This document summarizes a research study on surveying the effective factors on customer satisfaction levels at state banks in Iran. The study examined four factors: service quality, administrative factors, physical factors, and personnel factors. Surveys were conducted with 200 bank customers in Abhar, Iran. The results found that all four factors had a positive relationship with customer satisfaction levels. Within each factor, specific sub-factors were found to be most important: for service quality it was interest rates on bank deposits; for administrative factors it was the managerial potential of branch managers; for physical factors it was ATM systems; and for personnel factors it was the patience level of bank clerks against customer criticisms. The study concludes that focusing on these key

1. Management and Administrative Sciences Review www.absronline.org/journals
e-ISSN: 2308-1368, p-ISSN: 2310-872X
Volume: 3, Issue: 2, Pages: xx-xx (March 2014)
© Academy of Business & Scientific Research
*Corresponding author: Ehsan Mehrabanfar,
Faculty of Management, Science & Technology, Amirkabir University of Technology, Tehran, Iran.
E-Mail: e.mehrabanfar@gmail.com
xx
 Research Paper
Surveying the Effective Factors on State Banks’ Customers
Satisfaction
Seyyed Mahdi Moafi Madani1, Abdolreza Moharrer2, Mohammad Hassan Nasimi3,
and Ehsan Mehrabanfar4*
1. Department of Management, Hidaj Branch, Islamic Azad University, Hidaj, Iran
2. Department of Management, Abhar Branch, Islamic Azad University, Abhar, Iran
3. Department of Management, Bandar Lengeh Branch, Islamic Azad University, Bandar Lengeh, Iran
4. Faculty of Management, Science & Technology, Amirkabir University of Technology, Tehran, Iran
Today, advanced countries in the world, besides their important economic indexes, have
developed customer satisfaction index to show the importance in economic progress. This
study is done by aiming on state banks’ customers’ satisfaction survey and evaluation, and
has being searching for effective factors identification on customer's satisfaction in state
banking industry and intensity influence of each factor. Therefore, four aspects such as
service quality, administration factors, physical factors and personnel factors are considered.
Survey method is descriptive and is done with surveying method. Statistical society of this
study is state banks customers using banking services. Sample number is 200, and sampling
method is simple random sampling, so among state bank branches of Abhar city, some
branches were selected then, some people have been selected. After testing assumptions, it is
cleared that all four factors have positive effects on customer's satisfaction. These factors
have been prioritized according to ranking average. The most important factor in service
quality is bank deposit money interest increase, the most important factor in administration
factor is managerial potential of branch manager, the most important factor in physical
factor is ATM systems, and the most important factor in personal factor is the patience level
of clerks against customer's criticisms.
Keywords: customer satisfaction, state banking, service quality, administration
factors, physical factors, personal factors
INTRODUCTION
Lots of endeavors and efforts have been done
nowadays in developing performance
management and expanding view extension by
researchers, experts and commerce organizations
managers indicate that customer satisfaction is one
of the most important factors in establishing and
executing of organizations. Customer satisfaction
survey and evaluation as one of the most
important indexes in functional improvement, is
considered the main need for today organizations.

2. Manag.Adm. Sci. Rev.
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Volume: 3, Issue: 2, Pages: xx-xx
Madani et al.
Talking about measuring concepts like customers
satisfaction recalls Lord Kelvin speech. This great
scientist had told many years ago: when you can
measure something and describe it in numerical
form, indicates your knowledge about it, but when
you cannot describe something quantitatively,
shows that your knowledge is not enough about.
Maybe you have some acquaintance with that
phenomenon, but you cannot claim you have
master knowledge about that phenomenon (Wong,
2001).
In this way, ideals and purposes of organizations
have had many changes in recent years by
expansion of severe economic mobility and rivalry;
whereas, the main policy of organizations had
been focused on new costumer attraction
previously, but at the present time strategic and
commercial policies have focused on maintenance
and improvement of customers loyalty and
reliance increase toward organization. The most
important reasons for such changes is awareness
and general information increasing toward
customer's loyalty and satisfaction favorite
consequences. The companies which assign the
most part of customers loyalty to themselves,
relatively have increased the benefits of
organization by different cases like high further
buying rate, advertising cost decrease (for
customers involvement in oral advertising),
decreasing interest to turnover and change good
and service provider and resource
(Athanassopulos, 2000).
However, it can’t ever be overlooked that the main
motive for commerce organization searching for
main improvement in their progression way are
exactly customers of those organizations. In others
word, no business is able to continue working
without customers. Therefore, it is vital that each
commerce institute has a framework to
understand, analyze and evaluate customer's
satisfaction conditions.
In the present study, according to customer's
satisfaction evaluation in banking industry, in the
first step, customers’ satisfaction concept and
customers satisfaction evaluation method is
provided, then research methodology, research
purpose, consumptions, conceptual model and
customers’ satisfaction amount are examined.
Finally, beside research results, applicable
recommendations adjusted on model according to
customers’ satisfaction increase are rendered.
PROBLEM STATEMENT
One of the most important pillars in service section
is paying attention to customers. It is so important
to pay attention to customers, their wills and
effective factors on their satisfaction level as
knowing customers are the most important factor
in banking industry in earning interest and
activity. Why do organizations need to achieve
customers ‘satisfaction? For what customers
‘satisfaction is important for company? To answer
to these questions, it is needed to know what will
happen if customers become dissatisfied? And
then what benefits does customers ‘satisfaction
bring to companies? And how companies can
achieve them?
Researches show that 96% of customers do not
complain about the bad quality of products and
services, and 90% of these dissatisfied customers
won’t come back. Each of these dissatisfied
customers conveys their complaint at least to 9
more people and 30% of dissatisfied customers
convey their dissatisfactions to more than 20
people. Moreover, studies show that attracting 1
new customer costs 6th times more than keeping
the old one. In another word, keeping recent
customers are much cheaper than attracting new
ones; whereas, each of these processes is costly.
One satisfied customer, and consequently loyal,
may cost a lot of money in the years of his relation
to company, specially be prized by receiving high
quality services promised by organization. So, it is
so cheaper to have good dealing relation with
existed customers in comparison to find new ones
(Hayes, 1998).
Focusing on private banking entrance as rival of
state banks in recent years, has made paying
attention to customers so important and their wills
in order to achieve their satisfactions than past;
and, we are searching for these following goals:
 Survey and evaluating state bank customer's
satisfactions.
 Identifying effective factors on state bank customers
‘satisfactions amount.
 Providing executive policies to increase state bank
customers ‘satisfaction.

3. Surveying the effective factors on state banks’ customers satisfaction Research Paper
xx
FIGURE 1 HERE
Accordingly, these questions are discussed:
1-Do state banks customers are satisfied from the
present condition?
2-What are the main policies to increase banking
industry customer's satisfaction?
This matter causes the researcher to survey below
assumption:
 First assumption: There is a relation between state
bank service quality and customer's satisfaction
amount.
 Second assumption: There is a relation between state
bank administration factors and customer's
satisfaction.
 Third assumption: There is a relation between state
bank physical factors and customer's satisfaction.
 Fourth assumption: There is a relation between
personnel factor and customer's satisfaction.
RESEARCH BACKGROUND
Various designs and reports about customer's
satisfaction condition in and out of Iran have been
done. Some of the studies and designs are with
these details:
Athanassopulos in 1997 had evaluated customer's
satisfaction level from aspects like interactive
aspect-physical aspect-participating aspect- service
convenience aspect and price aspect among the
others in banking service of Greece state and
private banks. Results from studies showed that
interactive relation is one of the most important
matters relating to customers’ satisfaction.
Divandari and Delkhah in 2005 accomplished a
design and codified a model to evaluate customer's
satisfaction in country banking industry according
to which they have measured Mellat bank
customer's satisfaction. In this study, Structural,
administration, personnel and other factors were
important on customer's satisfaction.
Sharbatoghli and Ekhlasi in 2008(solar Hegira) in a
study have designed customer's satisfaction
evaluation in country banking industry and have
surveyed San’at-va-Mad’an customer's satisfaction
amount. In this study, service quality, service
features and accessible process to survey aspects
are surveyed as the main aspects of customers’
satisfaction evaluation model, and knew
accessibility to services as the basis of his work.
Further, a lot of literatures except suggested ones
above were found relating to researches relative to
studies about customer's satisfaction evaluation in
banking industry for countries all over the world,
because in this part suggested is an effective factor
on customer's satisfaction. These contexts are
summarized here in below table. Various designs
and reports about customer's satisfaction condition
have been done. Some of the studies and designs
are with these details:
TABLE 1 HERE
RESEARCH METHOD
Research method in this design is survey-
descriptive one from survey research kind, and
have practiced to identify effective factors on
customers’ satisfaction in this industry by
examining state banking industry condition and its
customers. The reason to choose research method
is the nature of problem that have been chosen to
identify customer's satisfaction amount and
evaluate that survey method, that various
variables are examined, the most important one is
recognized. In this design, questionnaires with
closed questions as evaluating tool have been used
to gather information about need to test
assumptions. Questionnaires were designed
according to effective factors by interviews with
specialized professors, experts and bank managers.
In this questionnaire, effective factors on
customer's satisfaction of bank systems are put like
assembled questions, and by codifying and
statistical analysis, effective factors on satisfactions
have been identified.
VALIDITY OF INFOMATION
Content validity of a test is usually determined by
specialized people. So, content validity depends on
arbitrator's judgment (Sarmad and et al., 2002, p.
171)
These tools are used in this research to increase
validity:
1. Using specialized professors ‘ideas.
2. Using banking experts ‘ideas.
3. Studying literatures, books and magazines using
these questionnaires or the same ones.

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Madani et al.
Cronbach's Alpha coefficient has been used to
identify questionnaire validity. Cronbach's Alpha
coefficient was calculated by SPSS software that
results are listed here:
Generally, Cronbach's Alpha coefficient is
calculated by one of these relations.
Or,
In these equations, K is the number of questions,
Si
2 is variance of ith question, δ2 is the variance of
questions total collection, C‾ is covariance
average among questions, and V‾ is variance of
questions average. By calculating Cronbach's
‘Alpha coefficient for each variable we resulted the
following:
 Validity content for service quality variable is
achieved 0.6.
 Validity content for administrative factors is
achieved 0.8.
 Validity content for physical factors is achieved 0.7.
 Validity content for personnel factors is achieved
0.7
 Accordingly, research tool has enough validity.
Statistical Sample and Society
Statistical society in this design is total number of
state banks customers in all over Abhar city.
Sample number is 200 people that we dispensed
these questionnaires to perform our research and
gathered information among customers.
Simple random sampling method is used to select
sample. There are different methods to identify the
least volume sample that in this research sample
volume identifying method was used. Sample
volume is determined by the following formula:
n = least sample volume
N= Statistical society number
e = error percentage
According to daily statistical calculations, banks
clients numbers were determined, about 300 to 400
people refer to state banks of Abhar every day that
in this study we consider 400. If we consider error
level on 5% and reliability level on 95%, Sample
least volume will become:
Those in these researches 200 questionnaires were
supplied.
Information Analysis Method
Descriptive statistics was used to analyze
information and describe demography features,
and statistical inference test (t test) was used to
survey the data significance and assumptions tests
(by SPSS software).
RESEARCH FINDINGS
In this part, after analyzing information related to
assumptions, results from assumptions are
provided here in estimated statistics frameworks.
1. First assumption test: There is a relation
between state banks service quality and
customers’ satisfaction amount.
TABLE 2 HERE
Result: Research assumption is admitted by using t
student test on 95% of reliability level .In another
word, there is a relation between state banks
service quality and customer's satisfaction amount,
and service quality factor is the most important
one in bank deposit money interest increase.
2. Second assumption test: There is a relation
between state banks administration factors and
customers’ satisfaction content.
TABLE 3 HERE
Result: Research assumption is admitted by using t
student test on 95% of reliability level. In other
words, there is a relation between state banks
administration factor and customers satisfaction

5. Surveying the effective factors on state banks’ customers satisfaction Research Paper
xx
amount, and branch manager is the most
important one in managerial potential.
3. Third assumption test: There is a relation
between state bank physical factors and
customers’ satisfaction content.
TABLE 4 HERE
Results: Research assumption is admitted by using
student t test on 95% of reliability level .In other
words, there is a relation between state bank
physical factors and customer's satisfaction, and in
physical factor the most important factor is ATM
systems.
4. Fourth assumption test: There is relation
between state bank personnel factors and
customers’ satisfaction.
TABLE 5 HERE
Result: Research assumption is admitted by
student t test. In other word, there is a relation
between state bank personnel and customer's
satisfaction, and in personnel factors, the most
important factor is clerks patience against
customer's criticisms.
SUGGESTIONS
Noting that in personnel factor ,the most
important factor in attracting customer's
satisfaction has been clerks patience amount
against customers criticisms, it is suggested that
managers and state banks bosses hold continuous
educational terms and workshops to teach in
human relation managerial field specially
customer relation management (CRM) to their
clerks, and in employment and bank personnel
employment test interviews pay more attention to
morality, social relation amount, their interest in
banking job and their level of patience.
 As the most important factor in administration
factors is bank manager’s managerial potential,
it is suggested to banks managers to hold
special and continuous educational terms and
workshops during years in organizational
management and marketing managements etc,
and also necessary predisposition for
educating in management and etc fields should
be provided.
 Noting that in physical factor s, the most
important factor is ATM systems. So, it is
suggested that as much as possible all bank
branches have this system to make the
customers able to access banking systems and
banking services full times. It should be noted
that these kinds of services should be
continuous and without defects to change
customers attitude toward banking services,
and maintain reliance and safety of bank
systems.
 Since service quality factor is the most
important one in increasing bank deposit
money interest, it is suggested to banks to pay
more attention in order to help attracting more
state banks customers because this factor is the
most effective one in attracting deposit money,
and beside the others factors can increase
customer's satisfaction.
 Acquaintance with roles and disciplines in Iran
can be effective on rationalization and order of
customers ‘expectations. It is suggested that
summary of collection of this roles be exposed
to state banks key customers.
REFERENCES
Anthony, T., & Addams, H. (2000). SQ at banks
and credit unions, managing SQ journal,
1(10), 52-60.
Athanassopulos, A. D. (1997). Another look into
the agenda of customer satisfaction:
focusing on service providers’ own and
perceived viewpoints, International Journal
of Bank Marketing, 15 (7), 264-278.
Ennew, C., Reed, G., & Binks, M. (1993).
Importance-performance analysis and the
measurement of SQ, European journal of
marketing, 27(2), 59- 70.
Hayes, J. (1998). Interpersonal Skills, In Michael
Poole and Malcolm Warner, the Handbook
of Human Resource Management, London:
Thompson Business.
Divandary, A., Delkhah, G.(2005). designing a
Model For Measuring Customer
Satisfaction in Banking Industry And

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Measuring customer satisfaction in Mellat
Bank, Business Researches Magazine, 185-223.
Johnston, R., (1997). Determinants of SQ: satisfiers
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Service Industry Management, 5(6), 53- 71.
Kamila, B., & Nantel, J. (2000). A reliable and valid
measurement scale for the perceived
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journal of bank marketing, 2(8), 84- 91.
Lassar, W., Manolis, C., & Winsor, R. (2000). SQ
perspectives and satisfaction in private
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Lewis, B., Orledge, J., & Mitchell, V. (1994). SQ:
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Mersha, T., & Adlakha V. (1992). Attributes of SQ:
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70.
Okiran N. (1994). Developing an instrument to
measure customer service quality in Branch
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Oppewal, H., & Vriens, M. (2000). Measuring
perceived SQ using integrated conjoint
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marketing, 4(18), 154- 169.
Pauline, M., Fergusen, R., Payaud, M. (2000).
Business effectiveness and professional
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SQ in the banking industry, journal of
services marketing, 4(10), 6- 22.
Sarmad, Zohre, Bazargan, Abbas, and Hejazi,
Elahe (2002). Research methods in behavioral
sciences, Tehran: Agah Publication (In
Persian).
Sharbatoghli, A., & Ekhlasi, A. (2008). Designing a
model to evaluate customers’ satisfaction
in development banking industry and
measurement of customers’ satisfaction
of Industry and Mine Bank based on it,
Management Knowledge, 21(81): 57-74.
Stafford, M., (1996). Demographic discriminators
of SQ in the banking industry, journal of
services marketing, 4(10), 6- 22.
Wong, Yuk-Lan Winnie, & Kanji, Gopal K. (2001).
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7. Surveying the effective factors on state banks’ customers satisfaction Research Paper
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APPENDIX
Table1: Suggested model in banking industry relative to customer’ satisfaction
Author
Research methodology and
statistical method to identify factors
and test conceptual model
Research findings
Mersha et al.
Discussion, qualitative methods have
used to suggest model
Customers have complete conceptual ideas about
services, and for most of the private services quality is
considered so important; Moreover, this matter is
surveyed in banking services.
Eno et al.
Survey research methods are used to
offer model
This study concerns to measuring problems of service
quality, and offer collection of indexes to measure
expectations, conceptions and customers’ total
satisfaction.
Okiran
Empirical methods have been used to
decrease model aspects
A six-dimension model was designed and examined for
service quality in banking industry. Although , this six-
dimension and 27 items are decreased to 17 items that
finally,4 aspects of personnel behavior, reliability,
communication and banking services accessibility
were left ,and validity and perpetuity of tool have been
tested, too.
Luis et al.
Discussion and survey used graphic
scale to measure model aspects.
This research tries to determine students’ loan service
aspects. Finally, this research determines fields that it
should consider to improve relations with university
students.
Stafeord.M
Case study and discussion,
qualitative methods have been used
to offer and test model.
He provides list of bank service quality features
perceived by customers; it determines main aspects of
bank service quality, and examines the importance of
this matter.
John Stone
Discussion and survey from
correlation coefficient has been used
for aspects effects amount.
He divides service quality like Hezerberge motive
model into 2 groups of satisfiers and dissatisfies. This
research findings shows that intangible aspects of
personnel relations-customers have great both positive
and negative effects on service quality.
Roein
Survey methods have been used to
offer initial data.
Initial orientation to determine service quality aspects
has been made when banks determine minimum
purposed market according to age or sex.
Staford
Qualitative methods have been used
to offer model aspects and also,
survey method to determine model
aspects importance.
Distinctive elements determines bank service quality,
and make clear which elements are more important
than the others for population various groups of
customers.
Yavas and et al. survey
This study has arrived to this results that final success
of each service quality program accomplished by a
bank just has been measured by customer's moods and
morality.
Antoni and et
al.
Discussion and survey
Credit unions and institutes in 11 questions from 14 of
service quality achieved more grades than the other
banks. These 11 aspects are included: Creditability,
Safety, Sympathy, Tangibility, basic services, Justice,
errors correcting and warranties.
Kamila and Case study and survey is just used for Provides a new scale to measure perceived service

8. Manag.Adm. Sci. Rev.
e-ISSN: 2308-1368, p-ISSN: 2310-872X
Volume: 3, Issue: 2, Pages: xx-xx
Madani et al.
Nontel offering proper scale. quality in banking industry. Authors of this study try to
offer more valid and creditable scale to measure.
Lasar and et al. Discussion and survey
They examine service quality effect on customer's
satisfaction from one sample of a international private
bank customers.
Epval and et al.
Assimilate empirical tests has been
used at the same time for model
testing.
A model is offered to measure perceived service
quality.
Pauline and et
al.
Empirical method has been used to
offer relations among model aspects
Changing banks account managers has negative effect
on banks effectiveness that is measured by customer's
justices from satisfaction and service quality, customer's
intents and bank giving suggestions to others.
Table 2: First Assumption Test
Variable t df Sig.
(2-tailed)
State banks service quality 93.675 199 0.0000
Table 3: Second Assumption Test
Variable t df Sig.
(2-tailed)
State banks administration 63.259 199 0. 000
Table 4: Third Assumption Test
Variable t df Sig.
(2-tailed)
State bank physical factors 62.508 199 0.000
Table 5: Fourth Assumption Test
Variable t df Sig.
(2-tailed)
Between state bank personnel
factors
70.722 199 0.000
Figure 1.visionary framework, integrated model
State banks
service quality
State banks
administration
factors
State banks
physical factors
State banks
personnel
factors
State banks
customers'
satisfaction
amount