Integrating internal customer orientation, internal service quality, and customer orientation in the banking sector: an empirical study

The purpose of this paper is to examine the interrelationships between internal customer orientation (ICO), internal service quality (ISQ), and customer orientation (CO) to develop and test a conceptual model of the antecedents of CO in the banking sector. The conceptual framework consists of the following constructs: ICO, interdepartmental conflict, interdepartmental connectedness, ISQ, job satisfaction, empowerment, and CO. Moreover, 10 hypotheses were developed and tested using a sample of 202 banks. Reliability analysis and confirmatory factor analysis have been used to test the validity of the constructs, while the structural equation modelling has been used in hypotheses testing. The strength of the relationship between the constructs indicates that features of the suggested CO model including interdepartmental connectedness, interdepartmental conflict, job satisfaction, and empowerment are crucial to achieving business performance and CO. The results which emerged from our hypothesised model were found to support that ICO leads to ISQ and in turn CO. In particular, all variables show strong support for our hypothesised model, however, interdepartmental conflict was found to be a negative indicator. Findings suggest that the CO model can be deployed as a means of enhancing organisational behaviour to improve business performance.