Rethinking perceived service quality: An alternative to hierarchical and multidimensional models

Abstract

Measuring perceived service quality continues to be a controversial topic in management literature. Brady and Cronin's (2001) hierarchical and multidimensional model overcame several limitations of previously proposed models. Nevertheless, Brady and Cronin's conceptualisation has been the object of substantial criticism. This research describes the most important limitations of the Brady and Cronin's (2001) model, pointing out some newly identified drawbacks to this kind of conceptualisation and to using the methodology for analysing service quality models. To overcome these shortcomings, a new procedure is proposed, based on the proper identification of service quality attributes and on the study of unobserved heterogeneity in customer perceptions. An application of this procedure to the insurance industry shows the possible advantages of using this method for studying perceived quality in services. The results of the empirical study confirm the presence of several latent classes formed by customers with disparate service quality perceptions.

Keywords:

• service quality
• unobserved heterogeneity
• multidimensional and hierarchical model

Notes

See Hayduk (1996) and Hayduk and Glaser (2000) for an in-depth explanation of the use of gold standard indicators and the non-necessity of at least four indicators per latent, as usually recommended when authors handle latent variables. In addition, the recent research of Bergkvist and Rossiter (2007) claims that for the many constructs in marketing that consist of a concrete singular object and a concrete attribute, single-item measures should be used. Thus if we considerer service quality factors as concrete singular attributes, the single-item measure would report advantages.

These are the managerial principles of MAPFRE insurance company.