EFFECT OF THE ADOPTION OF EASY PAY BILL PAYMENT STRATEGIES ON CUSTOMER SATISFACTION IN KENYA POWER AND LIGHTING COMPANY:

CASE OF KITALE MUNICIPALITY

BY

ALEX KUYA AMBOKO SBE/MBA/75/08.

A Research Project, Submitted in Partial Fulfillment of the requirements for the degree of Master in Business Administration

SCHOOL OF BUSINESS AND ECONOMICS MOI UNIVERSITY

OCTOBER , 2009

DECLARATION Declaration by the candidate This project is my original work and has not been presented to any other institution. No part of this project may be reproduced without prior express permission of the author /or Moi University, School of Business and Economics.

__________________________ ALEX KUYA AMBOKO SBM/MBA/075/08

____________________ Date

Declaration by the supervisors This project is submitted for examination with our approval as University supervisors

________________________________ Mr. Thomas K. Cheruiyot Lecturer, School of Business and Economics Moi University

________________________ Date

___________________________ Mrs. Loice Maru Lecturer, School of Business and Economics Moi University

_______________________ Date

DEDICATION

This research is dedicated to God for His Mercies and Grace are sufficient for me, my wife Phyllis and son Evans, for and brothers and sister for their moral support. May God bless you abundantly? their love ,care and inspiration, my parents Evans and Grace for being my pillars of strength

ACKNOWLEDGEMENT I am grateful to my academic guardians Mr. T. K. Cheruiyot and Mrs. L. Maru for their tireless effort in ensuring that my work was successful. Their advice and guidance has been an integral tool in the completion of this work. I am also indebted to my parents and brothers for their moral support during my MBA studies. I am greatly indebted to my wife and child for loving, caring and enduring my long absence from home. Lastly I thank the Almighty God for His love, care and protection.

ABSTRACT
Kenya Power and Lighting Company in its endeavor to improve on their customer satisfaction levels and service delivery, developed a marketing strategy called the EasyPay bill payment in early 2000.The main aim was to increase customer convenience through the increasing of bill payment centers options available to the customer, with the help of modern information and communications technology (ICT) With the threat of competition increasingly becoming a reality, customer- oriented strategies that focus on customer satisfaction and thus retention are the focus of the companys competitive strategies. The purpose of this study was to carry out an assessment of the effect of Easy Pay customer oriented strategy on customer satisfaction. The specific objectives of the study were to evaluate the customers perception and effectiveness of the KPLC Easy Pay bill payment concept. The study also seeks to establish whether or not the EasyPay ICT strategies enhance customer satisfaction, and finally to determine the relationship between customer level of education and adaptation of the Easy Pay bill payment options . An exploratory survey research design was used in the study. The sample comprised of 150 customers in Kitale Municipality. Primary data was collected using questionnaires and personal interviews. Secondary data was sought from industry and professional publications. Data was analyzed using descriptive statistics and presented in frequency and percentage tables and graphs. The study also found out that the Kenya power and lighting company has not adequately and effectively marketed the Easy pay bill payment strategy, and that proper marketing and increased utilization of the same can indeed increase the customers satisfaction levels. The study recommends that the company should put more effort in sustained customer education campaigns and concentrate on a fewer well equipped and dedicated pay centres.

ACRONYMS KPLC ICT Kenya Power and Lighting Company Limited. Information Communication and Technology

DEFINATION OF TERMS CUSTOMER BILL SATISFACTION Any one who seek a particular service. Charge for a particular services/ item levied by the supplier. Meeting or exceeding individual wants or needs through provision of desired goods or services STRATEGY The pattern of major objectives, purposes or goals and essentials policy or plans for achieving, stated in away as to the define what business the company is in or is to be as kind of company it is or is to be.

TABLE OF CONTENTS Declaration.......ii Dedication.......iii Acknowledgement......iv Abstract....v Acronyms...vi Defination of terms...vii Table of contents.viii List of Tables ..xii List of Figures xiv CHAPTER ONE: Introduction........1 1.0 Overview....1 1.1 Background of the study....1 1.1.1. Drivers of Customer Satisfaction Strategy in KPLC.....3

1.1.1.1 Human Resources Strategy .. .......3 1.1.1.2. Information Communication Technology (ICT) Strategies4 1.1.1.3. Market Development Strategies. .5 1.1.1.4. Strategic Business Units. 6 1.1.1.5. Customer Satisfaction survey. 7 1.2 Statement of the Problem...8 1.3 Objectives of the Study.. ..11 1.3.1 General Objective.....11 1.3.2 Specific Objectives...11 1.3 Research Hypothesis..12 1.5. Significance of the study.12 1.7 Scope of the study....12 CHAPTER TWO: Literature Review..13 2.1 Introduction....13 2.2 Concepts of customer satisfaction...13 2.3 Main Benefits of Customer Satisfaction..14 2.3.1 Customer Satisfaction Statistics.....15

2.4. Customer Expectations of Service Quality Delivery......15 2.4.1. Customer Satisfaction Illusion and Trap16 2.4.2.Strategic Quality Management and Customer Satisfaction..17 2.4.3. Measuring Customer Satisfaction..18 2.4.4. SEVQUAL Model In Relation To Customer Satisfaction...19 2.4.5.Consumer Decision-Making Process...24 2.5.Understanding Customer Needs..28 2.5.1 Strategic Customer Satisfaction.28 2.5.2.The Relationship of Customers satisfaction to Strategic Decision......29 2.5.3. Customer satisfaction model....31 2.6.Strategic Management And Organizational Success...33 2.7.The Conception Framework....33 CHAPTER THREE: Research Methodology....35 3.1 Introduction..35 3.2 Research Design...35 3.3 Target Population.35 3.4 Sample size and Sampling Techniques....36 3.4.1 Sampling techniques.36 3.4.2 Sample size...36 3.4.3 Sampling Procedure36

3.5 Data Collection Instruments37 3.5.1 Questionnaire....37

3.6 Data collection procedure....38 3.7 Validity and reliability of research instruments...38 3.8 Data analysis and Presentation 39 3.9. Limitations of the Study..39 CHAPTER FOUR: Data Analysis, Presentation and Interpretation.....40 4.0 Introduction..40 4.1 Customer Category..40 4.2 Respondents occupation...41 4.3 Respondents Monthly income..42 4.4 Receiving of electricity bills regularly.42 4.5 Means of Getting Bills.....43 4.6 Evaluation of the KPLC response to enquiry..44 4.7 Awareness of KPLC bill payment options...45 4.8 Bill payment options utilized...46 4.9 Rating the KPLC bill payment initiatives in terms of efficiency levels..47 4.9.1 Barclays bank....47 4.9.2 Standard Chartered48 4.9.3 Efficiency of Mpesa payment center49 4.9.4 Efficiency of KPLC banking halls...49 4.10 Prefer paying bill at KPLC offices....50 4.11 Lack of trust in the current technology.51 4.12 Scanty information of the KPLC bill payment options....52 4.13 Opening of more offices by KPLC......53

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4.14 Increase of customer convince due to introduction of the payment options.....54 4.15 Customers have no excuse for non-payment....55 4.16 The electricity bill payment can accommodate all level of income...56 4.17 Areas that have KPLC offices nearby are served better than out flung areas..57 4.18 KPLC should fully roll out pre-paid meters.....57 CHAPTER FIVE: Summary of Findings, Conclusions and Recommendations.61 5.0 Introduction..61 5.1 Summary of Findings...61 5.2 Conclusions......63 5.3 Recommendations....65 5.4 Recommendation for further research.65 REFERENCES..67 APPENDICES...70 LIST OF FIGURES Fig 1.1: Overall satisfaction with KPLC customer service Commercial .7 Figure 1.2: Overall satisfaction with KPLC customer service Domestic users8 Figure 2.1. SERVQAL Model...23 Figure 2.2: Consumer decision making process...24 Figure 2.3: Kanos customer satisfaction model..32 Figure 2.4: strategies Conceptual framework of the effect of Easy Pay bill payment on Customer

Satisfaction....34 Figure 4.1: Prefer paying bill at KPLC offices .51 11

Figure 4.2: KPLC should open more offices.54

LIST OF TABLES Table 3.1 Customer sample size....36 Table 4.1 Customer category.40 .Table 4.2 Respondents occupation...41 Table 4.3 Monthly Incomes...42 Table 4.4 Receiving of electricity bills regularly...43 Table 4.5 Means of getting bills....44 Table 4.6 Evaluation of the KPLC response to enquiry45

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Table 4.7 Aware of KPLC bill payment....46 Table 4.8 Bill payment options utilized.....47 Table 4.9 Barclays bank.....48 Table 4.10 Standard Chartered..48 Table 4.11 Efficiency of Mpesa payment center...49 Table 4.12 Efficiency of KPLC banking halls..50 Table 4.13: Lack of trust in the current technology..52 Table 4.14 Have scanty information of the KPLC bill payment options...53 Table 4.15: Increase of customer convince due to introduction of the payment options....55 Table 4.16: Customers have no excuse for non-payment.....55 Table 4.17: The electricity bill payment can accommodate all level of income earners56 Table 4.18: Areas that have KPLC offices nearby are served better than out flung areas...57 Table 4.19: KPLC should fully roll out pre-paid meters...58 Table 4.20: Chi-square tests customers perception and Easy Pay bill payment concept...60 Table 4.21: Chi-Square of personal characteristics and adaptation of the Easy pay bill payment61

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CHAPTER ONE INTRODUCTION 1.0 OVERVIEW This chapter provides a basis for the study, in that it covers the background of the study, statement of the problem, purpose of the study, the research objectives and questions, significance of the study as well as the scope and limitations of the study

1.2 Background of the study

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Customer satisfaction is 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, Carl D. McDaniel (2005). The achievement of customer satisfaction leads to company loyalty and product repurchase. There are some important implications of this definition, because customer satisfaction is a subjective, non quantitative state, measurement won't be exact and will require sampling and statistical analysis. Customer satisfaction measurement must also be undertaken with an understanding of the gap between customer expectations and attribute performance perceptions, and there should be some connection between customer satisfaction measurement and bottom-line results.

"Satisfaction" itself can refer to a number of different facts of the relationship with a customer. For example, it can refer to: Satisfaction with the quality of a particular product or service, Satisfaction with an ongoing business relationship, Satisfaction with the priceperformance ratio of a product/service or Satisfaction because a product/service met or exceeded the customer's expectations

Each industry could add to this list according to the nature of the business and the specific relationship with the customer. Customer satisfaction measurement variables will differ depending on what type of satisfaction is being researched. For example, manufacturers typically desire on-time delivery and adherence to specifications, so measures of satisfaction taken by suppliers should include these critical variables.

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The Kenya Power and Lighting Company (KPLC) is responsible for the transmission, distribution and marketing of electricity throughout Kenya. Over the last three years the company has developed and implemented prudent business strategies which have resulted in improved quality of supply, network expansion, increased customer base and reduction in system losses. In order to improve on the gains achieved so far, additional efforts must be made to increase value and customer service quality. One of the key strategies being implemented is customer satisfaction which will translate into market share growth, increased energy sales, thus increased revenue and profitability for the company.

Faced with energy increasing competitive environment, growing economy, threat of entry of direct competitors into the market, ever stretching targets set by the government and ministry of Energy, and a more enlightened customer who is increasingly demanding quality service, KPLC has no choice but to address the issue of customer satisfaction in order to appease the customer, improve profitability and create loyalty. It is with this in focus that KPLC introduced the EasyPay Bill payment strategy with a view of increasing customer convenience and reducing incidences of customers being disconnected from supply due to non- payment of electricity bill.

1.1.1. Drivers of Customer Satisfaction Strategy in KPLC

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KPLC has adopted a five pillar strategy which drives its customer satisfaction strategy. The company focuses on its Human resources, ICT, Adaptation of Market driven strategies, strategic business units and carrying out periodic customer satisfaction surveys. The combinations of these factors are projected to lead to increased customer satisfaction and loyalty thus ensuring a sustainable and profitable future for the organization.

1.1.1.1 Human Resources strategy KPLC recognizes the fact that Human Resources are the greatest assets to any organization. The company carries out regular employee satisfaction and overall business enhancement strategy. The company continues to invest in its human capital through comprehensive staff training and development programs. Through these programs, employees have been exposed to industry best practices, which have improved the skill base and enhanced productivity and quality of work. Performance contracts have been implemented and targets are reviewed regularly to align them to changing business trends and expectations.

1.1.1.2. Information Communication Technology (ICT) Strategies The companys investments in modern information technology systems and processes are firmly routed in the business strategy. ICT has enabled the company meet customer needs, plan on expansion strategies and to build value into services offend by the company. Programs like Integrated Customer Systems (ICS), Design Customer Systems (DCS), have been designed to enable quick and easy access to and follow up of customer job flow and to increase efficiency in delivery of customer oriented services.

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The ICT strategies have also enabled the company to outsource bill payment services to various agents like Postal Corporation of Kenya, Safaricom, Zain, Barclays Bank, Equity Bank etc., whose systems are interlinked with the KPLC systems and thus increase the customers convenience in Pay point options and decongest the KPLC banking halls. Improving customer service and enhancing revenue collection has been a major concern for the company. The following ICT initiatives, aimed at modernizing the credit metering technology used in the firms commercial cycle for billing, are being undertaken: Automated meter reading (AMR): 4000 large power customers consuming between 1000 and 7000 units are targeted. This technology will enable accurate readings of the meters automatically at set intervals, and detection of irregularities in consumption. Pre-paid meters: This concept of pay per usage is an exciting new concept that will enable consumers to better manage their bills. This strategy would involve customers being fitted with electronic meters that would provide electric energy according to the Units bought of Umeme Time scratch cards. EasyPay bill payment options: The companies ICT strategies have enabled the bills to be paid at different locations country wide. All Major Banks and some Mobile telephone companies have entered into agreement with the organization to give them partial access to the KPLC ICT system to enable the collection of payments of electricity bills, service line contributions, and Meter deposits. This service are developed in such a way that the servers of the individual banks and that of KPLC are linked at a specific time daily to allow for upload of , and transfer of payment data and relevant customer details, thus allowing the customers transactions to be reflected in the KPLC system and increasing the customers convenience.

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This strategy was developed to bring services closer to the customers and reduce the burden of having the customers traveling long distances to pay their bills at KPLC banking hall. The strategy has adapted a three prong approach, which involves the incorporation of Banks (KCB, Barclays, National Bank, Equity Bank, Cooperative Bank, Standard Chartered Bank, and Post Bank.), Mobile telephone companies (Safaricom Mpesa, Zain Zap.) and Postal corporation of Kenya (PCK) Posta Pay.

1.1.1.3. Market Development Strategies With an annual target of 200,000 customers connected to the national grid every year KPLC is forced to think on how to meet the customers at their very point of need in a timely and cost effective manner. The strategies initiated include: Stima loan: This involves the partnering of KPLC with financial institutions to extent credit facilities to prospective customer in meeting the connectivity charges. The credit facilities are designed in such a way that the customers are paid for connectivity charges by the bank, KPLC connects them with electric power and the customer enjoys electricity supply as he/she pays the loan to the bank and power bills to KPLC. Line Network Maximization: This strategy targets connection of potential customers in highly population density areas which are transverse by power lines. This seeks to ensure optional industrialization of the firms infrastructure and ensuring reduced system losses thus increasing supply quality to the customers.

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New Development zones (NDZs): The Company will identify and construct/ expand power lines and supply upcoming high density settlements in urban and peri-urban areas or new development zones. The investment would be at the companys costs and the company would recoup its investment as the customers are connected.

1.1.1.4. Strategic Business Units As a way of bringing services closer to the people KPLC has embarked on a branch enhancement strategy. This is where power and authority is devolved to the branch levels. Branches are being equipped and enhanced to attain self sufficiency and enable faster action towards improving the speed of delivery and quality of services.

1.1.1.5. Customer Satisfaction survey KPLC carries out regular customer satisfaction surveys to ensure that strategies developed are in conformity to the customers expectations and further enhance their convenience. According to the KPLC customer satisfaction survey (2008). KPLC scored an overall satisfaction means of 6.9 compared to 6.2 in2006. While this may be comparatively good the company aims at total satisfaction of at least 9.0 in the near future.

As indicated in Figure 1.1 the satisfaction level of the commercial customers were at 71.2% in 2004, then dropped to 62% in 2006, in the last survey of 2008 the commercial customers have exhibited a rise in satisfaction levels 68.4%. Fig 1.1; Overall satisfaction with KPLC customer service Commercial Customers

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10 9 8 7 6 5 4 3 2 1 0

6.84

6.2

7.12

2008

2006

2004

Source: KPLC customer satisfaction survey 2008. Figure 1.2. Indicates that the level of customer satisfaction for domestic customers have steadily been rising over the years, from 47.4% in 2004 to 69% in 2008. The survey carried out in 2008, sought to obtain an objective assessment of the customers; the level of satisfaction with KPLC, Perception of KPLC in terms of service quality and corporate image, Knowledge, attitudes and practices in relation to KPLC services, Awareness and usage of KPLC products, Needs, preferences and suggestions for improvements, Factors hindering connectivity for potential customers, Unmet needs, and Profiles and consumption patterns.

Figure 1.2: Overall satisfaction with KPLC customer service Domestic users

10 9 8 7 6 5 4 3 2 1 0

6.9

6.2 4.74

2008

2006

2004

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Source: KPLC customer satisfaction survey 2008 This study was carried out on the effect Easy pay bill payment strategy on customer satisfaction and it focused mainly on the KPLC customers within Kitale municipality. The study targeted both domestic and commercial customers and how the easy pay bill payment options affected their satisfaction levels.

1.2

Statement of the Problem

Organizations are increasingly interested in retaining existing customers while targeting non-customers; John and Joby (2003). Measuring customer satisfaction provides an

indication of how successful the organization is at providing products and/or services to the marketplace. 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 which correlate with satisfaction behaviors such as return and recommend 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. Because satisfaction is basically a psychological state, care should be taken in the effort of quantitative measurement, although a large quantity of research in this area has recently been developed.

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Berry et al (1993) defined ten 'Quality Values' which influence satisfaction behavior, further expanded by Berry in 2002 and known as the ten domains of satisfaction. These ten domains of satisfaction include: Quality, Value, Timeliness, Efficiency, Ease of Access, Environment, Inter-departmental Teamwork, Front line Service Behaviors, Commitment to the Customer and Innovation. These factors are emphasized for continuous improvement and organizational change measurement and are most often utilized to develop the architecture for satisfaction measurement as an integrated model. Parasuraman and Zeitham (1987) provide the basis for the measurement of customer satisfaction with a service by using the gap between the customer's expectation of performance and their perceived experience of performance. This provides the measurer with a satisfaction "gap" which is objective and quantitative in nature. Cronin and Taylor proposes the

"confirmation/disconfirmation" theory of combining the "gap" described by Parasuraman, Zeithaml and Berry as two different measures (perception and expectation of performance) into a single measurement of performance according to expectation. According to Garbrand (2002), customer satisfaction equals perception of performance divided by expectation of performance.

Kenya Power and Lighting Company enjoy a monopoly of transmission and distribution of electrical energy in Kenya. Currently, total connection of customers to the grid is only 15% of the potential population (Internal auditors report, May 2006). The gazettement of Kenya Transmission co. Ltd, a company whose mandate is to build, own and maintain transmission lines across the country, sets the stage for entry of competitive forces in the electrical; energy distribution sector.

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In todays competitive markets, companies are often differentiated less by the types of products or services they produce than by their customer satisfaction levels. Customer loyalty is a major contributor to sustained profit growth. KPLC has thus adopted and developed customer oriented strategies in the aim of increasing growth and profitability. The Easy bill payment strategy was developed to increase customer convenience and reduce conflict with customers due to disconnections of electricity for non payment. The strategy also enable the customer to get their bills on their mobile phones via 5551 SMS alerts.

Despite this effort by KPLC, the highest customer satisfaction level has been an average of 69%, profitability and customer confidence have had a marginal increase of 5%. This facts coupled by the danger of prospective competitive forces taking advantage of the satisfaction gap to gain entry in to the market begs the question of, whether current strategies are working. This study assessed the effects of customer oriented strategies on customer satisfaction.

1.3. 1.3.1

Objectives of the Study General Objective

The general objective of the study was to evaluate the effect of the Easy Pay bill payment option customer oriented strategy on the customer satisfaction in Kitale municipality.

1.3.2 Specific Objectives:

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i.

To evaluate the customers perception towards the KPLC Easy Pay bill payment concept.

ii. iii.

To assess the effectiveness of the KPLCs Easy Pay bill payment options. To establish the adoption level of the Easy Pay bill payment option among the customers

iv.

To determine the relationship between personal characteristics and adaptation of the Easy Pay bill payment options.

1.4.

Research Hypothesis

H01 There is no relationship between customers perception and Easy Pay bill payment concept H02 There is no significant relationship between personal characteristics and adaptation of the Easy pay bill payment. H03 There is no significant relationship between the Easy bill Payment customer oriented strategies and customer satisfaction.

1.5. Significance of the study This study provides data and information that is useful for proper planning and decision making at KPLC. The study will help KPLC management understand challenges facing target customers and their expectations. The results of this study will also be used to correct the shortcomings of current strategies, and help to further develop customer orientation in the organization. Prospective competitive forces in the energy sector may use the research data to evaluate the companys shortcomings and strengths and develop effective counter strategies. The 25

future researchers and academicians who may use it as a base for further research work. All other energy sector and service industry stakeholders in the private and public sector may utilize the findings to improve the quality of their businesses.

1.6. Scope of the study The study focused on the Kenya Power and lighting North Rift Sub-region, Kitale Municipality. The survey will basically examine the Easy Pay bill payment options strategy and its effect on customer satisfaction. The study was undertaken between June 2009 and October 2009, using a survey research design and a sample of 150 customers to be selected through simple random sampling. Questionnaires and interview schedule research tools are to be used.

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CHAPTER TWO LITERATURE REVIEW 2.1 Introduction This chapter reviews pertinent literature based on the research question and the conceptual framework. In presenting this literature it considers past studies done in this area. Strategies adapted role of the customer and employees in ensuring high levels of customer satisfaction.

2.2 Concepts of Customer Satisfaction Customer satisfaction refers to the extent to which customers are happy with the products and services provided by a business. Customer satisfaction levels can be measured using survey techniques and questionnaires. 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.

Studies carried out by companies like Argos and Cadburys 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 including: Products and services which are customer focused and thence provide high levels of value for money, Customer service giving

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personal attention to the needs of individual customers, and 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 that are designed for ease of use and good quality finish, environmentally friendly and customized to meet the needs of particular types.

2.3 Main Benefits of Customer Satisfaction A satisfied customer has very many benefits to any organization. Customers tend to stay with company longer due to a developed sense of security and loyalty. Customers also tend to deepen their relationship with the company. Hereby the customer relationship grows above loyalty and becomes more of a symbiotic partnership. Customers will also demonstrate less price sensitivity, due to the fact that the products and services provided exceed the customers expectations and thus raising the individual switching costs. Customers recommend company product or service to others. Word of mouth is the greatest advertising tool in the market. Satisfied customers tend to tell others of the benefits of the products and services received, thus marketing the organizations products and services.

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(Adapted from Gary Luck, The Ash ridge journal, Customer Satisfaction Strategy autumn 2006)

2.3.1. Customer Satisfaction Statistics Research has shown that it costs between five to six times more to attract a new customer than to keep an existing customer. Companies can also boost profits anywhere from 25% to 125% by retaining merely 5% more existing customer and also that happy customers will tell to others of their positive experience, whereas dissatisfied customers tell 9 to 12 how bad it was. It is also assumed that Only one out of 25 dissatisfied customers will express dissatisfaction and Two third of customers do no feel valued by those serving them. Luck, (2006)

2.4. Customer Expectations of Service Quality Delivery Customers usually have expectation of service they should be given. If the company is to successfully build on the relationship it has with the customers it need to understand the customers expectation in order to meet them or surpass them if at all possible. While individual customers have different expectations of the service the company should expect that it probably will not be able to meet absolutely all of them. There will however be many that are common to most customers and those that must be met if the company is to retain these people and enjoy repeat customer from them. Luck (2006). The customers will have expectations that relate to the company branches and offices they visit the staff that they deal with and organization as all customers needs and wants change over time and thus the

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organization seeking to satisfy these needs have to be dynamic and responsive to the customers expectations.

Schneider and Bowen (1995) assert that service organizations must met three key customer needs to deliver service excellence, Security, esteem and justice. They also identified an array of service quality factors that are important for customers including timeliness and convenience, personal attention, reliability and dependability, employee competence and professionalism, empathy, responsiveness, assurance, and availability and tangibles such as physical facilities and equipment and the appearance of personnel. Consumers demand more transparent equitable and consumer-oriented service thus producing a quality gap: a gulf in perceptions of quality and the impact of service on the end user. Pallinger (2001). Clearly defining and understanding customer satisfaction can help any company identify opportunities for product and service innovation and serve as the basis for performance appraisal and reward systems. It can also serve as the basis for a customer satisfaction surveying program that can ensure that quality improvement efforts are properly focused on issues that are most important to the customer. 2.4.1. Customer Satisfaction Illusion and Trap What is clear about customers satisfaction is that customers are most likely to appreciate the goods and services that they buy if they are made special studies carried out by companies like Argos and Cadburys have found very high levels of customers satisfaction. It is not surprising because these companies emphasize market research and marketing as

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tools to find out what customers want knowing what customers want then make it possible to tailor everything you do to pleasing the customers. It would be difficult to find company that does not claim to be customer oriented, customer focused or even customer driven enterprise. But looking closer at how the companies put their assertion into practice and then often you would discover an array of notions and assumption that range from superficial and incomplete to mis-guide. Wiersema (2008)

Some examples of customer satisfaction illusion include: Believing that by conducting market survey and focus group that you know all there is to know about your customer, believing that investing in awareness program for employees and putting customers pictures on the cover of your annual report is enough to achieve customer satisfaction, and believing that the job of the C E O is done by giving his or her direct phone number to some valued customers. All these approaches are well intention but all of them offer at best partial solutions to their customer satisfaction and all as a result fall short. Koterlnikov (2008).

2.4.2. Strategic Quality Management and Customer Satisfaction Total Quality Management (TQM) is a management style that encompasses all facts of

organizational internal and external processes. The TQM style ensures that the entire company is working towards the same goal always. Maintain best interest of their clients. TQM is a powerful management tool that guarantees customer satisfaction through the use of statically tools and employee empowerment. Commitment to employees and clients and paying close attention to both there needs is a recipe of success. Employees must

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understand the demands of customers and respond to enquiries in a timely manner also understanding the challenges faced by the employees in the working settling accord the organization the opportunities to integrate new technology in order to increase quality customer service. Koterlnikov ( 2008).

2.4.3. Measuring Customer Satisfaction Companies may feel that the services of products they are offering are exactly meeting the requirement of the customers they have got everything right regarding their dealings with customer. To execute a successful client satisfaction survey an organization has to develop one that is simple, convenient, and easy to respond to and that delivers into the types of information that will truly help enhance your performance (Luck, 2006).

There are many reasons why the actual level of customer satisfaction that may be below that, which the company is expecting, for example, There could be difference between the level of service that the provider things that the customer expect and actual this customer expect. The staff of the company may not be applying the standard as laid down by the provider. There could be reasons for this. It could be that they are unaware of the service standards that are supposed to be adhering to. It could be because of heavy workload or it could be because they are dealing with changed process etc, or as time goes by customers expectations of the service they should get will change and if the company does not regularly monitor and modify its service standards it will soon become out of date

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Customers satisfaction survey measures attributes like: How satisfied the customer felt after the service encounter, and which aspect of the service they feel are particularly important, Whether the service experience had left them with a more positive or more negative feeling towards the company and if the service the customer received would make them more likely to buy again from the provider or less likely, Which areas of the service could be improved and what the customer expectation of the service may be in future, and How the company can improve the service offers and what the priorities should be if there is more than one thing that need changing, Berry, Leonard L.; A. Parasuraman (1991).

2.4.4.. SEVQUAL Model in Relation To Customer Satisfaction The SERVQUAL method from Zeithaman, Parasuraman, and Berry (1988) is a technique that can be used to perform gap analysis of an organizations service quality performance against customer service quality. The model measures 10 aspects of service quality: Reliability, Responsiveness, Competence, Courtesy, Communication, Credibility, Security, Understanding or knowing the customer and Tangibles.

SERVQUAL is an empirically derived method that may be used by a services organization to improve service quality. The method involves the development of an understanding of the perceived service needs of target customers. These measured perceptions of service quality for the organization in question, are then compared against an organization that is "excellent". The resulting gap analysis may then be used as a driver for service quality improvement. SERVQUAL takes into account the perceptions of customers of the relative importance of service attributes. This allows an organization to prioritize and to use its

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resources to improve the most critical service attributes. The data are collected via surveys of a sample of customers. In these surveys, these customers respond to a series of questions based around a number of key service dimensions.

The method essentially involves conducting a sample survey of customers so that their perceived service needs are understood and for measuring their perceptions of service quality for the organization in question. Customers are asked to answer numerous questions within each dimension that determines: The relative importance of each attribute; a measurement of performance expectations that would relate to an "excellent" company, and measurement of performance for the company in question. This provides an assessment of the gap between desired and actual Performance, together with a ranking of the importance of service criteria. This allows an organization to focus its resources to maximize service quality whilst costs are controlled.

The method also provides detailed information about: Customer perceptions of service (a benchmark established by your own customers), Performance levels as perceived by Customer comments and suggestions, Impressions from employees with respect to customers expectations and satisfaction.

The SERQUAL service gaps are the difference between management perceptions of what customers expect and what customers really do expect, the difference between management perceptions and service quality specifications - the standards gap, the difference between service quality specifications and actual service delivery - are standards consistently met?,

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the difference between service delivery and what is communicated externally - are promises made consistently fulfilled?, and the difference between what customers expect of a service and what they actually receive. According to the model organizations have service gaps because they do not knowing what customers expect this may be due to a lack of a marketing orientation, inadequate upward communication (from contact staff to management) or too many levels of management. It may also be due to adapting the wrong service quality standards which may be caused by inadequate commitment to service quality, lack of perception of feasibility - it cannot be done, inadequate task standardisation or the absence of goal setting .

Developing and utilizing the wrong service quality standards may also cause service gaps which may be cause by inadequate commitment to service quality, lack of perception of feasibility - it cannot be done, inadequate task standardisation, or the absence of goal setting. Another reason for the service gaps may be service performance gap, which may be due to role ambiguity and role conflict - unsure of what your remit is and how it fits with others, poor employee or technology fit - the wrong person or system for the job, inappropriate supervisory control or lack of perceived control - too much or too little control, lack of teamwork. Finally Service gaps can also occur when promises made do not match actual delivery due to inadequate horizontal communication - between departments or services or a propensity to over promise.

This model is important in ensuring that all activities of an organisation are focused on the customer. For example in KPLC the SERQUAL Model can be used to ensure the EasyPay

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bill payment and other customer oriented strategies, are in accordance with the needs and wants of the customers and are indeed satisfying this particular needs. It captures the key components of a customer enlightment process and informational sources that guides what a customer expects from a service provider and compares with what the service provider thinks the customer wants and expects form them. Thus establishing the gaps or disconnect in the two.

Figure 2.1. SERVQAL Model SERVQAL / GAPS MODEL

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Word of Mouth Communications

Personal needs

Past Experience

Expected Service

GAP 5 Perceived Service CONSUMER PROVIDER Service Delivery (including pre and post contacts) GAP 1 GAP 3 Translation of perception into Service Quality Specs. GAP 5 External Communications to Customers

GAP 2

Management Perception of Consumer Expectations

Source: Zeithaman, Parasuraman, and Berry (1988)

2.4.5. Consumer Decision-Making Process

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According to Kottler (2003) each time a person buys a good or service, he or she goes through a decision making process. In some cases all six steps in figure 2.3 are utilized; in others, only a few of the steps are employed. For example, a consumer who has previously and satisfactorily bought luggage at a local store may not use the same extensive process as a person who has never bought luggage.

The decision process outlined Figure 2.3 assumes that the end result is the purchase of a good or service. However at any point in the process, a potential customer may decide not to buy; the process then stops. A good or service may be too expensive.

Figure 2.2: Consumer decision making process

Problem Information search Purchase

Evaluation of alternatives

Post-purchase behavior

Stimulus

awareness

Source: Kibera (1988:14)

Kibera (1996) describes a stimulus as a cue (social or commercial) or a drive (physical) meant to motivate or arouse a person to act. When one talks with friends, fellow employees and so on, a social cue received. The special attribute of social cue is that it comes from an interpersonal noncommercial source. A commercial cue is a message sponsored by a promoting company, retailer or some other seller. Advertising, sales pictures and organization displays are commercial stimuli. Such cues may not be regarded as highly as

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social ones by consumers because they are seller controlled. A third type of stimulus is a physical drive. It occurs when one or more of a persons physical senses are affected, Hunger, thirst, cold, heat, pain, or fear could cause a physical senses consumer may be exposed to any or all three stimuli for any good or service. If aroused a consumer may ignore the stimuli for any good or service. The need to conveniently pay electricity connection fees and related Bills is a stimulus that needs serious consideration. At problem awareness, the consumer is not only aroused by social, commercial and or physical stimuli, but also recognizes that the good or service under consideration may solve a problem of shortages or unfulfilled desire. It is sometimes hard to learn why a person is motivated enough to move from a stimulus to problem awareness. (Kottler, 2000).

Recognition of shortage occurs when a person discovers a good or service should be repurchased. Recognition of unfulfilled desire takes place when a person becomes aware of a good or service that has not been consumed before or an unutilized service. People are more reluctant to act on unfulfilled desires than on shortages. Equally customers may be delaying to pay their electricity bills due to the long distances involved in getting to the KPLC Banking halls or lack of sufficient information about the bill payment options. Whether a person becomes aware of a shortage or an unfulfilled desire, he or she will act only if it is a problem worth solving. Otherwise, the process will end. If a shortage or unfulfilled desire merits further thought, information is sought. An information search has two parts: Determining the alternatives that will solve the problem at hand (and where they can be bought), and Ascertaining the characteristics of each alternative. (Karim, 1978). Once the consumers search for information is completed, he or she must decide whether

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the current shortage or unfulfilled desires can be met by any of the alternatives. If one or more are satisfactory, the consumer moves to the next by any of the alternatives. If one or more are satisfactory, the consumer moves to the next step in the decision process. However, the consumer will discontinue the process if no satisfactory goods or services are found.

At the Evaluation state a person ranks the alternatives under consideration from most favorite to least favorite and selects one from the list. For KPLC customers may find the demand attributes lacking, thus the product may be unattractive, quality service not encouraging. Thus the development of alternative options in bill payment and service delivery so as to ensure excellence in service delivery. After the choice of the best alternative, the person is ready for the purchase act. This involves an exchange of money or a promise to pay for the ownership or use of a good or service. Important decisions are still made during this step. For KPLC this involves making the decision on whether to pay

your bill conveniently using Safaricom MPESA or Zain ZAP, or through Posta, KCB, Equity, Co-operative Bank, Barclays, National Bank or Standard Chartered bank. Criteria for selecting a store based retailer include such factors as store location, store layout, customer service, sales help, store image and prices, criteria for selecting a none store retailer include such factors as image customer service, prices, hours interactivity and convenience. Consume will shop with the firm that has the best combination of criteria as defined by that consumer (Cravens, 2003).

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The KPLC systems have been integrated and thus customers can be served from any branch countrywide. Thus the choice of Bill payment option is at the customers control and discretion. These include the price and method of payment. Price is the amount of money a person must pay to achieve the ownership or use of a good or service. Method of payment is the way the price may be paid (cash, short-term credit, long term credit).

Comparatively if the KPLC customers feel that the payment options offered by KPLC are inconveniencing or services rendered poor, they would be unwilling to consume more electricity and will be in frequent conflict with KPLC staff over disconnections due to nonpayment and unresolved customer queries. It may be difficult for the company to make customers buy a service if they are unsure of when it should be delivered. The Easy Pay bill payment options should be as available to the customers at points where the customers an conveniently access them After buying a good or a service, a consumer may engage in post purchase behavior. This falls into either the two categories: further purchase or reevaluation. In some situations, buying one item leads to further purchases and consumer decision making continues until the last purchase is made.

The person may also reevaluate the purchase of good or service. Does it perform as promised? Do its actual attributes match the expectations the consumer had of this purchase? Has the retailer done as expected? Satisfaction may lead to contentment, a repurchase when the good or service wears out and favorable conversations with friends interested in the same item. Dissatisfaction may lead to unhappiness, brand or store switching when the good or service wears out and unfavorable conversation with friends

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interested in the same product the situation may lead to cognitive dissonance, a doubt whether the right decision was made (Kottler, 2000) For electricity customers the consumers depending on their satisfaction with the services given may decide to consume more power by adding more electrical gadgets in their houses/ premises or cut back on consumption. KPLC utilizes communication strategies to convince their prospective

customers that, the service on offer is safe, superior and worthy the value and encourage the existing customers of their continued supply of safe, consistent and affordable energy.

2.5. Understanding Customer Needs The success of a brand is dictated by its acceptance by consumers and acceptance is dependent on whether or not the brand understands the consumer needs and fulfils them consistently. (Schifman et al 2004). Organizations should strive to understand their customers and devise means and products that serve to satisfy their needs and wants. Understanding consumers help brands to rejuvenate themselves, with a new variant or new version. An established brand has to constantly track its consumers so that it stays relevant and valuable in the consumers minds. An established brand will also have to figure out how to attract new consumers. What will make an impression and what will motivate trial

2.5.1

Strategic Customer Satisfaction

A strategic organization should endeavor to understand both the customer satisfaction (performance) and value (importance) dimension and position them in a grid to identify competitive advantage, threats or weakness and set action priorities for improvements aligned with corporate objectives .Zanakis (2009).By far the biggest mistake made oven by

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quality award-winning companies is neglecting to kink client satisfaction to client perceived value. For example at 8t kept reporting satisfaction levels at 90% or above yet it was loosing customers because they perceived receiving lower value. Companies confuse satisfaction can attitude with loyalty (behavior) which requires both high value and high satisfaction. Zanakis (2009).

Improving company perceived performance primarily in areas most valuable to its customers is of paramount important for its continuing growth in a competitive environment. Loyal customers spend more and are willing to pay higher price, refer new client, and are less costly to do business with. For typical business existing customers account for 65% of the revenue; it cost five times less to keep an existing customer happy than finding a new one. IBM estimated that 1% satisfaction gain leads to $500 million additional revenue in five years (Zanakis (2009).

2.5.2

The Relationship of Customers satisfaction to Strategic Decision

The continuous improvement in the quality of products and services offend to the market place and the improvement in the quality / cost relationship is not transitory. Their impact on price and demand elasticity is becoming more important on a world wide basis. Hammel and Prahalab (1994). Johnson and petty (1995) suggest that by spending three to five percent of operating costs on quality improvement, an organization as a potential of spending twenty to thirty percent of the operating costs.

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Quality conformance is not synonymous with the quality design well executed manufacturing process can produce items that are not also customer determines the definition and measurement of quality in dynamic environment that encompasses timely delivery, product/service quality , failure reaction by the producer and many other market related values that impact customer service.

Management may be in an enviable position of being able to choose between increasing supply of increasing price or some combination of both to regulate the market. This strategy seemed to be at work when Toyota introduced the Lexus automobile in the market. The initial model introduced was followed by several price increases over the following four years which resulted in almost a doubling of the base price of the automobile in approximately four years without a decrease in demand. The implication of this view is that at some point the customer are so pleased with their experience that they may be willing to pay substantially increased price to have access to the products or service. Competing products are effectively neutralized as promotional messages about that product go unheard and perhaps unheard by customers that are pleased beyond delight by features that are unnoticeable at conscious levels. (George 1996)

2.5.3. Customer satisfaction model Kanos (1964) customer satisfaction model distinguishes six categories which the first three actually influence customer satisfaction. Basic factors (Dissatisfier must have) the minimum requirements each will cause dissatisfaction if they are not fulfilled but do not cause customer satisfaction if they are

44

fulfilled (or are exceeded) the customer regards this prerequisites and takes this for granted. Basic factor establish a markets entry threshold Excitement factors (satisfier attractive) the factors that increase the customer satisfaction if delivered but does not cause dissatisfaction if they are not delivered. These factors surprise the customers and generate delight. Using these factors a company can really distinguish itself from the competitors in a positive way. Performance factors. The factor that cause satisfaction if the performance is high and they cause dissatisfaction if the performance is low. Here, they attribute performance - overall satisfaction is linear and symmetric. Typically these e factors are directly connected to customers explicit need and desires and a company should try to be competitive here. Kano, (1984)

The Kano model offers some insight into the product attributes which are perceived to be important to customers. Kano also produced a methodology for mapping consumer responses to questionnaires onto his model.

The additional three attributes which Kano mentions are: Indifferent attributes. The customer does not care about these features. Questionable attributes. It is unclear whether these attributes is expected by the customer, and Reverse attributes. The reverse of this product feature was expected by the customer.

Figure 2.3: Kanos customer satisfaction model.

Customer satisfaction Excitement factors

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Performance factors

Non fulfillment

state of fulfilment

Basic factors Customer dissatisfaction

Source: Kano et al (1984)

2.6 Strategic Management And Organizational Success Strategy is the determination and evaluation of alternatives available to an organization in achieving its objectives and mission and the selection of the alternatives to be pursued (Byars et al 2002). Many empirical studies have been conducted to measure the relationship of strategic management and the performances of organization. Several of these studies support a positive relationship between strategic management and good

46

performance. A primary benefit of strategic management is the result of the process itself as opposed to the outputs produced by the process. (Byars et al 2002). The strategic management process forces the manager to be more proactive and conscious of their environment.

2.7 The Conception Framework The main variables of the study are the customer oriented strategies that KPLC has adopted to increase customer satisfaction levels. The focus is on Easy Pay bill payment strategies. Customers crave for convenience, as such; the Easy Pay bill payment strategies and roll-out of convenient brands are believed to increase customer satisfaction and thus profitability.

Figure 2.4:

Conceptual framework of the effect of Easy Pay bill payment

strategies on Customer Satisfaction.

Extraneous variable
Personal characteristics (Age, Gender, Education level)

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Independent variables: Cause Source: Survey Data, 2009 Easy pay via Commercial Banks Easy Pay Mobile telecommunication industry Easy Pay PCK (Posta Pay)

Dependant variable:

Customer satisfaction level.

Effect

CHAPTER THREE RESEARCH METHODOLOGY

3.1 Introduction This chapter outlines and describes research design and methodology that the study adopted. The chapter mainly includes description of the research design and area, study population, sampling procedures, data collection instruments, validity and reliability of research instruments, data collection procedures and data analysis.

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3.2 Research Design Explanatory survey research design was used during the field study to establish the effect of Easy Pay bill payment strategies on customer satisfaction. This was preferred because it is efficient in collecting large amounts of information, rapid data collection and provides a stronger opportunity to understand the target population within a short time (Kothari, 2003). The design also provides description and explanation of the key variables of the target population. The survey method was chosen as it allowed collection of large amount of data. It is also economic and allows for standardized data hence easy analysis and comparison. The survey method gave the researcher more control over the research process.

3.3 Target Population Best and Khan (1998) define the target population as any group of individuals who have one or more characteristics in common that are of interest to the researcher. The study will target KPLC North rift Kitale Municipality. The targeted branch has a total population of 600 customers that will form the target population.

3.4 Sample size and Sampling Techniques 3.4.1 Sampling techniques According to Kothari (2003), 30% of a target population that is homogenous is adequate to use as a sample in a study. A small sample can serve the purpose, if the items of the universe are homogeneous.

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3.4.2 Sample size The selected sample consisted of 180 customers, this being 30% of the customers Table 3.1. Customer sample size

CATEGORY

OF POPULATION 600

SAMPLE SIZE 180

PERCENTAGE SAMPLE 30%

OF

CUSTOMER NORMAL CUSTOMERS Source: Survey Data, 2009

3.4.3

Sampling Procedure

Probability sampling (Purposive sampling) strategy was used to arrive at the sample. This is where the researcher decides who to include in the sample. Probability sampling is advantageous because the researcher selects typical and useful cases only and saves time and money. This ensured that the researcher selects a reasonable number of respondents, which provided adequate representation and captured variations of the target population.

The study applied stratified sampling technique to select customers sample. Stratified sampling involves identifying subgroups in the population and their proportions and select from each subgroup to form a sample. The method ensures equitable representation of the population. From the target population 30% of them will be considered as the sample. Table 3.1 above explains how the sample was arrived at.

This technique involves selecting every Kth case of the population to be included in the

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sample from a randomized list (Mugenda 2003). The researcher used a sample frame of registered customers from the KPLC customer database. After randomizing the list a sample interval was computed and was used to select the Kth case.

3.5 Data Collection Instruments In collecting data the researcher used questionnaires, interview schedule and an observation guide. 3.5.1 Questionnaire The researcher preferred to use questionnaires in carrying out the research because they have the ability to reach a large population. Kerlinger, (1978), argues that questionnaires are efficient as a research tools because the researcher is likely to obtain personal ideas from a respondent. All questionnaires had open and closed ended questions. The

researcher took precaution in constructing good questions. The questionnaire contained questions and statements aimed at obtaining information from customers about problems that they are encountering and their levels of satisfaction and awareness levels of branch enhancement programs.

The data was collected via self administered questionnaires from the sampled individual customers. The rationale for adopting the technique is the belief that the customers are literate and those not literate were assisted to fill in the questionnaires. Time and financial constraints may not allow for complete enumeration.

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3.6 Data collection procedure With the assistance of the research aide, the researcher personally administer the research instruments after a prior visit that assisted in refining timings of interviews and distribution of questionnaires. The pre -test visit would provide a rough picture of the expectations.

3.7 Validity and reliability of research instruments To ensure validity and reliability of the research instruments the researcher took the following measures (i) Randomization The customers were randomly selected. This guaranteed an adequately representative sample. (ii) Elimination of the extraneous variables The researcher ensured that the questionnaire and interviews were administered in absence of noise, interruptions and chose the right weather in the administration (iii) Use of experts Experts from Moi University and other institutions were extensively consulted and their opinion and suggestions incorporated in modification and polishing the research instruments.

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3.8 Data analysis and Presentation The data obtained from the questionnaires was coded, organized analyzed and presented using descriptive statistics including frequency tables, bar graphs and percentages. The methods ensured easy understanding of presented data and information 3.9. Limitations of the Study This study encountered the following limitations 1 Suspicion The respondents were reluctant and highly suspicious of the researchers purpose and most thought they were being investigated. It took the researcher a lot of time and persuasion to convince respondents, consequently the research process took longer than expected. 2. Costs

The costs involved in carrying out this study were very high and given the researchers limited funds. These costs are in terms o actual financial costs and time.

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CHAPTER FOUR DATA ANALYSIS, PRESENTATION AND INTERPRETATION 4.0 Introduction This chapter presents the findings of the study based on the responses to the items in the questionnaires. The study, which focused on the effect of the EasyPay bill payment strategies on customer satisfaction, had a sample of 180 customers of Kenya Power and Lighting Company. Out of the 180 questionnaires issued, the researcher received 150 questionnaires, which was a return rate of 90%. This was considered adequate for data analysis and relevant to the study. 4.1 Customer Category The study had to find out the category under which the Kenya Power and Lighting belonged to. Results showed that the majority of the respondents 73.3% were small

domestic customers while only 26.7% were small commercial customers. The results reveal that most of the sampled population (KPLC customers) used electricity for domestic purposes (110 of 150) as compared to commercial usage (40 of 150). Thus the need to enhance focus bill payment strategies that will fully capture the appropriate customer cadres.The results are shown in Table 4.0 below. Table 4.1 Customer category Category Small domestic customers Small commercial customers Total Survey data (2009) 4.2 Respondents Occupation. Frequency 110 40 150 Percent 73.3 26.7 100.0

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The study sought to establish the occupation of the respondents. Results of the study in table 4.1 below, shows that most of the customers 55.5% were employed 24.4% practiced farming and only 20.0% of the sampled populations were businessmen/women. This result implies that most of the customers of Kenya Power and Lighting are employed; this could be a reason why they can afford to install power and pay for it. It also shows that these customers have a way of earning a living and none of the respondents was rated as unemployed thus providing a direct relationship between electricity and economic empowerment. The Table 4.1 below shows the respondents dispersion in terms of their occupations.

Table 4.2Respondents Occupation Frequency 39 80 31 150 Percent 26.0 53.3 20.7 100.0

Farming Employment Business Total Survey data (2009)

4.3 Respondents Monthly Income Monthly income was also looked into it by the researcher as shown in the table 4.2. Results shows that the majority of the respondents 56.7% had a monthly income between 20,000-40,000, 34.7% had an income ranging from 5,000-10,000, 5.3% had a monthly income of less than 5,000 while only 3.3% of the got a monthly income ranging from 10,000-20,000. The results reveal that customers of the KPLC have a reasonable monthly income thus making them able to pay their electricity bills.

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Table 4.3 Monthly Incomes Frequency 8 52 5 85 150 Percent 5.3 34.7 3.3 56.7 100.0

Less than shs. 5000 Shs. 5000-10,000 Shs. 10,000-20,000 Shs. 20,000-40,000 Total Survey data (2009)

4.4 Consistency of Monthly Bills Receipt The study sought to find out if the sampled population received their bills regularly. Results are shown in the Table 4.3. The findings show that most of the customers of Kitale municipality 73.3% received their bills regularly, 17.3% did not receive their bills in time while 9.3% did not respond to the question. The results reveals that only few of the customers did not receive bills in time or regularly, this could be so due to the means of which they received their bills.

Table 4.4 Consistency of Monthly Bills Receipt Frequency 14 110 26 150 Percent 9.3 73.3 17.3 100.0

No response Yes No Total Survey data (2009)

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4.5 Means of Getting Bills The study found out that the majority 67.3% of the Kenya Power and Lighting Company customers received their bills through monthly bill statement, 13.3% got their by enquiring on the KPLC query counters, 4.7% through internet inquiry also 4.7% got through 5551 SMS (for those who are registered) and 10.0% of the population did not respond to it. It is seen from the results that the customers receive their bills through monthly bill statements through their respective addresses. The results are as shown on Table 4.5 below

Table 4.5 Means of getting bills Frequency No response 5551 SMS Internet inquiry KPLC query counters Monthly bill statement Total Survey data (2009) 15 7 7 20 101 150 Percent 10.0 4.7 4.7 13.3 67.3 100.0

4.6 Evaluation of the KPLC response to enquiry Study results shows on the efficiency of the KPLC on response on the enquiry shown in Table 4.5 show that 62.0% of the customer said that the response of KPLC on enquiry was 57

fair, 16.7% said that it was good, 7.3% were of the opinion that the response was very good while 4.7% of the respondents said that their response towards enquiry in KPLC in Kitale Municipality was fair.9.3% of the customers did not respond to the question while 4.7% of the customers felt that the companys response to their enquiries were poor. This shows that majority of the customers are satisfied with the response rate and manner that KPLC staff and related agents handled their enquiries towards various issues.

Table 4.6 Evaluation of the KPLC response to enquiry Frequency No response Very good Good Fair Poor Total Survey data (2009) 14 11 25 93 7 150 Percent 9.3 7.3 16.7 62.0 4.7 100.0

4.7 Awareness of KPLC bill payment options From the Table 4.6 below it is seen that the majority of the respondents 35.3% were aware of the KPLC banking halls as a bill payment centre, 16.7% were aware of Mpesa as a means of bill payment, 15.3% were aware of Barclays bank, 13.3% Equity bank, 10.7% knew about Standard Chartered bank while only 5.3% knew about Cooperative bank.

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Table 4.7 Awareness of KPLC bill payment options Frequency Standard chartered Barclays bank Equity Cooperative Mpesa KPLC banking halls Total Survey data (2009) 36 23 20 8 25 33 150 Percent 10.7 15.3 13.3 5.3 16.7 35.3 100.0

4.8 Bill payment options utilized Findings in table 4.7 below shows that the KPLC banking halls are the mostly utilized bill payment centres with 37.3% of the customers having utilized them, 25.3% of the respondents utilized Mpesa, 22.0% Barclays bank , 10.7% Standard chartered bank while only 4.7% of the customers felt that Equity bank as a bill payment option was also utilized. The results reveal that most of the sampled population KPLC banking Halls are the most utilized bill payment centres as compared to other payment modes.

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Table 4.8 Bill payment options utilized Frequency 16 33 7 38 56 150 Percent 10.7 22.0 4.7 25.3 37.3 100.0

Standard chartered Barclays bank Equity Mpesa KPLC banking halls Total Survey data (2009)

4.9 Rating the KPLC bill payment initiatives in terms of efficiency levels 4.9.1 Barclays bank On finding out the efficiency of Barclays bank, results shows that 56.7% of the respondents said that Barclays bank as a bill payment center was effective, 23.3% said that it was moderately effective, 16.7% said it was not effective while only 3.3% said that it was least effective. The result implies that customers who used Barclays bank center in paying their bills felt it was effective in bill payment. The Table 4.9 below shows findings on the efficiency of Barclays bank

Table 4.9 Barclays bank Frequency Percent

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Least effective Not effective Effective Moderately effective Total Survey data (2009)

5 25 85 35 150

3.3 16.7 56.7 23.3 100.0

4.9.2 Standard Chartered On finding out the efficiency of the Standard Chartered bank, the majority 54.7% of KPLC customers said that Standard Chartered bank payment center was effective in carrying out transactions, 23.3% moderately effective while only 22% said that the payment center was not effective. Result reveals that Standard Chartered bank as bill payment center was effective in their transactions

Table 4.10 Standard Chartered Frequency 33 82 35 150 Percent 22.0 54.7 23.3 100.0

not effective effective moderately effective Total Survey data (2009)

4.9.3 Efficiency of Mpesa payment center Mpesa as a payment center was also looked at to find out on its effectiveness in carrying out its effectiveness in carrying out its transactions of KPLC bill payment, results shows that the majority of the customers 58.7% said Mpesa was not effective, 20.0% effective 19.3% moderately effective while only 2.0% said that it was effective. Looking at the results, it is revealed that though Mpesa is used, customers find it to be ineffective in its

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transactions. This might be due to lack of understanding of technology thus customers do not even try to use it since it is new to the market. Table 4.11 Efficiency of Mpesa payment center Frequency 30 88 29 3 150 Percent 20.0 58.7 19.3 2.0 100.0

not effective effective moderately effective very effective Total Survey data (2009)

4.9.4 Efficiency of KPLC banking halls KPLC banking halls were as looked at on how they performed or carried out their transactions. From the findings below 67.3% of the respondents said that KPLC banking halls were effective in their operations, 16.0% said that they were moderately effective, while 16.7% said the KPLC banking halls were not effective, these results reveal that customers of KPLC find, KPLC banking halls to be effective in their transactions. Table 4.12 Efficiency of KPLC banking halls Frequency 25 101 24 150 Percent 16.7 67.3 16.0 100.0

Not effective Effective Moderately effective Total Survey data (2009)

4.10 Prefer paying bill at KPLC offices The researcher sought to find out if customers of Kenya Power and Lighting Company pay their bills at the KPLC offices, From the chart below it is shown that 43.3% of the

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customers of KPLC agreed that they preferred paying their bills at KPLC offices, 38.0% strongly agreed, 9.7 of the sampled population were undecided while 9.4% strongly disagreed. Putting strongly agreed and agreed together 81.3% of the total respondents are of the idea that they prefer paying their bills at KPLC offices. Results are shown in the pie chart below

Figure 4.1: Prefer paying bill at KPLC offices

Survey data (2009)

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4.11 Customers view on modern bill payment technology The table below shows finding on KPLC customers view of current bill payment technology. Findings shows that most of the respondents wee undecided on whether they lacked trust in the current technology or not, 18.7% strongly agreed that they did not have trust in the current technology while 20.7% said that they had trust in the technology (disagreed). Those findings implies that the majority of the respondents who were undecided either did not understand the technology on the market or they had not carried out any transactions with the current modes of technology on the market how.

Table 4.13: Lack of trust in the current technology Frequency Strongly agree Agree Undecided Disagree Total Survey data (2009) 28 39 52 31 150 Percent 18.7 26.0 34.7 20.7 100.0

4.12 Scanty information of the KPLC bill payment options Results shown below shows response on if customers had scanty information on the KPLC bill payment options

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Findings below shows that the majority of the customers 54.7% were undecided if they had scanty information on the bill payment bills, while 12.7% also agreed that they had scanty information on the options. The results here might imply that though 54.7% of the respondents were undecided putting strongly agree and agree together (45.3%) still is a strong percentage which might bring out argument that the customers who were undecided surely had scanty information on the pay bill payment options. Thus concluding that the customers need to be informed on the offer options of bill payment.

Table 4.14 Have scanty information of the KPLC bill payment options Frequency Strongly agree Agree Undecided Total Survey data (2009) 49 19 82 150 Percent 32.7 12.7 54.7 100.0

4.13 Opening of more offices by KPLC The KPLC customers were asked if it was good for the KPLC to open more offices to collect payments. The bar graph shown below shows the results. The results show that 30.0% strongly agreed that more offices to collect payments should be opened else where near customers to collect payments, 40.7% agreed, 19.3% of the sampled population were

65

undecided while only 4.7% disagreed. Those findings imply that the KPLC customers would the company to open more payment offices so as to ease payment and reduce congestion.

Figure 4.2: KPLC should open more offices

Survey data (2009)

4.14 Increase of customer convince due to introduction of the payment options

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Further it was important for the study to find out if customer convince had increased due to introduction to pay options. It is seen from the Table below that 46.7% of the respondents strongly agreed that there is customer, convince due to new introduction of payment options, 48.7% agreed while only 4.7% of the respondents were undecided. Putting strongly agree and agree together (95.4%) results implies tat there is satisfaction of customers that introduction of bill payment options have been convenient. Below is the table showing the results

Table 15: Increase of customer convince due to introduction of the payment options Frequency strongly agree agree undecided Total Survey data (2009) 70 73 7 150 Percent 46.7 48.7 4.7 100.0

4.15 Customers have no excuse for non-payment The researcher also had to find out if the KPLC customers had any excuse for nonpayment of bills. The findings below shows that 50.7% of the customers strongly agreed that customers had no excuse for non payment of electricity bills, 36.7% agreed that no excuse while only 10.7% of the respondents were undecided. The results reveals that

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customers were in agreement that due to introduction of payment options there was no excuse of one not paying electricity bills for the reason of congestion. Table 16: Customers have no excuse for non-payment Frequency No response Strongly agree Agree Undecided Total Survey data (2009) 4.16 The electricity bill payment can accommodate all level of income earners Table 16 below shows that 34.7% of the customers agreed that the program can accommodate all levels of income customers 24.7% strongly agreed, 24.0% were undecided while only 7.3% strongly disagreed. The small percent of strongly disagreed reveals that with the introduction of the payment programs all levels of income customers can be accommodation in the program. Results on the accommodation of all levels income earners are shown below: 3 76 55 16 150 Percent 2.0 50.7 36.7 10.7 100.0

Table 17: The electricity bill payment can accommodate all level of income earners Frequency No response Strongly agree Agree Undecided 14 37 52 36 Percent 9.3 24.7 34.7 24.0

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Strongly disagree Total Survey data (2009)

11 150

7.3 100.0

4.17 Areas that have KPLC offices nearby are served better than out flung areas On finding out if areas that had offices nearby were served that had offices nearby were served better than out flung areas customers strongly agreed 52.7% that it was true that areas that had KPLC offices nearby were served better 36.7% agreed and only 10.7% of the customers were undecided the results reveals that the nearer the offices the better the service the results still raises more questions about KPLC service Table 18: Areas that have KPLC offices nearby are served better than out flung areas Frequency 79 55 16 150 Percent 52.7 36.7 10.7 100.0

Strongly agree Agree Undecided Total Survey data (2009)

4.18 KPLC should fully roll out pre-paid meters As long as we can remember KPLC has been using pre-paid meters in billing; therefore the researcher had to find out if customers were comfortable if the prepaid meters were rolled out. Findings shows that the majority 48.7% strongly disagreed that prepaid meters should be rolled out, 14.7% were undecided while 18.0% disagreed findings reveals that still customers prefer the prepaid meters. This can be due to lack of knowledge on the other options.

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Table 19: KPLC should fully roll out pre-paid meters Frequency 14 27 73 22 14 150 Percent 9.3 18.0 48.7 14.7 9.3 100.0

No response Strongly agree Agree Undecided Strongly disagree Total Survey data (2009)

Testing of Hypothesis There is no relationship between customers perception and Easy Pay bill payment concept Hypothesis one was to test if there was any relationship between customers perception and Easy Pay bill payment concept. To achieve this a chi square Test statistic was used. Chisquare is a statistical technique used to compare the differences between categorical frequencies when data is categorical and drawn from a population with uniform distribution in which all alternative responses are equally likely as explained (Kombo 2003).

Chi square test in this study was used since the data collected was basically categorical of the description of views, perceptions and attitudes of the respondents towards the pay bill payment. It was the most suitable since it enables the researcher to establish whether there

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are any relationships in the data of the alternative responses. Significant level of 95% (0.05) was used below are the findings. The Pearson chi square statistic of 13.42, Degree of freedom of 1 and the significance level of 0.00 (p<0.05) [ c2(1, N = 150) = 0.00, p < .05] .reveals that the two variables are dependant on each other. Where customers perception is influenced by Easy Pay bill payment, showing that there is a significance between customers perception and Easy Pay bill payment concept, therefore we reject the null hypothesis that states that there is no relationship between customers perception and Easy Pay Bill payment and accept the alternate. The table below shows the results;

Table 20: Chi-square tests customers perception and Easy Pay bill payment concept Value df Asymp.sig(2 sided) Pearson chi-square Continuity Correction Linear by linear association N of Valid Cases 150 13.361 1 0.000 0.000 0.000 13.420 12.441 1 1 0.000 0.000 Exact sig Exact Sig (1 sided)

Significance between Personal Characteristics and Adaptation of the Easy Pay Bill Payment.

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Hypothesis two was to test if there was any significance between personal characteristics and adaptation of the Easy pay bill payment. Chi-square was used to achieve this, A chisquare test is used when you want to see if there is a relationship between two categorical variables.

A cross tabulation between level of education and Easy Pay bill payment was tested and it showed significance/relationship on calculating the chi square to find out the relationship between the level of education ( Personal characteristics) and Easy Pay bill a chi-square value of 11.203 at p< 0.05 with 2 degree freedom shows that there is a positive association which is significant, the significant level 0.001 this means that customers with high level of education are well conversant with the easy Pay bill, than those with low education. The table below shows the results.

Table 21: Chi-Square of personal characteristics and adaptation of the Easy pay bill payment dependent variable Level of education Value df Sig. 11.203 2 0.001 Value 22.043 Income df Sig. 2 0.005

(Easy bill payment ) Survey data (2009)

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CHAPTER FIVE SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS 5.0 INTRODUCTION This chapter presents the summary of the findings, the conclusions and recommendations to policy makers and potential researchers

5.1 Summary of Findings The study was set out to evaluate the effect of Easy pay bill payment option customer oriented strategy on the customer satisfaction in Kitale municipality. This was done by evaluating the customers perception towards the KPLC Easy Pay bill payment concept, assessing the effectiveness of the KPLCs Easy Pay Easy Pay bill payment options. Likewise, the study sought to establish the adoption level of the Easy Pay bill payment option among the customers and finally the study sought to determine the relationship between personal characteristics and adaptation of the Easy Pay bill payment options.

On evaluating the customers perception towards the KPLC Easy Pay bill payment concept. The findings revealed that majority of the sampled population received their bills regularly. This is evidenced 73.3% received their bills regularly. The researcher further went ahead to found out that the means of getting the bills majority 67.3% of the Kenya Power and Lighting Company customers received their bills through monthly bill statement and on the efficiency of the KPLC on response on the enquiry 62.0% of the customer said that the response of KPLC on enquiry was fair.

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On the effectiveness of the KPLCs Easy Pay bill payment options majority of the respondents 56.7% said that Barclays bank as a bill payment center was effective, 54.7% of KPLC customers said that Standard Chartered bank payment center was effective in carrying out transactions. Also, Mpesa was also looked at to find out on its effectiveness in carrying out its transactions of KPLC bill payment, results shows that the majority of the customers 58.7% said Mpesa was not effective. 67.3% of the respondents said that KPLC banking halls were effective in their operations. The researcher also sought to find out if customers of Kenya Power and Lighting Company pay their bills at the KPLC offices. Putting strongly agreed and agreed together 81.3% of the total respondents are of the idea that they prefer paying their bills at KPLC offices.

Findings reveal that KPLC customers have scanty information of the KPLC bill payment options 45.3% had scanty information on the pay bill payment options. Thus concluding that the customers need to be informed on the offer options of bill payment. On findings out from the respondents if it was good for the KPLC to open more offices to collect payments, 70.7% agreed that KPLC should open more offices. Those findings imply that the KPLC customers would the company to open more payment offices to ease payment and reduce congestion. Further, the study found out that customer convince had increased due to introduction to pay options. It is seen that 46.7% of the respondents strongly agreed that there is customer convince due to new introduction of payment options and 48.7% agreed. This implies that there is satisfaction of customers that introduction of bill payment options have been convenient.

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Also it was found that there was a significance between customers perception and Easy Pay bill payment concept, with a Pearson chi square statistic of 13.42, Degree of freedom of 1 and the significance level of 0.00 (p<0.05) [ c2(1, N = 150) = 0.00, p < .05] thus revealing that the two variables are dependant on each other. Where customers perception is influenced by Easy Pay bill payment.

On finding out if there was a relationship between personal characteristics and adaptation of Easy Pay bill payment options it was found out that there was between the level of education (Personal characteristics) and Easy Pay bill with a chi-square value of 11.203 at p< 0.05 with 2 degree freedom shows that there is a positive association which is significant, the significant level 0.001.

5.2 Conclusions The issues emanating from this research shows that customers received their bills regularly and the means of getting the bills of the Kenya Power and Lighting Company customers was through monthly bill statement.

On the efficiency of the KPLC the customer said that the response of KPLC on enquiry was fair. On the effectiveness of the KPLCs Easy Pay bill payment options respondents said that Barclays bank as a bill payment center was effective, customer also said that Standard Chartered bank payment center was effective in carrying out transactions.,

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Mpesa was also looked at on its effectiveness in carrying out its effectiveness in carrying out its transactions of KPLC bill payment it was also not effective. KPLC banking halls were effective in their operations.

The KPLC customers preferred paying their bills at KPLC offices. KPLC customers have scanty information of the KPLC bill payment options. Thus, concluding that the customers need to be informed on the offer options of bill payment. On findings out from the respondents if it was good for the KPLC to open more offices to collect payments it was established that KPLC should open more offices. Those findings imply that the KPLC customers would prefer that the company opens more payment offices to ease payment and reduce congestion.

The study further established that customer convenience had increased due to introduction to pay options. Thus the Easy pay bill payment options go along way towards saving the customers time and convenience thereby avoiding time wasted in queues. More should be done to increase the customers awareness levels through a sustained marketing campaign

It was also found that there was a significant relationship between customers perception and Easy Pay bill payment concept, Where customers perception of KPLC and its service offerings is influenced by Easy Pay bill payment options.

The study also found out that there was a relationship between personal characteristics and adaptation of Easy Pay bill payment options. it found that there was a relationship

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between the level of education, income and age ( Personal characteristics) and the adaption of the Easy Pay bill payment options.

The study also established a relationship between the Easy Pay bill payment options and customer satisfaction. This is mainly so because the customers convenience is increased significantly, time is saved and the customers can more efficiently and effectively manage their bill at their convenience.

5.3 Recommendations In order to bring out the customer satisfaction in using Easy pay Bill Payment option customer oriented strategy, it is of paramount importance for Understanding the expectations and requirements of all the customers, determining how well your company and its competitors are satisfying these expectations and requirements likewise developing service and/or product standards based on the above findings, examining trends over time in order to take action on a timely basis thus establishing priorities and standards to judge how well you've met these goals .

A more aggressive and sustained marketing campaign need to be undertaken so as to increase the customers awareness levels and understanding on the different bill payment options. This may entail a sustained visibility campaign. 5.4 Recommendation for further research The study focused on the effect of the Easy Pay bill payment options on customer satisfaction. A study of the magnitude cannot be exhaustive and more research can be done

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in areas covered in the study. The study can also be replicated in other areas of the country. The following suggestions for further research are made. 1. Factors affecting customers ability to pay their monthly bills. 2. The relationship between adaptation of the KPLC EasyPay bill payment options and the customers education levels. 3. Feasibility studies for the different bill payment options. 4. To investigate why customers are not fully adapting the various bill payment options.

REFERENCES Ansoff, H.I. (1965). Corporate strategy. London: McGraw-Hill publishers

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Berry, Leonard L.; A. Parasuraman (1991). Marketing Services: Competing Through Quality. New York: Free Press. Bluestein, Abram; Michael Moriarty; Ronald J Sanderson (2003). The Customer Satisfaction Audit. Axminster: Cambridge Strategy Publications. Byars, L.; Rue L.W. and Zahra S.A. .(1996). Strategy In Changing Environment. C. A. Barlett & S. Ghoshal (1995), Transnational Management: Text Cases & Readings in Cross Border Management, Boston, Massachusetts. Cravens, D.W. and Piercy, N.F. (2003). Strategic Marketing. London: McGraw Hill Companies. Education limited Gitman, Lawrence J.; Carl D. McDaniel (2005). The Future of Business: The Essentials. Mason, Ohio: South-Western. Gupta, S.P. (2002). Statistical Methods. New Delhi: Sultan Chand and Sons publishers Irwin book Team. John A. Pearce & Richard B. Robinson Jr., Strategic Management: Strategy Formulation and Implementation. (1999) A.I.T.B.S. Publishers & Distributors, Ne Delhi, India. John, Joby (2003). Fundamentals of Customer-Focused Management: Competing Through Service. Westport, Conn.: Praeger. Johnson, Michael D.; Anders Gustafson, Tor Wallin Andreassenc, Line Lervikc and Jaesung Cha (2001). "The evolution and future of national customer satisfaction index models". Journal of Economic Psychology 22 (2): 217-245. Joppe, M. (2000). The Research Process. Retrieved February 25, 1998, from http://www.ryerson.ca/~mjoppe/rp.htm

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Kenya Power & Lighting Company. (May, 2006). Audit report no. 6/2005- 6, on Customer creation. Nairobi: KPLC publication Kenya Power & Lighting Company. Customer connection policy (Revised June 2004). Nairobi: KPLC publication. Kerlinger, F.N. (1973). Foundation Of Behavioral Research (2nd Ed).New Delhi: Kessler, Sheila (2003). Customer satisfaction toolkit for ISO 9001:2000. Milwaukee, Wis.: ASQ Quality Press. Kibera, F.N. (1996), Fundamentals of Marketing. Nairobi: Oxford University press Kothari, C.R. (2003). Research Methods & Techniques. New Delhi :Wishwa Prakashan Kottler, F. (2003). Marketing Management (11th Ed.).New Delhi: Asoke Ghosh. Marion, L & Cohen, L. (1986). Research Methods in Education. London: Routledge. Mc Graw hill publishers Mugenda, D.M; & Mugenda, A.G. (1999). Research Methods, Qualitative and quantitative approaches. Nairobi: Acts Press Mugenda, O.M. and Mugenda, A.G. (2003). Research Methods, Qualitative and Quantitative approaches. Nairobi: Acts press. Mullins, J. (2005). Management and Organization Behavior 7th Ed. England: Pearson Mulusa, T. (1990). Evaluation Research for Beginners: A Practical study guide. Bonn: Deutsche Stifling for International Eritwickling. Mutai, K.B. How To Write Quality Research Proposal. New York: Thelley publications. Pearce, J.A. and Robinson, R.B. Jan. (2004). Strategic Management. London: A.I.T.B.S. Publishers. Peterson, R.A (1978). Strategic Marketing Problems. London:

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Saleemi, N.A. and Njoroge, E.K. (1997), Marketing Simplified. Nairobi: Saleemi N.A.Publishers. Schifman, G; and Kanuk, L. (2004). Consumer Behaviour 8th Ed. Singapore: Pearson education publishers. Wainer, H., & Braun, H. I. (1988). Test validity. Hilldale, NJ: Lawrence Earlbaum Associates. Winter, G. (2000). A comparative discussion of the notion of validity in qualitative and quantitative research. The Qualitative Report, 4(3&4). Retrieved February 25, 1998, from http://www.nova.edu/ssss/QR/QR4-3/winter.html

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APPENDIX 11: Introduction letter

Dear Respondent,

I am a MBA (Strategic Management) student at Moi University, department of Business Studies and this questionnaire is part of a research to be carried out in partial fulfillment of MBA degree. The questionnaire is on the effect of customer oriented strategies on customer Satisfaction in Kitale Municipality.

The information you provide will be held in strictest confidence and used for the purpose of academic research and will be used for the stated purpose only. Please answer the entire questionnaire as accurately and as honestly as possible.

Your kind assistance to facilitate this noble activity will be highly appreciated.

Thank you in advance.

Yours Faithfully,

Alex K. Amboko SBE/MBA/075/09

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APPENDIX I11

QUESTIONNAIRE FOR KPLC CUSTOMERS. Name (Optional Age..Occupation Residence Area.. Level of Education

1.

Please indicate the customer category under which you fall. Small Domestic Customers Small commercial customers [ ] [ ]

2.

What do you do for a living? (a) (b) (c) (d) Farming Employment Business Other, please specify_ [ ] [ ] [ ]

3.

What is your monthly income? (a) (b) (c) (d) (e) Less than KShs. 5,000 KShs. 5,000 10,000 KShs. 10,000 20,000 KShs. 20,000 40,000 Over KShs. 40,000 [ ] [ ] [ ] [ ] [ ]

4.

What is your highest completed level of Education?

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(a) (b) (c) (d) (e)

Primary School Secondary School College Graduate degree Other, please specify

[ ] [ ] [ ] [ ]

__________________________________________________________________ 5. Do you regularly receive your electricity bills? (a) (b) Yes No [ ] [ ]

6.

If no, how do you get your bills? a) 5551 SMS b) Internet Enquiry c) KPLC query counters d) Other , Please specify [ ] [ ] [ ] [ ]

7.

How would you evaluate the K.P.L.C. response to your Enquiry? (a) (b) (c) (d) Very good Good Fair Poor [ ] [ ] [ ] [ ]

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8. Are you aware of the following KPLC bill payment options/ centres? [tick the ones that you are aware of] a) Standard chartered b) Barclays bank c) Equity bank d) Cooperative bank e) National bank f) Postbank g) Mpesa h) Zap i) KPLC banking Halls [ ] [ ] [ ] [ ] [ ] [ ] [ ] [ ] [ ]

9. Which of following KPLC bill payment options/ centers have you utilized?[Tick the ones that you are aware of] a) Standard chartered b. Barclays bank c. Equity bank d. Cooperative bank e. National bank f. Post bank g. Mpesa h. Zap i. KPLC banking Halls [ ] [ ] [ ] [ ] [ ] [ ] [ ] [ ] [ ]

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10. One a scale of 1 to 5 with 1 being least satisfaction and 5 being very satisfied, how you rate the KPLC bill payment initiatives. Payment Options Standard chartered Barclays bank Cooperative bank National bank Post bank Safaricom Mpesa Zain Zap Kplc Banking Halls 1 2 3 4 5

11. One a scale of 1 to 5 with 1 being least efficient and 5 being very efficiency. Please indicate how you rate the KPLC bill payment initiatives in terms of their efficiency levels. Payment Options Standard chartered Barclays bank Cooperative bank National bank Post bank Safaricom Mpesa Zain Zap Kplc Banking Halls 12. 1 2 3 4 5

One a scale of 1 to 5 with 1 being least friendly and 5 being very friendly how do you rate the KPLC bill payment initiatives in terms of user friendliness and ease of use.

Payment Options Standard chartered Barclays bank Cooperative bank National bank Post bank Safaricom Mpesa

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Zain Zap Kplc Banking Halls 13. Please indicate on a scale of 1 5 where: 1. 2. 3. 4. 5. Strongly Disagreed Disagreed Undecided Agreed Strongly Agreed S.A - D.A - Ud -A - S.A.

What you feel about the following statements. S.A 5 1 2 3 4 5 6 7 8 9 1 0 I prefer paying my bill at KPLC offices. I do not trust the current technology being utilized I only have scanty information on the KPLC bill payment Options. KPLC should simply open up more offices to collect payments Customer convenience has been increased with the introduction of the payment options Customers have no excuse for non payment of electricity bill The electricity bill payment program can accommodate all level of income earners. Areas that have KPLC offices nearby are served better than out flung areas. KPLC should now fully roll out pre-paid meters. Areas with electricity infrastructure develop faster than those without. A. UD 4 3 D 2 S.D 1

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