TABLE OF CONTENT

TABLE OF CONTENTS i

ACKNOWLEDGEMENT iii

LIST OF TABLES iv

LIST OF FIGURES iv

ABSTRACT 1
CHAPTER ONE INTRODUCTION
1.1 Overview of Higher Learning Institutions in Malaysia 2
1.2 Background of Akademi Laut Malaysia (ALAM) 3
1.3 Problem Statement 5
1.4 Research Objectives 6
1.5 Research Questions 6
1.6 Scope of Study 6
1.7 Significance of Study 6
1.8 Limitation of Study 6
1.9 Definition of Terms 6

CHAPTER TWO LITERATURE REVIEW

2.1 Service Quality 7
2.2 Service Quality Dimension 8
2.3 Service Quality Model and Measuring Tools 9
2.4 Student Satisfaction 10
2.5 Related study in service quality and student satisfaction for 11
higher learning education centre
2.6 Strategic Tools 12
2.6.1 Internal Factor Evaluation (IFE) and External Factor 12
Evaluation (EFE)
2.6.2 Internal-External (IE) Matrix 13
2.6.3 Quantitative Strategic Planning Matrix (QSPM) 14
2.7 Academic Construct 15
CHAPTER THREE RESEARCH DESIGN AND METHODOLOGY
3.1 Research Design
3.1.1 Data 16
3.2 Sampling Process

i
 3.2.1 Sample Size 16
3.2.2 Sampling Technique 16
3.3 Data Collection and Instrument
3.3.1 Questionnaires 16
3.3.2 Interview 17
3.4 Application of Strategic Tools
3.4.1 Internal Factor Evaluation (IFE) and External Factor 17
Evaluation (EFE) 17
3.4.2 Internal-External (IE) Matrix 17
3.4.3 Quantitative Strategic Planning Matrix (QSPM) 17
3.5 Data Analysis Procedure 18
CHAPTER FOUR FINDINGS, ANALYSIS AND DISCUSSION

4.1 Demographics 19
4.2 Service Quality and Satisfaction 20
4.3 Strategic Tools and Suggestion
4.3.1 Internal Factor Evaluation (IFE) 25
4.3.2 External Factor Evaluation (EFE) 27
4.3.3 Internal-External (IE) Matrix 29
4.4 Choose the best strategy - Quantitative Strategic Planning 30
Matrix or a QSPM

CHAPTER FIVE CONCLUSION AND RECOMMENDATION

5.1 Conclusion 36
5.2 Recommendation 37
REFERENCES 39

APPENDIXES

Appendix I : Sample of Questionnaires 41

Appendix II : Interview Key Questions and Profile 45

ii
 ACKNOWLEDGEMENT

First of all, both of us wish to express

our heartfelt appreciation and gratitude to our supervisor
Professor Madya Zin Ibrahim
for his valuable advice and never-ending guidance throughout the length of this
study. He never hesitated in assisting both of us to sort out the various
problems faced in conducting this research.
Both of us also wish to take this opportunity to thank our MBA course mates
who had contributed to our study in one way or another.
Our sincere thanks to all lecturers in the MBA programme.
Finally, we wish to record my deepest gratitude to our family members,
colleagues and friends
for their understanding, support and encouragement
throughout our study.

iii
LIST OF TABLES

Table(s) Page

Table 1: Related study in service quality and student satisfaction 11

Table 2: Comprehensive Strategy-Formulation Framework 12

David (2011)

Table 3: Demographics 19

Table 4 : Gap Score Analysis 20

Table 5: Importance Point of Dimension 23

Table 6: Average Weighted Score 24

Table 7: Internal Factor Evaluation (IFE) 25

Table 8: External Factor Evaluation (EFE) 27

Table 9: QSPM 34

LIST OF FIGURES

Figure(s) Page

Figure 1 : Number of New Cadets 2009 - 2014 5

Figure 2: IE Matrix David (2011) 13

Figure 3: Academic Construct 15

Figure 4: ALAMs IE Matrix 28

iv
 ABSTRACT

As a private higher learning education, ALAM need to ensure there are sufficient number
of scholarship available for cadets registered. Major sponsors mainly the shipping
companies were concern on the satisfaction level of cadets towards the service quality
provided. They believe in satisfy cadet is a happy cadet who can perform better.
Therefore, the objective of this study is to examine the relationship between service
quality and cadets satisfaction. Besides that, this study also would like to recommend on
strategies to improvise service quality to further satisfy the cadets. The respondents are 236
ALAMs cadets whom need to answer a set of questionnaires that were modified from the
SERVQUAL instrument. Based on the gap score of -0.604 and total weighted score of -0.12,
it has found out that ALAM cadets are not satisfied with the service quality provided by
ALAM.
This study had used few strategic tools to recommend on strategies to be implemented.
Based on the QSPM result, ALAM is to opt for a market penetration strategy that will
consider the outcome from the survey conducted on cadets satisfaction towards service
quality provided so that cadets satisfaction level can be increased.

1
 Chapter One - Introduction

1.1 Overview of Higher Learning Education in Malaysia

Malaysia Governments long term aspiration is to make Malaysia becoming a regional center
of excellence in education. Since 1995 until 2013, the growth of higher education institution
can be seen through the increasing number of enrolment and student population,
introduction of various government policies and incentives in promoting education and the
most important is the increasing number of higher education institutions.

Malaysian government spent an annual total expenditure equivalent to 7.7% of annual

Government expenditure in higher education. This exhibit how committed the government on
education of it citizen especially in higher education.

In 2012, a total of 1.4 million students had enrolled themselves in various Malaysias Higher
Education Institutions (HEIs) and there are about 97,000 international students coming from
various countries all over the world.

Malaysia do have 20 public universities, 53 private universities, 403 active private colleges,
30 polytechnics and 73 public community colleges in 2011 and these institutions do offer a
wider range of tertiary education at a comprehensive and affordable price.

Malaysia Qualifications Agency (MQA) being set up to ensuring and assuring the quality of
higher education in Malaysia via implementation of Malaysian Qualifications Framework.
This agency is responsible on the accreditation of courses, quality assurance and other
related matters.

Resulting from the changes within education landscapes in Malaysia, public higher
education institutions had encountered serious challenges to operate within the limited
resources given by the government. According to Lee (2004a) the challenges has incite
government to encourage private higher education institutions to put up a more active role in
the higher education sector through various policy and regulatory amendments.

In Malaysia, the private higher education institutions were officially recognised in 1996. The
recognition was made thru the introduction of the enactment of the Private Higher Education
Institutions Act (PHEIA) 1996 and the amendments made to the Universities and University
Colleges Act (UUCA) 1971 and the Education Act 1961.

2
Malaysia's first rating system, SETARA (Rating System for Higher Education Institutions in
Malaysia) was implemented in 2009 to measure the performance of undergraduate teaching
and learning in universities and university colleges in Malaysia. The SETARA result was
determined by using a six-tier category with Tier 6 is identified as Outstanding and Tier 1 as
Weak.

Subsequently, another rating system was introduced in 2011. MyQUEST (Malaysian Quality
Evaluation System for Private Colleges) was used to evaluate private colleges in Malaysia in
terms of the program and courses, quality of students, graduates, governance and
resources. The MyQUEST rating will segregate and categorized an institution as either
excellent, good, or weak depending on the institution performance. The institutions would
also receive a rating based on their level of achievement which ranged from 1 star (poor) to
6 stars (excellent).

1.2 Background of Akademi Laut Malaysia (ALAM)

ALAM was established in 1977 and started its journey as MATES Foundation (Malaysian
Training and Education for Seaman). Later in 1981, it had been changed to Akademi Laut
Malaysia or better known as ALAM. Akademi Laut Malaysia is situated at Tg Dahan, Kuala
Sg Baru, Melaka and it has 30 hectares beautiful campus reside by the Straits of Melaka.

ALAM vision is to be a world class maritime academy and its mission is to facilitate
value added learning via conducive environment and providing competent personnel
to their client in the marine industry.

Since the establishment in 1977, ALAM manage to train more than 10,000 qualified and
competence seafarer to serve the maritime industry. This seafarer had enrolled in various
courses conducted. For the past 5 years, the number of courses offered had increased
from 136 to 156 courses. Most of ALAMs courses were accredited by the regulatory
bodies locally and internationally such as MARDEP (Jabatan Laut Malaysia), Malaysia
Quality Assurance (MQA), Det Notske Veritas (DNV), European Maritime Safety Agency
(EMSA) and few others bodies. These bodies accreditation were important for seafarers to
join the industry as seafaring career is based on competency.

ALAM had developed 2 eLearning packages namely LNG eLearning (first in the world for
LNG training) and CHEMel (for chemical tanker training).

3
ALAMs is fully equipped with training facilities, thus help the course participants to feel the
real equipment on shore. All type of courses can be conducted as the required equipment is
available. In 2007, ALAM had acquired the full mission ship handling simulator complex
(first in Malaysia) and 4 years later the engine room simulator.

Faculty members were well trained, qualified, experienced and multinational. Basically
the entire marine based faculty members were from the industry and had vast experience
in their own field.

There are 4 categories of customers that ALAM have right now namely sponsors,
government agencies, parent and student. All customers do have their own goals and
objectives when dealing with any parties.

As for the sponsor, they expect to have a knowledgeable, skilful and competence seafarer at
a very minimum of cost and time. They also want the training provider not just providing
common courses but also the highly demand courses example the oil and gas industry
requirement courses. These seafarers will come to ALAM to receive their education and
training. ALAM need to fulfil the sponsor requirement by providing world class facilities
coupled with an experience, knowledgeable, skilful and competence faculty members.

Besides that, the government agency like Marine Department of Malaysia (MARDEP)
requires ALAM to comply with their rules and regulations. This is due to all competencies
courses conducted at ALAM must be certified by MARDEP. As commonly known, MARDEP
ultimate goal is to ensure all training provider for maritime industry produce the right person
for the industry. Among the latest rules that all training provider must obey is as per Malaysia
Shipping Notice MSN 10/2012 and Malaysia Shipping Notice MSN 04/2013. The notice
stated that in order to enhance the quality of trainers, all trainers must undergone
International Maritime Organization (IMO) Train of Trainer (T.O.T) 6.09 (delivery) and IMO
Train of Trainer (T.O.T) 3.12 (assessment).

As for parent, definitely they expect the best for their children. They want their children to be
well trained and disciplined. ALAM promote that the student will go through a fully
regimented system when the student enrol in the diploma courses.

Students are also one of the main customers that ALAM need to entertain every day. As for
the long courses student, they expect to have good lecturer, nice learning facilities, great
campus life and definitely guaranteed of job after graduation.

4
1.3 Problem Statement

Figure 2 : Number of New Cadets 2009 - 2014

Over the years the intake of cadets in ALAM had being in declining trend. Refer to figure 1.
Cadetship program is one of the main revenue streams for ALAM. The declining in number
of cadets registered in ALAM over the years had affected the revenue. Thus also affects the
end result i.e. profit for shareholders. Furthermore most of the private higher learning
institutions in Malaysia are self funded and doesnt have the privilege or opportunities to
obtain any financial assistances or subsidies from the government (Teo, 2001).
A study by ALAMs Corporate Planning and Business Development department (CPBD) had
concluded that one of the reasons in the declining trend was complaints from existing cadets
to their sponsors with regard on services provided by ALAM. Among the action taken by the
sponsors is reducing the number of scholarship offered for ALAM.
According to Saravanan & Rao (2007) if any business want to develop strategies that lead to
customer satisfaction, one need to emphasis on customer perceptions on service quality.
Based on the above, this project is conducted to study the relationship of cadet satisfactions
and the service quality provided by ALAM. Besides that, this study will come out with few
suggestions and recommendation by using some strategic management tools to improve the
satisfaction of cadet.

5
1.4 Research Question(s)
Is there any relationship between service quality and Cadet Satisfaction?
What are the strategies to improvise service quality to further satisfy the cadets?

1.5 Research Objectives

To examine the relationship between service quality and cadets satisfaction;
To recommend on strategies to improvise service quality to further satisfy the cadets.

1.6 Scope of study

The research conducted shall only report the service quality in relation to cadet satisfaction
based on the SERVQUAL model (Parasuraman, 1985) that have been modified and refined
from 10 dimensions to 5 dimensions. This research also will only consider the cadets that
registered for long courses. Student enrols in short courses and advance courses will not be
included in this study.

1.7 Significant of study

This study will help ALAM to determine the ways in meeting the industry requirement. On the
other hand, this study will deter-mine the students opinions with regard to service quality
provided by ALAM. Like every service oriented organization, a training institution too has its
customers. It seeks to satisfy its customers, namely its students, by offering courses that
help the student, and providing a sufficient environment to stimulate the student desire to
learn.

1.8 Limitation of Study

The main limitation is that this paper focuses on the cadets/student who enrols in the long
course (Diploma program DNS and DME). Other types of student who enrol in short
courses are ignored. The sample taken from students who are currently at ALAM (registered
on Jan 2015).

1.9 Definition of Terms

Term Definition
Cadet Student who are enrolled in ALAM diploma program

Cadets Satisfaction Student satisfaction is a short-term attitude that results

from the evaluation of their experience with the education
service received
(Elliot & Healy, 2001).
Service Quality Service quality is expression of customers/clients
regarding overall performance of any service that
organization provides

6
 Chapter Two - Literature Review

2.1 Service Quality

Nowadays, most of the higher educational institutes are more concerned about their service
quality which they believe could improve their educational standard. University is one of the
best places where students obtain more opportunities in order to develop their career skills,
personal growth and revealing their individual potentials.

Among the critical element of customer perception is the service quality. As for educational
services, quality had become a dominant element in customers evaluation. The student
(customer) judge the quality of services based on their perceptions of the various type of
quality like outcome, interaction and physical environment (Janardhana & Rajeshekar,
2012).

Satisfaction and quality are terms that are used interchangeably. Service quality is
expression of customers/clients regarding overall performance of any service that
organization provides. First and foremost, service quality concentrates on meeting the
customers expectation. Due to the expectations are dynamic in nature, evaluations also
become dynamic. It varies from one group to another group and from one culture to another
culture.

The essence is, service quality is a measure of how the delivery service level matches
customers expectations and customers expectation is somehow interrelated with
customers satisfaction (Kang et al., 2002). The two concepts are fundamentally different in
terms of their underlying causes and outcomes. Generally, satisfaction being viewed in a
bigger picture and concept, whereas service quality is more focuses on dimensions of
service. Based on this view, we could conclude that perceived service quality is a
component of students opinions.

Wisniewski, 2001 had mentioned in his paper, that service quality is a concept that has been
debated in most of the literature and became the interest of many writers. This happens
because of it is difficult to define and measure.

Service quality can also be defined as the differences between customer expectations
towards service quality provided and the perceived service. According to Parasuraman
(1985) if the expectation value is higher than the perception value, then the perceived quality
is less than satisfactory level and hence customer dissatisfaction occurs.

7
2.2 Service Quality dimension
There are few studies being found talking about the service quality dimensions. According to
Parasuraman (1988), he had shared in his study that, there are 5 dimensions that are
related to service quality. The dimensions are as below:
1. Assurance
Zeithaml (2006) had defined assurance as the employees knowledge and courtesy
together with the service providers ability and capability to inspire trust and
confidence. Although assurance is important, for some industries it may not be so
important due to higher risk or uncertainty in the outcome (Andaleed and Conway
2006). As for education service, assurance is an importance dimensions that
customers looking at especially in the certification and accreditation of courses.

2. Reliability
Reliability is defined as the ability to of the service provider to perform the service
that being promises accurately and dependably (Zeithaml, 2006). This dimension is
important as all customers definitely want to deal with company that able to keep
their promises. Company like FedEx, PosLaju may make this dimension as their
selling point. For the food and beverages industry, reliability is interpreted as the
ability to deliver fresh food right during the first time and in the correct temperature
(Andaleed & Conway, 2006)

3. Responsiveness
This dimension is where the service provider shows their willingness to offer help and
provide prompt and immediate service (Zeithaml, 2006). Responsiveness deals with
the customers requests, attend to customer questions and complaints immediately.
Company need to be responsive with any problems or complaints and addressed it
within stipulated time. Zeithaml (2006) commented that for all companies need to
look at responsiveness from the view point of the customer instead of the companys
perspective.

4. Tangibility
Tangibility is a dimension used by company to convey the brand image and sign of
the quality provided (Zeithaml, 2006). It comes in form of physical fixtures, facilities
provided, staff, training materials and many more. The appearances of the tangible
items that are related to the service provided are considered (Zeithaml, 2006).

8
 5. Empathy
Zeithaml (2006) had defined empathy as how company provided their individual
attention and cares to their own customer. There are few ways company can provide
empathy to their customer: address their customer by name, preferences and needs.
Service company like hotel, their level of empathy is very high. In education sector,
when the lecturers are able to remember their student name and address them
accordingly, the rate of empathy is also high.

2.3 Service Quality Model and Measuring tools

Perceived Service Quality Model was developed by Gronross (1982) based on
disconfirmation paradigm where comparison made by customer on expectation and
perception which later lead to the outcome whether the customer is satisfied or not.

Parasuraman (1985,1988) had introduced SERVQUAL model after looking at the perceived
quality model and believed that the level of perceived quality is dependent on the gap
between customer expectation and their perception. A good service quality is considered as
one which meets or exceeds consumers expectation of the service (Parasuraman, 1985).

SERVQUAL instrument is very stable and could be used in most of service organizations. It
asked the customer on their expectations from an organization in terms of service quality in
22 items (Parasuraman, 1988). Parasuraman, (1988) had identified 10 dimensions of service
quality and later he had stream it down to only 5 dimensions namely tangibility, empathy,
responsiveness, assurance and reliability.

Despite the criticisms SERVQUAL has received, it's clear that the model provides a
convenient beginning for practitioners and teachers seeking to monitor and determine
perceived service quality. It provides a platform that's capable of directive attention to
problems with service quality, which might be engineered upon to come up with lots of
comprehensive interpretation of service quality (Palmer, 2011). It's sometimes impractical to
determine the expectations before the service are within the context of higher learning and
its normally out of the bounds of the human to be ready to capture student expectations of
the university. As a result, the study tries to record expectations retrospectively, which might
be problematic, since expectations might are influenced by service delivery. (Palmer, 2011).

SERVPERF model is a service quality measuring tool that only has the performance part as
compared to SERVQUAL instrument and it represents the direct measurement technique
(Cronin and Taylor, 1992). Jain & Gupta (2004) said that the SERVPERV model is more
well-organized in reduction of number of items to be measured by bigger percentage

9
besides able to discuss the variance in the overall service quality. In the higher learning
sector, Oldfield and Baron (2000) and Faganel (2010) had used SERVPERV in their
research.

Firdaus (2005) had constructed a HedPERF model in order to capture more genuine factors
in higher learning. HedPERF have 41 items and service quality being explained in 5 factors
namely non-academic aspects, reliability, assurance, program issues and academic aspects.

According to Brochado (2009), to choose measurement instrument, one need to analyse and
there is a results of one study revealed that SERVPERF and HedPERF had the best
measurement capacity.

2.4 Student Satisfaction

All successful organization, normally they address the need of customer segments in order
to develop customer loyalty and satisfaction. Good customer satisfaction will give an effect
on the profitability to every business. A satisfied customer normally will reward the
businesses by repeating the order and even to pay more for the services (Krishna, Swapna
& Gantasala, 2010).

Students are satisfied with quality of education when they are able to lead their life happily.
Student normally experiences various events and experiences during their university time
which continuously structured the student satisfaction (Elliot & Shin, 2002). Athiyaman
(1997) had developed a set of questionnaires that measure the relationship between the
satisfaction and contentment of students from the service quality of their institution.

Palacio, Menses and Perez (2002), believe that satisfaction actually covers issues of
students perception and experiences during the college years. Hom (2002) also complaint
some of the researcher had faced problem while creating a standard definition of student
satisfaction.

10
2.5 Related study in service quality and student satisfaction for higher learning education centre

Table below show few related study in showing the relationship between service quality and student satisfaction.
No Author Title Model Dimension Sample
1. Brenda Wai Using Servqual To Measure Users SERVQUAL Tangibility, Assurance, 171 (staff and
Fong Yu (2008) Satisfaction Of Computer Support In Higher Responsiveness, Reliability teaching staff)
Educational Environments and Empathy
2. Adee Athiyaman Linking Student Satisfaction and Service Perceived Emphasis on teaching 496 respondents
students well
(1997) Quality Perceptions: The Case of University Quality for
Class sizes
Education Higher Level and difficulty of subject
content
Education
Student workload
Availability of staff for
student consultation
Library services
Computing facilities
Recreational facilities
3 R. Dirkse Van Using SERVQUAL To Measure Users SERVQUAL Tangibility, Assurance, 984 students
Shalkwyk & R.J Satisfaction Of Computer Support In Higher Responsiveness, Reliability
Steenkamp Educational Environments and Empathy
(2014)
4. Ljiljana Kontic Measuring Service Quality in Higher Learning SERVPERF Assurance, 109 respondents
(2014) Education: The Case of Siberia Responsiveness, Reliability
and Empathy
Table 1: Related study in service quality and student satisfaction

11
2.6 Strategic Tools

According to David (2011), there are three stages of decision-making framework involved in
formulating a strategy. Comprehensive Strategy-Formulation Framework (Refer to table xx)
mentioned that in Stage 1 (Input Stage) it will summarize the basic information needed to
formulate the strategies. There are 3 tools namely Internal Factor Evaluation Matrix (IFE),
External Factor Evaluation Matrix (EFE) and Competitive Profile Matrix (CPM). While in
Stage 2 (Matching Stage) it will focused more on building and generating the alternatives via
aligning the external and internal key factors. David (2011) mentioned that in his book, stage
2 does have 5 tools namely SWOT Matrix, SPACE Matrix, BCG Matrix, IE Matrix and Grand
Strategy Matrix. In Stage 3 (Decision Stage), Quantitative Strategic Planning Matrix (QSPM)
is used to objectively examine the alternatives created in stage 2.

STAGE 1 (INPUT STAGE)

Internal Factor External Factor Competitive
Evaluation Evaluation Profile Matrix
Matrix (IFE) Matrix (EFE) (CPM)
STAGE 2 (MATCHING STAGE)
SWOT Matrix SPACE Matrix BCG Matrix IE Matrix Grand Strategy
Matrix
STAGE 3 (DECISION STAGE)
Quantitative Strategic Planning Matrix (QSPM)
Table 2: Comprehensive Strategy-Formulation Framework David (2011)

In order to come out with recommendation and propose a strategy for this study, IFE matrix
and EFE matrix is chosen in the input stage, IE Matrix for matching stage and QSPM for
decision stage.

2.6.1 Internal Factor Evaluation (IFE) and External Factor Evaluation (EFE)

Internal factor evaluation (IFE) matrix is used to evaluate the strengths and
weaknesses in a company. While external factor evaluation (EFE) matrix, is used for
assessing the opportunity and threats that business is currently or going to face
(Ovidijus, 2014)

According to Ahmad (2011), the combination of IFE and EFE have the capacity to
evaluate company performance by looking at the internal strength and weaknesses
of a company and also the external factor like the opportunity and treats that any
company could face.

12
Ovidijus (2014) mentioned that both of these matrices are easy to understand and
use, IFE and EFE can also be used to develop SWOT, IE Matrix and GE-McKinsey
Matrix. Although these matrices do have advantages, it also has some limitation. IFE
and EFE matrices can easily be replaced and they do not directly assist in
formulating a strategy (Ahmad, 2011).

2.6.2 Internal-External (IE) Matrix

Figure 2: IE Matrix David (2011)

The IE matrix is a continuation of the EFE matrix and IFE matrix models. The
Internal-External (IE) matrix is another strategic management tool used to analyse
strategic position of a business. The Internal External Matrix or short IE matrix is
based on an analysis of internal and external business factors which are combined
into one suggestive model (David, 2011)

There are 9 cells which later being segregate into 3 regions. For region 1 (Cells I, II,
and IV) it suggests more intensive and aggressive strategy as it will focus on grow
and build strategy. The strategies should focus on market penetration, market
development, and product development. From the operational perspective, a
backward integration, forward integration, and horizontal integration should also be
considered.

13
For region 2 (Cells III, V and VII), it focuses on hold and maintain strategy. The
tactical strategies for this region are focusing on market penetration and product
development. While region 3 (Cells VI, VIII and IX), are categorized with the harvest
or divest strategy. In some cases, aggressive cost management is a way for this
strategy (David, 2011).

2.6.3 Quantitative Strategic Planning Matrix (QSPM)

In order to evaluate any strategic options and to determine the option that any
business could opt to, techniques and methods like quantitative strategic planning
matrix (QSPM) is widely used. Meredith (2009), had mentioned in her paper that,
although this tool is used heavily in classroom by student and academia, businesses
and companies are reluctant to use this tool to help them in strategy evaluation and
decision making process. This tool will indicate the best alternatives and also shows
the relative attractiveness of other strategies. It based on the internal and also the
external critical success factor.

14
2.7 Academic Construct

Internal
Factor
Evaluation
SERVCE
(IFE)
Expectation QUALITY
tangibility Internal

Satisfaction
External

Cadet
assurance QSPM
Matrix
responsiveness
Perception (IE)
reliability

empathy
External
Factor
Evaluation
(EFE)

Figure 3: Academic Construct

15
 Chapter Three - Research Design and Methodology

3.1 Research Design

3.1.1 Data
There are two types of data being collected in research namely primary data and
secondary data. This study is a descriptive study therefore primary data is the type of
data that being collected. According to Kynda (2005), primary data is collected by the
researcher to address problems and it is not to be found in somewhere else. Primary
data can be collected via survey (distributing a set of questionnaires) and interview.

3.2 Sampling Process

3.2.1 Sample Size
As at January 2015, there are 458 number of student had registered at ALAM for
semester 2015. Based on the number, it is needed to determine the right sample size
for the study. This is to ensure the sample taken is enough to represent the
population. Based on table produced by Kreiji & Morgan (1970) for the population of
460, the number of sample needed is 210. The number of samples that is used for
this study is 236 samples. It is 51.5% of the population and this number of sample is
sufficient to represent the current population.

3.2.2 Sampling Technique

There are 2 types of sampling methods namely probability sampling and non-
probability sampling. Convenience sampling is one of the simple and easy methods
of non-probability sampling to use. It could be stopping people on the street or in
front of the company premises. Ashley Crossman from about.com also mentioned
that convenience sample also could be by asking from friends, students, customers
or colleagues that the researcher do has a regular assess to.

For this study, a convenience sampling method is used to gather data.

3.3 Data Collection and Instrument

3.3.1 Questionnaires
This study used questionnaire as a medium to obtain the data needed. There are
three sections in the questionnaire, consisting of Section A: Demographic factor,
Section B: Measurement of Service Quality in ALAM by looking at their expectation
and perception. Besides that, there is 1 item looking at the respondent satisfaction
towards overall service quality and Section C: Measurement of the importance of

16
 each dimension in SERVQUAL. In this section A, four question covering from the
subjects of gender, age, race or ethnicity, and their semester of study. Followed by
section B: service quality in ALAM and section C: measurement of the level of
importance of each dimension. Instrument used in this research is adapted from
Parasuraman et al. (1990) with some of the items used refined to the need of ALAM
but still within the five dimensions in service quality (tangibility, assurance, reliability,
responsiveness and empathy) using the Likert scale from 1 for not satisfied at all to 5
for very satisfied.
(Sample of questionnaires can be viewed at appendix I)

3.3.2 Interview
A session of interview had been conducted with ALAM personnel that have the
knowledge to discuss on internal and external factor. Key question (appendix II)
being set and given to the interviewee prior meeting. This could expedite the process
as the interviewee already has the basic idea on matter to be discussed. Profile of
the personnel can be viewed at appendix II.

3.4 Application of Strategic Tools

3.4.1 IFE and EFE
After conducting the interview with ALAM personnel, key factors, weight and rating
are being identified according to the categories. For IFE, the key factors are the
strengths and the weaknesses. For EFE, the key factors are the opportunities and
the threats. Weight is the indicator on how important is the factor to the business
while rating is the indicator on how good is the performance of the company in
relation to the factor. For each factor, a weighted score is determined from the
product of each weight and their rating. A total weighted score is determined from the
summation of all factors weighted score.

3.4.2 IE Matrix
The result of total weighted score from IFE and EFE was taken and being plot at the
matrix. Once the result plotted on the cell in the IE matrix, region is identified. The
region will propose on the strategies that applicable and most comprehensive to be
materialized.

3.4.3 QSPM
There are few strategies that IE matrix might identify and selection of strategies
needs to be done. First an attractive score with scale of 1 to 4 is being identified to be

17
 put at the internal and external factor, where 4 is the best strategy and 1 is the least
strategy. If any of the factor does not relevant to the strategy a dash is introduce.
Then the total attractive score for each factor is determined from the product of
weight and the attractive score. The grand total of the total attractive score is
determined by the summation of all factors total attractive score. The highest total
shall be chosen as the strategy to be applied.

3.5 Data Analysis Procedures

The data analysis for this study conducted through Microsoft Office application (Ms excel) by
looking at the mean (average) of expectation and perception. Later the differences taken
from the expectation and perception (gap score) is analyse together with the weighted score
proposed through the SERVQUAL instrument that could lead to the relationship between
dimension and satisfaction level.

18
 Chapter 4: Result and Analysis

4.1 Demographics
Factor Item N Percentage
Male 227 96%
Gender
Female 9 4%
<20 119 50%
Age 21<23 91 38%
>24 26 12%
Malay 121 51%
Chinese 11 6%
Race
Indian 84 35%
Others 20 8%
Semester 1 0 0%
Semester 2 135 57%
Semester
Semester 5 98 41%
Semester 6 3 2%
Table 3: Demographics
Gender
From the total number of 236 respondents (ALAMs cadets), 96% or 227 respondents were
male cadets while the other 4% or 9 respondents were female cadets.
Age
50% of the respondents were cadets below 20 years old; the other 38% were between 21
years old to 23 years old and the balance of 12% were cadets above 24 years old.
Race
51% or 121 respondents were Malay cadets, 6% or 11 respondents were Chinese cadets,
35% or 84 respondents were Indian cadets and the rest of 8%or 20 respondents were from
other races.
Semester
57% or 135 respondents were cadets from semester 2, 41% or 98 respondents were cadets
from semester 5 and 2% or 3 respondents were cadets from semester 6 (final semester).
There were no respondents from semester 3 and semester 4 cadets due to they were on
board of ship for their 1 year practical training.

19
4.2 Service Quality and Satisfaction
The SERVQUAL model is used to measure cadets expectation and perceptions regarding
the service quality provided by ALAM. These are measured by using a 5-point scale to rate
their level of agreement or disagreement (1 strongly disagree and 5 strongly agree).
Perceptions are based on the actual experience that the cadet go through and expectations
are based on the past experiences and information received about a maritime school. The
scores are determined by looking at the difference between perception and expectation
scores (P-E). It measures the service gap or the degree to which expectations exceed
perceptions. The more positive the P-E scores, the higher level of service quality which lead
to a higher level of customer satisfaction. Satisfaction and service quality are treated as the
function of a cadets perception and expectation. In some cases where the expectation and
perception value is equal, we could conclude that the service quality is satisfactory.
(Chingang & Lukong 2010).
EXPECTATION PERCEPTION GAP Average
DIMENSION QUESTION
SCORE SCORE SCORE Gap Score
S1 4.2 3.0 -1.2
S2 4.1 3.1 -1.0
TANGIBILITY - 0.83
S3 4.1 3.6 -0.5
S4 4.0 3.4 -0.6
S5 4.1 3.2 -0.9
S6 3.9 3.3 -0.6
ASSURANCE -0.73
S7 3.9 3.2 -0.7
S8 4.1 3.4 -0.7
S9 3.7 3.5 -0.2
S10 3.7 3.7 0
REALIABILITY S11 3.8 3.8 0 0.02
S12 3.6 3.7 0.1
S13 3.6 3.8 0.2
S14 3.7 2.9 -0.8
S15 3.7 3.1 -0.6
RESPONSIVENESS -0.70
S16 3.8 3.1 -0.7
S17 3.7 3.0 -0.7
S18 3.6 2.9 -0.7
S19 3.7 3.0 -0.7
EMPATHY S20 3.9 2.9 -1.0 -0.78
S21 3.8 2.9 -0.9
S22 3.6 3.0 -0.6
OVERALL AVERAGE GAP SCORE FOR 5 DIMENSION -0.604
Table 4: Gap Score Analysis

20
Based on the above table,
1. TANGIBILITY dimension of service quality had obtained an average gap score of -
0.83. It was the highest gap score among the five service quality dimensions. It being
asked in question S1 to S4. In these questions the cadets were asked regarding the
physical layout and attribute of ALAMs equipment and training materials such as
signboard, poster and others. The cadets were also questioned on the physical
appearance of ALAMs employees.
This is the largest gap that occurs among the five (5) dimensions during the study. The
expectations of the cadets are high as compared to the perceptions. The result
indicates that, cadets are not satisfied with element in the tangibility dimension
and ALAM need to invest more on improvement for the infrastructures to be in lined
with the modern learning environment and elevate its training equipment matches with
the technology advancement. Similarly, the front line employees should also enhance
their physical appearance professionally.

2. ASSURANCE dimension of service quality being asked in question S5 to S8. The

questions in this dimension were related around the feeling of trust and confidence in
the mind of the cadets while undergoing ALAMs services. The question of employees
behaviour, courtesy and knowledge while delivering their task were asked to the
cadets. Question on whether the cadets feel safe while studying in ALAM was also
included in this dimension.
It has a third largest average gap score of -0.73 among the five dimensions. This is
reflection of insecurity of cadets in dealing with the employees of ALAM. The result
shows that, ALAM needs to draw measures in ensuring its employees awareness
regarding their task and behaviour while delivering their jobs to the cadets. Likewise,
ALAM needs to make sure that its employees enhance their knowledge and
courteousness while deliver their services to the cadets. These moves will initiate trust
and confidence from the cadets in order for ALAM to gain competitive advantage and
for customers' loyalty.

3. RELIABILITY dimension of service quality being discuss in question S9 to S13. It has

the least average gap score of 0.02 and it was the only positive value among the five
service quality dimensions. For this dimension, questions posted to the cadets were
about ALAM assurances to accomplish task within the stipulated time and the
employees passionate to resolve cadets problem. Another questions posted were the
exactness of the service and accuracy of the data or record provided by the
employees.

21
 The perception of cadets is higher than their expectation. This denotes that ALAM
cadets are satisfied with the reliability dimension. Nevertheless between the five
questions posted, the assurance to accomplish task within the stipulated time
documented the lowest gap score. Therefore, ALAM must seriously thinking of the
best possible way to confirm that once it undertake to do something, it will be
completed within the time pledge.

4. RESPONSIVENESS dimension of service quality being discuss in question S14 to

S17. This dimension had received an average gap score of -0.70, the forth in term of
rank within the five service quality dimension. In this dimension, questions written
were regarding the actual time when the services will be rendered to the cadets and
the promptness of service provided by the employees. Other questions being asked
were employees willingness to assist cadets and the employees respond to manage
the cadets request.
For this dimension the result was negative as indicated above, the negative value point
out that the expectation is higher than perception. Therefore, the cadets are not
satisfied with the responsiveness dimension. Based from the five questions posted
in this dimension, the cadets feel that ALAMs employees responsiveness toward their
requests, questions, complaints and problems are the weakest area. Responsiveness
describes the notion of flexibility and ability to customize the service to cadets needs.
ALAM needs to improvise the employees responsiveness on cadets requests,
questions, complaints and problems.

5. EMPATHY dimension of service quality being discuss in question S18 to S22. The
questions surveyed in this dimension were regarding the individualization attention for
cadets and did ALAMs operative hours convenient for the cadets. Other questions put
in the survey were regarding the understanding of cadets specific needs by ALAM and
did ALAM will have their student best interest at heart.
It does have the second largest average gap score of -0.78 and it shows that cadets
are not satisfied. There are big gap and ALAM should focus for improvement on this
dimension. It is essential to provide individual attention to the cadets; this will show to
them that ALAM does best to satisfy their needs. Empathy is an additional plus that the
trust and confidence of the customers and at the same time increase the loyalty. In this
competitive world, the customer's requirements are rising day after day and it is the
companies' duties to their maximum to meet the demands of customers, else
customers who do not receive individual attention will search elsewhere.

22
The overall gap score with a value of -0.604 also show that ALAM cadets are not
satisfied with the service quality provided by ALAM.

A higher perception also indicates higher satisfaction as service quality and satisfaction are
positively related (Fen & Lian, 2005). This means that dimensions with higher perception
scores depict higher satisfaction on the part of customers and lower perception scores depict
lower satisfaction. (Chingang & Lukong 2010)

In order to obtain weighted SERVQUAL score, respondents were asked to allocate points
that when add up to 100 points among the five service quality dimension. The allocation
should indicate the importance of the five dimensions. Table 5 show the percentage points
for each dimension.

Dimension Percentage (points)

Tangibility 22.1
Assurance 17.7
Reliability 18.2
Responsiveness 23.1
Empathy 18.9
TOTAL 100
Table 5: Importance Point of Dimension

Based on table 5, it shows that responsiveness was deemed very important by ALAMs
student since it does have the highest weight (23.1%), followed by tangibility (22.1%), then
empathy (18.9%), reliability (18.2%) and assurance give the least weight (17.7%).

Then, the weighted SERVQUAL score is achieved by multiplying the averages gap scores
(table 4) of each dimension with their weight (table 5). The weighted score for the various
dimensions explains the degree and magnitude of satisfaction or dissatisfaction as
compared to the gap score. This is due to the respondent is given with the opportunity to
include his/her points in determining the importance of the dimension.

23
 Average
IMPORTANCE WEIGHTED
Gap
WEIGHT SCORE
Score
TANGIBILITY -0.83 0.22 -0.18
ASSURANCE -0.73 0.18 -0.13
RELIABILITY 0.02 0.18 0.003
RESPONSIVENESS -0.70 0.23 -0.16

EMPATHY -0.78 0.19 -0.14

Average weighted
-0.12
score
Table 6: Average Weighted Score

With the weighted SERVQUAL score, tangibility (-0.18 each) are most deficient followed by
responsiveness (-0.16), empathy (-0.14) and assurance been least deficient (- 0.13).
Reliability has the most efficient value (0.003). The values for the SERVQUAL weighted
score show how much each dimension was deficient and efficient in contributing to the
satisfaction of ALAM student. The overall weighted SERVQUAL score is -0.12. This
means that ALAMs students are highly dissatisfied with the services received.

24
4.3 Strategic tools for strategies and suggestion.

Before we could propose recommendation and solution, we would like to conduct IFE and
EFE. Then we are going to apply it through IE matrix to look at which strategies that ALAM
should propose in order to improve the satisfaction level of student towards service quality
rendered by ALAM.

Below are the Internal Factors Evaluation (IFE) and External Factors Evaluation (EFE) table.

4.3.1 Internal Factor Evaluation (IFE)

Weighted
No Factor Weight Rating
Score

STRENGTH

Courses accredited by regulatory bodies locally and

1 0.20 4 0.80
internationally MARDEP/DNV sea- skill/ISO/MQA

2 Fully equipped training facilities 0.20 4 0.80

Faculty members Well trained, qualified, experienced,

3 0.10 3 0.30
multinational, Niche expertise i.e. Simulators training

National and Internationally known - one stop center for

4 0.05 3 0.15
MET.

Strong image as a premier MET institution with 30 years

5 0.05 3 0.15
establishment

WEAKNESS

1 Higher cost to maintain ageing infrastructure 0.15 2 0.30

2 Difficulty in attracting and retaining faculty members 0.10 2 0.20

New administration employees with little knowledge in
3 0.05 2 0.10
maritime education and maritime related regulation
4 Heavily dependent on single client 0.05 2 0.10
5 Weak ICT infrastructure 0.05 2 0.10

TOTAL WEIGHTED SCORE 1.00 3.00

Major weakness (1), weakness (2), strength (3) and major strength (4)
Table 7: Internal Factor Evaluation (IFE)

25
STRENGTH
Most of ALAMs courses were accredited by the regulatory bodies locally and
internationally such as MARDEP (Jabatan Laut Malaysia), Malaysia Quality
Assurance (MQA), Det Notske Veritas (DNV), European Maritime Safety
Agency (EMSA) and few others bodies. These bodies accreditation were
important for seafarers to join the industry as seafaring career is based on
competency.
ALAMs is fully equipped with training facilities, thus help the course
participants to feel the real equipment on shore. All type of courses can be
conducted as the required equipment is available.
Faculty members were well trained, qualified, experienced and multinational.
Basically the entire marine based faculty members were from the industry and
had vast experience in their own field.
ALAMs was established 30 year ago and is well known locally and
internationally. The only MET in Malaysia that had full spectrum of maritime
education. ALAM had trained more than 10,000 seafarers since its inception.

WEAKNESS
Since ALAM was established 30 year ago, lots of its infrastructures were
ageing. It is required high repair and maintenance cost and ALAM doesnt
receive any grant from government and financial aids from its parent
company.
It is difficult to attract maritime employees to be its faculty members as
maritime industry salary is among the highest. To attract the maritime
employees ALAM need to put up its employment remuneration benefit at par
with the maritime industry. To retain its existing faculty members were also
required lots of investment in human capital.
Newly engaged administration employees who have limited knowledge in
maritime education and regulation. The maritime education is governed by
the regulation such as The Standards of Training, Certification &
Watchkeeping (STCW), Maritime Labour Convention (MLC) and International
Maritime Organization (IMO). The newly employed administration staffs have
to enhance their knowledge with regard to the regulation governing the
maritime industry.
ALAM graduates were conferred with diploma and Certificate of Competency.
To further the tertiary education they need to study at other institution.

26
 MISC Bhd (ALAMs parent company) contributes 40% of its revenue annually.
Thus it heavily depends on one single customer. ALAM need to move out
from this situation and spread out its revenue contributors to other customers
from the industry.
ICT infrastructure in ALAM is fragile due to its locality. To upgrade the facility
need huge sum of investment.
4.3.2 External Factor Evaluation (EFE)
Weighted
No Factor Weight Rating
Score
OPPORTUNITY

Shortage of manpower and increase in demand to

1 0.15 4 0.60
replace aging seafarers

New rules, regulation and amendment e.g. STCW

2 0.20 3 0.60
2010

PETRONAS/MISC overseas business ventures

3 0.05 3 0.15
provides training opportunities

Graduates are guaranteed employment from the

4 0.15 3 0.45
sponsors

Expansion of ports and marine terminals which

5 0.05 3 0.15
require simulator studies and port related courses.

THREAT

Uncertainty on extension of concessionaire

1 0.15 2 0.30
agreement

2 Poaching of experience trainers by maritime industry 0.10 2 0.20

3 Insufficient training shipberth 0.05 1 0.05

Bureaucracy and red tape from regulatory bodies

4 0.05 1 0.05
i.e.; MARDEP, immigration

Mushrooming of maritime training centers-Sarawak

5 0.05 1 0.05
Maritime Academy, Mardep training center, UniKL

TOTAL WEIGHTED SCORE 1.00 2.60

Poor (1), Below average (2), Above average (3) and Superior (4)
Table 8: External Factor Evaluation (EFE)

27
OPPORTUNITY
Based from MARDEP report currently there are more than 45,000 seafarers
in Malaysians companies were foreigner. The opportunity arises for ALAM to
train local to be seafarer.
There were regulation imposed by the international governing bodies for
maritime industry, and all the companies need to comply with it. Thus create
opportunity for ALAM to conduct related courses.
PETRONAS and MISC Bhd were two main players in the oil and gas industry
and shipping industry. ALAM is MISC Bhd subsidiary and PETRONAS related
company. This gives the advantage of using their synergy to create
opportunity for ALAM.
Graduates are guaranteed employment from the sponsors. 80% of ALAMs
cadets were sponsored by shipping companies locally and internationally.
The cadets employments were guaranteed as they need to serve their
sponsors.
ALAM is equipped with the stage of art simulators such as Full Mission Ship
Handling Simulator, Engine Room Simulator and Liquid Cargo Simulator.
ALAM is the only maritime institution in Malaysia owned the simulators; hence
give the extra mileage for consultancy jobs.

THREAT
ALAM is a concessionaire between Government and Malaysia Maritime
Academy Sdn Bhd. It will expire in 2016. The uncertainty of the extension
concessionaire agreement has made ALAM to put hold on its investment for
future expansion.
The poaching of staffs from industry is also threat to ALAM. Experience staffs
resign and join back the industry. Hence ALAM need to train other staff to be
subject matter expert.
Insufficient training shipberth. ALAMs cadets need to go thru one year
shipberth training on board of ship in order to get their Certificate of
Competency. With the insufficient training shipberth, it will reduce the
potential cadets to join ALAM and seafarer career.
Bureaucracy and red tape from regulatory bodies for example MARDEP and
immigration. As ALAM conducted courses for foreigners this factor will
contribute to difficulty to attract them.
Mushrooming of maritime training centres; Sarawak Maritime Academy
(SMA), Marine Department (Mardep) training centre, UniKL and others.

28
 These training institutions had in away conceived as threat to ALAM, even
though they dont provide full scale of maritime training.

4.3.3 ALAMs IE Matrix

THE IFE TOTAL WEIGHTED SCORE
IFE = 3.00
STRONG AVERAGE WEAK
EFE = 2.60
(3.00 4.00) (2.00 2.99) (1.00 1.99)
HIGH I II III
TOTAL
WEIGHTED SCORE

(3.00 4.00) Grow and Maintain

MEDIUM IV V VI
EFE

(2.00 2.99) Build and Harvest

LOW VII VIII IX
THE

(1.00 1.99) Hold or Divest

Figure 4: ALAMs IE Matrix
Based from ALAMs IFE score of 3.00 and EFE score of 2.60, the ALAMs IE is placed in
quadrant IV. As for this quadrant the strategy that ALAM should impose is grow and build. In
this quadrant, ALAM is recommended to pursue intensive (market development, product
development or market penetration) or integrative (forward, backward or horizontal
integration) strategies. Although the above strategies are recommended, ALAM must not
confine its strategies. ALAM should adapt strategies that can intensify cadets satisfaction on
the services delivered.

MARKET PENETRATION
ALAM need to concentrate to its existing products and its existing markets. Therefore
ALAM had to focus on its existing courses that able to produce higher margin and
frequently subscribe by customers. These courses should be marketed to the existing
customers.
Besides focusing on the existing courses, it is vital for ALAM to satisfy its existing
markets. ALAM should develop or enrich its customers satisfaction in order to
sustain the existing customers. Once the customers satisfy with the courses or
services offered he or she will return to attain other courses, hence created sense of
loyalty by the customers.
For example, In order to satisfy the customers, the front line employees should be
knowledgeable in the maritime education and industry. These front liners should be
able to give informative advices to the customers.

29
 For example courses for ship operation and safety which are frequently subscribed
and give higher margin had to be promoted to MISC Bhd., AET Ship Management
and Bumi Armada Bhd. These three companies are the platinum customers for
ALAM. These companies contributed 65% of ALAM yearly revenue based on
previous records.
Since these three companies are the main contributor to ALAM revenue, emphasis
should be more on dealing with them. At any instances their requirement should be
fulfilled if possible. Extra attention should put on them and retain their business with
ALAM.
ALAM should also look into other means of promoting its courses. Besides gearing
up its marketing team to all shipping company existing in Malaysia, ALAM also need
to look into company that are residing at nearby country like Singapore, Indonesia,
Brunei and Thailand.

PRODUCT DEVELOPMENT
ALAM also need to introduce new products to the existing customers. Create the
awareness of new courses needed to the existing customers.
As for ALAM, introduce the new STCW 2010 Manila Amendments courses to the
platinum customers. Make them aware of the requirement and arrange for the
platinum customers employees to subscribe those courses first.
Study cases that involved breaching of safety that happen on-board the ship,
particularly cases involved the platinum customers asset. Develop courses based on
the tragedy or incident and introduce to the customers. This will create awareness to
them and will trigger them to subscribe the courses

4.4 Choose the best strategy - Quantitative Strategic Planning Matrix or a QSPM
The Quantitative Strategic Planning Matrix or a QSPM approach attempts to objectively
select the best strategy using input from other management techniques and some easy
computations. When company executives think about what to do, and which way to go, they
usually have a prioritized list of strategies. If they like one strategy over another one, they
move it up on the list. This process is very much intuitive and subjective. The QSPM
method introduces some numbers into this approach making it a little more "expert"
technique.
From the IE matrix we had 2 strategies. Based on these, we have decided to evaluate
further the product development strategy and market penetration strategy. We used
Quantitative Strategic Planning Matrix or a QSPM approach attempts to objectively select
the best strategy.

30
 Attractive score
Strategy 1 - Market Penetration Strategy
The attractive score for the S1 (Courses accredited by regulatory bodies locally and
internationally MARDEP/DNV sea skill/ISO/MQA) is the most acceptable (4)
because in order for us to implement the market penetration strategy we must make
sure our product that we are going to sell is valuable and as for ALAM all its courses
is accredited by regulatory bodies from local and international.
Then the attractive score for S4 (National and internationally known - one stop center
for MET) and S5 (Strong image as a premier MET institution with 30 years
establishment) is acceptable (3) due to branding is one of the feature that is
important in order for us to market our product in an easy way. While the attractive
score for S2 (Fully equipped training facilities) and S3 (Faculty members Well
trained, qualified, experienced, multinational, Niche expertise i.e. Sim training) only
score possibly acceptable (2).
The attractive score for W1 (Higher cost to maintain ageing infrastructure) and W2
(Difficulty in attracting and retaining faculty members) is the most acceptable (4).
Maintaining the ageing infrastructure and retaining experience faculty members are
important in satisfying the customers. W3 (New administration employees with little
knowledge in maritime education and maritime related regulation), W4 (Heavily
dependent on single client) and W5 (Weak ICT infrastructure) are acceptable (3).
One way to satisfy the customers is by having knowledgeable front liners that can
convey informative answers to all the queries. Good ICT infrastructure is also
pertinent in satisfying the customers.
The attractive score for O2 (New rules, regulation and amendment e.g. STCW 2010),
O3 (PETRONAS/MISC overseas business ventures provides training opportunities)
and O4 (Graduates are guaranteed employment from the sponsors) are acceptable
(3). ALAM could seek help from its parent company in planning it market penetration
strategy. They might use this opportunity as their platform to venture into overseas
client.
As for O5 (Expansion of ports and marine terminals which require simulator studies
and port related courses), the attractive score is possibly acceptable (2) due to ALAM
might use the connection that they have within the maritime fraternity to grab the port
people.
Last but not least, the attractive score for T3 (Insufficient training ship berth) and T5
(Mushrooming of maritime training centers Sarawak Maritime Academy, Mardep
training center, UniKL) is possibly acceptable (2). These two factors are among the

31
difficulties that ALAM might face in doing it marketing effort. ALAM need to compete
with other institutions that are now mushrooming.

Strategy 2 - Product Development Strategy

The attractive score for the S1 (Courses accredited by regulatory bodies locally and
internationally MARDEP/DNV sea skill/ISO/MQA) is the most acceptable (4) due
to in order for us to develop any new courses or enhance the current courses we
must make sure our product is accredited by regulatory bodies from local and
international.
Then the attractive score for S2 (Fully equipped training facilities) and S3 (Faculty
members Well trained, qualified, experienced, multinational, Niche expertise i.e.
Sim training) and S4 (National and internationally known - one stop center for MET)
is acceptable (3). In order to develop any new courses and enhance any current
courses, a fully equip facilities coupled with excellent faculty members will definitely
resulted to a good product produced.
The attractive score for W4 (Heavily dependent on single client) and W5 (Weak ICT
infrastructure) are acceptable. ALAM is requires to accommodate the needs of it
platinum customer who are sending many of their employees to enrol for courses.
Therefore these play important role in deciding the strategy. Although ALAM has a
fully equip facilities, it still have some weakness in the IT infrastructure.
The attractive score for O1 (Shortage of manpower and increase in demand to
replace aging seafarers) and O2 (New rules, regulation and amendment e.g. STCW
2010) is most acceptable (4). By developing new product to accommodate the
requirement of STCW 2010 Manila amendment and enhancing the current product to
suit the requirement, ALAM could able to make a lot of profit. Besides that the
attractive score for O3 (PETRONAS/MISC overseas business ventures provides
training opportunities), and O4 (Graduates are guaranteed employment from the
sponsors) are acceptable (3).
Then the attractive score for T4 (Bureaucracy and red tape from regulatory bodies
i.e.; MARDEP, immigration) is acceptable (3).

32
The matrix is as per table below:

Strategy 1 Market Strategy 2 Product

Penetration Development
Key Factors Weight Total Total
Attractive Attractive
Attractive Attractive
Score Score
Score Score
Strength
S1. Courses accredited by regulatory bodies locally and
0.20 4 0.80 4 0.80
internationally -MARDEP/DNV sea- skill/ISO/MQA
S2. Fully equipped training facilities 0.15 2 0.30 3 0.45
S3. Faculty members Well trained, qualified, experienced,
0.07 2 0.14 3 0.21
multinational, Niche expertise i.e. Sim training
S4. National and Internationally known - one stop center for MET 0.06 3 0.18 3 0.18
S5. Strong image as a premier MET institution with 30 years
0.05 3 0.15 - -
establishment
Weaknesses
W1. Higher cost to maintain ageing infrastructure 0.20 4 0.80 - -
W2. Difficulty in attracting and retaining faculty members 0.10 4 0.40 - -
W3. New administration employees with little knowledge in maritime
0.06 3 0.18 - -
education and maritime related regulation
W4. Heavily dependent on single client 0.06 3 0.18 3 0.18
W5. Weak ICT infrastructure 0.05 3 0.15 3 0.15
Sum Weight 1.00

33
Opportunity
O1.Shortage of manpower and increase in demand to replace aging
0.15 - - 4 0.60
seafarers
O2. New rules, regulation and amendment e.g. STCW 2010 0.20 3 0.60 4 0.80
O3. PETRONAS/MISC overseas business ventures provides
0.05 3 0.15 3 0.15
training opportunities
04. Graduates are guaranteed employment from the sponsors 0.15 3 0.45 3 0.45
05. Expansion of ports and marine terminals which require simulator
0.05 2 0.10 - -
studies and port related courses
Threat
T1. Uncertainty on extension of concessionaire agreement 0.15 - - - -
T2. Poaching of experience trainers by maritime industry 0.10 - - - -
T3. Insufficient training ship berth 0.05 2 0.10 - -
T4. Bureaucracy and red tape from regulatory bodies i.e.; MARDEP,
0.05 - - 3 0.15
immigration
T5. Mushrooming of maritime training centers-SMA, Mardep training
0.05 2 0.10 - -
center, Uni KL
Sum Weight 1.00
Total Sum Attractive Score 4.78 4.12
(Attractiveness Score: 1 = not acceptable; 2 = possibly acceptable; 3 = probably acceptable; 4 = most acceptable; 0 = not relevant)
Table 9: QSPM

34
Doing some easy calculations in the Quantitative Strategic Planning Matrix QSPM, it came
to a conclusion that to strategize in MARKET PENETRATION is the better option. This is
given by the Sum Total Attractiveness Score figure. The strategy no 1 (Market Penetration)
yields higher score than the strategy no. 2 (Product Development). The strategy of MARKET
PENETRATION has a score of 4.78 in the QSPM shown above whereas the strategy of
PRODUCT DEVELOPMENT has a smaller score of 4.12.

Although MARKET PENETRATION strategy is the strategy that ALAM will opt for, ALAM
must ensure that the strategy taken must also take consideration the result of SERVQUAL
instrument that this study had achieved earlier.

35
 Chapter 5 - CONCLUSION and RECOMMENDATION

5.1 Conclusion
A higher perception also indicates higher satisfaction as service quality and satisfaction are
positively related (Fen & Lian, 2005). This means that dimensions with higher perception
scores depict higher satisfaction on the part of customers and lower perception scores depict
lower satisfaction. (Chingang & Lukong 2010). The first objective for this study is to examine
the relationship between service quality and cadets satisfaction. This study had used
SERVQUAL instrument by looking at the gap score and the total weighted score of the 5
dimensions.

Tangibility have the highest gap score of -0.83, followed by Empathy (-0.78), Assurance
(-0.73) and Responsiveness (-0.70). These dimensions do have negative gap score due to
the expectation does have a higher score as compared to perception. This is an indication
that cadets are not satisfied with the service quality provided by ALAM. Only Reliability
dimension have positive gap score of 0.02. The perception value is higher than the
expectation value. This indicates that cadets are satisfied with the element in the Reliability
dimension. Although Reliability dimension have a positive value (cadets are satisfied) but the
overall gap score with a value of -0.604 indicate and show that ALAM cadets are not
satisfied with the overall service quality provided by ALAM.

The values for the SERVQUAL total weighted score show how much each dimension was
deficient and efficient in contributing to the satisfaction of ALAM student. The overall
weighted SERVQUAL score is -0.12. This means that ALAMs students are highly
dissatisfied with the services received.

The second objective is to recommend on strategies to improvise service quality to further

satisfy the cadets. After using IFE and EFE to obtain score for IE Matrix which later resulted
ALAM is in region 1 (Build and Grow). In this region ALAM could opt for few strategies either
to pursue intensive (market development, product development or market penetration) or
integrative (forward, backward or horizontal integration) strategies. This study have use
QSPM to choose the best strategy to be implemented by ALAM. Based from the analyses
describe above, it can be established that ALAM need to concentrate on its MARKET
PENETRATION strategy.

36
5.2 Recommendation

This can be achieved by:-

1. Develop and conduct courses as per industry regulation and requirement.
Market the STCW 2010 Manila Amendments courses to the existing
customers because these courses are compulsory to the seafarers. Without
these courses they cannot work on board the ship even though they had vast
experience in the industry.
2. ALAM should also focus on the tailor made courses.
For examples, the tailor made conversion course for mechanical engineer to
marine engineer or ALAM can work out with its existing customers to offer
tailor made courses for its customer administration employees such as
introduction to shipping business or Shipping Anatomy.
3. Introduce research and consultancy ability to customers, however based on
existing capability only and no new investment for CAPEX should involve.
The Research and Consultancy department had to apprehend PETRONAS or
ports operator in Malaysia to offer its capability. The department need to
promote their ability thru the simulators owned by them.
4. Work closely with government agencies and shipping companies in order to increase
the shipberth (on job training) for cadets.
By increasing the shipberth (on job training) it will increase the chances for
ALAM to recruit more cadets. Currently the unavailability of shipberth is the
main issue stopping ALAM from recruiting more cadets. Thus it will help to
increase the manpower within the industry
5. Market the existing courses with higher margin to the existing platinum customers.
6. Ensure that the existing customers (including cadets sponsored by these
customers) were administered diligently. Based from the finding of this study, the
customers (cadets) were not satisfied with the service provided that is to say the
customers were not administered diligently. The 5 dimensions of Servqual had to be
handled. Among the recommendation are:-
Tangibility ALAM need to invest more on improvement for the
infrastructures to be in lined with the modern learning environment and
elevate its training equipment matches with the technology advancement.
Similarly, the front line employees should also enhance their physical
appearance professionally. On this idea, ALAM need to send the front liners
to enhancement courses such as grooming course. This will help to improve
the cadets satisfaction on ALAM services.

37
 Assurance ALAM needs to make sure that its employees enhance their
knowledge and courteousness while deliver their services to the cadets.
These moves will initiate trust and confidence from the cadets in order for
ALAM to gain competitive advantage and for customers' loyalty. The
employees need to be informed on new regulation with regards to maritime
industry or the employees need to keep abreast of the industry.

Reliability Even though this dimension is satisfied by the cadets, ALAM

must extremely consider the best potential way to confirm that once it
undertake to do something, it will be completed within the time pledge. This
will helps in increasing the cadets satisfaction.

Responsiveness ALAM needs to improvise the employees

responsiveness on cadets requests, questions, complaints and problems.

Empathy It is essential for ALAM to focus on individual attention to the

cadets; this will show to them that ALAM does best to satisfy their needs. To
do this ALAM need to employ student counsellor to handle the Gen Y
generation.

38
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41
 Appendix I

This survey form aims to further understand on Cadets Satisfaction on quality of service provided by
Akademi Laut Malaysia The items are set so as to support the study's proposition on the said issue.
The items are also meant to answer the following research questions:

What is the relationship between the service quality and cadet satisfaction?

The researchers assure the respondents that INFORMATION THAT WILL BE OBTAINED FROM
THIS SURVEY WILL BE PRIVATE AND CONFIDENTIAL and will be used for the purpose of this
research only. The researchers hope for your cooperation. Please analyse and answer each item to
the best of your knowledge as this will contribute a lot to the success of this research.

Should there be any queries or questions about the research please contact

HANIM ZAINAL 0127005582

MDJAI AHMAT 0192655432

Section A: Demographic factor

Age
Gender
< 20 years old
Q1. MALE Q2.
21 <23 years old
FEMALE
24 < 26 years old

Race or Ethnicity Semester

Malay Semester 1

Q3. Chinese Q4. Semester 2

Indian Semester 5

Others Semester 6

Section B: STUDENT EXPECTATION AND PERCEPTION

This section of the survey deals with your opinion of a MARITIME SCHOOL. Please show
the extent you think a maritime school should possess the following features. Tick () at the
relevant boxes.

Indicators:

Absolutely disagree (1)

Disagree (2)
Not sure (3)
Agree (4)
Absolutely Agree (5)

42
 Scale
No Statement
(1) (2) (3) (4) (5)

1 A maritime school will have modern looking

equipment
2 The physical facilities that a maritime school have
are visually appealing.
3 The staffs (admin & training) are neat in their
appearance.
4 Clear & concise materials (e.g. notes, signboard,
posters)
5 The staff behaviour of maritime school will instil
confidence in students

6 Students of maritime school feel safe study in

campus

7 Staff of maritime school are consistently courteous

with students

8 Staff of maritime school will have the knowledge to

answer students questions

9 When maritime school promise to do something by

a certain time, they do

10 Staffs show great interest in solving the student

problem.

11 The service that maritime school provide is right at

the first time.

12 Maritime school will provide the service at the time

they promise to do so

13 Maritime school will keep an accurate record

14 Staff of maritime school will tell customers exactly

when the service will be performed

15 Staff of maritime school will give prompt service to

customer

16 Staff of maritime school are always willing to help

customers

17 Staff of maritime school will never be too busy to

respond to student request

18 A maritime school will give student individual

43
 attention

19 Staff of maritime school recognize their student and

address them by name

20 A maritime school will have operating hours

convenient to all student

21 A maritime school will have their student best

interest at heart

22 The employee understand the specific needs of

their customers

44
This section of the survey deals with your opinion of ALAM (a premier maritime school in
Malaysia). Please show the extent you think ALAM should possess the following features.
Tick () at the relevant boxes.

Indicators:

Absolutely disagree (1)

Disagree (2)
Not sure (3)
Agree (4)
Absolutely Agree (5)

Scale
No Statement
(1) (2) (3) (4) (5)

1 ALAM have a modern looking equipment

2 The physical facilities that ALAM have are visually

appealing.
3 The staffs (admin & training) are neat in their
appearance.
4 Clear & concise materials (e.g. notes, signboard,
posters)
The staff behaviour of ALAM have instil confidence
5
in students

6 Students of ALAM feel safe study in the campus

Staff of ALAM are consistently courteous with

7
students

Staff of ALAM will have the knowledge to answer

8
students questions

When ALAMs promise to do something by a certain

9
time, they do

Staffs show great interest in solving the student

10
problem.

The service that ALAM provide is right at the first

11
time.

ALAM will provide the service at the time they

12
promise to do so

13 ALAM always keep an accurate record

Staff of ALAM will tell students exactly when the

14
service will be performed

45
15 Staff of ALAM will give prompt service to student

16 Staff of ALAM are always willing to help the student

Staff of ALAM will never be too busy to respond to

17
student request

18 ALAM will give student individual attention

Staff of ALAM recognize their student and address

19
them by name

20 ALAM s operating hours convenient to all student

21 ALAM will have their student best interest at heart

ALAMs staff understand the specific needs of their

22
students

How would you rate the overall quality of service provided by ALAM? (Circle one number
below)

Extremely Poor Extremely Good

1 2 3 4 5

Section C: FACTORS

1. Listed below are five (5) general factors pertaining to ALAM and the services that
they offer. We would like to know how important each of these factors is to you when
you evaluate ALAMs Quality of Service. Please allocate a total of 100 points among
the five factors according to how important each factor is to youthe more important
a factor is to you, the more points you should give it. Please be sure the points you
give add up to 100.

No Description(s) Point(s)

A. The appearance of ALAM physical facilities, personnel and

teaching and communication materials (signs, poster, notes
etc.)

ALAMs ability to perform the promised services dependably

B.
and accurately.

46
C. ALAMs willingness to help me and provide prompt service

The knowledge of ALAMs staff and their ability to convey trust

D.
and confidence

The caring individualized attention that ALAMs provides to

E.
students.

TOTAL points allotted (100 marks) 100

- End of questionnaires -

47
 Appendix II

Interview Key Questions

1. What is the strength of your company and the importance of each factors discuss?
2. What are the weaknesses of your company and the importance of each factor
discuss?
3. What are the opportunities of your company and the importance of each factor
discuss?
4. What are the threats of your company and the importance of each factor discuss?
5. Any recommendations or suggestions in strategies that you think ALAM could adapt.

Profile
Jimmy Wong Koon Sang is a Senior Manager of Corporate Planning and Business

Development department at Malaysian Maritime Sdn. Bhd. Formally a mariner who sailed

across 7 continents and had visited 33 countries. He had been working at Mexico, Singapore

and Indonesia.

Qualification:

MBA. HERIOT-WATT UNIVERSITY, SCOTLAND

DIPLOMA IN MANAGEMENT WITH DISTINCTION, MIM Malaysia

DIPLOMA IN MARINE ENGINEERING (SINGAPORE POLYTECHNIC)

CERTIFICATE OF COMPETENCY IN MARINE ENGINEERING CLASS 2 MOTOR

(MINISTRY OF TRANSPORT, SINGAPORE)

48