1.
FACTORS AFFECTING EMPLOYEE'S MOTIVATION IN
HOSPITALITY INDUSTRY:
THE CASE OF LUMBINI TANDOORI RESTAURANT
A Seminar Paper
Submitted by
Rajkumar Adhikari
Roll No.: 19
MBA Second Semester
Kantipur International College
Submitted to
Faculty of Management
Purbanchal University
Biratnagar, Nepal
In partial fulfillment of the requirements for
The degree of Master of Business Administration (MBA).
Feb, 2015
Kathmandu

2.
DECLARATION
I, Rajkumar Adhikari declare that the contents of this Seminar paper represent my own
unaided work, and that the Seminar paper has not previously been submitted for academic
examination towards any qualification. Furthermore, it represents my own opinions and not
necessarily those of the Purbanchal University.
Signed __________________ Date _________________

3.
VIVA -VOCE SHEET
We have conducted the VIVA VOCE Examination of the seminar paper.
Submitted by:
Rajkumar Adhikari
Entitled
Factors Affecting Employee's Motivation in Hospitality Industry:
The Case of Lumbini Tandoori Restaurant
And found that the seminar paper to be original work of the student and
prepared according to the prescribed format. We recommend the seminar paper
to be accepted as partial fulfillment of the requirement for the Master of
Business Administration (MBA), faculty of management, Purbanchal
University, Nepal
VIVA VOCE COMMITTEE
Institutional Head Chairperson
Concerned Seminar Faculty Internal Expert
Appointee of the Dean External Expert

4.
ACKNOWLEDGEMENT
I express my gratitude to Purbanchal University for providing me the opportunity to conduct
a study on hospitality management .This study has been carried as a study based report for
the seminar series, Master of Business Administration (MBA), according to the course
offered by Purbanchal University. This study has been made with a view to analyze the
Factors Affecting Employee's Motivation in Hospitality Industry.
Doing this study, it made me able to understand and know different types of activities related
to Factors Affecting Employee's Motivation in Hospitality Industry. Firstly, I owe my deep
gratitude to our Academic Director, Mr. Narendra Kumar Shrestha for providing me valuable
guidelines, supervision and rightful comments, without which this report wouldn’t have
materialized in this form. I am also appreciative to the staffs of the Lumbini Tandoori
Restaurant for their valuable help in providing the necessary materials and information
required.
I would like to express my sincere thanks to our Facilitator Prof. Dr. Shyam Katwal for
providing me valuable information, guidelines and rightful comments in order to complete
this study. I would like to express my extreme gratitude towards my brother Vijay Adhikari,
Sister Kamala Adhikari for providing me constant support.
Any error in this report is my own responsibility and sincere suggestion of this paper is
highly appreciated.
Feb 9, 2015
Rajkumar Adhikari

5.
ABSTRACT
Today it is clear that businesses give importance to factors that increase employee’s
motivation. As the hospitality industry is mainly focus on hospitality and the hospitality
providers are employee of that organization, thus it is the major task for managers &
owners to motivate employee for the growth of their business. The purpose of this research
is to examine the factor which motivates employees in a hospitality industry. Also it’s
another aim is to measure whether employees, according to their demographic
characteristics, show differences in evaluating factors that affect motivation. The combined
approached (mix of qualitative and quantitative techniques) method is used for the purpose
of this project. Primary data of this research is obtained by using questionnaire technique
and secondary data from books, articles and from website. In this research, we argue that
motivating your employees is as critical for excellent hospitality as is training them.
Keywords: Motivation, hospitality industry, restaurant, employees.

6.
INTRODUCTION
Motivation
Today, to remain standing in competitive world, hospitality businesses need both to increase
their employee’s motivation and to be in effort of continuous development of their
businesses facilities provided for their customers (Aksu, 2000). Every employee has unique
needs and wants that must be addressed by the employer and the employer too has goals to
be achieved at the end of the day by the employee. Motivation is very important in any
organization inclusive the hospitality Industry. Motivation creates employees’ job
satisfaction and good interaction between employees customers that eventually attract a
repeat business (Condly & De Pietro, 2001). There are organizations that make serious
efforts and devise effective strategies to keep their employees motivated. Managers should
make paramount efforts to derive employees to perform at their best. By making the
provision of motivational factors managers and supervisors can make employees satisfied
which in turn increase the efficiency of employees. The core purpose of this research is to
explore the motivational factors for employees. For this purpose, hospitality industry is
chosen. Employee turnover in the Hospitality Industry costs restaurants and hotels billions
of rupee each year, with worker turnover rates as high as 95% for some properties (Samuels,
2013). In the United States of America it was observed that employees’ turnover cost the
industry a loss of 150 billion dollars per year. Research showed that if level of motivation is
improved, the turnover rate reduces by 53% (Barrows & Bosselman, 1999). A study of
motivation and performance among fast food employees by Candy and De Pietro (2001)
found out that turnover is less when employees feel good about their jobs; are supported by
their organizations and have value for their work. Those who feel that work conditions are
below standard and do not play fair are less motivated. The purpose of the study is to
identify factors affecting motivation of employees working at Lumbini Tandoori Restaurant
and assess the level of their motivation. The study has been carried out on the employees
working in the line position (operation level) who are directly involved in day-to-day food
making and selling operations at Lumbini Tandoori Restaurant. Employees involved in staff
management (strategic and tactical level) have not been included in the study.

7.
Theories of Motivation
1. Maslow’s Hierarchy of Needs
Abraham Maslow’s theory proposed that human beings had different levels of needs in a
particular order. He identified five levels of needs in order of hierarchy. The most basic
needs are the biological and physiological needs. At the top is the need for self-actualization
which Maslow defines as growth motivation and calls it the ‘Being Need’. Maslow identifies
the four different types of needs below the level of self-actualization as ‘Deficit Needs’. He
explained that if one had any of these four levels of unmet needs, one would feel the
deficiency but if the need was met, one would almost be unaware of it.
Diagram: Maslow’s Hierarchy of Needs
According to Maslow, peoples’ needs are insatiable and there can be unending demands.
Once needs in one level are met, people will demonstrate their desire for the next level of
needs. Maslow’s theory helps to understand different types of needs of people.

8.
2. Theory X and Theory Y
The Theory Y assumptions (Douglas McGregor, 1960) about people and their work created
Space for bringing in an environment where they can feel motivated to perform at their best
Employee motivation often depends on the style of the managers. The managers with theory
X assumptions are characterized by certain traits, e.g. authoritarian style and tight control.
They do not appear to promote development, and create a restraining culture. Employees
hardly get any motivation under such leadership. The managers with theory Y assumptions
practice a different style which is liberating, empowering and developmental. They believe
in achieving accountability among the employees by enabling them and giving them
responsibility. Employees feel more motivated while working with such managers.
Table: Theory X and Theory Y

9.
Why Motivate Employees?
A successful organization can generally trace its success to motivated employees. A look at
the synonyms for the word ‘motivated’ such as induce, move, provoke, prompt, and cause,
shows that without motivation at some level, nothing really gets started. However, motivating
people can be difficult; there are no magic formulas or programs to motivate individuals.
Motivation is also personal. While one employee may appreciate time off, the next may enjoy
new challenges. The basic rule is to discover what your employees want and create a way to
give it to them or encourage them to earn it. Following this principle should motivate your
employees and allow them to become engaged in the success of the campus and your
department
In order to gain an understanding and assess employees’ motivation, this study emphasizes
to explore results of a number of questions:
1. What are the reasons employees choose to work in Lumbini Tandoori Restaurant?
2. What are the most important factors that affect the willingness of the Lumbini
Tandoori Restaurant's employees to exert more effort in the job? And finally
3. To what extent the Lumbini Tandoori Restaurant's employees are motivated to
achieve the company's objective?
Justification of the study
This study examined the concept of employee motivation as a mean for delivering superior
service quality in the hospitality industry as well as other similar industries. This paper
provides a framework for managers to use to enhance their understanding of employee
motivation and its sources. A successful quest for service quality can be the difference
between success and failure for many service organizations. In today’s competitive
environment, customers are always looking for better service, more knowledgeable support,
faster response time, and lower prices. Service organization that allow their employee
productivity standards to deteriorate by not encouraging improvement in the volume and
quality of output, will see their customer base dissolve.

10.
LITERATURE SURVEY
According to some previous researches, it is seen that factors that affect the employees of
hotel industry in a negative way are, insufficient wage and job security, limited training
program, new opportunities’ not developing, business managers being deprived of manager
qualifications and high job transfer speed (Cheng & Brown, 1998; Wong et al., 1999; Zhang
& Wu, 2004). In addition to these factors it is known that employees have problems with
their working hours and social conditions (Karatepe & Uludağ, 2007). That’s why in hotel
businesses there are different researches made by researchers to determine what are the
factors that motivate the employees in a positive way and as a result of these researches too
many factors have been found (Mak & Sockel, 2001; Velo & Mitta, 2006). For example, in
the middle of 1990s Smith, Kendal and Hulin found a scale named ‘’Job Descriptive Index’’
in their researches and developed in later years. Hackmen and Oldham (1996) developed
‘’Job Characteristics Approach ‘that explain the reasons of factors that have effects on
employees job satisfaction. This approach includes dimensions of skill variety, task unity,
task importance, autonomy and feedback. These features are important in motivating
employees and providing employees job satisfaction. Taking this broad definition to the
context of supervision in the hospitality operation, motivation is what the supervisor does to
encourage and influence other people to take necessary action. Infract motivation is an
internally generated force or drive within the individual which provides an incentive for the
employee to act.

11.
METHODOLOGY
The study was carried out based on both primary and secondary data. Primary data was
collected from three different Lumbini Tandoori Restaurant located at Thapathali,
Kupandole, Bagbazaar station in Kathmandu during period of 7th
Feb 2015 to 11th
Feb
2015. A structured questionnaire, mostly closed styled, was provided to 35 employees of
three restaurants to collect primary data. Out of them, only 29 sample respondents (82.86%)
out of them participated by filling the questionnaire and sending it back to me. However, 24
out of 29 (69% of 35 sample respondents) sample respondents participated actively in
survey activities by answering to all questions dully and rest of them answered partly and
was excluded their responses from the study. There are two type of the questionnaire; part
one consisted of demographic information of the sample respondents. The second part
comprised four questions in comprised four questions in relation to employee’s motivation.
Secondary data, on other hand, was used as well to describe different motivation theories
and factors. They were collected from different books, journal articles, website, published
dissertation papers of graduates etc. A combined approached (mix of qualitative and
quantitative techniques) was used to achieve the objective of the study. The qualitative
approach was used to explore sample respondent’s interpretations of event and the
quantitative approach to quantify their attitudes, beliefs, feelings, behaviors that seemed
immeasurable in qualitative techniques. 4-point Likert scale was used in all questions of the
questionnaire ranging from 1 to 4-point, where point-1 represents negative responses (such
as not important/ not motivated/ not de-motivated) of the sample respondents. On the other
hand, point-2, 3 and 4 represents gradual ranking of positive answers (such as least,
moderate and highly important/motivated/de-motivated respectively) of the sample
respondents. Primary data collected from field survey was tabulated using Microsoft office
Excel, and all data was recorded using numerical codes. Various statistical measures such as
frequency distribution were used in describing the variables. This section has been divided
into five phases. In the first phase, demographic information of the sample respondents and
reason to choose work at Lumbini Tandoori Restaurant has been described in second phase.
Factors affecting the motivation and de-motivation of the respondents have been discussed
in the third phase. In the final phase, the level of motivation of employees has been assessed
based on the data collected from the field survey

12.
FINDINGS AND EVALUATIONS
Demographic Information of the Sample Respondents
The culture of Nepal is a diversified and multi-cultural. The evidence of the multicultural is
observed in the job market where different people belonging to unlike cultured get
assembled that develops an exceptional multifarious working environment. According to
Thomas and Pekerti (2003) there is a moderate impact of national culture on the relationship
between job satisfaction and employees' exchange behaviors. The study shows, the male is
dominant (75%) over female. The field survey study shows that a large portion (41.67%) of
the employee's age lies between 21 to 30 years. An insignificant percent of lower or higher
aged employee is seen to work at Lumbini Tandoori Restaurant. The study found that 25%
of the employees are part time. In the case of work experience of employment, the
study shows that period of employment of the sample respondents is between 0 year to
maximum 20 years. The table illustrates that a substantial portion (50%) of employees has
been working between 0 to 5 years. There are three work stations in Lumbini Tandoori
Restaurant, such as kitchen (for cooking foods), middle (for packing foods),and front where
cashier receives order from and deliver to customers. There is a management team in each
shop that supervises, directs and guides the task of other sections and maintains liaison
with corporate head office. The number of workers deployed in each section depends on
the span of task related to each section. This study shows that (12.5%) of the respondents
work in the front section as a cashier followed by the middle section (50%) and (37.5%)
works in the kitchen.

13.
CONCLUSION
The study attempted to identify key factors and indicator that affect the employee's
motivation working at Lumbini Tandoori Restaurant and assess their motivation level.
Results suggest that there are eleven reasons choose to work at Lumbini Tandoori
Restaurant; however, financial benefits such as salary and other fringe benefits do not
receive as much of priority as nonfinancial benefits. On the other hand, the study identified
six broad categories of motivation factors such as (1) work itself and environment, (2)
supervisor relations, (3) company itself and matters, (4) recognition, (5) development and
growth and finally (6) pay and benefits. The research reveals that nonfinancial factors have a
significantly higher impact on the employee's motivation than the financial factors such as
pay and benefits which substantiate the result in relation to reasons choose to work at
Lumbini Tandoori Restaurant. This indicates that Lumbini Tandoori Restaurant needs to
focus on nonfinancial factors along with financial factors to ensure that its workforce is
effectively engaged and consequently motivated. Employees at Lumbini Tandoori
Restaurant are more motivated by factors relating to the work itself and the environment.
This means that Lumbini Tandoori Restaurant needs to create a good working environment
and employees receive recognition and feel valued. As the need for development and growth
is also identified as a motivating factor, Lumbini Tandoori Restaurant should provide
adequate training and development to ensure employees are motivated. The study also
indicates that there are identical sources of motivation and de-motivation which contrast
with the result of Herzberg two factor theory where motivation and de-motivation sources as
being different and independent. However, the extent of motivation provided by a factor is
not the same extent of de-motivation for that factor i.e. the same factors have an effect on
motivation and de-motivation of employees in different extent and manner. For example,
lower scale of salary results in high level of de-motivation but good wages of salary causes
motivation employees not as much as de-motivate them.

14.
REFERENCES
International Journal of Contemporary Hospitality Management, 20 (2):228-234. Chan, S.W
E., & Wong, S. C.K. (2006).
Motivations for ISO14001 in the hotel industry. Tourism Management, 27 (3): 481-492.
Cheng, A., & Brown, A. (1998).
HRM strategies and labor turnover in the hotel industry: a comparative study of Australia
and Singapore. International journal of human resource management, 9 (1):136-154. Chiang,
C.F., & Jang, S.C. (2008).
An expectancy theory model for hotel employee motivation. International Journal of
Hospitality Management, 27: 313-322. 1. Alderfer, Clayton P., (1969).
An Empirical Test of a New Theory of Human Needs;
Organizational Behaviour and Human Performance,vol.-4, no.-2, retrieved from: http://dx.d
oi.org/10.1016/0030-5073(69)90004-X, (Accessed on: 23/10/2012)2.Bokorney, J. (2007).
Salaries Still Rising, retrieved from:http://www.archive.evaluationenginering.com/archive/ar
ticles/0407/0407salaries.asp, (Accessed on 11/10/2011)3. Brewster, L. Carey, P. Dowling, P.
Grobler, P. Holland and S.Warnich (2003).
Contemporary Issues in Human ResourceManagement: Gaining a Competitive Advantage. 2
nd edition. CapeTown: Oxford University Press.4. Glanz, B. A., (2002).
Handle with CARE: motivating and retainingemployees, New York: McGraw-Hill5. Griffin.
R, (2008),
Management, Boston: Houghton Mifflin Company6. Habib, M.N., Mukhtar, S., Jamal, W. (
2010).
Factors Influencing theTeachers Intentions to Quite in Private Sector Higher Educational
Institutions of Pakistan.
Interdisciplinary Journal of ContemporaryResearch Business,
vol.-1, p.-12.7. Herzberg, Frederick (1959),
The Motivation to Work, New York:John Wiley and Sons

15.
Appendix A
EMPLOYEE MOTIVATION SURVEY
Instructions: Please Circle the Appropriate Answer.
Demographic questions:
1. Gender:
A. Male B. Female
2. Work Status:
A. Full Time B. Part Time
3. Position:
A. Supervisor/Management B. Maintenance C. Customer ServiceD. Clerical
4. Age:
A. 18-25 B. 26-40 C. 41-60 D. Over 60
5. Cultural Background:
A. Hindu B. Buddhist C. Christian D. Muslim E. Other
6. Years of Hospitality with Current Facility or Organization:
A. 0-5 B. 6-10 C. 11-20 D. 21-30 E. Over 30

16.
Appendix: B
Factors affecting Motivation of employee in Hospitality Industry.
1. Employees must be provided social facilities (housing, transportation etc.) at the
highest standards.
A. Very Important
B. Important
C. Indecision
D. Unimportant
E. Certainty Unimportant
2. Employees give importance to moral incentives (appreciation, respect, etc) as well as
physical
A. Very Important
B. Important
C. Indecision
D. Unimportant
E. Certainty Unimportant
3. Amount of payment effects the motivation positively
A. Very Important
B. Important
C. Indecision
D. Unimportant
E. Certainty Unimportant
4. Optimum time of work in businesses affects the motivation
A. Very Important
B. Important
C. Indecision

17.
D. Unimportant
E. Certainty Unimportant
5. Team work adds more to the motivation.
A. Very Important
B. Important
C. Indecision
D. Unimportant
E. Certainty Unimportant
6. Rewards motivate employees at a higher level
A. Very Important
B. Important
C. Indecision
D. Unimportant
E. Certainty Unimportant
7. Employees like to be given responsibility.
A. Very Important
B. Important
C. Indecision
D. Unimportant
E. Certainty Unimportant

18.
Appendix: C
Demographic information Result
Table 1: Demographic Information table of the sample Respondents
Culture Frequency %
Cumulative
percentage Gender
Frequency
number of
respondent % Cumulative %
Hindu 10.00 41.67 41.67 Male 18.00 75.00 75.00
Buddhist 12.00 50.00 91.67 Female 6.00 25.00 100.00
Muslim 1.00 4.17 95.83 Total 24.00 100.00
Christian 1.00 4.17 100.00 Age Group
Other 24.00 4.00 52.00 15-20 6.00 25.00 25.00
Length of Employment in years 21-30 10.00 41.67 66.67
0-5 12.00 50.00 50.00 31-40 3.00 12.50 79.17
5 to 10 3.00 12.50 62.50 41-50 3.00 12.50 91.67
10 to 20 5.00 20.83 83.33 51 to above 2.00 8.33 100.00
Above 20 4.00 16.67 100.00 Total 24.00 100.00
Total 24.00 100.00 Work Place
Working Status Kitchen 9.00 37.50 37.50
Full Time 18.00 75.00 75.00 Middle 12.00 50.00 87.50
Part Time 6.00 25.00 100.00 Cashier 3.00 12.50 100.00
24.00 100.00 Total 24.00 100.00
S.N Statements
Very
important important Indecision Unimportant
Certainty
unimportant
f
%
f
%
f
%
f
%
f
%
1
Employees must be provided social facilities
(housing, transportation etc.) at the highest
standards.
20
83.34% 2 8.34%
1
4.17%
1
4.17%
0
0%
2
Employees give importance to moral
incentives (appreciation, respect, etc) as well
as physical
14
58.34%
6
25%
2
8.34%
1
4.17%
1
4.17%
3
Amount of payment effects the motivation
positively
19
79.17%
5
20.84%
0
0%
0
0%
0
0%
4
Optimum time of work in businesses affects
the motivation
8
33.34%
10
41.67%
4
16.67%
1
4.17%
1
4.17%
5 Team work adds more to the motivation.
6
25%
8
33.34%
4
16.67%
3
12.5%
3
12.5%
6 Rewards motivate employees at a higher level
15
62.50%
5
20.84%
2
8.34%
2
8.34%
0
0%
7 Employees like to be given responsibility.
8
33.34%
8
33.34%
4
16.67
2
8.34%
2
8.34%