Investigating the influence of TQM, service quality and market orientation on customer satisfaction and loyalty in the Indian banking sector

Purpose: The purpose of this paper is to examine the effect of total quality management (TQM) on service quality (SQ), market orientation (MO) and the subsequent effect on customer satisfaction (CS) and customer loyalty (CL). The research also analyses the direct effect of TQM on CS. Design/methodology/approach: Data were collected from middle managers of retail banking sector in India using survey method. Structural equation modeling is used to analyze the data and to test the hypotheses. Findings: The results show that TQM is positively associated with SQ, MO and CS. SQ and MO are significantly and positively associated with CS. CS subsequently leads to improved CL. Practical implications: Enforcing TQM practices in their organizations as a change management tool, banks can achieve a greater degree of MO, improved SQ and higher CS to gain higher CL. Originality/value: This paper empirically demonstrates that, by proper implementation of TQM in banks, the SQ and MO can be improved. Well implemented quality management practices, better customer service and market-focused attitude of banks will elevate the CS level and improve loyalty of customers toward the banks. With a little study has yet focused on India, the paper offers knowledge to banking professionals for increasing CL by effective implementation of TQM practices.