a random manner to be included in the survey. Another method of sampling used

in the study was the convenience sampling. In a convenient manner, the researcher positioned

herself at the ECG paypoints in the various communities involved in the study. Out of the 33

communities in the district, six were randomly selected. Towns selected included Ahwiaa,

Antoa, Kenyasi, Adwumakase, Nkukua Bouho and Mamponteng the district capital. 20

respondents were selected from each of these communities. The total sample size used in the

study numbered up to 120. In applying the simple random sampling, every fifth customer that

visited the paypoint was interviewed. This was done at the beginning of the month when most

consumers had to pay for the previous month’s consumption for credit meter users or buy new

credits for that month for pre-paid meter users.

3.10 Data Collection technique

The study used both quantitative and qualitative data collection techniques. The research

adopted three data collection techniques to collect data. These are:

a. Administration of questionnaires

b. Interviews

c. Observation and analysis

The questionnaires were well-structured and closed-ended with most of them needing ‘Yes’ or

‘No’ answers. One hundred and twenty questionnaires were. Twenty questions were well

designed for respondents to answer with full explanations to establish links between

38
questionnaire responses and interview answers. The observation method was used in handling of

complaints, payments of bills etc.

3.11 The Population of the Study

The population of the study consisted of the following:
a. Officials, technicians and operatives of ECG in the study area.
b. Contractors who are contracted to lay cables and distribute metres.
c. Contractors responsible for maintenance.
d. Industrial, commercial and domestic/residential consumers.

3.12 Sources of Data

The sources of data for this research came from both primary and secondary sources. The

primary data was derived from interviews with customers of the Electricity Company of Ghana,

while the secondary data was obtained from documents from the library, journals and the internet

on theories about customer satisfaction, electricity use and problems of electricity generation,

distribution and service delivery.

39
 CHAPTER FOUR

ASSESSING CUSTOMER SATISFACTION IN PUBLIC SERVICE ORGANISATIONS

DATA ANALYSIS

4.0 Introduction

Chapter four of the study is devoted to the analysis of data collected. In this chapter the

demographic characteristics of the respondents are analyzed so are the perceptions and of the

respondents about the services they receive from ECG.

Demographic Characteristics
Respondents were classified into the following demographic characteristics:

i. Sex and gender

ii. Age

iii. Occupation

iv. Type of customer

v. Educational attainment

In is the view of the researcher that these demographic characteristics have so much bearing on

responses given by the respondents on consumer satisfaction of ECG. In all, the study involved

120 respondents from six communities in the district. The communities were Ahwiaa, Antoa,

Kenyasi, Adwumakase, Nkukua Bouho and Mamponteng. 20 respondents were selected from

each of the community visited. Of the 120, 80 of them, representing 66.7% of the total sample

size of the study were males. The remaining 40, representing 33.3% were females (Table 4.1).

40
The females represented in the study were those who were household heads and were responsible

for utility bills.

Table 4.1 Gender of Respondents

Cumulative
Frequency Percent Percent

Male 80 66.7 66.7

Female 40 33.3 100.0

Total 120 100.0

Source: Field Survey, 2010

In table 4.2, the age distribution of the respondents is presented. From the table, majority of the

respondents constituting 60.8% were those between the ages of 31 – 50 years. Other age groups

represented in the study included those between 21 – 30, 20.8%, and those above 51years who

constituted 18.3%.

Table 4.2 Age of Respondents

Cumulative
Frequency Percent Percent
21 – 30 25 20.8 20.8
31 – 50 73 60.8 81.7
51 years and above 22 18.3 100.0
Total 120 100.0

Source: Field Survey, 2010

In terms of education, the residents of the study area were quite literate. About 38.3% and 21.7%

had had secondary and tertiary education respectively. 26.7% had acquired basic education, with

only 13.3% having no education at all (Table 4.3). This level of literacy enhanced the research,

especially during the data collection. This was because most of the respondents could

understand the issues that the research was seeking to unravel.

41
Table 4.3 Level of education
Cumulative
Frequency Percent Percent

None 16 13.3 13.3

Basic 32 26.7 40.0

Secondary 46 38.3 78.3

Tertiary 26 21.7 100.0

Total 120 100.0

Source: Field Survey, 2010

Another demographic characteristics interrogated by the research was the occupation of

respondents collected revealed that as many of the respondents representing 36.7% were artisans.

They included masons, carpenters, welders, kente weavers etc. Other occupations were farmers,

19.2%, traders constituted 24.2%, followed by farmers, teachers, civil servants and the

unemployed in that order (Table 4.4).

Table 4.4 Occupation of Respondents

Cumulative
Frequency Percent Percent
Farmer 23 19.2 19.2
Teacher 11 9.2 28.3
Trader 29 24.2 52.5
Artisan 44 36.7 89.2
Unemployed 4 3.3 92.5
Civil Servant 9 7.5 100.0
Total 120 100.0

Source: Field Survey, 2010

42
4.2 The ECG Customer

The customers of ECG in the district cuts across all age groups with the majority of them

however within the 31 – 50 yrs age group. This age group according to Ghana’s demographic

characteristics is the active working group. This therefore indicates that those who pay for the

services of ECG are those within the working class. Of the 120 customers interviewed, 38

representing 31.7% were using the services of ECG for commercial purposes, while the majority

of 68.3% used it for domestic purposes (Fig. 4.1). Electric power according to the respondents

was used for such purposes as lighting, ironing, refrigeration, air conditioning, television, radio

and the like.

Fig. 4.1 Type of customer

Source: Field Survey, 2010

The 31.7% of the respondents, who used the services of ECG for commercial purposes, were

engaged in such activities as welding, cold store business, food processing, and retail shops (Fig.

4.2). However, this section of respondents did not use electricity exclusively for commercial

purposes since they all had homes and used electricity there too.
43
Fig. 4.2 Type of commercial activity

For those who used the services for domestic purposes, 45.1% were residents of compound

houses, 24.3% lived in flats and the remaining 30.4% lived in ‘self-contained’ houses. This is

presented in Fig. 4.3. According to the respondents, even though there is a pricing

arrangement that ensures that they enjoyed the use of electricity for their basic

needs at an affordable price, through the “lifeline tariff” arrangement, the

reverse is the case. This is because considering the number of households in a

compound house, the aggregate consumption rate far exceeds the life line. The

poor consumers actually pay more than the well-to-do who lived in their own

houses.

Fig. 4.3 Types of Domestic residence

44
 Source: Field Survey, 2010

The researcher tried to establish how long respondents had been doing business with ECG. The

reason being that one is always in a better position to assess the performance of service provider

if that individual had had the opportunity of a longer relationship. In this regard therefore,

respondents were asked how long they had been doing business with ECG. The responses

indicated in Fig. 4.4 were that majority of the respondents (77.7%) had been doing business with

ECG for the past 5years and above. The remaining 23.3% had however been doing business only

between the past 1 – 4 years. Respondents were therefore in a very good position to assess the

performance of ECG.

Fig. 4.4 Length of time as customer

45
 Source: Field Survey, 2010

4.3 Customer Relations Policy of ECG

The ECG in the district does not have any concrete well spelt out customer relations policy,

except for their mission statement that stated ‘to achieve a step change in quality service to our

customers. Apart from this mission statement, they also had the value statement. In the statement

they envisage to be passionate about their customers, they wanted the best, value each other and

they could be trusted. All these were summed up in their vision statement ‘achieve customer

delight’.

4.4 Service Delivery of ECG

The main service that the ECG delivers as a public utility service company is the distribution of

electricity across the country. This is a service solely undertaken by ECG. The company

therefore enjoys absolute monopoly in its area of operation. Consumers were to a large extent

stuck with this company. The lack of competition in the supply of electricity had resulted in

complacency, inertia and operational inefficiencies on the part of ECG which are paid for by the

consumer. When respondents were asked about the specific problems encountered by them,

46
mention were made of unannounced outages, power fluctuations and over billing (high tariffs)

(Fig 4.5). When respondents were asked if they enjoyed uninterrupted electricity supply, all

respondents answered in the negative. They contended that about 99% of the outages

experienced were unannounced. According to the respondents officials of the company lacked

the decency to even apologize or engage customers when these intermittent unannounced

outages took place. The effects of these unannounced outages and power fluctuations had had on

them included damage to electrical and electronic appliances, decrease in lifespan of bulbs and

total inconvenience. For commercial users, respondents complained about decrease in income as

a result of low productivity, damage to expensive equipment and sometimes fire outbreaks.

According to all respondents interviewed, they had always been at the losing end. The company

had publicly offered explanations for such operational inefficiencies, paid compensations or even

apologize for the inconvenience caused.

Fig. 4.5 Problems Associated with Service Delivery

Source: Field Survey, 2010

Another problem shown in Fig. 4.5 was the issue of tariffs. As indicated in Fig. 4.6, majority of

the respondents (56.7%) paid Gh.¢20.00 and above every month as cost of electricity.

47
Fig. 4.6 Cost of Electricity per Month

Source: Field Survey, 2010

According to the respondents the charges by ECG were very high considering the unsatisfactory

service being rendered to them. However, 65% of the respondents said they could still afford the

high bills because they did not have any other option. The remaining 35% however said they

most at times found it difficult to settle bills (Fig. 4.7)

48
Fig. 4.7 Respondents’ Ability to Settle Bills

Source: Field Survey, 2010

When respondents were asked if there had ever been a time that their electricity supply had been

disconnected because they could not settle their bill, 40% of them answered in the affirmative

(Table 4.5) This situation according to them occurred at times when very questionable bills had

been issued.

Table 4.5 Disconnection of Power for Non-payment of bills

Cumulative
Frequency Percent Percent

Yes 48 40.0 40.0

No 72 60.0 100.0

Total 120 100.0

Source: Field Survey, 2010

About 60% of the respondents who used the pre-paid meters complained that even though tariffs

had not been increased officially, they were paying more for the same number of units than they

did a couple of years ago. They felt that their tariffs should only go up when new electrical

gadgets were added and consumption had gone up. However, their complaints were that with the

49
same number of electrical gadget, the same pattern of electricity use, the amount of credits that

was supposed to last a month got finished in two weeks.

A secure and comfortable customer is one who says that he or she is very satisfied with the service,

definitely will continue to use the service in the future and definitely would recommend the service

to others. A vulnerable customer is one who says he or she is somewhat satisfied or dissatisfied,

might or might not use the service in the future or might not recommend the service to others.

On the basis of these assumptions, respondents were asked if they would recommend ECG to a friend

if there were other electric power service providers. In response, only 28.3% said they would. The

majority of the respondents, representing 71.7% however said they would not recommend ECG to

friend if there were other service providers (Fig. 4.8)

Fig. 4.8 Likelihood of Recommending ECG

Source: Field Survey, 2010

Furthermore, results for the question of how likely respondents were going to repurchase services

from ECG if there were other service providers were also significant. As indicated in Fig. 4.9, 45%

of the respondents mentioned that their chances of repurchasing from ECG were poor. As many as

50
15% also were indifferent. This is an indication that if there were other service providers in the

district as many as over 60% of ECG’s present customers in the district would switch to ECG’s

competitor.

Fig. 4.9 Likelihood of Repurchase from ECG

Source: Field Survey, 2010

4.5 Needs of the ECG Consumer

In the minds of ECG consumers, their needs and expectations from ECG were listed by

respondents as follows:

i. Provision of 24hr electric energy supply

ii. Affordable prices, reasonable billing

iii. Provision of better after sales service

iv. Better handling of complaints

v. Better communication and inter-personal relationship

51
 vi. Avoidance of bureaucracy in service provision

4.6 Determinants of Satisfaction

In assessing the levels of satisfaction by consumers of the services or products of a company,

five major factors are normally used. In this study therefore these factors have been used as the

determinants of satisfaction. They are customer service, price of the services rendered,

complaints handling, location of offices, and service delivery quality. Customers were asked

about their levels satisfaction based on these five factors as they are collectively linked to the

extent to which customers would be satisfied with the services they receive from service

providers.

4.7 Customer Service

Business success is dependent on a variety of factors – a realistic business idea, a well thought-

out business plan, an appropriate marketing strategy and more importantly, great customer

service are amongst the top ones. While customer service is a part of marketing, it can be

segregated as a separate field on its own. King (2007) defines the term customer service as

including all aspects of interaction with a customer and speaking to the organization’s image in

the mind of a customer. Because of the nature of the services rendered by ECG, there is regular

interaction of customers with the company, at least once every month. Customers visit either the

district office or paypoints to purchase credits or pay their monthly bills. Other services included

fixing of meters, repair or replacements, fixing of broken lines etc. The research therefore sought

to assess the levels of performance of ECG in their customer service care. The result as

presented in Fig. 4.10, indicate that performance in this area is nowhere near excellent or very

good. A majority of 38.3% rated ECG as just fair, and 33.3% also rated ECG as good. A

52
considerable section who constituted 18.3% rated ECG service delivery quality as poor. The

reasons adduced by customers for this rating were that customers normally waited a long time

for new services to be rendered, especially in the supply of meters for new customers to be

connected. According to the survey, of 65% of respondents who are consumers said, they had to

part with money to induce speedy processing of documents, otherwise they would have to wait

for a long time to get to their turn. The major excuse according to respondents is unavailability of

metres.

Fig. 4.10 Rating of Customer service by Respondents

Source: Field Survey, 2010

4.8 Price of Service

Price of a product or service is another important factor that determines how customers will or

will not be satisfied with the product or service if it is compared to the quality of that service.

According to Parasuraman, et al (1991), customers will not complain if they paid higher prices for

53
high quality service. According to the respondents, the price of the services of ECG in itself was

not important. Their contention was that when it was compared with the quality of the services

that they received, they were paying too much. In many cases in the country, concerns of

customers about the quality of services had been a constraint factor in how tariffs are increased

by ECG. In assessing the price levels by respondents, the general response was that the cost of

electricity was high considering the very poor services rendered by the company. According to

60.8% of the respondents the price levels of the services of ECG was rated poor, with 26.2%

rating it as fair (Table 4.11).

Fig. 4.11 Price of service

Source: Field Survey, 2010

4.9 Complaint Handling

Since services exist in real time, they are consumed at the very moment when they are made

available to customers. They cannot be stored and checked for their quality like a physical product.

Hence, every service production failure is likely to be experienced by a customer. Consequently,

54
"dissatisfaction with a service might occupy most of the time over which service is consumed" (East,

1997). However, customers might not instantly switch their service providers after experiencing a

problem during the service production. This is mainly because of the fact that the perceived costs of

switching are relatively high, and also the fact that there is no alternative service provider in the

electricity section of the energy sector. Customers, however, might display a passive response to a

problem, which can be in the form of making a formal complaint. Customer satisfaction in such cases

can depend upon the efficient and effective response of the service provider (Levesque and

McDougall, 1996). In the study area however, customers had not presented formal complaints of

poor services to management. They however contended that customers across the country on daily

basis complained about the poor services of ECG. They added that the Public Utility Regulatory

Commission (PURC) had organized forums at which complaints had been made, yet services were

not improved. There was a general feeling of resignation and indifference by respondents on this

issue. Most customers expressed the view that they were fed up with the excuse of obsolete

equipment made by management of ECG for failing to offer improved services despite the huge

tariffs. Respondents were asked to assess the performance of ECG on this issue. The result, indicated

in Fig. 4.12, shows that as many as 45% of the respondents were of the view that the handling of

customer complaints by ECG has been generally poor.

Table 4.12 Customers Assessment of ECG’s Complaint Handling

55
 Source: Field Survey, 2010

4.10 Location

The location of the offices of a company or organization contributes to the levels of satisfaction

of the services rendered to customers. A convenient location means customers can easily do

business with their service providers on a regular basis (Levesque and McDougall, 1996).

Accessibility is also a related factor which, while acting together with convenience, enables

customers to deal with their service providers more easily (Levesque and McDougall, 1996). The

more a location is convenient and accessible, the higher the perceived customer satisfaction level.

On the assessment by respondents of this determinant, responses were very favourable towards ECG.

As shown in Fig. 4.13, majority of the respondents said they had easy access to the office of ECG.

According to the respondents apart from the main office which was easily accessible, there were

paypoints located in every community where customers paid their monthly bills.

56
Fig. 4.13 Assessment of ECG’s Location

Source: Field Survey, 2010

4.11 Service Quality and delivery

In the service industry, strong emphasis is placed on the importance of service quality perceptions

and the relationship between customer satisfaction and service quality. Researchers like

Parasuraman, Levesque and McDougall (1996) argued that customers, while evaluating the quality of

a service, compare the service they expect with perceptions of the services they actually receive.

Customers not only judge the accuracy and dependability (i.e. reliability) of the delivered service but

they also judge the other dimensions such responsiveness, assurance and empathy, as the service is

being delivered. Customer satisfaction can thus be based not only on the judgment of customers

towards the reliability of the delivered service but also on customers' experiences with the service

delivery process. On this basis therefore, respondents were asked to assess the service quality and

the delivery process of ECG’s services. The respondents were unanimous in their responses.

Majority of the respondents who constituted 68% of the total sample size indicated that the

performance of ECG in the area of service quality and delivery was poor. Respondents were

57
incensed about the fact that ECG does not empathize or even apologize for the poor services they

render them.

Fig. 4.14 Customers’ Assessment of Service Quality and Delivery

Source: Field Survey, 2010

4.12 Factor Rating of Determinants

In determining the most important satisfier, respondents were asked to identify among the five

determinants which of them was the most important or their preferred factor that satisfies or will

satisfy them most. From Fig. 4.15, the most preferred factor, or the most important determinant

of customer satisfaction was service quality and delivery. The next preferred factor was

customer service, followed by location and price. The least preferred according to the

respondents was complaint handling. The reason given for the choice were that better services in

the form of reliable and constant electricity supply supersede every other thing and that they

58
would not mind paying more for such service. They believed that if services were better and the

company offers better customer services, there would be very little or nothing to complain about.

Fig. 4.15 The Most Preferred Factor/Determinant

Source: Field Survey, 2010

4.13 Level of Overall Satisfaction with ECG Services

Based upon all the considered issues, the researcher wanted to know consumers’ overall

satisfaction with the services provided by ECG considering all the discussed points regardless.

Respondents were asked to assess on the scale of 1 – 5, with 1 being extremely satisfied, 2 being

satisfied, 3, indifferent, 4 dissatisfied and 5 being extremely dissatisfied. The graph (Fig. 4.16)

indicates that as many as 60% of the consumer respondents are dissatisfied with service delivery

quality of ECG while only 8% were satisfied with the company’s service delivery quality.

59
Fig. 4.16 Level of Overall Satisfaction with ECG

Source: Field Survey, 2010

However, the counter argument put across by officials of ECG about inefficiency and lack of

customer satisfaction was that Ghana’s population growth, urbanization and economic growth

have surpassed operational growth of ECG. According to officials of ECG, the current capacity

of ECG is such that it can ensure customer satisfaction of a:

a. Given population (x)

b. Given urban development (y)

c. Given economic growth (z)

Based on x,y,z, ECG is efficient, ECG ensures customer satisfaction, ECG cannot be blamed.

ECG’s alleged inefficiency is a perception because it is over-whelmed by the current population

and the growing economy. In other words population and economic growth of the country have

outclassed operational capability and ability of ECG. In that context ECG is not inefficient. In

60
the same context, lack of customer care and satisfaction are over-emphasized statements.

Officials also contended if quality services to be provided, economic prices should be paid for

services rendered. However, the economic situation and poverty levels pertaining in the country

makes it almost impossible for economic prices to be paid.

61
 CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS

5.0 Introduction
This chapter is the final chapter of the study and it presents the summary of the research findings,

conclusion and also suggest recommendations to the problems based on the results of the

analysis of the data in the previous chapter.

Summary of Research Findings

After analysis of the data collected, the following are the summary of research findings.

i. Majority of the customers of ECG in the Kwabre East District used electricity for

domestic purposes. Electricity was used mainly for lighting, refrigeration, ironing,

television, radio and air conditioning. However, those who used it for commercial

purposes were those in the retail business and small-scale enterprises.

ii. Majority of the domestic power users were those living in compound houses. Despite the

availability of the life-line tariff regime those who cannot afford flats and ‘self-contained’

houses, paid higher tariffs.

iii. It was also found that ECG does not have a clear cut customer service policy in place.

iv. The major problems confronting consumers in the district are unannounced outages, over

billings, power fluctuations and wrongful disconnections. It was also found that despite

these major problems Kwabre South ECG does not management never empathized with

62
 their consumers or even apologized for the many inconveniences, destructions to

equipment and appliances and sometimes fire outbreaks caused to them.

v. It was revealed that a section of the customers, who sometimes could nor settle bills were

disconnected despite pleas, even though there could be over-billing.

vi. Majority of the customers would not recommend ECG to a friend if there were other

service providers.

vii. Many of the customers would not repurchase or do business with ECG should there be an

alternative power service provider. They would immediately switch to ECG’s competitor

if there should be one.

viii. Customers assessed ECG’s customer service as fair; price of service was rated as poor. In

terms of compliant handling, people in the district rated ECG’s performance as poor. The

ECG’s performance in the area of location of their offices was however rated as good

since there was accessibility and convenience in doing business with ECG. ECG’s

performance in service quality and delivery was rated as poor.

ix. Among all the factors that determine satisfaction, customers rated service quality and

delivery as the most important satisfier followed by customer service, price, location and

complaint handling in that order.

x. In terms of overall level of satisfaction customers were dissatisfied with the performance

of ECG.

Conclusion

63
Business success is dependent on a variety of factors – a realistic business idea, a well thought-

out business plan, an appropriate marketing strategy and more importantly, great customer

service are amongst the top ones. While customer service is a part of marketing, it can be

segregated as a separate field on its own. King (2007) defines the term customer service as

including all aspects of interaction with a customer and speaking to the organization’s image in

the mind of a customer.

Public service delivery in Ghana has been bedeviled with a lot of problems. The government

had instituted the public sector reforms, which was in part to see to the effective management

and delivery of public service utilities. In spite of the much talked about public sector reforms,

including the issuing of service charters by public sector agencies, the quality of public service

delivery remains unsatisfactory, being very bureaucratic and cumbersome and open to petty

corruption. Many private entities and service providers have succeeded because of the failure of

the public sector. The grave dissatisfaction with the many public utility services is compounded

by the fact that they are operating in an environment of monopoly, especially in the area of

electricity generation and transmission. The Electricity Company of Ghana (ECG) is the only

distributor of electricity for both domestic and industrial use in the country. The complacency

associated with monopoly has over the years made the ECG very inefficient and sluggish in its

management operations coupled with poorly maintained distribution system. However,

consumers are unable to seek any option or alternative but to cope with the existing service

provided by the country’s only electric power provider.

64
Customer satisfaction is an ambiguous and abstract concept and the actual manifestation of the

state of satisfaction will vary from person to person and product/service to product/service. The

state of satisfaction depends on a number of both psychological and physical variables rate. The

level of satisfaction can also vary depending on other options the customer may have and other

products against which the customer can compare the organization’s products.

It seems self evident that companies should try to satisfy their customers. Satisfied customers

usually return and buy more, they tell other people about their experiences, and they may well

pay a premium for the privilege of doing business with a supplier they trust. Statistics are

bandied around that suggest that the cost of keeping a customer is only one tenth of winning a

new one. Therefore, when we win a customer, we should hang on to them.

A secure and comfortable customer is one who says that he or she is very satisfied with the

service, definitely will continue to use the service in the future and definitely would recommend

the service to others. A vulnerable customer is one who says he or she is somewhat satisfied or

dissatisfied, might or might not use the service in the future or might not recommend the service

to others. On the basis of the research findings therefore one could conclude that the customers

of public service organizations are not satisfied with the services rendered as has been shown by

the research findings on the Electricity Company of Ghana using the ECG of the Kwabre East

district of the Ashanti region.

5.3 Recommendations

65
 i. ECG as a service company must develop well structured customer service and relations

policy and ensure that the every bit of it is adhered to by employees, especially their front

desk personnel.

ii. Considering the strategic importance of the energy sector in socio- economic

development of the country and with the attendant problems that have characterised it, it

appears that public- private partnership (PPP) in virtually all aspects of electric power

generation, transmission and distribution should be considered.

iii. In doing so, competition and appropriate regulatory framework which are prerequisites to

achieve better services delivery must be put in place. Competition should be promoted by

introducing functional segmentation by separating transmission companies; the

establishment of a number of competing privately owned generation companies from

existing ECG generation facilities and the opening of a number of distribution and

marketing companies.

iv. Provision of uninterrupted power supply should be seen as part and parcel of social

services provided by government to the masses with affordability as the watchword.

v. There should be an effective communication with the public on power cuts and outages to

enable consumers save equipment that can be lost through the intermittent interruptions.

66
vi. The government should provide adequate resources (financial and equipment) to the

public utility service providers, especially ECG to improve their performance

considerably. In that regard, the involvement of banks and other financial institutions in

pre-financing or co-financing utility and other development projects to ease the financial

burden on Government should also be considered.

vii. The Public Utilities Regulatory Commission (PURC) has to apply the necessary

sanctions and penalties if public utility providers do not adhere to the highest level of

service delivery quality to the public.

67
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 COLLEGE OF ART AND SOCIAL SCIENCES
KWAME NKRUMAH UNIVERSITY OF SCIENCE AND TECHNOLOGY
SCHOOL OF BUSINESS

QUESTIONNAIRE

This questionnaire seeks to collect data about the thesis topic, ‘Assessing Customer Satisfaction
in public service organizations; a case study of the Electricity Company of Ghana, Kwabre
district. The information provided will be used for academic purposes only, and shall be treated
with the strictest confidentiality.

1. Gender: ( 1). Male [ ] (2). Female [ ]

2. Age: (1) Under 20 years [ ] (2) 21- 30 years [ ] (3) 31- 50 years [ ] (4) 51
years and above [ ]

3. Level of Education: (1) None [ ] (2) Basic [ ] (3) Secondary [ ] (4) Tertiary [ ]

4. Marital status: (1) Married [ ] (2) Single (3) Separated [ ]

5. Occupation: (1) Farmer [ ] (2) Teacher [ ] (3) Trader [ ] (4) Unemployed [ ]

6. What type of customer are you? (1) Commercial [ ] (2) domestic [ ]

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7. If commercial, what type of activity are you engaged in?
…………………………………………

8. If domestic, what type of residence? (1) Compound house [ ] (2) Flat [ ] (3) Self-
contained [ ]

9. For how long have you been a customer? (1) 1 – 4 yrs [ ] (2) 5 – 10 yrs [ ] (3) 11
yrs and above [ ]

10. Do you enjoy uninterrupted power supply? (1) Yes [ ] (2) No [ ]

11. Are you given prior notice before power outages? (1) Yes (2) No [ ]

12. How much do you pay for power per month? (1) Gh.¢3 – 5 [ ] (2) Gh. ¢6 – 10 (3)
Gh. ¢11 – 140 (4) Gh. ¢150 – 20 (5) Gh. ¢21 – 24 (6) Gh. ¢25 and above.

13. Which type of metre do you use? (1) Pre-paid metre [ ] (2) Credit metre [ ]

14. Are you able to afford this amount every month? (1) Yes [ ] (2) No [ ]

15. Has there been any time that your power has been disconnected for non-payment of bills?
(1) Yes [ ] ( 2) No [ ]

16. If there were other electric power service providers, would you recommend ECG to a
friend or relative? (1) Yes [ ] (2) No [ ] (3) Not Sure [ ]

17. How likely are you to repurchase services from ECG if there were other competitor (s) ?
Would you say chances are?

1. Excellent [ ]
2. Very Good [ ]
3. Good [ ]
4. Fair [ ]
5. Poor [ ]
6. Indifferent [ ]
18. How would you rate the overall quality of your relationship with ECG, considering all of
your experiences with them?

1. Excellent [ ]

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 2. Very Good [ ]
3. Good [ ]
4. Fair [ ]
5. Poor [ ]
6. Indifferent [ ]

On a scale of 1 to 5 where; 1 – Extremely satisfied, 2 – Satisfied, 3 – Indifferent, 4 –

dissatisfied, 5 – Extremely dissatisfied. How would you rate your level of satisfaction with ECG
with regards to the following?

19. Customer Service

1 2 3 4 5

20. Prize of Service/product

1 2 3 4 5

21. Complaint Handling

1 2 3 4 5

22. Location
1 2 3 4 5

23. Service Delivery/Products

1 2 3 4 5

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24. Which of the factors mentioned above would you rate as the most important satisfier? (1)
Customer service [ ] (2) Prize of service/product [ ] (3) Complaint handling [ ] (4)
Location [ ] (5) Service delivery/product [ ]
25. How would you rate your level of overall satisfaction with ECG? (1) Excellent [ ] (2) Very
Good [ ] (3) Good [ ] (4) Fair [ ] (5) Poor [ ] (6) Indifferent [ ]

74