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Purpose – This paper focuses on the determinants of student satisfaction and retention in a college or university that are assumed to impact students’ college experience. Design/methodology/approach – Using empirical data and Herzberg’s two-factor theory, a modi? ed version of the questionnaire developed by Keaveney and Young was administered to approximately 160 undergraduate business students at a state university in South Central Pennsylvania.

Using path analysis, the hypothesized effects were tested empirically by incorporating a comprehensive set of independent variables and self-reported experiential assessments to predict experience, which in turn related to student satisfaction. Findings – The results indicate that the path coef? cients from faculty and classes to students’ partial college experience are consistent with the assumption that these are key factors that in? uence student partial college experience. Also, the path coef? cient from student partial college experience to satisfaction was consistent with

Herzberg’s two-factor theory. In addition, students who have a positive college experience are more likely to be satis? ed with the college or university than students who do not have a positive college experience. Research limitations/implications – By focusing on antecedents of student satisfaction, colleges and universities can align their organizational structure, processes and procedures to become more customer-oriented. Small sample size and self-explicated retention data are the limitations of this study.

Practical implications – It is recommended in this study that the changing nature of the higher education marketplace encourages college administrators to apply the customer-oriented principles that are used in pro? t-making institutions. Originality/value – Using a satisfaction model and a comprehensive set of independent variables and self-reported experiential assessments to predict experience, this paper provides empirical ? ndings to understand student satisfaction in higher education institutions. Keywords Higher education, Students, Customer satisfaction, Customer orientation Paper type Research paper.

Introduction Higher education institutions are increasingly recognizing that higher education is a service industry, and are placing greater emphasis on meeting the expectations and needs of their participating customers, that is, the students. This becomes even more important in those states where university budgets utilize a tuition-based model. The rapid expansion of colleges and universities, and signi? ant increases in college education costs combined with demographic shifts in the population, force colleges to think differently about the role of student satisfaction for their survival (Kotler and Fox, 1995).

Furthermore, intense competition in today’s competitive educational market forces universities to adopt a market orientation strategy to differentiate their offerings from those of their competitors. Similarly, higher educational institutions in the US are operating in a competitive marketplace. Thus, they need to understand their target markets (i. . students, external stakeholders of different types), assess the target market needs, modify their offerings to meet those needs, and thereby enhance customer satisfaction by delivering superior quality services (Keegan and Davidson, 2004). Even though the successful completion and enhancement of students’ education are the reasons for the existence of higher educational institutions, college administrators tend to focus disproportionately more time on programs for attracting and admitting students rather than managing enrollments (Zemke, 2000).

Similar to the importance of satisfying customers to retain them for pro? t-making institutions (Anderson and Sullivan, 1993), satisfying admitted students is also important for student retention. Statistics indicate that more than 40 percent of all college entrants leave higher education without earning a degree, 75 percent of these students drop out in the ? rst two years of college, and institutions can expect that 56 percent of a typical entering class cohort will not graduate from that college (Tinto, 1975, 1993).

More recent statistics indicate that 26. 4 percent of freshmen do not return for the following fall semester and 46. 2 percent of these students do not graduate from college (Reisberg, 1999). Also, higher educational institutions that are heavily populated by commuter students have higher dropout rates, while institutions with strong residential dormitory programs have lower drop out rates (Baldridge et al. , 1982). Therefore, it might be argued that dissatis? ed students may cut back on the number of courses or drop out of college completely.

Hence, the satisfaction to intention to retention link for students in higher education should be studied and carefully managed. This paper focuses on the determinants of student satisfaction and retention in a college or university that are assumed to impact the business student college experience. Studies that examine student satisfaction in higher educational institutions from a more customer-oriented perspective add additional dimension to the educational planning activities of colleges and universities.

Therefore, the objective of this study is to investigate the determinants of student satisfaction and retention in higher educational institutions. Using empirical data and Herzberg’s two-factor theory as a framework, we investigate student satisfaction in college setting (Herzberg et al. , 1967). To measure student satisfaction, we used a modi? ed version of the model of Keaveney and Young (1997), which incorporates a comprehensive set of independent variables and self-reported experiential assessments to predict experience, which in return is related to student satisfaction.