SERVICE QUALITY AND THE IMPACT ON STUDENT’S SATISFACTION LOYALTY TO MASTER OF MANAGEMENT PROGRAM IN SURABAYA

DOI 10.17970/jrem.17.170102.ID ABSTRACT Globalization makes the competition between companies become increasingly tight. It makes them try to find leaders who can bring success. Many universities opened Master of Management program that can create leaders with the necessary characters. Some strategies are implemented. Service quality becomes one of Universities’ concern in order to meet the companies needs. Therefore Universities should identify the factors determine it. The purpose of study is to identify the factors that determine service quality and its effect on satisfaction and students’ loyalty on Master of Management Program in Surabaya. The study used questionnaires to test the proposed model. The questionnaires were distributed among 100 students in Surabaya based on simple random sampling and purposive method. Factor analysis is used to analyze factors of service quality. This research found that service quality is formed by product, procedure, learning process, staff’s attitude, faculty members value, reliability, knowledge & attitude of faculty factor; service quality has positive and significant effect on satisfaction and loyalty.


Introduction
Globalization makes the competition between companies becoming increasingly tight. This makes the company wants to find leaders who can bring progress for the company. Therefore, more and more universities are opened, one of which is the Master of Management program. Each program trying to attract people to be their student. One of the efforts is to create specific strategies in order to meet the needs for a good quality education. Awareness of the importance of good quality made universities to be able to identify the factors that determine quality services.
Research on service quality, satisfaction and loyalty commonly in healthcare, telecommunication and tourism industries.
Research in the tele-communications industry, for example, performed by Santouridis & Trivellas (2010). Therefore in the healthcare industry, which is conducted by Chahal & Kumari (2011). In education, the similar research are conducted by Mansori, Vaz and Ismail (2014). The research found that the most decisive factor service quality is empathy, tangibility and responsiveness; and service quality has an effect on satisfaction and student's loyalty However, in Indonesia there is a bit research of service quality, satisfaction and students' loyalty in education service, especially in Master of Management program. For the reasons above, this study entitled "Study of Service Quality, Satisfaction and Loyalty Students on the Master of Management in Surabaya".

Theoretical Framework and Hypothesis Service Quality
Service quality comes from the way to meet the needs and desires of consumers and its accuracy to deliver it as consumer' expectations (Parasuraman, Zeithaml, and Berry, 1985). Service quality is based on a comparison of what is supposed to be offered and what is provided. If the services meet or exceed expectations, it can be perceived that the quality of service provided is good, otherwise if the service received is not the same as expectations, it can be said that service quality is not good.
It has been developed a model to measure the quality of service. SERVQUAL developed by Parasuraman, Zeithaml, and Berry (1985) has identified twenty-two major dimensions of service quality, however, as more research is done, these dimensions ultimately simplified into five dimensions (Fandy Tjiptono & Chandra, 2011: 198), named Reliability, Responsiveness, Assurance, Empathy, and Tangibility.
The other model to measure service quality is SERVPERF, developed by Cronin & Taylor (1994). SERVPERF is the development of SERVQUAL that based on performancebased on the components of perception. a lot of research on the quality of service there are colleges that use SERVQUAL concept, such as research Kwan and Ng (1999); Sohail & Shaikh (2004);O'Neil & Wright (2002); Tan and Kek (2004).
Another model is HEdPERF. HEdPERF developed by comparing the 41 sets of items that includes not only consider academic component but also all environmental aspects of the service perceived by students. (Eden, 2006). There are five dimensions of service quality, named non-academic aspects, academic aspects, reputation, access, and existing programs.
In Indonesia, the Ministry of Education arrange the regulation about National Standard of Higher Education. It is stated about minimum criteria that must be universities implemented for the learning, research, and community service system. The regulation stated that the national standard of education consists of eight standards, consist of competency standards, learning content standards, learning process standards, learning assessment standards, lecturers and staff standards, facilities and infrastructure standards, learning management standards, and financing standards.
The quality of service received by consumers closely related to satisfaction. A consumer satisfied if the service is the same or more than the expectation, but when the service is less than expectation means consumer is not satisfied. This statement is supported by research conducted by Dwi & Febrina (2010), Chahal & Kumari (2011), as well as Santouridis & Trivellas (2010) that said service quality has a positive and significant effect on satisfaction. So, the first hypothesis in this study is: JOURNAL of RESEARCH in ECONOMICS and MANAGEMENT (Jurnal Riset Ekonomi dan Manajemen) Volume 17,No. 1, (2010) states that service quality has a direct effect on loyalty. This statement is also supported by research conducted by Aga & Okan (2007). So, the second hypothesis in this study s: H2: Service Quality has a positive and significant effect on the students' loyalty on Master of Management Program in Surabaya

Satisfaction
Today we believed that the key to winning the competition is to give satisfaction to the consumer. (Fandy Tjiptono, 2000: 129). Therefore, the concept of marketing states that all elements of the business should be oriented towards customers satisfaction. (Budiarto & Nasution, 2001).
Satisfaction is defined as the overall consumer attitudes shown on services after they obtain and use. (Mowen & Michael, 2000). Meanwhile, according to Kotler and Keller (2015: 131) satisfaction is a happiness or disappointment towards comparing expected performance against expectations. The level of satisfaction is a function of the difference between the perceived performance (perceived performance) and hope (expectation).
Quality of the services have an important role to establish customer satisfaction. If a consumer satisfaction levels are high, it will be beneficial for the company. Therefore, the company will make every effort to provide the good quality of services.
Satisfaction makes consumer has a tendency to continue and depend on the product or the service. People who are satisfied with a product or service will tend to make repeat purchases. In addition to repurchase, the person will also tend to transmit information about a product or service to others. This is called a loyalty. According to (Engel, Blackwell, and Miniard, 1995), loyalty is defined as repetitive behaviors purchase due to the habit. People who have been loyal will have a high level of involvement of the specific product or service.
Statements about the satisfaction that influence loyalty is supported by research conducted by Dwi & Febrina (2010), Chahal & Kumari (2011) and Pollack (2009) that states satisfaction has a positive and significant effect on loyalty. Therefore, the second hypothesis in this study reads: H3: Satisfaction has a positive and significant effect on students' loyalty on Master of Management Program in Surabaya.

Loyalty
Creating a strong relationship and closely with consumers is the desire of the companies. It is important for the long term success. Selecting, establishing and maintaining consumer involvement is the key to success of service. (Lovelock & Wirtz, 2011: 338). Loyalty is related to consumer satisfaction. According to some studies, satisfied consumers will tend to be loyal to the company. The statement was proved by research conducted by Mansori, Vaz and Ismail (2014) and Iqbal (2014).
Loyalty is defined as the ability to put the service in the minds of consumers, (Dharmesta & Hani, 2000). According to Lovelock & Wirtz (2011: 338) Loyalty is the willingness of consumers to continue to use the products or services of a company in the long term, exclusive, and recommend the product or service to their friends and relatives.
Loyalty is a manifestation and continuation of consumer satisfaction. In the long term, customer loyalty become strategic goal for creating a strong relationship and closely with consumers.
In higher education, loyalty is defined as the attitude of students to the services provided Master of Management Program, such a trust, positive words, and willingness to give a positive recommendation to friends or relatives about the services.

Research Method
Based on the theoretical framework and hypotheses of the study, there are three variables used in the study are: Service Quality of is the assessment of the students about the quality of services provided by Master of Management Program. If the level of the student consent to the service of the high, it can be said that service quality is good, but if not it can be said services are not good.
Satisfaction is the students' expression of satisfied or happiness of service on Master of Management Program. Indicators was obtained from Education Minister Regulation No. 49 in 2014; Dwi & Febrina (2010) and Dutka (1994) include Satisfaction towards service, Satisfaction towards teaching, Satisfaction of scoring, and Satisfaction towards facilities.
Loyalty is students' attitudes towards the service given indicated by positive statements, the attitude of trust, and willingness to give recommendations. Indicators that can be used as a measurement according Dwi & Febrina (2010).

Data Analysis and Discussion Validity and Reliability Test
Validity test is used to measure the validity of questionnaires. A questionnaire is valid when the statements in the questionnaire were able to measure variable. (Imam Ghozali, 2013 : 52). Significant level of the statements should less than 0.05.
Reliability test is measuring the consistency of the answer in a questioner (Imam Ghozali, 2013:47). Reliability test is using alpha coefficient or Cronbach alpha. Reliable if the measurement variables Cronbach alpha value of more than 0.7 (Nunnally in Imam Ghozali, 2013:47) Validity and reliability test is used to test the variables including the service quality, satisfaction and loyalty of 100 students of Master of Management Program in Surabaya.
Based on the data (appendix 1) can be explained that the lowest item to total correlation is 0.489 (item KL_2) and the highest 0.834 (item KP_1). Cronbach alpha value is at the lowest 0.7811 for loyalty and to 0.9672 for satisfaction.

Summary of Characteristics of Respondents
Number of female and male is equal. Based on study's period, there are 39% of respondents whom in 2 nd semester and 72% is in 19-29 years old. Based on marital status, 58% of respondents are single, and the remaining 42% are married. Based on profession, 43% is employee and their reason to study is 72% for self development. 82% of respondents is not active in organization activity.

Descriptive Analysis
Descriptive analysis aims to explain the results of the questionnaire in the form of accumulation of respondents rating for each indicator variables include Service quality, Satisfaction, and Loyalty. Table 2 is a descriptive output results. In the service quality variable, respondent give a good value of the service that Master of Management Program provided. They are likely satisfied with the service and wants to loyal to their university.

Factor Analysis Test
Before examine the factor analysis, Barlett and KMO should be analyzed to concluded that the factor analysis can be done. Barlett test shows the significance is 0.000. The table 3 shows the feasibility of the sample size indicated by the KMO is more than 0.5 (0.880>0.5) so it can be concluded that the factor analysis can be done. 0.000 According to the appendix 2, there are seven factors formed. The following is an explanation of each factors service quality:

Products
Product is everything that is offered by a Master of Management program to meet the needs and in order to create a good performance for students. It could be the creation of various programs with diverse specialization, provision of equipment and adequate facilities, the creation of a good reputation and ability to absorb the graduates in the working life. According to Firdaus (2006), important for university to offer the varied program/academic activities.This factor has the greatest value variation compared with other factors, namely 49 percent. It can be useful for university to be able to formulate a study program right marketing strategy.
Based on the answers of respondents, the lowest average is in item that relates to the diversity of programs offered. This means that the university still needs to increase the diversity of programs/ activities. The university may be providing supporting activities for example, for marketing management concentration there is activity held outside the classroom that aims to improve students' ability in terms of marketing.

Procedures
This factor relates to the flow of university operational activities related to the student.
University must have a good working flow standards and uncomplicated so that students feel comfortable. The procedures should be socialized properly to the students so that the students know.
In addition, university must provide access of communication that is easily accessible. University can use social media.
Based on the answers of respondents, it is known that the item related to the student union got the lowest answer. It means that important for university to provide student union organization.

Staff's Attitude
This factor relates to how the administrative staff provides services in order to meet the needs of students, how the staff to establish good communication, work ethic and knowledge of the staff and the willingness of staff to address the problems faced by students.
According to David (2012: 20) one of the most important elements in the marketing of educational services is the staff. The staff is the marketing agent of the best educational services able to plot the values of a study program through the relationship/interaction directly with students. Staff were able to establish a good relationship with the students will be able to increase the confidence of the students to the study program. It also supports the results of research conducted by the Paradise (2006) in his research calls this factor with the name of a non-academic aspect, namely the essential items that support the students to fulfill the obligation of learning and linking tasks taken is non-academic staff.
Based on the answers of respondents, the item about staff knowledge got the lowest answer. That means university should give an extra care to make staff's knowledge higher in order to serve the students need.

Faculty member's value
This factor relates to the values owned by the lecturers. Lecturer is a very important part in the context of teaching and learning in Higher Education. Lecturers who uphold academic values that will either be able to create a good quality of teaching. Such values may include values of honesty, integrity and openness.
Based on the answers of respondents, it is known that item about the value of openness got the lowest answer. The lecturers are expected to be more open to the process of assessment and learning outcomes.

Learning Process
This factor is about how lecturers teach and deliver course in the classroom. As well as the customer, the student feels comfortable in the learning process would be satisfied.
The quality of services offered should contain things such as knowledge of lecturers, class materials, feedback on assignments and interaction between students and lecturers (Hill, Lomas & MacGregor, 2003). Based on the answers of respondents, the lowest items is about lecturers' willingness to help students.

Reliability
This factor is about how the university provide reliable services to students. How quickly these services and the provision of a guarantee that the services provided are appropriate. Fandy Tjiptono (2014: 282) stated reliability as the ability to deliver services quickly, accurately, and satisfying.
Based on the answers of respondents, the lowest items is about the speed of service. The university is supposed to provide services quickly according to the promise. Training for staff should be given regularly to increase serving time.

Knowledge and Attitudes of Lecturer
This factor is related to knowledge and attitude of the lecturers. This knowledge is competences of the lecturers. How far the competence of lecturers to teach. According to the Regulation of the Minister of Education there is a standard of lecturers and academic staff. The point is about the minimum criteria concerning the qualifications and competence of lecturers and academic staff to provide education in order to meet the learning outcomes of graduates. Lecturers are required to have academic qualifications and competence.

Hypothesis Test
The analysis is performed by using partial least square analysis. The results can be reflected in the table 4  Table 4 shows that the path coefficient is positive and p-value <0.01, which means that service quality has a significant positive effect on satisfaction. Therefore the first hypothesis in this study may be accepted.
Quality being the main reason for students in choosing courses. This is consistent with the results of the analysis on the characteristics of respondents in the previous discussion.
With the provision of services quality then university will be able to formulate a good marketing strategy.
Based on the results of descriptive analysis, the average respondent in this study responded to agree on statements contained in the questionnaire, which means that the average student considers that the university has provided a good quality of services. Nevertheless, there are still some items which have a value statement in response to far below average, statement items relating to the diversity of programs provided by the Program of Studies, and the support of the student union.
Quality of service is closely related to satisfaction. Students is satisfied if the service received the same or greater than the expectations.
Overall respondents gave a positive assessment of the quality of the services provided. However, there are some items of satisfaction that still low. The item is about the learning atmosphere. Many things can cause dissatisfaction over learning atmosphere, such as the facilities and equipment provided, class size and the availability of the student union.
The results support the research conducted by some previous researchers, such as Chahal & Kumari (2011), Santouridis & Trivellas (2010), Dwi & Febrina (2010. Previous studies that it is not done in the education sector. Research conducted by Chahal & Kumari (2011) conducted on the health industry, while research Santouridis & Trivellas (2010) and Dwi & Febrina (2010) each were conducted in the communications industry and the food. Both studies state that the quality of service has a positive and significant impact on satisfaction. It is also stated by Mansori, Vaz and Ismail (2014) that the research conducted on students in Malaysia. This means that the various types of industrial quality of service becomes very necessary to address the management company or the study program in order to achieve satisfaction.

Hypothesis 2
H2: Service Quality has a positive and significant effect on the students' loyalty on

Master of Management Program in Surabaya
Based on test results contained in Table  4.8 shows that the path coefficient is positive with a p-value <0.01 means that the quality of service has a positive and significant effect on loyalty. Therefore, the second hypothesis can be accepted. This study supports the results of research conducted by Aga & Okan (2007) which states that service quality has a significant positive effect on customer loyalty.
Creating a strong relationship and closely with customers is the desire of all companies. Similarly for the university. It was important to do for long-term success. Selecting, establishing and maintaining consumer involvement is the key to success of service providers (Lovelock & Wirtz, 2011: 338).
The quality of service according to the results of the analysis can lead to loyalty. People who feel they have quality services will tend to remain faithful to come or use of a product. Similarly undertaken by students. According to data that have been obtained from questionnaires, the main reason respondents chose Studies Program is due to the quality of the study program. Descriptive analysis declared value of the quality of service is good, meaning that the overall quality of services provided in the university is good.
Based on the results of descriptive analysis, the loyalty stage of student in this research, according to Oliver (1997) is a cognitive loyalty, the loyalty stages that formed the basis of the knowledge and information that will establish confidence in the service. This kind of loyalty was lowest stages so that university should formulate strategies to improve student loyalty.
One way that can be taken to increase the loyalty is granting discounts tuition fee for a family of alumni. Granting discounts of tuition fee is intended to relatives/ friends of alumni who are willing to join a student in the Master of Management Program. In addition, the reward program for students or alumni who are willing to recommend the program to others. David (2012: 20) states that a student or alumnus is the best advisor due to its own process of education in a study program. Students can be a good marketer agent for communication by word of mouth more than convincing someone of mass communication.

Hypothesis 3
H3: Satisfaction has a positive and significant effect on students' loyalty on Master of Management Program in Surabaya.
Based on test results contained in Table  4.8 shows that the path coefficient is positive with a p-value <0.01 means that satisfaction has a significant and positive effect on loyalty. Therefore, the third hypothesis in this study may be accepted. The results support the results of research conducted by Chahal & Kumari (2011), Santouridis & Trivellas (2010), Dwi & Febrina (2010 as well as Mansori, Vaz and Ismail (2014) stating satisfaction significant positive effect on loyalty.
A satisfied person will tend to be loyal. Loyalty in the context of this study was defined as the attitude of students to the services provided by university. Such attitudes that can be trust, positive words, willingness to not switch to the services and willingness to give a positive recommendation to friends or relatives about the services that have been provided.
In this study, the average of respondents stated that they feel happy and satisfied with the service, the learning system, learning environment and activities provided. This loyal attitude shown by confidence and a positive attitude and willingness to give a JOURNAL of RESEARCH in ECONOMICS and MANAGEMENT (Jurnal Riset Ekonomi dan Manajemen) Volume 17, No. 1, Januari -Juni (Semester I) 2017, Halaman 1-xx positive recommendation. Nevertheless, there is still unatisfaction It is also same for loyalty. Although the respondents indicated would be loyal, but still there are those who disagree with the statement that the their university is the first choice.

Conclusion, Implication, Suggestions, and Limitations
This study aims to determine the factors of service quality and the effect of service quality on satisfaction and students loyalty. After collecting data, processing and analyzing of both descriptive and statistical conclusions can be drawn that there are seven factors service quality, they are products, procedures, staff attitudes, faculty member values, learning processes, reliability, and the knowledge and attitude of the lecturers; Service quality has a significant and positive effect on Satisfaction on Master of Management Program in Surabaya; Satisfaction has a significant and positive effect on Student Loyalty on Master of Management Program in Surabaya and the last is service quality has a significant and positive effect on Student Loyalty on Master of Management Program in Surabaya The limitations of this study are only four of the twenty-two university in Surabaya which is used as a place of research. This amount is considered still too little to be able to represent the entire university and assessment of the effect of independent variables on the dependent variable is limited to the service quality and satisfaction resulting R 2 values of low than 70 percent.
The advice can be given by researchers are for the next research to increase the number of university to be a place of research so that the results are increasingly able to represent the real situation, to involve other variables that also affect loyalty, for example, testing of demographic factors. There are some studies that state that demographic factors also have an influence on satisfaction and loyalty, so that later the results have been more perfect and can be utilized by the community, especially university. For university can use the results on the factors of service quality. Products and procedures are the biggest factors of service quality, so it can be used as a reference for formulating marketing strategies, such as offering courses off campus that supports the learning process (study visits, seminars, competitions and practical work), the formation of the student union and others.
The quality of service has an influence on satisfaction and loyalty, so that the service needs to be upgraded continuously. Based on the analysis, the things that need to be improved is availability of adequate facilities and equipment, and the staff problems. To overcome this problem university should regularly conduct training for the staff in order to increase the value of student satisfaction that will affect the loyalty. Also university cam conduct loyalty programs, such as giving a discount of tuition, and reward those who have been willing to invite relatives to join with the university.