Airline service quality of Vietnam Airlines

1. Specific research objectives

1. Clarifying the nature/theoretical basis of aviation service quality and aviation service quality management

2. Systematize some statistical methods commonly used in research on perceived service quality and customer satisfaction

3. Apply statistical methods to study factors affecting passengers' perception of VNA's overall ground and air service quality, thereby proposing solutions to increase passengers' perception of VNA's service quality.

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4. Draw some conclusions about the possibility of applying modern statistical methods and models that have been commonly used in the world to research service quality in Vietnam.

2. Research subjects

The research subjects were Vietnamese and international passengers who used VNA services on international flights to and from Noi Bai, Tan Son Nhat and Da Nang airports in 2006.

3. Scope of research

Within the framework of this thesis, the author only focuses on studying the factors affecting the quality of service perceived by passengers on international flights of VNA in 2006. Because the perception of passengers is affected by many factors of space and time such as emotions, socio-economic development conditions, the conclusions drawn from the thesis may only be correct during the research period. Whether those conclusions are still correct for the following years or not needs to be further studied.

Air passenger service is very complex, consisting of many steps and processes. Due to time constraints in this thesis, the author only studies the factors affecting the quality of ground and air services.

Due to limited time, the author did not study the factors affecting the quality of service perceived by passengers by nationality and by route.

The conclusions drawn in the thesis are based on passenger evaluations on all investigated routes and all nationalities.

4. Data collection method

In the thesis, the author uses all secondary data, models, and studies conducted in countries around the world. The data source used for analysis in Vietnam is secondary data collected on more than 5,000 international and Vietnamese passengers of VNA in 2006.

5. Research methods

The author used quantitative research methods in the thesis. Based on the system of theories on service quality management, service quality models and statistical methods commonly used in service quality research in countries around the world, the author has synthesized and proposed models on factors affecting the quality of ground and air services of VNA. The author based on secondary data on VNA's perceived service quality, through statistical methods demonstrated the applicability of these models in managing VNA's service quality. VNA can rely on these models to continue researching factors affecting VNA's perceived service quality in the following years.

6. Contribution of the thesis

Through his research, the author has made a number of contributions to the treasure trove of business management theory and practice. Specifically as follows:

1. The author has systematized the theory of aviation service quality; issues of quality management in general and specific applications in aviation service quality management.

2. The author has systematized some of the most modern statistical methods that are widely applied in the world but are not yet widely known in Vietnam in studying abstract concepts such as perceived quality and customer satisfaction.

3. The author has applied these methods to study models of factors affecting the perceived service quality on the ground and in the air of VNA, proving the rationality and validity of the model. Based on these models, the author has made recommendations to help VNA improve the perceived service quality.

4. The author has demonstrated that statistical methods that have been widely applied in developed countries can be applied in practice in the business environment of Vietnam.

7. Structure of the thesis

The structure of the thesis consists of 5 parts as follows: Introduction

Chapter 1: General theory of aviation service quality and aviation service quality management

Chapter 2: Some statistical methods for studying perceived quality and customer satisfaction

Chapter 3: Applying statistical methods to study factors affecting the quality of VNA's ground and air services.

General recommendations and conclusions

Chapter 1:

GENERAL THEORY OF AVIATION SERVICE QUALITY AND AVIATION SERVICE QUALITY MANAGEMENT

1.1. AIRLINE SERVICE QUALITY

In this section, the author will focus on analyzing the quality of aviation services according to each link in the value chain that an airline will bring to customers in the process of providing aviation services. However, to have a systematic view, this section will include the issues of i) general concept of service quality and ii) quality of aviation services.

1.1.1. Concept of service quality

1.1.1.1. Concept of service

Up to now, there has been no globally accepted definition of services. The intangible and elusive nature of services, the diversity and complexity of service types make it difficult to define services. Moreover, different countries have different understandings of services, depending on the level of economic development of each country. However, scholars and practitioners seem to agree on some points when trying to distinguish between ordinary goods and services. The production process of goods creates tangible products with certain mechanical, physical, chemical properties, etc., with specific technical standards and therefore can be produced according to standards. Unlike goods, service products do not exist in physical form with specific items, are invisible and therefore cannot determine the quality of services directly by quantified technical indicators.

There are four issues that are often put forward to clearly distinguish services from goods in general. These four characteristics are intangibility, inseparability, volatility and perishability.

Intangibility is reflected in the fact that most services cannot be touched or tried before purchase. Customers cannot test samples.

displayed or packaged like other goods. Customers often perceive more risk in buying services than in buying goods. This hinders the exchange of services. Services cannot be protected by copyright, so competitors cannot be prevented from offering similar service packages to the original service.

Services are inseparable. They are produced and consumed at the same time. Therefore, the first impression a customer has of a service experience will leave a very important impression of the quality of the service, and as a service provider, the company/organization will not have a second chance. This is a completely different characteristic of services compared to other ordinary goods.

Services are inherently unstable. One characteristic of services is the large human involvement in the service delivery process, which creates instability in service quality. Instability can also be caused by the machinery and equipment involved in the service delivery process. For example, in aviation services, the paralysis of the reservation system can cause serious consequences in flight operations and reservations. Aviation services are also affected by natural factors such as weather. Fog incidents can lead to a series of flight cancellations and airlines have to compensate passengers with large sums of money.

Non-reservability of a service is reflected in the fact that the infrastructure of the service is shared and designed to provide a certain capacity at any given time. The time the service is not sold also means a permanent loss of revenue. A specific example of non-reservability of a service is the number of empty seats on a flight. The number of empty seats is the amount of money the airline loses due to the unsold service. These empty seats cannot be reserved for transfer to another flight.

There are two elements that make up a service: machinery and equipment and people. This classification is completely similar to the way of dividing the elements of the production process. However, in services, the role of people is of utmost importance if placed

in the context of a market economy. All businesses must focus on customers and consider customer satisfaction to be extremely important. There are some services where the role of machinery is very large, and there are some services where the involvement of machinery and equipment is not much. However, every service has human (employee) communication with customers.

For service providers, the first moment when a customer directly interacts with a service provider is very important. In service provision, the moment of that interaction plays an extremely important role, as it is the moment when the customer begins to confirm the “quality of service”. There are many definitions of direct interaction with customers. Stostack, Glynn (1984) [30] defines direct interaction service as “ the time when the customer directly interacts with the service provider ”. This definition is more general than the definition of Surprenant, (1982) [9] and only refers to direct interaction between the customer and the service provider’s employees. Although Chandon, Leo, and Philippe (1997) [8] also provide a similar definition to that of Stostack, Glynn (1984) [30], it is limited to face-to-face interaction. Bitner, Booms and Tetreault (1990) [2] stated that only the definition of Stostack, Glynn (1984)

[30] is not limited to face-to-face transactions between customers and service employees, so the concept can be applied to high-tech use in face-to-face transactions as well.

Customer satisfaction with transaction services is understood as customer satisfaction during the time of direct transaction with the service enterprise and can be understood as transaction with or without the presence of service enterprise staff.

Transactional services with the presence of customers and service staff are called face-to-face transactional services, while transactional services that do not include the presence of customers and service staff are called high-tech transactional services. Research on customer satisfaction with the two types of transactional services mentioned above will help service organizations find customer service strategies.

most effectively, while helping businesses attract, maintain and develop loyal customers, thereby improving the competitiveness of the business.

1.1.1.2. Concept of service quality

Service quality is a concept that has received much attention and debate in the research community. Defining and measuring service quality is a relatively difficult task and there is no consensus on both issues (Wisniewski, 2005) [34]. There are many different “definitions” of service quality. A commonly used definition suggests that service quality is the extent to which a service meets the needs and expectations of customers (Asubonteng et al., 1996) [1]. Service quality can therefore be defined as the difference between customers’ expectations and perceptions of the service. If expectations are greater than the performance of the service, customers will not be satisfied with the quality, and therefore they will be dissatisfied with the service Lewis, Robert C. and Bernard H. Booms (1983) [21].

Definitions of service quality have shown a close connection between the definition of “service quality” and “perceived service quality”. According to Parasuraman et al (1985) [26], service quality is the customer’s perception of the value that the service brings to the customer. Another definition states that “service quality is an attitude that represents the overall evaluation” Bitner, Booms and Tetreault (1990) [2]. Thus, service quality from the customer’s perspective is an emotional concept, and is often associated with “perception” and “customer satisfaction”.

There are many definitions of customer satisfaction, however, it seems that the authors agree with each other's opinions. Customer satisfaction or dissatisfaction is the emotional state of pleasure or disappointment through comparing the quality of service / service with the customer's expectations. (Philip, Kotler, 2001) [27]. Accordingly, customer satisfaction is a function of service quality.

/service according to customer perception and customer expectation. If customer expectation is greater than service quality, customer will be disappointed. If

As product quality exceeds expectations, customers will be satisfied and the business will achieve customer satisfaction.

Businesses always aim to achieve increasing customer satisfaction because this will enable businesses to control customer psychology. In other words, make customers repeat their purchase behavior. Increasing customer satisfaction will create an emotional state associated with the service brand, not just creating rationality in the customer's purchase decision. The result is creating high customer loyalty (Philip, Kotler, 2001) [27].

All the reviewed studies agree that service loyalty has brought benefits to the company. However, there are still slight differences in some of the concepts of researchers and businesses about customer satisfaction and service quality. Businesses believe that these two terms can be interchanged. For researchers, the factors that constitute customer satisfaction exist and develop relatively independently from service quality. The concepts of service quality, loyalty to quality and customer satisfaction are related to each other, in which service quality is the cause and customer satisfaction is the result of customer loyalty to service quality (Anynomous, 2002).

From the customer's point of view, service quality is a composite concept consisting of two dimensions: the final service quality and the quality of the production process or in other words: technical quality and functional quality or production process. Technical quality is assessed based on the customer's opinion, it can be a meal in a restaurant, a flight or a consulting service of a consulting company. Functional quality implies how the service is performed. This includes how easy it is to access the service provider; how the employees perform the service (Anonymous, 2002). This classification of service quality is agreed by many authors. Technical quality includes the tangible aspects of the service, although often considered unimportant and often not given due attention. Functional quality is also

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