The Effect of Customer Relationship Management (CRM ...

1 The Effect of Customer Relationship Management (CRM) Concept Adoption on Customer Satisfaction Customers Perspective The case of Coastal Municipalities Water Utility CMWU- Rafah Branch by Zaidan A. Zaidan Dhman Supervisor: Dr. Rushdy Wady A thesis Submitted in Partial fulfillment of the requirements for the degree of Master of business Administration 2011-1432 H " " 162 - 163 I II DEDICATION I dedicate my study to my Father, to my Grandmother & to my Brother Motaz - God's mercy be upon them, for which their memories give me the energy to continue.

2 I dedicate my study to my Mother for whom words is not enough to express my gratitude s. I dedicate my study to my wife, my daughter Elena, and my sons Yamen and Momen. I dedicate my study to who encourages me to accomplish my study, all my family members, my friends, and my colleagues in costal municipalities water utility CMWU. Finally I dedicate my study to my beloved Palestine and all the martyrs who sacrificed for the sake of independence and freedom. III ACKNOWLEDGMENTS I would like to express my deepest appreciation to Dr. Rushdy A. Wady, for providing excellent guidance, generous supports, and continuous encouragements throughout my research.

3 His suggestions and comments were of great value in writing of this study. I would also like to thank Professor. Majed El Farra dean of faculty of commerce and Dr. Sami Abu El Roos for their endless effort in the discussion of this study. My sincere appreciation to Dr. Samir Safi who statistically analyzed this study and provided me with valuable advice. My sincere appreciation to my colleagues in CMWU - Customer services department especially Mr. Esmael Jaber for his efforts in distributing and collecting the questionnaires. I would also like to thank the Faculty of Commerce for all of their support and feedback during my study.

4 IV TABLE OF CONTENTS DEDICATION _____ I ACKNOWLEDGMENTS _____ III TABLE OF CONTENTS _____ IV LIST OF TABLES _____ VI LIST OF FIGURES _____ VII LIST OF ABBREVIATIONS _____ VIII ABSTRACT _____ IX _____ X 1 CHAPTER 1: INTRODUCTION _____ 1 Introduction .. 2 Background .. 2 Research Problem .. 4 Study Hypothesis .. 5 The study variables .. 5 Independent variables: .. 5 Dependent variables: .. 5 Research 6 Importance of the Study .. 6 2 CHAPTER 2: LITERATURE REVIEW AND PERVIOUS STUDIES _____ 7 Introduction.

5 8 Rise of Relationship marketing .. 9 Customer Relationship Management - CRM .. 11 Why CRM Is Valuable .. 16 Customer Satisfaction .. 16 Customer acquisition .. 20 Customer Retention .. 22 Why retention improvement is important to CMWU.. 23 A frame work for Customer retention improvement to CMWU.. 23 Customer Loss Rate .. 24 CRM Ingredients .. 25 26 Process .. 28 Technology .. 30 CRM Models .. 31 Factors that affect CRM successful implementation .. 34 CRM in the public sector .. 35 What prevent effective public sector CRM .. 37 CRM in the public sector Vs CRM in the private sector.

6 39 Introduction to CMWU .. 40 First- establishment steps of the Water Utility: Legal Stage .. 40 Second: Contracting stage .. 41 Third: CMWU administrated by Local staff .. 42 Final Stage: Assets and employees transfer .. 42 V CRM in water services Utility .. 42 Conditions that could impede a successful implementation of CRM in CMWU .. 45 Previous studies .. 47 Local Studies: .. 48 Foreign Studies: .. 51 Comments on Previous studies .. 73 3 CHAPTER 3: RESEARCH METHODOLOGY _____ 76 Introduction .. 77 Study Design .. 77 Population and sample.

7 78 Inclusion and Exclusion Criteria .. 80 Questionnaire Design and Preparation .. 80 Response Rate .. 82 Data Collection .. 82 Ethical Matter .. 82 Data Coding and 82 Data Measurement .. 83 Statistical analysis Tools .. 83 Piloting .. 84 Validity of the Questionnaire .. 85 Statistical Validity of the Questionnaire .. 85 Internal Validity .. 85 Reliability of the Research .. 85 Cronbach s Coefficient Alpha .. 86 Split Half Method .. 86 Internal Validity .. 86 Structure Validity .. 91 Reliability Statistics .. 91 4 CHAPTER 4: DATA ANALYSIS, INTERPRETAION AND HYPOTHESES TESTING _____ 93 Introduction.

8 94 Descriptive Analysis of the Sample, Personal information .. 94 Hypothesis Testing .. 97 Testing of Hypothesis 1 .. 98 Testing of Hypothesis 2 .. 107 Testing Hypothesis 3 .. 114 Testing of Hypothesis 4 .. 121 Testing of Hypothesis 5 .. 127 5 CHAPTER 5: CONCLUSIONS AND RECOMMENDATIONS _____ 131 Introduction .. 132 Conclusions .. 132 Recommendations .. 139 Recommendation for further studies: .. 142 6 BIBLOGRAPHY _____ 143 7 APPENDICES _____ 148 Appendix 1: list of Referees .. 148 Appendix 2: Questionnaire (English Version) .. 149 Appendix 3: Questionnaire (Arabic Version).

9 154 VI LIST OF TABLES Table : Differences between CRM in private sector/CRM in the public sector.(Saremi 2009) .. 39 Table : No of customers / Area. CMWU billing record.. 78 Table : Customer s classification in area CMWU billing Record .. 79 Table : Response rate according to Customer classification .. 82 Table : Likert scale .. 83 Table : Correlation coefficient of each item of customers Satisfaction measure and the total of this field .. 87 Table : Correlation coefficient of each item of Customer s acquisition measure and the total of this field.

10 88 Table : Correlation coefficient of each item of Customer s retention measure and the total of this field .. 89 Table : Correlation coefficient of each item of Customer s loss measure and the total of this field90 Table : Correlation coefficient of each field and the whole of questionnaire .. 91 Table : Cronbach's Alpha for each filed of the questionnaire and the entire questionnaire .. 91 Table : Split Half Method .. 92 Table : Customers Age Frequency Outcomes.. 94 Table : Educational attainments .. 94 Table : Monthly income / NIS .. 95 Table : how often you pay the water bill.