Research on factors affecting the quality of business registration service of enterprises in Can Tho city

results indicated that service quality (service consistency, service convenience and the ability to meet customers' needs) had positive impact on perceived value (function and symbol) and customer satisfaction; at the same time perceived value also had a positive impact on customer satisfaction. Using a 5-point Likert scale, Gumussoy and Koseoglu (2016) studied the impact of service quality, perceived value and price on customer satisfaction and loyalty in the tourism sector. A total of 346 customers of hotels in Alanya city, Turkey were selected for the interview that used prepared questionnaires. Linear regression analysis results showed that (1) customer satisfaction and perceived value were important predictors of customer loyalty; (2) perceived value, price and service quality (reliability, assurance, empathy) influenced customer satisfaction; (3) service quality (reliability, assurance, empathy, tangibles) influenced perception of perceived value of customers who received the service of hotels during their trip. Hapsari and Dean (2016) tested the relationship between service quality, perceived value and customer satisfaction of 200 customers from 5-star airlines such as Surabaya, Malang in East Java province, Indonesia. Data were analyzed using exploratory factor analysis- EFA, then linear structural model SEM was used to test the research model. The research results indicated that service quality has a positive correlation impact on customer satisfaction with perceived value acted as a mediating variable. In summary, at the present the author did not find any research on the relationship between service quality, perceived value and customer satisfaction in the business registration sector. Also, after reviewing literature 9 some limitations in researches on service quality can be found as follows: (1) because researches on the direct impact of service quality on customer satisfaction was influenced by the context and time of the research as well as field of research, this leaded to different results making it difficult to verify the impact of service quality on customer satisfaction; (2) most previous researchers focused on private sector and very few researchers studied about service quality in public sector. Therefore, building model to assess satisfaction of enterprises toward service quality in this sector can contribute to scientific framework to support more extensive international and domestic studies on this subject; (3) literature review indicated that researches in public administration sector mostly focused on the direct impact of service quality on customer satisfaction and neglect the mediating role of perceived value to customer satisfaction. Thus, the dissertation expanded and contributed to the SERVPERF model the mediating role of perceived value variables. 2.5 HYPOTHESIS To understand the relationship between service quality, perceived value and customer satisfaction, the author proposed the research model consisted of factors of service quality that had positive impact on perceived value as well as customer satisfaction; at the same time perceived value also affects positively customer satisfaction. Thus, hypotheses were proposed as follows: Tangibles had positive impact on satisfaction of enterprises (H1), at the same time Tangibles also had positive impact on enterprises’ satisfaction with service quality (H2). Reliability had a positive impact on perceived value of enterprises (H3), at the same time reliability had a positive impact on enterprises’ satisfaction with service quality (H4). Responsiveness had a positive impact on perceived value of enterprises (H5), at the same time Responsiveness had a positive impact on enterprises' satisfaction with service quality (H6). Empathy had a positive impact on perceived value of enterprises (H7, at the same time Empathy had a positive impact on enterprises’ satisfaction with service quality (H8). Competence had a positive impact on perceived value of enterprises (H9), at the same time Competence had a positive impact on enterprises’ satisfaction with service quality (H10). Courtesy had a positive impact on perceived value of enterprises (H11), at the same time Courtesy had a positive impact on enterprises’ satisfaction with service quality (H12). Transparency had a positive impact on perceived value of enterprises (H13), at the same time Transparency had a positive impact on enterprises’ satisfaction with service quality (H14). Finally, perceived value has a positive impact on enterprises’ satisfaction with service quality (H15). 10 2.6 RESEARCH MODEL After reviewing theoretical framework and proposing hypothesis, the author proposed research model as follow: Figure 2.1: Research model Source: Recommended author Tangibles Reliability Responsiveness Empathy Competence Courtesy Transparency Perceived value Service quality satisfaction H15 H2 H4 H6 H8 H10 H12 H14 H1 H3 H5 H7 H9 H11 H13 11 CHAPTER 3: RESEARCH DESIGN Based on the theoretical framework and literature review, the author proposed a research model and hypotheses with corresponding variables as mentioned in Chapter 2. In this chapter, the author will present qualitative research methods and procedures to achieve research objectives as well as test hypotheses in Chapter 2. This chapter included: (i) Qualitative research and (ii) Quantitative research. 3.1 QUALITATIVE RESEARCH Results from qualitative research are the foundation for quantitative research, determining the appropriateness and feasibility of quantitative research in dissertation. The reason for that is that if the result from qualitative research on perceptions of enterprises is that enterprises do not know about the quality of business registration service then it means that this research is not appropriate. Therefore, to ensure the research model in the context was appropriate and necessary, the author implemented qualitative research methods including: (1) preliminary scale design; (2) adjusted scale and (3) official scale. After expert interview, the official scale consisted of 37 observable variables and 7 factors (tangibles, responsiveness, reliability, empathy, competence, courtesy, and transparency) with 29 observable variables in service quality scale, 4 observable variables in perceived value scale, 4 observable variables in customer satisfaction scale as follows: Table 3.1: Official scale details NO. Variables Tangibles 1 The administration procedures are posted in a place easy to see 2 There are instruction boards that show necessary procedures for enterprises when contacting the Business Registration Office 3 The office where business registration procedures are carried out is airy and clean 4 The office has necessary full, comfortable and modern equipment (desks and chairs for officers, computers, lighting, waiting chairs for customers) Reliability 5 The Department of Planning and Investment ensures that working hours are in accordance with regulations 12 NO. Variables 6 Enterprises do not have to revisit many times when following business registration procedures 7 The format of forms is consistent and easy to read and understand 8 Simple business registration procedures 9 Business registration certificates are issued on time and accurately Responsiveness 1 The forms required in the application can be accessed easily, convenient 2 The Department of Planning and Investment has the resources to provide the service 3 Officers advice and instruct enterprises about business registration procedures in a timely manner, within a reasonable length of time. 4 The waiting time to apply application and receive result is short 5 The Department of Planning and Investment readily respond to and promptly handle all complaints and issues from enterprises Empathy 1 Officers sympathize with and care about enterprises’ issues and difficulties 2 Officers understand the need of enterprises 3 The Department of Planning and Investment always creates the best conditions for enterprises and help to solve their problems Competence 1 Officers provide clear, reasonable, legal, consistent instructions and support 2 Officers can detect issues in the application to promptly advise enterprises when receiving the application 3 Officers can process the application in a timely manner in accordance with the regulation 4 Officers can handle difficult situations in a flexible way 5 Officers have professional qualifications, good knowledge and experience Courtesy 1 Officers have a polite and affable attitude when receiving enterprises’ applications 13 NO. Variables 2 Officers promptly provide support to enterprises 3 Officers have very friendly when enterprises come to the office to register 4 Officers take the initiative to provide instruction and support when enterprises come to the office to register Transparency 1 Regulations and procedures are shown publicly at reception desk of Department of Planning and Investment 2 Officers wear employee identification tags. Each officer has a name plate at the office. 3 New legal documents are promptly disseminated to the enterprises Perceived value 1 I felt comfortable when I followed business registration procedures at the Department of Planning and Investment 2 I felt that the fee for business registration service was reasonable 3 I was treated with respect by officers of the Department of Planning and Investment when I came there to register 4 I did not spend too much effort to get the Enterprise Registration Certificate Service quality satisfaction 1 I was satisfied with the support, consultation and information provision of business registration service of the Department of Planning and Investment 2 I was satisfied with the manner the service was delivered when registered business at the Department of Planning and Investment 3 I was satisfied when I used business registration service at the Department of Planning and Investment 4 I am willing to recommend my friends and family members to register business at the Department of Planning and Investment Source: Synthesized from relevant studies and opinions from expert interview (2018) 3.2 QUANTITATIVE RESEARCH The procedures of quantitative research were: design questionnaire, pilot interview and create complete questionnaire, sampling. 14 Designing questionnaire: To be able to create a complete questionnaire for the survey, the author first relied on an official scale to complete the questionnaire. Pilot interview and perfect the questionnaire: The purpose of pilot survey was to test the questionnaire before conducting a complete survey. 20 enterprises were selected randomly from 3 districts Ninh Kieu, Binh Thuy and Cai Rang because according to the statistics of the Department of Planning and Investment the majority of operating enterprises were in these districts. After the pilot survey, the author adjusted and completed the questionnaire as well as the sampling method and the way to conduct the interview. Sampling method for quantitative research: Respondents were enterprises operating in Can Tho city. Enterprises were sampled using stratified random sampling methods. The author selected randomly 300 enterprises from the list of names and addresses of enterprises in Can Tho city provided by the Department of Planning and Investment by drawing respondents and contacting the representative of the enterprise to conduct a face-to-face survey based on a prepared questionnaire. From the list of 300 enterprises, the interviewer conducted the official survey with enterprises that had been registered at 9 districts in Can Tho city. During the survey, interviewers couldn't contact many enterprises because they changed their headquarter address or registered as a different form of company. Interviewers drawn new respondents to replace these cases from a list of 5.773 enterprises. At the end of the survey, the author was able to collect data from 248 enterprises. Data analysis: Data were analyzed using different methods depending on each research objective such as descriptive statistics, testing reliability of the scale through Cronbach's Alpha coefficient, exploratory factor analysis EFA, evaluating research model and Bootstrapping test – testing the significance of PLS-SEM model. 15 CHAPTER 4: RESULT AND DISCUSSION The first part of this chapter gave an overview on the current situation of business registration service in Can Tho city. Next, chapter 4 presents the following contents: (1) Descriptive statistics of sample; (2) Descriptive statistics of variables; (3) Testing the reliability of the scale through Cronbach's Alpha coefficient, exploratory factor analysis EFA and finally (4) PLS-SEM model results 4.1 AN OVERVIEW ON CURRENT SITUATION OF BUSINESS REGISTRATION IN CAN THO CITY When the Enterprise Law (2014) came into effect from 01/7/2015 in order to more accurately match the actual business activities of enterprises, this was considered an event that marked important innovations regarding enterprises and a new milestone in the process toward the free market. Also, due to breakthrough reforms and that enterprises were given more autonomy, the number of applications during the period from 2014 to 2016 witnessed drastic change. That was shown in detail in Table 4.1 as follows: Table 4.1: The number of applications received, approved and not approved from 2010 to 2016 Unit: Application Year Application received Applications approved Applications not approved The percentage of approved applications (%) 2010 1.362 1.317 45 96,69 2011 5.166 5.016 150 97,1 2012 4.636 4.531 105 97,74 2013 4.810 4.724 86 98,21 2014 5.388 5.297 91 98,31 2015 8.224 7.938 286 96,52 2016 10.083 9.722 361 96,42 Total 39.669 38.545 1.124 Source: Department of Planning and Investment of Can Tho city (2018) The data in Table 4.1 showed a significant increase in the number of enterprises coming to the Department of Planning and Investment to register 16 business although in 2015, the new Enterprise Law (2014) replaced the previous version (2005) and created huge changes causing some enterprises initially got "stuck" when registering their businesses. However, the number of applications received in 2015 were 8.224 compared to 5.388 applications in 2014, corresponding to an increase of 2.836 applications. This showed that although the Enterprise Law (2014) only took effect from 01/7/2015 it partially solved the limitations of the previous Enterprise Law (2005) and was considered to have many important innovations that matched the expectations of many enterprises. Thus, a large number of enterprises came to Can Tho to open businesses. Nonetheless, when the number of applications rocketed because the time to issue Business Registration Certificate was shortened from 07 working days to 03 working days, that was a huge challenge for the Business Registration Office and the issue for them was how to process applications "on time" to meet the demands from enterprises. In addition, while the number of applications received increased steadily over years, a small number of applications were returned. The main reason these applications were returned was that during the process of submitting an application and waiting for results at the Business Registration Office, these enterprises withdrew the application to adjust the information and change the type of business. Besides, Table 4.1 showed that in 2015 and the number of applications being returned were 286 and 361 respectively. This data was completely consistent with the actual situation at that time because in 2014 Enterprise Law was updated and the guidelines were still not clear. Enterprises faced many difficulties when following the procedures due to this circumstance thus the number of applications being withdrawn to be adjusted increased significantly in 2015 and 2016. 4.2 SAMPLE CHARACTERISTICS The surveyed areas of the sample were 9 districts in Can Tho City, among them Ninh Kieu District had the most number of observations because it was the central district thus having many enterprises in Can Tho City. Age-group analysis shows that among customers who came to the office to register their business, the percentage of customers belonged to the age group of 30 -35 and 36-45 was 27,4 % and 46,4% respectively with the later age group accounted for the largest portion while the percentage of age group of under 30 was only for 5,2% and the percentage of the age group of above 45 was 21,0%. There were more male customers than female ones, but the difference between two sexes was not significant. The education level of respondents wasquite high, 17 with 71,8% respondents having a University education level. This proved that the higher the education level of the respondents was the more knowledge about administration procedures they knew. Thus, they had good interaction with officers of the Business Registration Office when following business registration procedures. Out of 248 surveyed enterprises, the percentage of one member limited liability company type was 53,6% - the largest percentage. This indicated that although Can Tho City attracted a large number of enterprises who invested in the city, most operating enterprises were small and family owned companies thus it was understandable that they registered their business as one member limited liability company to suit them most. Table 4.2: Respondents’ characteristics Categories Detail Number Percentage Age < 30 13 5,2 30 -35 68 27,4 36 - 45 115 46,4 > 45 52 21,0 Sex Male 186 75,0 Female 62 25,0 Education level Junior high school 3 1,2 High school 22 8,9 Vocational school 24 9,7 Colleges 15 6,0 University 178 71,8 Postgraduate education 6 2,4 Type of business Private company 40 16,1 Limited liability company with 2 or more members 54 21,8 One member limited liability company 21 8,5 Joint stock company 133 53,6 Source: Results from analysis of data collected from 248 enterprises (2018) 18 4.3 RESULT 4.3.1 Reliability of the scale To assess the reliability and quality of the scale, the author conducted the test through Cronbach's Alpha coefficient to eliminate inappropriate variables. The results showed that all scales had Cronbach's Alpha coefficient greater than 0,6 therefore it was acceptable in term of reliability. Table 4.3: Results from testing the reliability of service quality, perceived value, customer satisfaction scale Scale Cronbach's Alpha coefficient Remaining observable variables Tangibles 0,825 4 Reliability 0,815 5 Responsiveness 0,859 5 Empathy 0,759 3 Competence 0,810 5 Courtesy 0,896 4 Transparency 0,840 3 Perceived value 0,749 4 Customer satisfaction 0,706 4 Source: Results from analysis of data collected from 248 enterprises (2018) 4.3.2 Exploratory factor analysis EFA 4.3.2.1 Business registration service quality The results from performing the last EFA after eliminating inconsistent observable variables showed that factor loadings of each item were greater than 0,5. KMO coefficient = 0,830 was greater than the required value, with p.value = 0,000 < 0,05 the Barlett's test was statistically significant. Cumulative of variance = 57,365% > 50%. It could be concluded that the results of 7 dimensions were consistent with the model of factors that influence quality of business registration service in Can Tho city. 4.3.2.2 Perceived value The results of exploratory factor analysis EFA of perceived value variable showed that the KMO coefficient = 0,757; sig. value = 0,000; there was 1 factor extracted at Initial Eigenvalues of 2,291 which was higher than 19 minimum level (>1) Observable variables also explained 57,284% total observations which was higher than minimum level (>50%). In addition, all factor loadings were greater than 0,5. The results showed that the scale of perceived value reached the statistical standard. 4.3.2.3 Service quality satisfaction Results of exploratory factor analysis EFA showed that KMO coefficient was 0,750; significance value was 0,000;. there was 1 factor extracted at Initial Eigenvalues of 2,132 which was higher than minimum level (>1) Observable variables also explained 53,288% total observations which was higher than minimum level (>50%). In addition, all factor loadings were greater than 0,5. The results showed that the scale of customer satisfaction reached the statistical standard. 4.3.3 Evaluation of measurement model Whether the impact was statistically significant or not was based on p- value. The below table presented relationship, path coefficient and significance value. With the significance value of 5% the author summarized results from testing the hypotheses which would be presented in the next part. Source: Results from analysis of data collected from 248 enterprises (2018) Hình 4.5: The results coefficient of the structure model PLS-SEM Tangibles Reliability Responsiveness Empathy Competence Courtesy Transparency Perceived value 0,145 *** 0,181*** 0,211* ** 0,258*** 0,235*** 0,172*** 0,196*** 0,134*** 0,185*** 0,221*** 0,223** * 0,264** * 0,123*** Service quality satisfaction 20 Table 4.3: Path coefficient and t-value Hypothesis Relationship Path Coefficient T-value (Bootstrap) P-value Result H1 HH -> HL 0,172 4,053 0,000 Accept H2 HH ->CN 0,099 1,669 0,096 Reject H3 TC -> HL 0,196 5,154 0,000 Accept H4 TC ->CN 0,145 2,912 0,004 Accept H5 DU -> HL 0,134 3,702 0,002 Accept H6 DU ->CN 0,181 2,885 0,004 Accept H7 CT -> HL 0,185 5,541 0,000 Accept H8 CT -> CN 0,211 4,153 0,000 Accept H9 NL ->HL 0,221 5,577 0,000 Accept H10 NL -> CN 0,258 4,992 0,000 Accept H11 UX ->HL 0,223 5,707 0,000 Accept H12 UX -> CN 0,085 1,730 0,096 Reject H13 CK ->HL 0,264 6,480 0,000 Accept H14 CK -> CN 0,235 3,875 0,000 Accept H15 CN -> HL 0,123 3,052 0,000 Accept Source: Results from analysis of data collected from 248 enterprises (2018) The results showed that out of 15 hypotheses tested for the first time, 13 hypotheses were accepted at significance value 1% due to p-value < 0,01. There were also two hypotheses that did not have sufficient evidence to conclude that the impact was the relationship between tangibles and perceived value; courtesy on perceived value. Regarding this result, because all coefficients were positive this indicated that the correlation between factors were positive (or positive impact). 21 Hypotheses H1, H3, H5, H7 stated that perceptions about tangibles, reliability, responsiveness, empathy, courtesy, transparency had a positive impact on enterprises' satisfaction. The statistical test result showed that this relationship had the corresponding impact level of 0,172 (p-value < 0,001); 0,196 (p-value < 0,001); 0,134 (p-value < 0,001) and 0,185 (p-value < 0,0,001). Therefore, hypotheses H1, H3, H5, H7 were accepted as expected initially. This result was completely consistent with the result from many previous studies such as Lim and Tang (2000), Sohail (2003), Le Nguyen Doan Khoi et al. (2014) in healthcare sector, Bui Van Trinh et al. (2010), Dam Thi Huong et al. (2015) in tax sector. Hypotheses H9, H11, H13 stated that perception of courtesy, competence, transparency of service quality had a positive impact on enterprises' satisfaction. The result presented in the table showed that the impact levels were 0,223 (p < 0,000), 0,221 (p < 0,000) and 0,264 (p < 0,000) respectively. Therefore, hypotheses H5, H6,H7 were accepted. The relationships between courtesy and customer satisfaction; competence and customer satisfaction; transparency and customer satisfaction were studied in different context and sectors by Cao Duy Hoang and Le nguyen Hau (2010), Dam Thi Huong et al. (2015), Pham Thi Hue and Le Dinh Hai (2018). Hypotheses H4, H6, H8 stated that perception of reliability, responsiveness, empathy of service quality had a positive impact on perceived value of customers. The result presented in the above table showed that these 4 factors of service quality had positive impact on perceived val