©JBSQ 2013 83 Journal of Business Studies Quarterly 2013, Volume 4, Number 4 ISSN 2152-1034 The Most Effective Strategy to Improve Customer Satisfaction in Iranian Banks: A Fuzzy AHP Analysis Mojtaba Alidadi, University of Tehran, Iran Mohsen Nazari, University of Tehran, Iran Abstract With the intense competition in banking systems, customer satisfaction has become more important issue in customer marketing. In existing studies, customer satisfaction has examined based on customers’ viewpoint. This study investigates customer satisfaction based on viewpoint of bank managers who understand their customers’ needs. This study aims to examine importance of various strategies that improve customer satisfaction and also determines their priorities. The results indicate that improving services and facilities is the most effective strategy to improve customer satisfaction in Iranian banks. In this strategy, interest rate and fair facilities are most important factors. Keywords: Customer satisfaction, Banks, Bank managers, Fuzzy AHP, Iran. Introduction With increasing growth of banking systems, people have fewer limitations to choose their favorite banks. Because of this, one of the most challenging issues for bank managers is to maintain customers and enhance their loyalty. In recent decades, banking system has grown dramatically in Iran. For many years, there were only a few state-owned banks. Today, with entry of private sector to banking market, this unipolar system is fading and the number of banks has increased. With the growth of this market and availability of more banks for people or in other words, due to increasing of choice power, competition have increased among different types of banks and thus, customer marketing is more important than ever. With such competitive conditions, customers play a key role in banking systems (Bee Wah et al., 2012). When banks are exposed to pressure of intense competition, they focus on retaining loyal customers (Terrence and Gordon, 1996). According to direct relationship between loyalty and customer satisfaction (Amin et al., 2010; Lenka et al., 2009b; Mohsan et al., 2011; Ziaul Hoq and Amin, 2010), the most effective way to pass this important challenge is understanding people’s expectations and then identifying possible and appropriate strategies and finally selecting the best strategy to provide more satisfaction for customers. Customer satisfaction is an important factor in business and its outcomes is a critical matter in banking system (Ahmad and Kamal, 2002).