The relationship between customer satisfaction and business performance of insurance companies in Gilan Province (Rasht)

Dissertation for Master's Degree

Field: Business Management, Major: Insurance

Abstract

This research aims to investigate the relationship between customer satisfaction and business performance of insurance industry companies in Gilan province. The statistical population includes 28 branches in the insurance industry. The sample size is 20 branches (including managers of 20 branches and 20 customers from each branch, a total of 400 customers). Descriptive research method and field method and data were collected through standard Magnus customer satisfaction and Hsu business performance questionnaires. Face validity was used to measure validity and Cronbach's alpha coefficient was used to measure reliability. By using the inferential statistics test method of bivariate regression, the findings have been analyzed. The results showed that; Customer satisfaction has an effect on the business performance of insurance companies in Gilan province. Keywords: customer satisfaction, business performance, insurance companies. Chapter 1 (research overview) 1-1. Introduction

On the eve of the 21st century, the world has faced tremendous changes. These developments mean that the old ways of doing business in today's world will not be as effective as they used to be. In the current situation, the real mission of organizations is to understand the needs and demands of customers and provide solutions that will lead to customer satisfaction [1]. Companies that excel in marketing strive to keep their customers happy. A satisfied customer repeats his purchases and informs others about the good experiences he has about the product or service. The main key to success is that the company's performance[2] matches the expectations of its customers. Companies that are nimble and frostbite strive to please the customer. This means that they are not only committed to providing services or products, but what they offer is more than their commitments (Katter and Gray [3], 2011).

One of the most important developments that took place in the field of performance improvement in the last decade of the 20th century was the recognition of measuring customer satisfaction as one of the main elements and requirements of management systems in business institutions and enterprises. A lot of effort and effort that is being made today by researchers, experts and managers of business organizations to improve performance management tools and expand customer-oriented attitude, shows that now customer satisfaction is one of the most important factors in determining the success of organizations in terms of business and profitability. Therefore, the creation and implementation of customer satisfaction measurement and monitoring systems is considered as the most important indicator in terms of performance improvement, one of the basic needs of today's organizations. However, one can never ignore the fact that the main driving force for commercial and service organizations such as insurance companies, which are looking for major improvements in their progress, are the customers of that organization. In other words, no business can survive without customers. Therefore, it is very vital for every commercial institution to have a framework for understanding, analyzing and evaluating the satisfaction status of its customers (Farsijani, 2016). While previously focusing on attracting new customers was the main policy of organizations, today strategic and business policies are focused on maintaining and improving loyalty and increasing customers' trust in the organization. The most important reasons for such a change is the increase in public awareness and information about the favorable consequences of customer satisfaction and loyalty. In other words, customer orientation has been identified as the cornerstone of modern marketing management theories (Bansal et al. [4], 2004).

There is no doubt that in the era of mass production and endless competition, organizations can achieve success by increasing the level of satisfaction of their customers to the level of full loyalty, and the main issue in achieving this satisfaction is to provide quality goods or services expected by customers, which is realized through the application of proper management in facing internal organizational issues. Performance is one of the most important factors of customer satisfaction, which in service institutions like companies is always affected by internal issues and is influenced by various variables. The variables that neglecting them leads to the decline of customer orientation.

This chapter includes the statement of the problem, the importance and necessity of research and . is.Statement of the problem

Performance in the word means the state or quality of functioning. Function is a general construct that refers to how operations are performed. The most famous definition of performance is provided by Neely et al. (2002), which is; The process of explaining the quality of effectiveness and efficiency of past actions. The traditional approach to business performance emphasizes profitability and is often evaluated by the rate of return on investment (Morgan and Strong [5] 2003). Business performance includes indicators of sales return, investment return and profit per share, and non-financial indicators such as market share and new product development (Bergren [6], 2004). Martin Consogra and Esteban [7] (2007) also consider business performance as profitability, company size, market share and growth rate. Lee and Choi [8] (2003) defined organizational performance as the degree to which companies achieve their business goals. In other words, they consider performance as the behavior or way that organizations, groups and individuals do work. On the other hand, improving the performance of these companies depends on profitability, providing quality services, satisfaction, and productivity of its employees, which are measured as performance indicators in this research (Armstrong, 2016).

In the past, non-competitive conditions caused by limited supply and the absence of competitors and the acceptance of the idea that high quality leads to market capture caused them to pay less attention to the issue of customer satisfaction. While today, many manufacturers offer their products to order because customer satisfaction does not end only with the quality of the product. Success now belongs to those who think about the customer like this: "The customer is not a nuisance to our work, he is the meaning of our work." We do him no favors. He favors us by giving us the opportunity to serve him. Change and transformation in human life has come a long way, and one of the characteristics of the new world is the intensity and speed of transformation, the main difference between the developed world and the developing world lies in this sense (Divandri and Al-Karfi, 2014). Many authors [9] consider customer satisfaction to be an organizational process that causes the survival and growth of companies' performance (Entrialgo et al. [10], 2000). Customer satisfaction improves overall company learning and generates knowledge that builds and realigns the company's sources of competitive advantage. Research results show that customer satisfaction improves business performance by increasing pioneering, risk-taking, product and process improvement, and service innovation (cited by Walter et al. [11], 2006). The constant and increasing provision of new goods and services is the result of these competitions and shows a continuous effort for this survival. Producing and providing new services with unique characteristics requires organizations with new thinking and strategies. Organizations whose speed and intensity in their internal transformation are arranged with the needs of the market and with intelligence have all the ability to understand these needs and are able to provide them on time. Today, only having a wide market cannot guarantee the survival of the organization, customers come to products and services or stay away from them by evaluating four arrays, price, quality, time and better innovation in products and services. The more companies are able to provide it, the more market is available and the production will be more beautiful and attractive for their customers, crystallizing these arrays requires a heavy effort in all your processes. The starting point of this building is the correct understanding of the needs of the market and customers, and the end point is providing the demands and fulfilling these needs and the process towards perfection (Oliver [12], 1997). Also, satisfied customers can be good evangelists of their useful business to others. Positive word-of-mouth advertising about a product will be very useful, especially in the collective culture of Central Asian countries, where people's lives are based on the development of social relationships with others. On the other hand, customer dissatisfaction can lead to negative advertisements from customers, their switching to other competitors' goods and services, and as a result, the company's market share decreases. Obviously, in order to prevent the decrease in profitability, the company will have no choice but to discover the reasons for the increase in dissatisfaction among customers (Boorgi [13], 2007).