Investigation Of The Influence Of Issues Related To Customer Satisfaction On The Kingfisher Financial Performance
Question
Task:
Assessment Brief: This module (BRPlan) is, directly, linked to the Business Research Project (BRProject) module
that students undertake during the last term. BRProject is designed in such way that students
conduct a research project in topics of their personal and professional interests. The task of
the assignment for the BRPlan is to provide a comprehensive and coherent plan of the
research project in the BRProject module.
In particular, students are required to do the following:
• Choose a research topic in the context of their programme/degree
• Write a 4,000-word summative assignment comprising of a 3,500-word individual
research plan and a 500-word evaluation of the choices made in the individual research plan.
2.1. The Research Topic
Students can choose research topics in the context of their programme/stream that reflect
their professional and personal interests and represent contemporary challenges in their field
of studies. The topics should be expressed in such way that they are researchable in scientific
terms (focused and answerable questions/issues) and realistic (amount of time available,
access to required information and data and a reasonable level of implementation
requirements).
2.2. The Research Proposal
The research proposal is the plan that students recommend in order to investigate the chosen
research topic. It should demonstrate a critical approach to the literature using a good number
of reviewed sources (academic articles, books, etc.) with the majority of them being academic
and professional work and properly referenced based on the Harvard System. References
should be used where appropriate throughout the whole report.
The report should also inform decisions about the general research approach
(deductive/inductive view), a good understanding of the variety, the advantages and the
challenges of different research methods and techniques (e.g. questionnaires, interviews), a
plan of gathering data, any time frame considerations, possible and alternative ways to
analyse the data, any relevant ethical and access issues. The reasons for the choices selected
must be clearly outlined in the research plan and in the evaluation.
Page 5 of 8
The main part of the individual plan should discuss the following:
• Introduction
• Literature Review (Background of the research)
• Research Aims/Objectives
• Research Methodology (Philosophy, approach etc.)
• Sampling (Population profile, sampling theories and sampling size)
• Accessibility
• Ethical Issues
• Significance
• Deliverables
• Required Resources
• Implementation Time Table (Gantt-like chart)
Answer
Introduction
The present study revolves around analysing the concept of Kingfisher financial performance on the customer satisfaction. Customer satisfaction is a broad term in a business and it measures the way in which products and services from an organisation supplied to the market for meeting the demands of the customers. There is a close link between the satisfaction level of the employees and the financial performance of an organisation. As opined by Xie et al. (2017), the enhanced satisfaction of the customers can lead to the improvement of the financial outcome of the businesses. The current business plan proposes to conduct research on the impact of the satisfaction of the consumers on the financial outcome of the British multinational retail organisation Kingfisher Plc.
Company overview
Kingfisher Plc is the multinational British retailing organization which consists of home enhancement products like tools, home furnishing, home appliances, hardware and garden supplies. The Kingfisher Plc has its headquarters in London, UK and was founded in 1982. The total strength of the staffs are 79,000 with the revenue of GBP 11,655 million, the net income is GBP 485 million and operating income of GBP 685 million (Kingfisher Corporate. 2019). It is considered to be the largest in Europe and the third largest home appliance organisation in the world. The Kingfisher Plc has 1,300 stores involving brands like B&Q, Castorama, Brico Depot and Screwfix.
Figure 1: Kingfisher Logo
Source: (Kingfisher Corporate. 2019)
Research question
The broad research question which aims to be answered in this project is “What is the impact of the issues related to customer satisfaction on theKingfisher financial performance?”
The sub-questions for this research include:
- What is the concept of Customer Satisfaction?
- What is the interrelationship amongst Kingfisher financial performance and customer satisfaction?
- What is the impact that customers excises on the Kingfisher financial performance?
- What are the strategies for resolving the issues of customer satisfaction within the organisation?
Rationale of the research
The present study highlights the issues of customer satisfaction which impacts upon the Kingfisher financial performance as it has been recently reported that the sales of the company has declined upto 3.2%. The emerging issues is rising in the company due to its lack in reaching the customers through lower promotional activities, lacking behind introducing new product in the market and also the lack of considering the customer within the decision making process that has led to decrease rate in the satisfaction of the customer of the company. This issue has led to fall in the profit as well as the Kingfisher financial performance which had lowered the brand image and the popularity of its main and substitute brands. Thus, the study helps in extracting out the issues faced by the company along with SPC model which helps in defining the relation of the customer satisfaction and the financial outcome of the company. There are certain strategies which may help in mitigating the loss of customer satisfaction, so that the company will get facilitated with the improvement in the Kingfisher financial performance and its profitability with brandishing the company image.
Literature Review
Concept of Customer Satisfaction within organizations
The customer satisfaction has been considered to be the measure of the products and services that are supplied by the company’s like Kingfisher that helps in mitigating the needs and expectations of its customers. It is defined to be the number of consumers or the overall amount of the consumers whose experience regarding the firm, its product and the services rates exceeds the goals of specified satisfaction. As stated by Agnihotri et al., (2016), the satisfaction of the consumers is considered to be the degree which matches up between the expectation and the product performance of organisations like Kingfisher. Thus, the customer satisfaction is recognised to be a vital part of the organisation which helps in accomplishing the demands and requirements of the customers and also helps in the company as well as the financial performance.
Interrelationship amongst Kingfisher financial performance and customer satisfaction
As per the views of Pizam et al., (2016), that relationship among the financial outcome and satisfaction of customer of the organisations like Kingfishers should be in a positive status. It is counted that the more is the satisfaction rates of the customers, there is the more favourable performance of the company’s finance. Furthermore, is even inculcated that there is the optimistic relationship among the satisfaction of the customers and the changes within the Kingfisher financial performance. As discussed by Zablah et al., (2016), the benchmark of the financial outcome of the organisation is it profitability. It is the classic measurement which helps in measuring the performance of an organization.
The utmost satisfaction of customers may lead to the acceleration of the cash flow, volumes of sale increments, and also the reduction of risk that may relate to the cash flow. The customers’ satisfaction leads up to the higher revenue in the future and also the reduction of the operational cost. On the other hand, the customer advocacy and customer loyalty are the parts of the customer satisfaction which helps in influencing the Kingfisher financial performance as mentioned below,
What is the interrelationship amongst Kingfisher financial performance and the customer loyalty?
The customer's loyalty is considered to be the business sign whether it is successful or not. The loyalty of the consumer makes a huge impact upon the company where the loyal customers buy back the products and services and becomes the screening of company's financial future. Thus, as opined by Hult et al., (2019), with the positive connection between Kingfisher financial performance and customer loyalty that helps in element of Return on Assets as if the scale of customer loyalty stays between 1-7 then there will be an increase of 0.59% of ROA.
The interrelationship between Kingfisher financial performance and customer advocacy
The advocacy is the attitude of the customers to provide recommendations to others for the purchase of the services and the products. The behaviour of the customer advocacy can lower the cost of the contemporary consumer acquisition as advocacy tends the consumer to trust against the company and ethics, the company could pressurise it charges for fetching the new customers. The customer advocacy helps in maintaining the competitive advantage of the company as the customers are loyal to provide confidence within the organisation. Thus, the increased customer advocacy helps in having a positive impact upon the consumer behaviour that is willing to pay much higher even if the company raise it product price. As per the views of Kaura et al., (2015), that this positive condition will help in impacting upon the increasing profit margin that is obtained by the organisation. Thus, with this huge margin in the profit, there will be a company’s positive financial performance.
Models and theories
The Satisfaction Profit Chain is a recognised theoretical framework which helps in linking the perception of attribute level with the overall satisfaction of the customers, customer’s behaviour and intentions and lastly, the financial results. Thus, as per the argument of Ramanathan et al., (2017), the abandoning consumer satisfaction is the means for the optimisation of customer retention and profitability. Thus, the SPC models follow the linkage that is as follows,
Attribute level of performance and consumer satisfaction
As per the modelling of the satisfaction and performance link as nonlinear and asymmetric, companies like Kingfisher gets facilitated by estimating the attributes of estimation weights and helps in prioritising the efforts that helps in maintaining and improving customer satisfaction.
Consumer satisfaction and consumer retention
It was observed that with 1% shift within the customer satisfaction can cause up to 61 8% shift within the customer loyalty. However, if companies like Kingfisher are successful in providing the services and products that caters the needs of it customer, this will help in increasing it customers’ loyalty. Hence, it can be said that with an increase in the customer loyalty may help in ROS of the company and this will assist in gaining huge Kingfisher financial performance.
Consumer retention and profitability
As per the observation of Otto et al., (2019), the linear view helps in encouraging the company for maximising the consumer retention, by the maximization of attribute performance and the satisfaction of the consumers, will help in satisfying the customer and will make them happy. Thus, the customer retention will undoubtedly help in enhancing the financial outcome of the company.
Figure 1: SPC model
Source: (Hogreve et al., 2017)
Customer Satisfaction related issues and its impact within Kingfisher Plc
The Kingfisher Plc had faced certain concern which became the issues of customer satisfaction that are,
Lack of Customer Reachability: With lower promotional activity regarding the products and its services of the Kingfisher Plc had a major impact upon it customer’s satisfaction. There was the disappointment of the customers as they can’t get the proper information of the products regarding ir benefits and facilities for which the purchase rate also decreased.
Lacking in satisfying the growing demands of the customers: As per the views of Fornell et al., (2016), Kingfisher Plc failed in introducing new range of products for its target customers, and therefore, failing to cope up with the changing requirements of the consumers. There was no new innovation regarding the products and services and the traditional product were continuing within the market which is loose in the interest of the customer searching for new and latest services. Thus, the rates of customer satisfaction also decreased.
Lack in involving the customer within decision making: The customers were not concerned in the process of decision making in Kingfisher Plc whether it is regarding the product launch or catering new strategies (Wang et al., 2016). The company ignored the feedbacks and reviews of the customer and had major focus on building up new large scale projects rather focusing upon the needs of the customers.
Hence, as per the above issues identified in the above study of Kingfisher financial performance there was a decrease in the sale of Kingfisher Plc which fell up to 3.1% that is GBP2.96 billion with the declining rate of 3.7%. In the UK and Ireland, there was a decline within the revenue unto 3.5%. The Costoram and Brico Depot which the French business of kingfisher posted the revenue decline of 5.7% and 6.2%. In Poland, 1.4% was the revenue decline rate. Thus, as per the statement of Qiu et al., (2016), the Kingfisher could observe the disruption and softness in the market of UK, whereas in France, the brico depot and castorama underperforms the market condition and will suffer with a decrease in the promotional activity.
Strategies for the mitigation of issues related to customer satisfaction within organizations
There are certain strategies which helps in mitigating the issues of customer satisfaction by Kingfisher Plc are mentioned below,
Treating the customer with excellence: The Kingfisher Plc should treat its each and every customer as VIP’s, which will help in enhancing the trust of the customers, the company should thank it customer for their business both in receipt and in person. The assistance provided to the customers helps in the mitigation of the issues in an effective way, while keeping the promise and integrity (Epstein et al., 2015).
Measuring the customer's satisfaction: With frequent measurement of the consumer satisfaction, Kingfisher can reduce the count of the unsatisfied customers, which would be potent in prevent the consumer churns. The online survey tools such as Netigate can work as an easy and effective way and it will also reflect upon the Kingfisher financial performance.
Use of social media: The Kingfisher Plc should monitor and track the customer’s experience within the social media which helps them in keeping updated with the negative as well as the positive feedback of the consumers. Thus, as per the evidence of Saeidi et al., (2015), this helps the company to take appropriate measures for resolving the negative reviews and enhancing more efficient strategies for catering positive reviews again.
Aim of the research
The aim of the research is to investigate the influence of issues related to customer satisfaction on the Kingfisher financial performance. The purpose of the research is to recognize the empirical relationship that is present between the loyalty and satisfaction of the customers on the profitability, market indicators, operating income and profit level of the company with major focus on the key issues that the organization in currently facing.
Objectives:
The objectives for this study on Kingfisher financial performance can be enlisted as follows:
- To understand the concept of customer satisfaction
- To explore interrelationship amongst consumer satisfaction and financial performance of organizations
- To investigate the impact on the Kingfisher financial performance caused by customers
- To analyse strategies for the resolution of the customer satisfaction related issues on Kingfisher Plc
Research Methodology
Research philosophy
According to Bresler and Stake (2017), research philosophy can be regarded as the ideology regarding the process of accumulating, analysing and using the information about the topic in a research. In a specific research, the philosophy is followed for gaining reliable and new information and knowledge regarding the topic of research. The different kinds of research philosophy that are followed in a particular research are interpretivism, positivism, and realism. In this particular research project, the researcher will utilise the positivism research philosophy. The utilisation of this philosophy is acceptable for the current research on Kingfisher financial performance as it enables the researcher to use an objective viewpoint for observing and describing the reality which is interpreted as stable. The use of the positivism philosophy will further help to make law-like generalisation with an observable social reality. As the nature of the research is primary, the use of interpretivism and realism philosophy is not appropriate and can be disadvantageous for this study as these do not consider the natural phenomena and quantifiable observations like the positivism research philosophy.
Research approach
As stated by Fletcher (2017), the understanding of proper research approach that can be implemented in a research project is crucial for research. Research approach portrays the procedure and plan of research that covers the phases in a research starting for broad assumptions to the processes of collecting, analysing and interpreting data. The various research approaches are the deductive, abductive and inductive approach that is used commonly in the business research. The proposed study on Kingfisher financial performance will use the deductive research approach as this approach allows the research to complete the study in a quicker way. The use of deductive research approach is justified as it enables in developing and evaluating the hypothesis and propositions on the basis of the existing theories (Wiek and Lang, 2016). In the proposed study on Kingfisher financial performance the researcher will start the investigation with the help of a social theory that is compelling with the topic and test the implication of the theory on the basis of the information that will be collected from different relevant sources. The use of inductive and abductive research can be disadvantageous for the proposed research as these offer inaccurate inference and scope in this type of research.
Research design
Research design relates to a framework that incorporates the techniques and methods that are selected in a particular research project in the aim to logically combine different elements in research. The different types of research designs that are applied in the case of business research are explanatory, exploratory, and descriptive research design. The proposed research project will use the exploratory research design. As demonstrated by McCusker and Gunaydin (2015), the researcher projects that use the exploratory design rely on the direct observations. The utilisation of exploratory research design is acceptable in the present research as helps in understanding the research topic in a preliminary manner. The design will also be advantageous in this research because of its flexibility and adaptability to the changes and ability to develop groundwork for future research in the particular research area. The descriptive research design is generally used in the secondary research and these can be disadvantageous for this particular research on Kingfisher financial performance as this does not allow the researcher to test the research problem with the usage of statistical tools.
Data collection method used to prepare the study on Kingfisher financial performance
The choice regarding the methods of data collection in a particular research is very important to make sure the quality and outcome of the research is high. The collection of data relates to the process in which relevant information regarding a specific subject is gathered from authentic sources. There are two types of data collection that are primary and secondary data collection (Aithal 2017). The collection of primary data relates to the accumulation of information from direct sources by the researchers. The accumulation of secondary data refers to the collection of data from previously conducted research on the same area. This particular research will utilise the primary method of data collection as it will help in exploring the relevant and original data relating to the topic of research. The primary research method will also enhance the accuracy of the research outcomes. For applying the primary data collection, the researcher would use the different techniques such as in-person interviews and online survey. Use of in-person survey can increase the overall cost of the project and thus can be avoided in this research.
Data analysis method
According to Etikan et al. (2016), the method of analysing data in research projects is the procedure in which logical and statistical techniques are applied for describing, condensing, illustrating and evaluating data collected in a particular research. Data analysis in research projects helps in identifying the patterns in the observations and the related themes. This leads to the identification of the issues in the topic and linking to conclusion. The different kinds of data analysis are the quantitative and qualitative data analysis. The quantitative data analysis methods are implemented to analyse the numerical data collected in research (Taherdoost, 2016). The qualitative data relates to the analysis of non-numerical data. The proposed research project developed on the concept of Kingfisher financial performance will use both quantitative and qualitative data collection and analysis techniques. For applying the quantitative method the researcher in the proposed research will use measures of central tendency as well as graphs and tables for figurative analysis and interpretation. The qualitative data will be analysed through the help of transcript analysis technique.
Limitation
The major limitation of the study on Kingfisher financial performance is that only primary research will be carried out and the secondary research process will be avoided. Secondary sources of information are rich source of information that could have enhanced the relevance and validity of the study. Limited time and financial resources was another drawback for this research and this prevented the researcher from carrying out the secondary research.
Sampling
As stated by Gentles et al. (2015), population in a research relates to the large collection of objects or individuals that is the major focus of query in a research. The population includes a large number of people who share some common characteristics. In this particular research that aims to investigate the connection between satisfaction of customers and the financial outcome of Kingfisher Plc, the population profile includes the customers, employees and managers of the organisation. All the customers, employees and managers who work in Kingfisher Plc, UK, will be considered as the population in this research. As the number of individuals included in the population is very large, a small subset of the population will be considered as sample in the proposed research. The subset of the population that are included in the research process relates to the sample.
Sampling theory refers to the relationship between the sample and the overall population. Based on the sampling theory, population is an aggregate of individuals or objects that share common traits or characteristics. The theory of sampling is concerned with the estimation of the features of the population from analysis of the features of the sample (Roberts, 2015). In the present research 50 employees and 50 customers of Kingfisher Plc, UK will be surveyed through online survey method. On the other hand, a face-to-face interview will also be applied for collecting information from 3 managers of the organisation. The present research on Kingfisher financial performance will use 2 major types of methods for sampling that are the probability and non-probability sampling technique. For conducting the online survey on the employees and the customers the researcher will utilise the probability sampling technique; however, a non-probability technique of sampling would be applied on the in-person interview of the managers.
Accessibility
As explained by Walther et al. (2015), accessibility refers to the process of designing social, psychological and physical environments for ensuring that in a research, the researcher can interact with the participants on an equal basis despite of the individual features. In the present research on Kingfisher financial performance the researcher will consider broader data accessibility for being able to pool research data and conduct the investigation and analysis with increased confidence in the research outcome.
Ethical Issues
Research ethics is very important and if not considered can cause the failure of the research project (Goodrich and Luke, 2017). The researcher in this particular study of Kingfisher financial performance will consider the research ethics by collecting informed consent from the participant and brief them about the purpose of the research. In addition, the researcher will also ensure that the literature sources are adequately cited in the study for avoiding issues of plagiarism and respecting the intellectual property rights. The use of proper language and avoiding discriminatory and offensive language is another approach that will be used in the research on Kingfisher financial performance. A critical and careful examination of the research outcome will be done to avoid careless errors.
Significance
The research outcome will be significant as it will enable the concerned organisation to understand the importance of the link between Kingfisher financial performance and customer satisfaction. On the basis of the theories and the results of the research, the organisation can use different strategies to eliminate the issues that have decreased the satisfaction level among the customers and affect the Kingfisher financial performance. On the other hand, the research outcome will be beneficial as a secondary source of information for other researchers who aim to conduct research on this particular area.
Deliverables
The project will deliver the knowledge of the interrelationship between the satisfaction of the consumers and financial outcome to the key stakeholders of the company Kingfisher Plc, UK such as the employees, managers, owners and investors. The scope of the project is to provide information on the strategies that can be taken to mitigate the challenges associated with the decreased customer satisfaction level.
Required Resources
For completing the proposed research successfully financial resources is very important. The financial resources will help the researcher in collecting information from relevant academic journals, books and research papers from offline and online library sources. To collect data from the employees, the researcher will develop an online survey platform which will also require financial resources. To arrange in-person interview as well, the researcher will need financial resources. Time is an important resource that will be needed in any research project (Hair Jr et al. 2019). Material resources that will be required in this research are the computers, laptops, statistical tools, and internet connection.
Implementation Time Table
(Refer to Appendix 1)
Evaluation of Individual Research Plan
The research plan focuses extensively on determining and understanding the factors that affect satisfaction and its effects on the Kingfisher financial performance. The research plan states that a structured format needs to be used in order to present the research in an effective manner. It was suggested that the Positivism Philosophy would be used in order to conduct the research. According to Pawlikowski et al. (2018), this philosophy has been specifically considered due to its ability to use natural sciences and logical thinking. Without proper logical thinking, the research will not be able to deduce the main causes of change in customer preferences and satisfaction. Additionally, this logical thinking can also help to keep track of various situations and understand the causes of various events leading to low customer satisfaction and decrease in financial viability for the Kingfisher Brand. Other philosophies such as Interpretivism and Realism lack in the use of logical thinking. Interpretivism focuses on social sciences and the views of other people which may be biased. On the other hand, as stated by De Landa and Harman, (2017), Realism focuses on realistic thinking which involves thinking emotionally rather than logically and thus cannot be applied to the research.
It has also been stated in the present study on Kingfisher financial performance that a Deductive Approach will be used in order to conduct the research in an efficient manner. As per Woiceshyn and Daellenbach (2018), this approach is highly efficient in deducing an idea based on a certain issue, event or problem. This approach has especially been selected as it works hand in hand with the Positivism Philosophy. An inductive approach has not been used here because of its ability to introduce a new idea or concept. This research on Kingfisher financial performance will not involve the development of any new entity and thus the inductive approach is not applicable. Additionally, the exploratory research design has been considered in this research. This design enables the researcher to explore a variety of ideas and concepts that may have been involved in customer satisfaction. Additionally, it allows speculating on various outside interferences that might lead to differences in the thought processes of customers. Other designs such as the explanatory and descriptive deals with conducting deductions based on the information gained and do not focus on considering new ideas or concepts that may be involved. Therefore, these designs cannot be used within this research paper.
The research plan also involves collecting data from primary sources. There have been previous studies regarding the factors affecting customer satisfaction but none of them have specifically focused on its effects on the financial conditions of Kingfisher. Therefore, the usual factors affecting customers of this brand may be different. Additionally, various factors may have been an issue during the time of previous research and various changes and updates may have been implemented within this time. Conducting research using primary sources can help to gain current information (Farrell and Brunton, 2016). Both surveys and interviews have been considered in order to gain maximum information on the Kingfisher financial performance. Surveys can help to gain numeric data that can be represented in the form of graphs and charts whereas interviews can help to gain detailed descriptions of the factors that may have been causing these changes in customer mindsets.
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Appendix
Appendix 1: Gantt Chart
Table.1: Gantt chart
(Source: Created by the learner)