RESEARCH ARTICLES

 

The impact of leadership practices on service quality in private higher education in South Africa

 

 

R Dirkse van Schalkwyk; A Davis; R Pellissier

UNISA

 

 

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ABSTRACT

In recent years, higher education institutions in South Africa and, more specifically, private higher education institutions, have faced increasing pressures on many fronts. These pressures include increased competition, changing technology and greater emphasis on efficient and effective management. The aim of this article is to report on the findings of a study that investigated the impact of leadership practices on service quality in private higher education (PHE) in South Africa as a source of competitive advantage. Literature suggests that leadership impacts positively on quality and, equally importantly, on service quality. Principals at these PHE institutions have a notable influence on the quality of service rendered to the students. Using a quantitative methodology and a cross-sectional survey research design, the study was conducted on five campuses of a prominent PHE provider across South Africa. Two survey instruments were used, namely the Leadership Practices Inventory questionnaire and the SERVQUAL questionnaire. Correlation analysis was used for data analysis. Findings of this study indicate a strong positive linear correlation between the leadership practices of principals and the service quality at these institutions. Thus the empirical findings complement and add to existing literature by emphasising the positive impact of leadership on service quality in PHE.

Key phrases: leadership, LPI, private higher education, service quality, SERVQUAL, South Africa

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1 INTRODUCTION

One of the challenges facing private higher education (PHE) institutions is that the PHE industry is becoming increasingly competitive, marketing-oriented and highly regulated. In this industry, these institutions have to function, survive and compete, not only with one another, but also with public higher education (HE) institutions. Competition is on the increase and PHE institutions need to find new ways to compete if they wish to survive in this dynamic environment. Existing literature suggests that effective leadership practices are essential for service quality in any organisation. According to Foster (2010:81), organisations with weak leadership will not gain a market advantage in quality.

One of the arguments for service quality is its link to increased profits and sustaining competitive advantage. Within the HE environment, Abdullah (2006:570) confirmed that HE has been compelled towards commercial competition and that these institutions should not only be concerned with the abilities and skills of their graduates, but also the way in which the students perceive their educational experience.

The study on which this article is based, complements the strategic plan of the South African Department of Education (DoE) for 2007 to 2011 as is evident from the vision and mission of the DoE. The mission reads as follows: "Our mission is to provide leadership in the establishment of a South African education system for the 21st century." The vision is as follows: "Striving to address the training needs for high-quality service and seeking ways to achieve our goals" (South Africa. Department of Education s.a.:9). In concurrence with the DoE's mission of providing leadership and vision of high-quality service, McKenna (2003:15) acknowledges the importance of leaders to execute successful service strategies.

This view received wide support in academic circles. Hui, Chiu, Yu, Cheng and Tse (2007:151) found that the practices of the leader were important for maintaining service excellence to external customers. Where service quality is poor, leadership behaviour plays a key role in maintaining service excellence to external customers. Kouzes and Posner (2007:14) take leadership behaviour further and calls for exemplary leadership. According to Kouzes and Posner (2007), exemplary leadership is achieved by five leadership practices, namely model the way, inspire a shared vision, challenge the process, enable others to act and encourage the heart. These leadership practices form the basis of the Leadership Practices Inventory (LPI) questionnaire that was used in this research study.

Due to the competitive nature of PHE in South Africa, taking cognisance of the growth in the number of providers and the market forecasts, it seems unavoidable that private institutions will have to pursue service quality and product differentiation strategies in order to maintain a competitive advantage and remain sustainable.

The basic premise guiding the research on which this article is based was that proven leadership practices will have a positive impact on service quality in a PHE institution in South Africa. This will thus impact on the competitive advantage which, in turn, will then lead to the long-term sustainability of the institution. As such, a study was conducted within the positivist paradigm and a deductive process was applied. The data collection strategy consisted of cross-sectional quantitative surveys to study leadership practices and service quality. The service quality research data were gathered by means of the SERVQUAL questionnaire, while the leadership data were obtained through the LPI questionnaire. The impact of leadership as the independent variable on service quality as the dependent variable is indicated. The purpose of this article is to report on the findings of a cross-sectional study that investigated the impact of leadership practices on service quality in PHE in South Africa as a source of competitive advantage.

The objective of this article is to report on the findings of a study that investigated the impact of leadership practices of service quality in private higher education in South Africa using the SERVQUAL and LPI instruments. This study could in fact be the only other attempt to report on the impact of leadership practices or behaviour on service quality in PHE. Whereas a previous study relating to service quality and transformational leadership focused on United Arab Emirates hospitals, the current study was conducted in the PHE sector in South Africa.

 

2 PHE IN SOUTH AFRICA

This article reports on the impact of leadership practices on service quality in PHE in South Africa. A well-known brand of a prominent service provider in the field was selected for the study. The brand, as well as the service provider, will remain anonymous for the purpose of the article. To ensure confidentiality, the brand will be referred to as "The College".

The College, which is one of the four brands of a prominent service provider in the field, was selected as the focus of the study being reported here. The service provider is a PHE provider registered with the South African DoE and offering a full range of qualifications and short learning programmes on 19 sites of delivery, organised into four brands. Owing to the dynamic nature of the PHE environment in South Africa, providers specifically need to be leaders in their field to compete successfully in order to maintain a competitive advantage in the marketplace.

Private institutions who want to offer qualifications (certificates, diplomas or degrees) at the National Qualifications Framework (NQF) levels 5 to 10, are required to register with the DoE. Therefore, all PHE institutions must register with the DoE in accordance with the HE Act 101 of 1997 (South Africa. SAQA 2012:2). The purpose of registering private institutions offering HE, is to ensure that PHE institutions offer an acceptable quality of education and that students enrol at institutions that have the capacity and expertise to offer such programmes. An institution that applies for registration must also fulfil the requirements for quality assurance set out by the Higher Education Quality Committee (HEQC) of the Council on Higher Education (CHE). The CHE is the body responsible for quality assurance in HE, while the HEQC is responsible for conducting institutional and programme assessment, which is known as accreditation. One of the benefits of accreditation is an assurance that the programmes offered by the institution are indeed HE in nature.

PHE providers are also established elsewhere on the African continent. A high number of PHE institutions can further be found in countries such as Benin (27), Ghana (28) and Senegal (48) while countries such as Zimbabwe and Tanzania have four and ten PHE institutions respectively (UNESCO 2006:34). In the South African PHE environment, the Register of PHE Institutions of 2012 indicates that there are currently 88 PHE institutions registered with the DoE in South Africa and 29 provisionally registered providers. In total, there are 117 role players in the PHE market, all competing for the same market share with new (local and international) education providers entering the market despite the relatively high barriers to entry such as cost and regulations. Thus it seems that South Africa has by far the largest number of registered PHE institutions in Africa, with this sector still growing. Between March 2009 and February 2012, there were 24 new PHE institutions registered in South Africa (South Africa. SAQA, 2012).

 

3 LITERATURE REVIEW

Robbins and DeCenzo (2008:89) argue that the better an organisation can satisfy its customers' needs for quality and the more it can build up a loyal customer base, the better it will be able to differentiate itself from its competition.

The importance of service quality is accentuated by the fact that constant improvement in the quality of services can lead to a competitive advantage that other organisations cannot emulate. Zahorik and Keiningham (cited in Ham and Hayduk, 2003:200) emphasise service quality as an investment that is required to remain competitive in the global market. According to Wang, Lo and Yang (2004:325), customer-perceived service quality is one of the principal success factors of sustained competitive advantage for both manufacturers and service providers.

Scholars and practitioners ascribe to the notion that leadership is the key to improving quality. This is confirmed by Foster (2010:131) who claims that quality experts all agree that certain variables form the core of quality management and that one of these core variables is leadership. Goetsch and Davis (2006:262) report that Juran's quality trilogy comprises planning, control and continuous improvement. However, these three functions do not occur automatically but are driven by leadership. Linked to this is Foster's (2010:81) contention that organisations with weak leadership will not gain a market advantage in quality.

A review of the literature indicated that there are various definitions of leadership and service quality (Colquitt, Lepine & Wesson 2011:483; Drafke 2009:460; Khoshafian 2007:312; Markovic 2006:88; Palmer 2008:321; Thompson 2009:154; Wang & Berger 2010:6, Zeithaml, Parasuraman & Berry 1990:18). With due consideration of the multitude of definitions, we define leadership and service quality in this study as follows:

Leadership refers to the mobilisation and influencing of people to work towards a common goal through the building of interpersonal relationships and the breaking of tradition to achieve the organisation's objectives despite risk and uncertainty.

Service quality refers to meeting and exceeding students' expectations and perceptions by constantly rendering a reliable service that conforms to pre-determined requirements.

In the following sections, the SERVQUAL and LPI questionnaires will be explained in more detail.

3.1 The Servqual questionnaire

The SERVQUAL questionnaire was developed by Zeithaml, Parasuraman and Berry in 1988. It is an instrument for assessing quality along five service dimensions (tangibles, reliability, responsiveness, assurance and empathy). Many organisations use this instrument because it is an off-the-shelf approach that can be used in a variety of service settings (Foster 2010:257). It has two parts, namely customer (student) expectations and customer (student) perceptions, and consists of 22 items. Parasuraman, Zeithaml and Berry (1988:23) define the five dimensions as follows: (1) tangibles (the physical facilities, equipment, personnel and communication materials); (2) reliability (the ability to perform service dependably and accurately); (3) responsiveness (the willingness to help students and provide prompt service); (4) assurance (the knowledge and courtesy of employees and their ability to convey trust and confidence) and (5) empathy (the organisation provides care and individualised attention to its students).

According to Foster (2010:259), the SERVQUAL questionnaire identifies five discrepancies or "gaps" that may cause problems in service delivery and therefore influence customer evaluations of service quality. The gap approach is widely recognised in quality literature, and refers to the difference between what the customer expects and what is actually delivered (Foster, 2013:140). Gaps are important because once a gap has been identified, corrective action and improvement must follow. Based on the SERVQUAL questionnaire, gap 1 shows the difference between customer expectations and management's perception. Management do not always know and understand what the customer wants. Gap 2 refers to the difference between management perceptions of customer expectations and service quality specifications.

Gap 3 is the gap between service quality specifications and service delivery. This could be the result of inadequate training of personnel or poor management. Gap 4 refers to the gap between service delivery and external communications to customers. This could stem from the difference between what an organisation promises to deliver and the service that is actually delivered. Gap 5 indicates the difference between perceived and expected service delivery. The difference between customers' expectations and perceptions or their experience of the service is directly related to their perceptions of service quality. This gap occurs because of one or more of the previous gaps. The key to closing gap 5 is to close gaps 1 to 4 by means of improved communication, improved system design and highly trained personnel who render outstanding customer service (Foster 2010:262; Kotler 2000:439; Palmer 2008:328).

3.2 The leadership practices inventory

According to Conger and Riggo (2007:58), the value of a leadership assessment tool lies in its economic value, whether or not standards were followed in its development and whether it has construct validity. The instrument measures leadership on the basis of "five practices of exemplary leadership" (Kouzes &Posner 2007:14). It reveals the leader's behaviour in terms of challenging the process, inspiring a shared vision, enabling others to act, modelling the way and encouraging the heart. The LPI consists of 30 items requesting constituents (college employees) to rate the leader's (principal's) abilities on a ten-point rating scale. It indicates perceptions of how frequently leaders engage in the five practices. It is a 360-degree measurement instrument as well as an instrument to improve and teach successful leadership behaviour and can be applied in the PHE environment. "Leadership is everybody's business" is the foundation of the LPI (Kouzes & Posner 2003:8).

 

4 RESEARCH DESIGN

For the purpose of the service quality survey, the units of investigation consisted of the five delivery sites, while the units of analysis were the students at the five sites. Proportional stratified sampling was used to select the target population (ideal number of respondents) to participate in the service quality survey. The population was segmented according to the campuses across South Africa. Each stratum is in proportion to its size in the overall population, in this case, 5 085 students. A random sample was drawn from each stratum.

The SERVQUAL questionnaire was used for the collection of service quality data. The research population (actual number of respondents) of the service quality survey consisted of students from the five campuses (n = 984) with the following number of respondents per campus (stratum):

Campus 1: 104 (from a student population of 415) = 26%

Campus 2: 276 (from a student population of 1604) = 17%

Campus 3: 336 (from a student population of 1916) = 18%

Campus 4: 148 (from a student population of 726) = 21%

Campus 5: 120 (from a student population of 424) = 28%

The questionnaires for students were distributed electronically to the campuses via an online survey system. The respondents (students) evaluated service quality on a Likert scale from 1 to 7, in terms of their expectations and perceptions of the quality of service rendered at their campus. The SERVQUAL instrument consists of 22 items (22 items for both the perception and expectation sections) divided into five sections (the five dimensions of service quality), namely tangibles, responsiveness, reliability, assurance and empathy.

Two LPI questionnaires (the LPI self and LPI observer) were used to collect data on the leadership practices of the campus principals. The leaders, in this instance the campus principals, completed the LPI self (n = 5). This instrument required the leaders to rate themselves on the frequency with which they thought they engaged in each of the 30 behaviours (items) on a rating scale from 1 to 10. Seven staff members (selected by the leader) as well as the leader's manager completed the LPI observer (n = 40) questionnaire, rating their leader on the frequency with which they thought the principals engaged in each of the 30 behaviours (items), also on a rating scale from 1 to 10.

As in the case of the SERVQUAL questionnaire, all the questionnaires were distributed to the campuses electronically via an online survey system from "The College's" regulatory body head office - five LPI self questionnaires (one for each principal) and 40 LPI observer questionnaires (seven constituents and one manager per principal). Computerised scoring software, which is part of the LPI assessment tool, provided feedback on a number of dimensions, including comparisons by the respondent category, rankings by frequency and variances between self and observer scores.

 

5 RESULTS AND DISCUSSION

As indicated earlier, the purpose of this article is to report on the findings of a study that investigated the impact of leadership practices on service quality as a source of competitive advantage. Hence, the impact of leadership (the independent variable) on service quality (the dependent variable) was investigated.

As indicated previously, the SERVQUAL questionnaire is composed of the five service quality dimensions, namely tangibles, reliability, responsiveness, assurance and empathy. The instrument is based on 22 generic questions and designed to cover the five dimensions of service quality. Survey customers complete the questionnaire, with one section that measures their expectations related to the 22 questions, and then another section measuring their perceptions related to the same 22 questions. For each question, the customer must rate, on a Likert scale from 1 (strongly disagree) to 7 (strongly agree) whether or not he or she agrees with each statement. The SERVQUAL score is then the difference between the perception and expectation scores of actual service delivery (perception-expectation or P-E). This is referred to as the service quality gap as explained previously. An organisation can then determine its level of service quality for each of the five dimensions by taking the average score across the questions for that dimension and calculating the overall score (Aaker, Kumar & Day 2007:690; Foster 2010:262; Gryna, Chua & DeFeo 2007:439; Lewis 2007:243; Moscardo 2006:263; Palmer 2008:330; Wilson, Zeithaml, Bitner & Gremler 2008:132).

The SERVQUAL gap analysis summary is provided in Table 1 below. The overall rating is determined by the mean score of each dimension.

 

 

As indicated in Table 1, Campus 1 is perceived to render the best overall quality of service with a service quality gap of only -0.03. By contrast, Campus 5 seems to provide the worst service quality experience to its students with a service quality gap of -0.23. In terms of overall individual service quality dimensions, tangibles and responsiveness appear to represent the largest quality gaps.

Table 2 below provides the LPI data summary of the leadership survey conducted on the five delivery sites of "The College". Table 2 indicates the LPI mean scores for each campus as well as the mean scores for the five practices.

 

 

In terms of the LPI mean scores, Campus 1 had the highest score of 47.84, indicating that the leader (principal) of Campus 1 engaged in the five practices of exemplary leadership fairly often. By comparison, the lack of leadership on Campus 5 was prominent, with an LPI score of 33.44.

There is little variation in terms of the mean scores for the five practices. The leadership practice of "Enable others to act" had the lowest score, with a mean score of 41.64. This indicates that the leaders of the five campuses engaged the least in this practice. By contrast, the practice of "Inspire a shared vision" had the highest score of 43, indicating that on average, leaders engaged in this practice more frequently.

The Pearson product moment correlation (represented by the letter r) was used to measure the relationship between leadership practices and service quality for "The College's" five campuses. The coefficient of determination (R²) was also used to calculate the proportion of variance. A correlation coefficient helps to determine the strength of the linear relationship between two ranked or quantifiable variables. This coefficient (r) can take any value between -1 and +1.

The correlation between leadership and service quality is calculated by using the SERVQUAL scores (mean SQI score) and LPI scores (mean observer scores). For the purpose of this study, only the LPI observer scores were used.

Table 3 below represents the calculation of the Pearson product moment correlation coefficient.

 

 

According to the data in Table 3, the Pearson product moment correlation coefficient has a strong positive linear relationship between leadership practices and service quality of r = 0.915 with a coefficient of determination of 85%. Leadership practices (x) therefore explain 85% of the variation in service quality. The level of service quality based on leadership practices can be viewed with a high degree of confidence, since only 15% of the variation in service quality is unexplained by leadership practices. This is excellent news for education managers interested in improving their service quality as a source of competitive advantage.

In Figure 1, the SERVQUAL scores are plotted against the LPI scores. For all the campuses, the LPI score correlates with the SERVQUAL score. In other words, where the campus principal received a high LPI score, the campus also received a high SERVQUAL score. The converse was also true. Where the campus principal received a low LPI rating, the campus also received a low SERVQUAL score.

 

 

Figure 1 indicates that Campus 1 had the highest LPI and SQI scores. This is supported by the correlation coefficient calculated in Table 3, which indicated a strong positive linear relationship between leadership practices and service quality.

The main aim of the study discussed here was to report on the impact of leadership practices on service quality in PHE in South Africa as a source of competitive advantage. A review of the literature indicated that a limited amount of research has previously been conducted in this regard. The empirical findings collectively suggested that there is a strong positive linear relationship between leadership practices and service quality.

5.1 Reliability and validity of the research

Both the SERVQUAL and LPI demonstrated the psychometric properties of reliability (consistency from one measurement to the next), and validity (accurate measurement of the concepts) consistent with the literature findings. Gliem and Gliem (2003:87) explain that Cronbach's alpha is a measure of the internal consistency of a set of items comprising a scale. The closer Cronbach's alpha coefficient is to 1.0, the greater the internal consistency of the items in the scale will be.

Tables 4 and 5 below represent the Cronbach's alpha coefficient for both the expectation and perception dimensions of the SERVQUAL instrument.

 

 

 

 

Tables 4 and 5 confirm the internal consistency of both the expectation and perception dimensions of the SERVQUAL instrument. Cronbach's alpha coefficient for the expectation dimensions varies between 0.77 and 0.95, while the perception dimensions are in the 0.84 to 0.97 range. As mentioned by Kouzes and Posner (2003:11), all five leadership practices have strong internal reliability scores that are above 0.75 for the "self" version and above 0.85 for the "observer" version. Test-retest reliability scores are high in the 0.90 "plus" range. Both the SERVQUAL and the LPI questionnaires have thus proven to be reliable and valid measuring instruments.

5.2 Recommendations

The study on which this article reports, adopted a cross-sectional design. This provided a solid foundation for further research. Similar studies could follow a longitudinal method where a single group of people is observed over a period of time. In HE, future research could examine and compare service quality and leadership practices in other PHE providers as well as public institutions of HE. Future research could also be conducted in sectors other than education, where nonprofit and for-profit organisations are competitors. Such research would promote a better understanding of the impact of leadership on service quality. In addition to the use of quantitative instruments such as SERVQUAL and LPI, future research could include the use of case study research, personal interviews and focus groups.

The use of such qualitative methods could help future investigators to identify new service quality and leadership research themes on which to focus. An ethnographic study, in which a researcher observes the service quality and leadership practices of the participants, and talks to students and subordinates under the leader's authority, could produce interesting findings and affirm or disaffirm the findings of this study. Further investigation, using a different measurement instrument to assess service quality and leadership in the PHE environment, could yield different or similar results, especially if the surveys were to be conducted during a major crisis or administration change.

Further research could also be conducted to develop an improved model to measure service quality in the PHE environment in South Africa. These recommendations are made with reference to the literature review and the findings of the empirical study that investigated the impact of leadership practices on service quality.

5.3 Limitations

Several notable limitations affected the findings of this study and the researcher's ability to ultimately generalise the findings to the greater PHE population in South Africa. The data represented a "snapshot" as opposed to a trend. Hence only the "depth" and not the "width" of the data were examined. There could have been participant bias because principals could have selected constituents with whom they had a good relationship to participate in the "LPI observer" survey. Furthermore, the SERVQUAL questionnaire was completed as part of a class exercise and students might not have given their true opinion of service quality.

 

6 CONCLUSION

This article supports the findings of various authors that leadership is important for maintaining service excellence to external customers. Previous research confirms that service quality is positively related to both transformational and transactional leadership. In addition, research studies also provide evidence that transformational leadership improves employee performance. However, these studies only focused on performance measures such as profit, sales figures and stock performance. No other empirical study could be found that had investigated the relationship between leadership practices and service quality.

In conclusion, the empirical findings collectively suggest that there is a strong positive linear relationship between leadership practices and service quality. Furthermore, the presence of service quality in PHE can be a source of a strategic competitive advantage (Arambewela & Hall, 2009:555; Daud & Sapuan, 2012:23; Qureshi, Shaukat & Hijazi, 2010:282). The selected PHE provider is a dominant player in this domain, leading to some generalisation to the broader PHE domain and its quality requirements.

 

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