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A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE
SATISFACTION IN THE HOSPITALITY INDUSTRY
By
Ksenia Novikova
B.S., Voronezh State University, 2006
A Thesis
Submitted in Partial Fulfillment of the Requirements for the
Master of Science in Recreation Degree.
Department of Health Education and Recreation
In the Graduate School
Southern Illinois University Carbondale
May 2009
UMI Number: 1464981
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THESIS APROVAL
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE
SATISFACTION IN THE HOSPITALITY INDUSTRY
By
Ksenia Novikova
A Thesis Submitted in Partial
Fulfillment of the Requirements
for the Degree of
Master of Science
in the field of Recreation
Approved by:
Dr. Regina B. Glover, Chair
Dr. Marjorie Malkin
Dr. T.C. Girard
Graduate School
Southern Illinois University Carbondale
January 28, 2009
AN ABSTRACT OF THE THESIS OF
Ksenia Novikova, for the Master’s of Science degree in Recreation Resource Administration,
presented on 28 January 2009, at Southern Illinois University Carbondale.
TITLE: A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE
SATISFACTION IN THE HOSPITALITY INDUSTRY
MAJOR PROFESSOR: Dr. Regina B. Glover
The major purpose of this study was to identify customer and employee satisfaction
levels and the most important satisfaction factors in the lodging industry by the example of two
hotel properties of a resort on the East Coast. This study included a sample of 267 customers,
while the exact number of employees was unknown.
The customer satisfaction survey was prepared by the consulting agency. It was
conducted in the form of a 10-minute telephone interview with the customers who stayed at the
resort 30 days prior to the survey. The customers indicated their satisfaction levels with six areas
of the customer experience at the resort such as dining experience, golfing experience,
experience with spa, beach club experience, experience with facilities/activities, and guest
problems experience.
Top 10 and lowest 10 customer satisfaction factors were found for both hotels of the
resort. Four similar factors out of 10 positive ones were found to be in both of the hotel
properties. Nine similar factors out of 10 were ranked as least satisfying in both of the hotels.
The range score between the highest and the lowest customer satisfaction rating for the Hotel A
was found to be 1.44, and for B Hotel 1.6. As for the overall customer satisfaction in two hotels,
the overall customer satisfaction for the Hotel A was 4.5 (90%), and for the Hotel B was 4.58
(91.6%).
i
To identify the customer satisfaction factors, four areas were selected for the analysis:
staff, room divisions, recreation, and conflict resolution. Satisfaction with Room Divisions
received the highest overall mean scores (4.64-for Hotel A, and 4.83- for Hotel B), while
Conflict Resolution area received the lowest satisfaction scores for both of the Hotels (4.51- for
Hotel A, 4.48- for Hotel B).
The employee satisfaction questionnaire was created by the human resources department
of the resort. The employee satisfaction survey was represented by 12 areas: the company;
vision/mission/values; interact; your job; your department; physical work environment;
communications; leadership, supervision and management effectiveness; teamwork; pay,
opportunity, and benefits; career development and training; quality; and demographic
information. To determine the employee satisfaction levels, the mean percentage scores of all
positive and negative employees’ responses were calculated. Satisfaction with Your Department
received the highest positive total percentage mean score of 81.1%, while satisfaction with the
Interact program implemented by the resort received the lowest positive mean percentage score
of 44.0%. Similar to customer satisfaction, the 10 top positive and 10 bottom negative employee
satisfaction response questions were identified.
The strong positive relationship (r=0.66) was found between the Hotel A and B of the
resort and customer satisfaction factors. Those areas that were ranked high by the customers of
the Hotel A were also highly ranked by the Hotel B customers. A Person’s correlation coefficient
was run on the relationship between the hotel property and customer satisfaction levels. The
strong positive association was found between two hotel properties and satisfaction statements.
Paired sample t-test was also run in order to determine if there was a significant
difference in customer satisfaction in two hotels A and B based on the customer’s responses to
ii
the questionnaire. The t equal to (-2.5), and the probability of (0.016) were found. There was
found to be statistical significant difference between the Hotel A and B customer satisfaction
statements.
iii
ACKNOWLEDGMENTS
I would like to thank:
My advisor Dr. Regina Glover for her leadership, support, motivation, hard work and attention to
details throughout this thesis. She played a major role for two years of my graduate school,
investing her energy, and time into my personal and academic growth.
The members of my committee, Dr. Marjorie Malkin and Dr. T.C. Girard for their helpful
comments, patience, and understanding, as well as great classes that I had a chance to take with
their instruction.
I'd like to thank all the faculty members and the administrative staff of the Department of Health
Education and Recreation. They each contributed to my professional development, and helped
me with understanding of the American education system.
I would not have been able to complete my Masters degree without support of my family and
friends. Their confidence in my abilities has been driving me to succeed and accomplish the
goals that I set.
iv
TABLE OF CONTENTS
Abstract............................................................................................................................................ i
Acknowledgments.......................................................................................................................... iv
List of Tables ................................................................................................................................ vii
List of Figures..............................................................................................................................viii
Chapter 1 Introduction .................................................................................................................... 1
Background..................................................................................................................................... 1
The statement of the problem ......................................................................................................... 2
Research questions.......................................................................................................................... 2
Null hypotheses............................................................................................................................... 3
Significance of the study................................................................................................................. 3
Delimitations................................................................................................................................... 4
Limitations...................................................................................................................................... 5
Definitions....................................................................................................................................... 5
Chapter 2 Literature review ............................................................................................................ 7
Issues in customer satisfaction........................................................................................................ 8
Cultural value................................................................................................................................ 14
Waiting time.................................................................................................................................. 19
Issues in employee satisfaction..................................................................................................... 21
Chapter 3 Methodology ................................................................................................................ 25
Description of the Sample............................................................................................................. 25
Instrument ..................................................................................................................................... 26
Data collection procedure ............................................................................................................. 27
Data preparation and statistical procedures .................................................................................. 27
v
Chapter 4 Data Presentation.......................................................................................................... 29
Results........................................................................................................................................... 29
Research Sample........................................................................................................................... 29
Statistical analysis......................................................................................................................... 43
Chapter 5 Summary ...................................................................................................................... 49
Conclusions................................................................................................................................... 51
Discussion..................................................................................................................................... 52
Recommendations......................................................................................................................... 55
References..................................................................................................................................... 57
Appendices.................................................................................................................................... 60
Appendix A................................................................................................................................... 61
Appendix B................................................................................................................................. 666
Appendix C................................................................................................................................. 889
VITA............................................................................................................................................. 94
vi
LIST OF TABLES
Table 1. Top 10 Customer Satisfaction Factors in A Hotel.......................................................... 31
Table 2. Top 10 Customer Satisfaction Factors in B Hotel.......................................................... 32
Table 3. Lowest 10 Customer Satisfaction Factors in A Hotel..................................................... 33
Table 4. Lowest 10 customer satisfaction factors in B hotel........................................................ 34
Table 5. Customer satisfaction factors grouping in 4 major areas................................................ 36
Table 6. Overall employee satisfaction facets of the resort on the east coast............................... 39
Table 7. Top 10 positive employee satisfaction response questions ............................................ 42
Table 8. Top 10 negative employee satisfaction response questions........................................... 43
Table 9. Spearman's Rho correlation coefficient calculation ....................................................... 45
Table 10. Paired samples test hotel A and hotel B ....................................................................... 48
vii
viii
LIST OF FIGURES
Figure 1. Customer Satisfaction Factors in A and B Hotel………………………………36
Figure 2. 12 Employee Satisfaction Facets………………………………………………41
CHAPTER 1
INTRODUCTION
1.1 Background
Customer satisfaction is considered to be a key element for a company’s success in the
market; a leading criterion in determining the quality of service or product to the customers; and
it is also crucial for organizational survival. Customer satisfaction, loyalty, and the image of the
business, have become the most discussed and relevant topics in research for the service
industry, especially for hotel management theory and practice, being considered as the next
source of competitive advantage (Woodruff, 1997, cited in Nasution, & Mavondo, 2008). The
measurement of customer satisfaction has become an important issue for researchers in service
marketing and hospitality management. According to Drucker, customer satisfaction is, and has
always been, “the mission and the purpose of every business” (Drucker, 1973, p.79 cited in
Kandampully, J. & Suhartanto, 2003, p. 5). Moreover, it is known that one of the goals of
corporate culture is to retain and satisfy both the current and past customers. Shoemaker and
Lewis (1999) claimed that for many years hospitality enterprises believed in creating as many
new customers as possible as the goal of marketing, while hoteliers thought it is much more
important to satisfy those customers who are on the property; although “the real goal was to
continue to find new customers” (p. 345).
It has been proven by researchers (Holmund & Kock, 1996, p.289 cited in Kandampully,
& Suhartanto, 2003, p.4) that the cost of attracting new customers is five times higher than
keeping the existing ones. The knowledge of customers’ expectations is essential for companies
because it influences the repetition of purchases and word of the mouth recommendations.
1
Furthermore, Reichheld and Sasser’s research (1990) indicates that a profit increase of 25-28
percent can be produced by 5 percent increase in customer loyalty (Reichheld & Sasser, 1990
cited in Kandampully, & Suhartanto, 2003, p. 4).
Each and every organization starts with the employees, the people who bring the
organization alive and who are responsible for the output. Without the employees the hotel
would be just a structure made of steel, iron, and glass (The Need for Employee Counseling,
2006). Employees are the most important asset the company has. Employee satisfaction levels
can affect the quality of service, and therefore are believed to be related to customer satisfaction
issue in the hospitality service industry, where front line employees have constant interaction
with customers and can affect the overall company’s profitability and success.
1.2 The statement of the problem
The primary purpose of this study was to understand customer and employee satisfaction
factors and overall level of satisfaction in the resort setting. More specifically the study
examined the customer satisfaction and employee satisfaction in the lodging industry in two
hotel properties of a resort on the East Coast.
1.3 Research questions
1. What are the most important customer satisfaction factors in a Hotel A and B in a Resort on
the East Coast of the US?
2. What are the biggest problems in customer satisfaction in a Resort on the East Coast by the
example of the Hotel A and Hotel B?
3. What are the employee satisfaction levels in the lodging industry by the example of a Resort
on the East Coast?
2
4. What are the strongest and the weakest areas of employee satisfaction in a Resort on the East
Coast?
5. Is there a relationship between customer satisfaction rankings in two hotel properties of a
Resort on the East Coast based on the customer satisfaction survey?
1.4 Null hypotheses
1. There is no significant difference in customer satisfaction rankings in two properties of a
Resort on the East Coast.
1.5 Significance of the study
The issue emphasized in the present research/study concerning customer satisfaction and
employee satisfaction is of great importance today and expected to be even more important in the
future. The research on the topic of customer satisfaction is increasing along with the importance
of quality in service and production areas. More than 15,000 academic and trade articles have
been published on this topic (Pizam, & Ellis, 1999, p.327). Several conferences and profound
literature review publications have been devoted to the topic of customer satisfaction (Daym
1977; Hunt,1977; LaTour & Peat, 1979; Smart, 1982; Ross, et al., 1987; Barsky, 1992; Oh and
Parks, 1997 cited in Pizam, & Ellis, 1999, p.327).
The research has a practical and economic significance as the growth of service in the
world’s developed economies continues to dominate. Today companies need to excel in both
customer satisfaction and employee satisfaction in order to gain business growth, a positive
reputation, an increase in the company’s overall profitability image, work atmosphere, positive
employee attitudes, and behaviors.
3
Due to increasing competition among the hotel chains, the issue of customer satisfaction
and employee satisfaction becomes relevant both for research and practice. The value of the
study of customer satisfaction and employee satisfaction is increasing along with the importance
of improving quality in hotel service, as well as the significance of reducing turnover and
employee training. The knowledge obtained from this research may have applicability and
practical value for hotel managers toward the development of creative strategies to maintain
existing customer loyalty, increase prospective customers, improve management, and motivate
personnel. The research results could be used by hotel managers in identifying their hotel’s
strengths and weaknesses. The benefits of measuring customer satisfaction in various hotel
departments raises the awareness of special challenges in the particular departments in providing
service that could better satisfy the customers, enhance the use of customer service management
and personnel training, and identify the best possible practices for quality service, and customer
and employee satisfaction. This study is also important because there have been very few studies
that would analyze customer satisfaction and employee satisfaction in the hotel industry,
particularly in the Resort on the East Coast.
1.6 Delimitations
1. The study was limited to one resort setting on the East Coast.
2. Only 267 customers were used in the study.
3. No information was available for the researcher on the exact number of the employees who
completed the employee satisfaction survey.
4. Data collection for the Employee Satisfaction occurred during the month of October, 2003.
5. Customer Satisfaction Surveys and data for this study were only received from December to
February 2005 and are restricted to the outside agency interpretation.
4
6. The sample for the study was chosen from the guest list who stayed at the resort within 30
days prior to the survey.
1.7 Limitations
1. The results of this study may be generalized to only customers and employees of a small
portion of the lodging industry.
2. There were some differences in lodging facilities between the two hotel properties.
3. Information may not accurately reflect the opinion of the total population.
4. Customer satisfaction data were provided by the outside consulting organization to the resort,
and may not include all factors of customer satisfaction.
5. The employee satisfaction survey designed by the resort human resources may not include all
factors of employee satisfaction.
6. Opinions of the employees might have been influenced by the management.
7. Human error in the transfer of data might have occurred.
8. Validity and reliability of the surveys used was not available to the researcher.
1.8 Definitions
1. Customer satisfaction is a psychological concept that involves the feeling of well-being and
pleasure that results from obtaining what one hopes for and expects from an appealing
product and/or service (WTO, 1985 cited in Pizam, & Ellis, 1999, p.327).
2. Job satisfaction is an employee’s overall perceived evaluation of the job situation
(Bettencourt & Brown , 1997 cited in Mount, & Frye, 2000).
3. Service loyalty is the degree to which a customer exhibits repeat purchasing behavior from a
service provider, processes a positive attitudinal disposition toward the provider, and
5
considers using only this provider when a need for this service arises (Kandampully, &
Suhartanto, 2003, p.6).
4. The main areas of the resort setting in this study are represented by Room Divisions,
Recreation, Conflict Resolution, and Staff. The grouping of the existing data into those areas
was done by the researcher.
5. Room Divisions Department of the resort includes reservations, bellman/butler service, front
office, concierge service, and housekeeping. Eight statements regarding Room Divisions
Department area of the customer satisfaction survey were used to describe this term.
6
CHAPTER 2
LITERATURE REVIEW
The purpose of this chapter was to provide an overview of the related literature in order
to understand customer satisfaction factors (i.e. pricing, waiting time for service, and satisfaction
factors with different hotel departments) and their relation to employee satisfaction in the
lodging industry. The review of literature contains various sources of information including
recent publications in the following research journals, such as Journal of Contemporary
Hospitality Management, Journal of Hospitality & Leisure Marketing, Hospitality Management,
Journal of Hospitality and Tourism, International Journal of Contemporary Hospitality
Management, International Journal of Hospitality Management, Journal of Consumer
Marketing, Marketing Science.
The review of literature includes such topics as the measurement of customer satisfaction
in hospitality enterprises (Pizam, & Ellis, 1999); the importance of customer satisfaction and
hotel reputation in gaining customer loyalty (Kandampully, & Suhartanto, 2003); measurement
of customer satisfaction regarding personal service and service setting (Nicholls, Gilbert, &
Roslow, 1998); links between waiting time for service and service outcome (Butcher, &
Heffernan, 2006). Due to the minimal available research done on the topic of customer
satisfaction factors with regard to different hotel departments as well as employee satisfaction,
this review focuses on general customer and employee satisfaction factors in various service
industries, on service quality, customer loyalty, and value. As for the employee satisfaction, the
literature review was concentrated on studies done before, concerning general job satisfaction
factors, positive employee emotions, and favorable outcomes at the workplace (Staw, Sutton, &
7
Pelled, 1994), as well as a study about the impact of hotel size and service type on employee job
satisfaction (Mount, & Frye, 2000). This chapter is divided into two main sections: issues in
customer satisfaction, and issues in employee satisfaction.
2.1 Issues in customer satisfaction
Customer relations are known as of a greater value in the service industries than in the
production industry. Nicholls, Gilbert, and Roslow (1998) concentrated their research on
measurements of customer satisfaction. Their research adds to the developed knowledge base in
hospitality industry by examining the service satisfaction in 15 various industries. Nicholls,
Gilbert, and Roslow identify viewpoint differences between supporters of the notion of service
quality and proponents of the alternative of service satisfaction. Their research explores the
relationship between satisfaction and quality. It also points out the instrument of measurement of
customer satisfaction. Taking into consideration the increasing value of time in American
culture, this research focused on the immediate service encounter, not on past experiences.
The research was accomplished by using personal interviews with service organization
customers immediately after their service experience. The sample population included customers
who were exiting from their experience of service. The survey that was offered to the customers
included 29 statements that required respondents to report their satisfaction degree regarding
certain service elements. The statements covered such aspects as service, organizational system,
and security. The results from the responses outline the domain elements of the service
experience that contributed to customer satisfaction. Research findings from the data
demonstrated that “the highest public sector mean rating, 3.69, was less than the lowest private
sector mean rating, 3.93” (Nicholls, at. al., 1998, p. 246). According to the statistics from the
8
research, customers’ private sector organizations were rated higher than public sector ones.
Customer satisfaction, being “consumers’ reaction to their most recent experience of service,” is
an indicator of a company’s success and profit, because the delighted customers usually return
and become the best marketing tool for the organization (Nicholls, at. al., 1998, p. 247). The
research results can be used by managers of service organizations in identifying their companies.
The benefits of measuring customer service in various industries raise of awareness of special
challenges in the customer service industry, enhance the use of customer service management,
and identification of the best possible practices for quality service.
Anderson, Fornell, and Rust (1997) also emphasized the leading role of customer
satisfaction and productivity for the company’s success. Their research stresses that companies
need to excel in both customer satisfaction and productivity, in other words in “quality” and
“quantity,” in order to gain business growth, positive word of mouth about the company, and as
an increase in the company’s overall profitability and image.
The objective of the research is to find out whether there are situations with tradeoffs
between customer satisfaction and productivity, its purpose being an examination of the
relationships between customer satisfaction and productivity. The literature review on this topic
represents two opposite view points, one school stating that customer satisfaction and
productivity are compatible since improvements in customer satisfaction can result in less
handling of returns and complaint management, and at the same time lower the costs of future
transactions, and the second school stating that increasing customer satisfaction results in
growing costs due to the improvement of product attributes.
9
During the research of Anderson et. al., the empirical hypothesis was formed to analyze
measures of customer satisfaction, productivity, and profits, stating that the association between
changes in customer satisfaction and productivity “should be more negative for services than
goods”, and “the interaction and probability should be more negative (…) for service than for
goods”.
The Swedish Customer Satisfaction Barometer (SCSB) was used to measure these
variables. The research included an analysis of major competitor companies in such industries as
airlines, banking, basic foods, charter travel, gas stations, department stores and many others that
share 70 percent of the market. SCSB used a computer–aided telephone survey method to find
the sampling group of customers for each company. The respondents were selected based on
their recent usage of company’s product or service. The questionnaire included 10-point scales to
collect multiple measures. SCSB also measured the Return of Investment (ROI) and labor
productivity for each company. The outcomes of the research show the association between
satisfaction and productivity for goods as positive, and significant at (0.94), while the association
between satisfaction and productivity for services turned out to be negative and significant at (-
10.81). The findings of the research indicate that “service exhibits ‘tradeoffs’, while goods do
not”. A 1% increase in both customer satisfaction and productivity should be associated with
0.356% increase in ROI for goods, but only 0.22% increase for service. The research proves that
tradeoffs are more likely for services rather than for goods.
The research done by Pizam and Ellis in 1999 entitled “Customer satisfaction and its
measurement in hospitality enterprises,” identifies and analyzes various concepts of customer
satisfaction, and also furnishes organizations with relevant methods of value measurement of
customer satisfaction. The research also analyses global issues and main cultural differences in
10
customer satisfaction. This research resulted in the development of nine distinct theories of
customer satisfaction. Most of these theories “are based on cognitive psychology, some have
received moderate attention, while other theories have been introduced without any empirical
research” (p.327). The theories that were developed by consumer behaviorists have been applied
by researchers (Barsky, 1992; Barsky & Labagh, 1992; Saleh & Ryan, 1991; Ekinci & Riley,
1998) in lodging areas, in restaurant spheres (Dube et al., 1994; Bojanic and Rosen, 1994; Lee &
Hing, 1995; Oh & Jeong ,1996), foodservice industries (Almanza et al., 1994), and tourism
(Pizam & Milman, 1993; Danaher & Arweiler, 1996; Ryan & Cliff, 1997; Hudson & Shepard,
1998) (cited in Pizam, & Ellis, 1999, p.327). Customer satisfaction measurement serves two
roles for organization; it provides information and also enables communication with customers.
Lewis and Chambers give a mathematical depiction of overall customer satisfaction. The
research points out that regional, cultural and other cross-cultural aspects have to be taken in
consideration in measuring customer satisfaction (Pizam, & Ellis, 1999, p.335).
Parasuraman (1985, as cited in Pizam, & Ellis, 1999, p.327) concludes that service
quality should be measured by the formula (Q=P-E), P- being the customers’ perception scores,
and E- being the customers’ expectation scores. The higher the positive score (P), the greater the
positive amount of service quality (Q), or vice versa (Pizam, & Ellis, 1999, p.330). According to
the research results, the satisfaction with the hospitality experience is the total sum of
satisfactions with the individual elements of all the products and services that the company offers
(Pizam, & Ellis, 1999, p.327). Overall, the process of monitoring, analyzing, and measuring of
customer satisfaction is beneficial to any hospitality enterprise, and results in the company’s
positive image and good reputation for recommendations that influence the repeat purchase
and/or customer return.
11
Kandampully and Suhartanto’s research (2003) was focused on customer loyalty as the
dominant factor of success of business. Identifying loyalty as “positive long –term relationship
between service provider and customer,” (p.7) this research indicates that loyalty extends beyond
customer satisfaction and image, addressing the issues of customer return and friend
recommendation. Thus, there is a tendency now that companies try to perceive both customer
satisfaction and image to build the best long-term strategy (Selnes, 1993, cited in Kandampully,
& Suhartanto, 2003, p.9).
Regression analysis was used for analyzing data collected from five different chain hotels
in New Zealand. Two hundred thirty seven guests received a questionnaire and a cover letter
through the reception desk during the check-in procedure, where 158 surveys were returned,
while 106 (45%) surveys were used for the research. The 0.7 Cronbach’s alpha value as a cut –
off proved the reliability of the test. As for the validity, the regression analysis was an
appropriate method for testing three hypotheses:
H1: That the holistic and attributes dimension of hotel image is positively related to
customer loyalty .
H2: That customer satisfaction with reception, housekeeping, food and beverage,
and price is positively related to customer loyalty.
H3: That hotel image and customer satisfaction with hotel performance significantly
explain the variance in customer loyalty. (Kandampully, & Suhartanto, 2003, p.13)
The findings indicate that various departments of hotel operations, as well as price factors
have a different importance for the hotel guests. The research findings suggest that the image of
the hotel, as well as customer satisfaction including housekeeping, food and beverage
12
department, reception, and pricing are the most important factors in custom loyalty
determination. Convenience and accessibility are also named as relevant factors in guest return
decisions. According to research findings, housekeeping is considered to be the most significant
factor in determining customer loyalty for the hotel chains. The research concludes that customer
loyalty is a very time-specific and non-permanent factor, which is why it requires continuous and
consistent investment. Therefore, maintaining and developing customer loyalty is a key factor for
long-term success of any hotel management.
Matzler, Renzl, and Rothenberger, (2006) examined the relationship between quality,
satisfaction, and price as central criteria that determine the purchasing and post-purchasing
process which has been theoretically and empirically studied by many researchers (Kano, 1984;
Anderson et al., 1994; Fornell, 1992; Yeung & Ennew, 2000; Keaveny 1995; Varki & Colgate,
2001; Oh, 2003; Baumgartner, 2002 and others cited in Matzler, Renzl, & Rothenberger, 2006,
p. 179-196). This research is dedicated to the finding of “drivers of service and price satisfaction,
and the impact of service and price satisfaction on loyalty” (Matzler, et. al., 2006, p.179). The
authors of the research imply that both quality and price as perceived by the customers need to
be measured by hotel managers. The present study investigates different approaches, stating that
“price is a stronger driver of customer value than quality,” and is easy to evaluate comparing to
quality, while others argue that quality has a stronger impact on guest satisfaction (Matzler, et.
al., 2006, p.181). Another issue that was investigated in the present research was cultural
influence on satisfaction and loyalty. The data for the study was taken from the Austrian Guest
Satisfaction Barometer, which was to measure guest satisfaction with 25 hotels and their
services, price, and loyalty and provided the participating hotels with benchmarking data
(Matzler, et. al., 2006, p.183). The standardized self-administered questionnaire for hotel guests
13
has been used as a research data collection method. The questionnaire consisted of 26 items
which were to measure various aspects of a service on a 5 – point scale; loyalty in terms of the
intention to recommend the hotel to others was measured on a 5 point scale also with 5 -
representing “yes, for sure,” and 1 - representing “no, definitely not.” (Matzler, et. al.,, 2006,
p.184). Price and service satisfaction were measured using a 100% scale (0%-completely
dissatisfied, 100%-completely satisfied). Overall 1,555 questionnaires were completed.
The results statistically proved that the drivers of price and service satisfaction are not the
same. According to research, the price satisfaction was also very much influenced by the service
dimensions; thus, both service and price satisfaction significantly impact loyalty (R^2=.76). The
research had several findings: first, the relative importance of service dimensions for overall
service satisfaction differs from their importance for price satisfaction. Second, price satisfaction
has a stronger impact on loyalty than service satisfaction. Third, the finding is relating to cultural
differences, as it assumes that the guests’ nationalities are a strong moderator of the relationships
investigated in this study (Matzler, et. al., 2006, 191).
2.2 Cultural value
Tsaur, Lin, and Wu’s conducted the research “Cultural differences of service quality and
behavioral intention in tourist hotels” in 2005. With increasing global competition, the
understanding of the cultural influences of service becomes an important issue for service
companies (Tsaur, et. al., 2005, p. 43). The hotels were chosen as an example for the present
research because they offer individual services for tourists form all over the world. Some
researchers (Winsted, 1997; Donthu & Yoo, 1998; Mattila, 1999; Furrer, Liu and Sirakumar,
2000 cited in Tsaur, et. al., 2005, p. 43) studied the relationships between culture and service
14
quality in hotel industries. However, it is important to mention that very little research has been
done “regarding the cultural influences on service quality and behavioral intention” (Tsaur, Lin,
& Wu, 2005, p. 43).
The purpose of the 2005 study is an explanation of the role of culture in the relationship
between the quality of service and the inattention of the service provider staff. Based on the
literature review, the research indicates that culture is a crucial point that influences perceived
service quality and staff behavior.
For the study, 282 international travelers departing from CKS Airport in Taiwan were
selected by using a simple sampling approach. The sample included tourists from 26 countries
that represent three cultural group clusters similar to the cultural groupings of European, Asian,
and English Heritage (Tsaur, Lin, & Wu, 2005, p. 48). The respondents were asked to complete a
questionnaire while they were waiting for the plane’s departure. The survey consisted of a
questionnaire designed to measure the perceptions of tourists with regard to service quality and
staff behavior. A SERVQUAL scale was also used in the study to measure the difference
between customers’ expectations and performance.
The results of the research indicated that in contrast to Asian and European groups,
tourists from English Heritage cultures perceived better service quality regarding tangibles,
reliability, assurance, and empathy, but there was no significant variation among these three
groups considering the “responsiveness” (Tsaur, Lin, & Wu, 2005, p. 58). The results of the
research supported previous findings by Mattila, 1999; Furrer et. al., 2000; and Donthu and Yoo,
1998 cited in Tsaur, et. al., 2005, p. 58), who concluded that European and English Heritage
groups would expect empathy, attention, and care about them from the hotel service provider,
15
and demand a high level of service quality (Tsaur, et. al., 2005, p. 58). The findings of the
research are very useful for the hospitality managers in dealing with culturally diverse clients,
and helpful in the improvement of the customers’ perceived service quality.
Another research study that concentrates on the role of culture being the main category
that influences customer satisfaction with various pricing policies was done by Mattila and
Sunmee in 2006 who investigated the topic of “A cross-cultural comparison of perceived fairness
and satisfaction in the context of hotel room pricing.” With globalization and international trade
development, the number of businessmen, as well as leisure travelers is increasing fast. There
have been many previous studies in social psychology (Fiske et al., 1998 cited in Mattila, &
Sunmee, 2006, p.146) that proved that “psychological processes are culturally contingent.” Also,
previous research on this topic demonstrated the difference in customer expectations of Western
and Asian consumers. Thus, most consumer behavior research is based on theories developed in
Western societies (e.g., Maheswaran and Shavitt, 2000 cited in Mattila, & Sunmee, 2006, p.146).
That is why there is not enough knowledge about cross- cultural generalizability of customer
behavior theories (Mattila, & Sunmee, 2006, p.147).
The goal of Mattila and Sunmee’s research is to examine cross-cultural differences in
East-Asian and American consumers’ perceptions of fairness regarding hotel room pricing
(Mattila, & Sunmee, 2006, p.147). Taking into consideration that most hotels use differential
pricing as a form of revenue management, the present study was determined to find how
different outcomes of price (as worse, same, or better price) and price information influence
fairness and customer satisfaction of people from the U.S. as an example of a Western
individualistic culture, and people from South Korea as an example of an Eastern collective
culture (Mattila, & Sunmee, 2006, p.147).
16
A quasi-experimental design of (2 culture: American, Korean) x (3 outcome: better,
same, worse) x (2 information present, absent) was used as a method of study. Two hundred
eighty nine American and 302 South Korean travelers who were waiting for a plane in
Washington, DC and in South Korea airports were chosen as the subjects of study, 63% of the
total participants being male. The respondents were frequent users of hotels, as 43% responded
that they had stayed in a hotel over six times during the past year, while 39% stayed more than
six times, though for leisure travelers the figure was lower (Mattila, & Sunmee, 2006, p.149).
The survey with hypothetical scenario questions was used as the research instrument, translated
in both languages.
The researchers manipulated the price perceptions of the customers by indicating a price
that was better, same or worse than either the price they paid during their last visit to the hotel, or
the price that was given to another customer. They crossed the three levels of outcome with two
levels hotel’s pricing policy information. A seven-point Likert scale was used to measure
satisfaction with the reservation process, the Pearson correlation coefficient being 0.64.
The research findings indicate that U.S. consumers “preferred equitable outcomes in
pricing to either better or worse outcomes” (p.152). In other words, Americans, due to their
individualistic orientation, are less influenced by information explaining price changes. Korean
consumers, because of their group harmony orientation rather than individual interest, “gave
relatively low fairness and satisfaction ratings regardless of the outcome” (p.152).
In their research, Iglesias and Guillen (2004) differentiate the concepts of perceived value
and customer satisfaction, showing that they are not synonymous. They claim that being an
intangible product, service itself is simultaneously characterized, and therefore it is very difficult
17
to measure customer satisfaction and perceived value separately. The research focuses on the
assumption that customer satisfaction is positively affected by perceived quality of received
service, while perceived prices do not have the same huge impact on customer satisfaction.
The restaurants in Northeast Spain were chosen as research sites. The hotel and restaurant
sector was chosen for Iglesias and Guillen’s research, because it produces 80 percent of the
Spanish Gross Domestic Product, and plays a leading role in the Spanish economy (Iglesias &
Guillen, 2004, p.375). The empirical work was based on a survey database prepared in 1997,
employing a non-probabilistic procedure, and obtaining 156 valid surveys. The participants of
the survey were 60 % females and 40 % males with university education, the mean age of 35,
and an income level around EUR 1,500. The variables were measured through a ten-point
interval scale, where 1 represented “very low”, and 10 ”very high” with respect to the opinion
stated about total perceived price, value and satisfaction.
The results of the comparison of the means indicates that the total perceived price does
not have a considerable impact on customer satisfaction levels, whereas quality does. This
research has a great importance for restaurant management, because is shows that customer
satisfaction must be taken into account while implementing various policies of customer
satisfaction. The research also underlines that there is a high level of variability in restaurant
service, which is why the level of service quality and customer satisfaction may vary
tremendously form one customer to another, as well as from one employee to another. Research
indicates that in order to offer quality service to satisfy their customers, restaurant managers have
to hire qualified personnel, and empower them to make decisions when it comes to special
customer demands and preferences, for example the manner they want a dish to be cooked. Of
further importance for restaurant management is the knowledge of the reasons that lead
18
customers to require the services from the specific restaurant. Among the most common reasons
are family celebrations, leisure, and time.
Discussing time issue, optimization of the customer waiting time is a fundamental task
for all businesses that provide services to customers, especially the hospitality industry.
Researchers Butcher and Heffernan (2006) investigated specific aspects of waiting time that can
help in providing more cost-effective outcomes for companies. Their research concentrates on
the assumption that “social regard plays a mediating role between the length of customer wait,
friendly and apologetic employee behaviors and service outcomes such as repeat visit intentions”
(p.35).
This research accumulates many opinions on this topic, including an overview of diverse
literature. The main focus of the literature is on customer relation research in the service
management and hospitality field, as well as the field of social psychology.
2.3 Waiting time
Many researchers examined the relationship between waiting time and customer
satisfaction. For example, Davis and Vollman, 1990 (cited in Butcher, & Heffernan, 2006, p.35)
studied the conditions of time of the day, of the week, and location in the terms of waiting time
and degree of satisfaction. Further, Honric (1984) and Maister (1985) suggested managerial
actions related to perceived length of customer waiting time (cited in Butcher, & Heffernan,
2006, p.35). Jones and Dent (1994) discovered that smiling faces and apologies to customers
make the waiting more bearable (cited in Butcher, & Heffernan, 2006, p.36); Boshoff and Leong
(1998) found that a personal apology is strongly related to customer satisfaction (cited in
Butcher, & Heffernan, 2006, p.37).
19
Four hypotheses were stated for the Butcher and Heffernan’s research study:
H1: Perceived wait length will be positively associated with repeat visit intentions and
word of mouth.
H2: An apology will positively influence service outcomes, such as repeat visit
intentions and word of mouth in the wait situation.
H3: Friendly employee behavior will moderate the impact of a long wait on service
outcome measures, such as repeat visit interactions and word of mouth.
H4: Wait perception, an apology and employee friendliness will positively affect social
regard. (Butcher, & Heffernan, 2006, p.40)
A 2x2x2 between-subject experimental design was used as a research method to test the
hypotheses. One hundred fifty one first-year students of an Australian University were randomly
selected as a convenience sample for the present research, including 38.9% males. Written
vignettes were developed for the study for the café settings. Among the dependent variables that
were manipulated were the “actual length of wait duration friendliness of service employee, and
whether an apology was offered to the customer by the service employee” (p.41). The dependent
variable was the word of the mouth. Both independent and dependent variables were measured
using a seven-point Likert scale. Each questionnaire contained a vignette and twenty-five
questions based on the activities in a vignette. The analysis of variance (ANOVA) (2 actual wait
length x 2 friendly service x 2 apology) was used to illustrate the difference in rating of the
dependent measure of social regard (Butcher, & Heffernan, 2006, p.43).
20
The research had two main findings. The first finding stated that social regard plays a
main role in repeat purchase and word of mouth. The second finding showed that the actual
length of wait time had a direct impact on social regard, and was moderated by friendly
employee behavior and apology for slow service (Butcher, & Heffernan, 2006, p.48).
2.4 Issues in employee satisfaction
According to The Conference Board press release (2005), 50% of all Americans are
satisfied with their jobs, which indicate a 10% decline from 1995. But in these 50% only 14%
are “very satisfied” (U.S. job satisfaction keeps falling, The Conference Board reports today,
2005). The sample size for this report is five thousand U.S. households which were contacted by
TNS, which is a leading marketing information company. This information pointed out that one
quarter of American employees are showing up to work only to pick up a paycheck. The largest
decline in job satisfaction, from 60.9% to 49.2% was among workers of 35-44 years of age. As
for the income perspective, the household with the income of $25,000 to $35,000 had the biggest
decline in job satisfaction. Employees were mostly dissatisfied with promotion policies and
bonus plans. Wages were also rated as poor, only 33.5% were satisfied with their pay (2005).
Syptak, Marsland, and Ulmer (1999) in their study “Job satisfaction: Putting Theory into
Practice” stated that employee satisfaction and retention have been a research topic for many
years. In the 1950s, Herzberg developed the theory that includes two components of job
satisfaction: motivation and so called “hygiene.” According to Herzberg, motivation “create
satisfaction by fulfilling individuals’ needs for meaning and personal growth”, for example
achievement, recognition and advancement (Syptak, Marsland, & Ulmer, 1999, p.2). Hygiene
factors can not motivate people, but they can minimize dissatisfaction. Hygiene factors include
21
policies, supervision, salary, and working conditions. Hygiene issues have to be taken into
consideration in order to create favorable environment for employee satisfaction and motivation.
The customers’ perceptions of the service quality and their satisfaction with the service
mainly depend on the interaction with the employee. Wangeheim, Evanschitzky, and Wunderlich
(2007) conducted a study that analyzed the relationships between employee and customer
satisfaction.
Different researchers (Berhnardt, et al., 2002, Koys 2001, Ryan et al. 1996, and Tornow
& Wiley, 1991 cited in Wangeheim, Evanschitzky, and Wunderlich, 2007, p. 690) proved that
there is a positive association between employee and customer satisfaction. Harter et. al. found
support that there is a positive link between employee and customer satisfaction by conducting a
meta- analysis of 7,939 business units in 36 companies (Wangeheim, Evanschitzky, &
Wunderlich, 2007 p.691). Tornow and Wiley (1991), Bernhardt et al. (1996), and Koys (2001)
state that there is a strong correlation between employee attitudes and customer satisfaction in
automobile finance and restaurant chain sectors (cited in Wangeheim, Evanschitzky, &
Wunderlich, 2007, p.691). Data for Wangeheim, Evanschitzky, and Wunderlich’s research was
collected from customers and employees of a European retail chain in the Do-it-Yourself (DIY)
market (p.692). A pre-test was conducted in 2001, and resulted in 53,645 customer and 1,659
employee questionnaires at 99 outlets. LISREL 8.54 was used for the purpose of analysis.
According to the research findings, perceived quality and perceived price had the largest effect
on customer satisfaction, but employee job satisfaction was also proven to be a statistically
significant factor. Moreover, the correlation analysis of cashiers’(.172), with p<.05 and
storeroom workers’(.162) with p<.05 scores of work satisfaction and customer satisfaction scores
22
with the service proved that employee job satisfaction is related to customer satisfaction, even
for the employees who do not have direct contact with customers.
Staw, Sutton, and Pelled (1994) conducted a cross- subject study in psychology,
sociology and organizational behavior that proved that positive emotions help employees to
obtain favorable outcomes at work. The data for this study was collected by Michigan’s Survey
Research Center at two times, separated by 18 to 20 months. The total number of participants for
both periods of time was 272 employees (152-men, 120 women), with the mean age 37.58. The
data was collected both times at a hospital and two manufacturers automobile accessories in the
Midwest Predictor. Dependent and control variables were used for the study. Positive emotion at
workplace was a predictor variable. As for the dependent variable, it included two measures of
work achievement such as supervisor evaluation and pay at time, and two measures of the
employee’s social environment (supervisor and coworker social support) (Staw, Sutton, &
Pelled, 1994, p.60). Age, education, gender, and rated intelligence were controlled variables in
this study. The findings of Staw, Sutton, and Pelled’s study found that employees with positive
emotions will have more favorable outcomes in their work. The following predicted relationships
were supported by the research:
1) employees who had positive emotions in the workplace received more favorable
supervisor evaluation and had a greater pay increase in 18 months
2) employees with greater positive emotions at time one had a better supervisor and
coworker support at time two, enriching the overall organizational supportive social
contest
The other finding was that the relationship between job enrichment and positive emotion
was considered to be not significant.
23
Mount and Frye’s research (2000) examines employee satisfaction issue from the
prospective of hotel size and service type. Segmentation is considered to be a standard for the
corporate development in the hospitality industry. The leading hotel companies buy, sell, and
create new brands for specific target markets constantly. Robert Shaw stated that eight largest
hotel companies controlled 66 brands in 1999 (cited in Mount, & Frye, 2000, p. 60). The hotel
organization structure is different for extended stay, limited service and full-service type of hotel
service. This research focuses on the job satisfaction of hotel employees from 52 hotel properties
operated by private hotel company. Fifty two properties included 22 full-service hotels, 17
limited services, and 13 extended stay hotels in 22 states. The research objective was to
determine whether hotel size and type has an impact on employees’ job satisfaction. 2,102
questionnaires were received, while 1,991 were used for the research. Individual response rate of
the various hotels was between 36% and 100%. Mount and Frye found that job satisfaction was
positive related to customer satisfaction among resort employees, cruise ship employees, and fast
service restaurant employees. Moreover, satisfaction was found as negatively related to turnover.
Independent sample t-tests were used to measure the difference in satisfaction between different
hotel service types. The findings of this research show that there are no relationships between
the employee satisfaction, and the hotel size, but there is a significant relationship between
employee satisfaction and the type of the hotel service, and employees of the limited service
hotels are more satisfied than full- service ones (p. 65).
24
CHAPTER 3
METHODOLOGY
The purpose of this study was to identify customer and employee levels of satisfaction in
the lodging industry, and also to define most significant factors of both employee and customer
satisfaction, as well as to examine the relationships between customer satisfaction and employee
satisfaction. This chapter will discuss the sample of the study, its description, instrument, data
collection, and data analysis procedures.
3.1 Description of the Sample
This study was conducted using data collected at a resort on the East Coast. This resort is
considered to be one of the finest community resorts in the World. There are three different
hotels in this resort family, in order not to name them; they will be called the A Hotel, the B
Hotel, and the Rental Cottages for the research purposes. The A Hotel is a very famous hotel in
the industry; it was a recipient of many awards in its nearly 80-year history. A Hotel has a
"boutique" style, and it is represented by 156 rooms, including 56 beachfront options. The A
Hotel also includes the new 65,000-square-foot spa and the Beach Club. The Spa has a salon, a
workout center, and indoor squash courts just to name a few. Among other recreational activities
that the A Hotel offers are golf, tennis, horseback riding, yacht cruises, and shooting lessons. The
B Hotel is a 40-room golf clubhouse. The B Hotel is famous for featuring three championship
golf courses. The Cottage Rentals Department of the resort enables to rent one-third of about 500
homes and 44 condominiums. The cottages vary from 3 to 9 bedrooms homes. Typical
minimum rental time for the Cottages is one week, even though 3 days are possible in some
cases.
25
The sample of study is represented by 267 customers, 171 of which stayed in the A Hotel
and 96 stayed in the B Hotel. The sample size was determined by 50 guests from the A Hotel
property who were interviewed per month, and 105 guests from B Hotel property were
interviewed during the quarter period. Employee Satisfaction Surveys were distributed to all
level employees in all the departments of the resort during October 2003. The exact number of
employees who completed the survey was not available for the researcher.
3.2 Instrument
The instruments used in this study were designed in a form of the customer and employee
satisfaction questionnaire. The employee satisfaction survey was developed by the human
resources department of the resort, while the customer satisfaction questionnaire was created by
the outside consulting agency.
The customer satisfaction questionnaire contains 52 statements total. The first 11 items
on the questionnaire are copyrighted from consulting firm survey, while 41 others are unique to
this particular resort setting. The customer satisfaction questionnaire is represented by the 6
following areas: dining experience; golfing experience; spa experience; beach club experience;
experience with facilities/activities; and guest problems. The questionnaire statements are graded
on the five–point Likert scale, with 1 rating “strongly disagree” to 5 “strongly agree.”
The employee satisfaction survey consists of 12 facets of satisfaction which are: the
company; vision/mission/values; interact; your job; your department; physical work
environment; communications; leadership, supervision and management effectiveness;
teamwork; pay, opportunity, and benefits; career development and training; quality; and
demographic information. The questionnaire consists of 89 questions represented by 86
26
statements and 3 multiple choice questions that address demographics. The 86 statements
questionnaire includes both a five–point Likert scale, and a 6 point –point Likert scale to better
understand the factors that mostly affect employee satisfaction.
3.3 Data collection procedure
Customer and employee satisfaction data were provided by the company. Employee
satisfaction survey was done by the company in October 2003. As for the customer satisfaction,
the data was restricted to the report that was presented by the outside consulting agency in
November 2004. Researcher does not have information about the validity and reliability of
either survey. The customer satisfaction survey was done in the form of a 10-minute telephone
interview with the guests who stayed at the resort 30 days prior to the survey. The list of the
guests was provided by the resort to the consulting agency. The list was broken down by the
facility that the guests used during their stay and/or other relevant guest segmentations.
Permission was granted by SIU Human Subjects Committee to conduct the study in this
resort setting (Appendix A).
3.4 Data preparation and statistical procedures
SPSS (Statistical Package for the Social Sciences) version 15.0 was used to enter, code
data, and analyze data.
Customer satisfaction data were provided in the form of report, with questions and
percentages for the certain small areas and imported into SPSS.
For the customer satisfaction analysis, the main departments and services were grouped
together by the researcher and mean scores for the distinct areas were calculated to better
27
understand the most important customer satisfaction factors based on the data obtained from the
company.
For the employee satisfaction, the data were grouped by the A and B hotel and the
researcher did the pair comparison of two properties of the resort. Also, top positive and top
negative employee satisfaction factors were found, and main areas and/or departments that had
best results and most difficulties were determined based on the data from the company. Mean
scores were calculated for 12 facets of the employee satisfaction.
Correlation coefficient (Pearson r) was calculated to determine if there is a relationship in
customer satisfaction of the two hotels in the Resort setting.
28
CHAPTER 4
DATA PRESENTATION
4.1 Results
The purpose of this study was to identify customer and employee satisfaction factors and
levels of satisfaction in two hotel properties of the Resort on the East Coast. The participants of
the study were customers, who stayed at the resort in September, October, and November 2004,
and the employees of the resort of October, 2003. The customers’ responses to a questionnaire
(Appendix B) regarding their satisfaction levels with various areas of the two hotel properties
were used to determine results of this study. The customer satisfaction questionnaire was
constructed by the consulting agency. The employees’ responses to a questionnaire (Appendix
C) regarding their job satisfaction within 12 areas of satisfaction were also used in order to
determine results of this research study. The employee satisfaction survey was created by the
human resources department of the resort.
4.2 Research Sample
With the assistance of the Human Resources department of the resort the data were sent
to the researcher via email in the form of the Excel tables for the customer satisfaction
questionnaire, wich included the mean scores of satisfaction with certain areas of the two hotel
properties. The employee satisfaction data were also sent as to the researcher in the form of
Excel tables with the mean percentages of the employees’ satisfaction.
The customer satisfaction survey was represented by 52 statements within 6 areas of
customer experience at the resort such as dining experience, golfing experience, experience with
spa, beach club experience, experience with facilities/activities, and last but not least guest
29
problems. The list of participants is represented by 267 customers, where 171 customers stayed
in the A Hotel and 96 stayed in the B Hotel during the period of September, October, and
November 2004. Of there, fifty customers were interviewed in a month period from the A Hotel,
and 105 customers were interviewed in the same quarter period from B Hotel.
The customer satisfaction survey was conducted in the form of a telephone interview
(about 10 minutes) with the customers who stayed at the resort 30 days prior to the survey. The
list of the guests was provided by the resort to the consulting company, and was divided by the
facility at which customers used during their stay. The survey statements were graded on the
five–point Likert scale, with 5 rating “strongly agree” to 1 rating “strongly disagree.”
In attempt to better understand the most and the least important customer satisfaction
factors in two hotel properties of the Resort on the East Cost, the researcher did a rank order
transformation of the customer satisfaction data for the A and B Hotels. Forty nine of the 52
statements were common in two hotel properties. Three satisfaction factors that were available
only for one of two hotels were not taken into consideration in this study. These factors are
satisfaction with tennis, satisfaction with the charter fishing, and satisfaction with junior staff
activities.
Table 1 represents the top 10 customer satisfaction factors out of 49 available in the Hotel
A. The statements were graded on a five –point Likert scale, with 5- rating “strongly agree,” to 1
- rating “strongly disagree” (See Table 1). One factor (satisfaction with the shooting school)
received the highest customer rating equal to 5.0.
30
Table 1. Top 10 customer satisfaction factors in Hotel A
______________________________________________________________________________
Satisfaction factor Mean Score
Satisfaction with the shooting school 5.0
The pool cleanliness 4.92
Always treated with respect 4.90
The staff being attentive 4.89
The bell man/butler service 4.84
Always treated fairly 4.76
The recreational activities being fun 4.76
Satisfaction with the transportation services 4.76
The overall experience at check-in 4.75
The overall reservation process 4.75
(n=171)
Note: The higher the score the greater the agreement.
Table 2 indicates the 10 customer satisfaction factors that were highly rated by the customers of the Hotel
B (See Table 2). Two customer satisfaction factors (the beach being clean and satisfaction with the
shooting school) received 100% satisfaction score of 5.0. Three items were tied at 4.89: always delivers
personalized service, the overall experience at check-in, and the overall experience with housekeeping.
31
Table 2. Top 10 customer satisfaction factors in Hotel B
______________________________________________________________________________
Satisfaction factor Mean Score
______________________________________________________________________________
The beach being clean 5.0
Satisfaction with the shooting school 5.0
Satisfaction with the concierge service 4.96
Always treated with respect 4.95
Likelihood to recommend 4.93
Always treated fairly 4.92
Always delivers personalized service 4.89
The overall experience at check-in 4.89
The overall experience with housekeeping 4.89
Always count on a fair/sat. resolution 4.86
______________________________________________________________________________
(n=96)
Note: The higher the score the greater the agreement.
By looking at the descriptive information from the tables 1 and 2, and also by comparing
the top 10 mean scores and statements of two hotel properties, there were 4 similar factors for
both hotel properties. These factors were satisfaction with the shooting school, always treated
with respect, always treated fairly and the overall experience at check-in. Satisfaction with the
shooting school received a perfect (5.0) satisfaction mean score in the Hotels A and B. Three
other common statements were slightly higher ranked in Hotel B.
32
Table 3 indicates 10 customer satisfaction factors of the Hotel A that received the lowest
customer satisfaction scores. The statement, is the finest resort in the world, was considered as
the least satisfying with a mean score of 3.56.
Table 3. Lowest 10 customer satisfaction factors in Hotel A
______________________________________________________________________________
Satisfaction factor Mean Score
______________________________________________________________________________
Is the finest resort in the world 3.56
Can't Imagine a world without 3.60
Is the most unique resort I have ever visited 3.73
Satisfaction with problem handling 4.00
The overall dining experience being top class in the world 4.02
Is a place where kids can learn values, traditions, and manners 4.07
The overall spa experience being top class in the world 4.09
Intent to repurchase/continue to use 4.17
Overall, how satisfied were you with the treatment received at the spa 4.22
Satisfaction with the spa 4.25
______________________________________________________________________________
(n=171 per month)
Note: The higher the score the greater the agreement.
Ten lowest customer satisfaction factors of the Hotel B are represented in Table 4. The least mean
number of satisfaction (3.4) was for satisfaction with problem handling factor.
33
Table 4. Lowest 10 customer satisfaction factors in Hotel B
______________________________________________________________________________
Satisfaction factor Mean Score
______________________________________________________________________________
Satisfaction with problem handling 3.40
Can't imagine a world without 3.50
Is the most unique resort I have ever visited 3.76
Is the finest resort in the world 3.87
Overall, how satisfied were you with the treatment received at the spa 3.90
The overall spa experience being top class in the world 3.92
The overall dining experience being top class in the world 4.12
Is the perfect place to spend quality family time 4.14
Is a place where kids can learn values, traditions, and manners 4.25
Satisfaction with the spa 4.30
______________________________________________________________________________
(n=96)
Note: The higher the score the greater the agreement.
Nine similar factors out of 10 were ranked as least satisfying in both of the hotels.
Satisfaction with the problem resolution, spa, dining experience, as well as the resort being the
best and most unique one in the world were rated low in both of the hotels.
The range score between the highest and the lowest customer satisfaction rating for the
A Hotel is (1.44), while for B Hotel the range score is (1.6). The B Hotel seems to be more
satisfying in terms of customer satisfaction ratings, even though the range between the most and
least satisfying aspect of customer service is 0.16 mean scores higher than in the Hotel A. As for
34
the overall customer satisfaction in two hotels, the overall customer satisfaction for the Hotel A
is 4.5 (90%), and for the Hotel B is 4.58 (91.6%).
Another way to look at this data is presented in Figure 1. The bar graph easily
identifies "satisfaction with problem handling" as the statement with the greatest difference (1.6)
between both hotels. The statement with the greatest agreement (.75) between both hotels was
"satisfaction with the spa."
Figure 1. Lowest 9 Customer Satisfaction Factors in A and B Hotel
To better identify the satisfaction factors, four areas were selected by the researcher for
further analysis: staff, room divisions, recreation, and conflict resolution. For both satisfaction
with staff and satisfaction with room divisions 8 statements were identified; for the satisfaction
with recreation 10 statements were identified by the researcher; and for the satisfaction with
conflict resolution 4 statements were identified in order to define the areas that have the highest
and lowest level of satisfaction based on the customers’ responses to the questionnaire (See
Table 5).
35
Two areas such as satisfaction with Food and Beverage and satisfaction with Other
factors were not taken into consideration for this research. The mean scores were calculated for
each of four designated areas. Satisfaction with Room Divisions received the highest overall
mean scores (4.64-for Hotel A, and 4.83- for Hotel B), while Conflict Resolution area received
the lowest satisfaction scores for both of the Hotels A and B (4.51- for Hotel A, 4.48- for Hotel
B). Satisfaction with Staff was rated a little lower than Satisfaction with Room Divisions, being
given the second place with the scores (4.67- Hotel A, and 4.74- for Hotel B) in the overall rating
of four research areas. Guest Satisfaction with Recreation was ranked as the third area with the
mean scores of (4.54- for Hotel A, and 4.52-for Hotel B).
Table 5. Customer satisfaction factors grouping in 4 major areas
______________________________________________________________________________
Area of Satisfaction Satisfaction factor Mean Score
Hotel A Hotel B
______________________________________________________________________________
Staff
Employees are perfect examples of genuine 4.68 4.77
Southern hospitality
Always delivers personalized service 4.64 4.89
Employees are great at anticipating my needs 4.51 4.68
The staff being attentive 4.52 4.66
The staff being knowledgeable 4.65 4.60
The staff being courteous 4.58 4.73
The staff being attentive 4.89 4.60
Always treated with respect 4.90 4.95
Overall Mean Score for the Staff Satisfaction 4.67 4.74
______________________________________________________________________________
36
Table 5 (continued)
______________________________________________________________________________
Room Divisions
The reservation process 4.67 4.68
The overall experience at check-in 4.75 4.89
The bell man/butler service 4.84 4.82
The overall experience with your room or suite 4.53 4.83
The overall experience with housekeeping 4.55 4.89
The overall experience at checkout 4.54 4.85
The overall reservation process 4.75 4.75
Satisfaction with the concierge service 4.73 4.96
Overall Mean Score for the Room Divisions Satisfaction 4.64 4.83
______________________________________________________________________________
Recreation
The overall golf experience being top class 4.39 4.46
in the world
The overall quality of the course 4.71 4.70
The caddie being helpful 4.36 4.75
Satisfaction with the spa 4.25 4.30
The overall spa experience being top class 4.09 3.92
in the world
Overall, how satisfied were you with the 4.22 3.90
treatment received at the spa
The pool cleanliness 4.92 4.78
The recreational activities being fun 4.76 4.67
Satisfaction with the stables or horseback riding 4.67 4.67
Satisfaction with the shooting school 5.00 5.00
Overall Mean Score for the Recreation Satisfaction 4.54 4.52
______________________________________________________________________________
37
Table 5 (continued)
Conflict Resolution
Satisfaction with problem handling 4.00 3.40
Always count on a fair/sat. resolution 4.69 3.86
Always treated fairly 4.76 4.92
Always delivers on promises 4.60 3.74
Overall Mean Score for the Conflict Resolution 4.51 4.48
______________________________________________________________________________
(n=171 for the Hotel A, and n=96 for the Hotel B)
Another part of this research contains finding Employee Satisfaction levels at the same
resort on the East Coast. The employee satisfaction survey which was developed by the human
resources department of the resort was distributed to all level employees throughout the resort
during October 2003. The number of employees who completed the survey was not available for
the researcher. The survey includes of 12 facets of satisfaction: the company;
vision/mission/values; interact; your job; your department; physical work environment;
communications; leadership, supervision and management effectiveness; teamwork; pay,
opportunity, and benefits; career development and training; quality; and also demographic
information. The questionnaire included 89 questions, with 86 statements and 3 multiple choice
questions addressing demographics. The 86 statements questionnaire includes both a five–point
Likert scale, and a 6 point –point Likert scale to better understand the factors that mostly affect
employee satisfaction.
For employee satisfaction, the data available for the researcher were grouped based on 12
employee satisfaction facets, and the mean percentage scores of the all the positive, negative, and
not able to assess employees’ responses were calculated (See Table 6). Figure 2 presents this
data in bar graph format.
38
Table 6. Overall employee satisfaction facets of the Resort on the East Coast
______________________________________________________________________________
Facets of Satisfaction Positive Negative
Total Total
% %
______________________________________________________________________________
The Company 67.2 12.7
Vision/Mission/Values 55.6 15.8
Interact 44.0 25.7
Your job 57.0 10.5
Your Department 81.1 3.7
Physical Work environment 69.1 11.9
Communications 53.4 20.0
Leadership, Supervision, and 58.3 18.1
Management Effectiveness
Teamwork 66.1 15.2
Pay, Opportunity, and Benefits 55.4 14.9
Career Development and Training 61.5 15.9
Quality 60.2 18.9
______________________________________________________________________________
(n-not provided)
Note: The remaining percent falls into the neither satisfied nor dissatisfied area
39
0 10 20 30 40 50 60 70 80 90
The Company
Vision/Mission/Values
Interact
Your job
Your Department
Physical Work environment
Communications
Leadership, Supervision, and MNGT Effectiveness
Teamw ork
Pay, Opportunity, and Benefits
Career Development and Training
Quality
Negative Total %
Positive Total %
Figure 2. 12 Employee Satisfaction Facets
As for the demographic information, 60.4%-males, and 39.6%-females participated in the
employee satisfaction survey, 14.0% respondents preferred not to answer to the gender question.
Among those employees, 16.9% - employees were employed less than one year, 48.5% - were
employed from one to five years, 15.1% - were employed from six to ten years, 8.3% - for eleven
to fifteen years, 4.6% - for sixteen to nineteen years, and 6.7% - for over twenty years, while
12.0% - preferred not to answer this question.
Satisfaction with Your Department received the highest positive total percentage mean
score of 81.1%, and the lowest negative total percentage score of 3.7%, while satisfaction with
the Interact program implemented by the resort received the lowest positive mean percentage
score of 44.0%, and the highest negative means percentage score of 25.7%. Satisfaction with the
Physical Work environment received a second place with a positive satisfaction percentage score
40
of 69.1% and negative percentage score of 11.9%. The third place received the facet satisfaction
with the Company, being given 67.2% - positive total mean percentage score, and 12.7% -
negative total mean percentage score.
Also, 10 top positive and 10 top negative employee satisfaction response questions were
found (See Tables 7 and 8). Based on Table 7, satisfaction with your job, was represented by
three questions in the top 10 positive questions, satisfaction with leadership was represented by
two questions, and satisfaction with communications, with company, with your department, with
vision/mission, and with quality were represented by one question. Based on Table eight, 10 top
negative satisfaction questions, the facet satisfaction with vision/mission was represented by
three questions, satisfaction with interact, with quality, and leadership by two, and satisfaction
with communications by one question.
Comparing the data of the overall means of the employee satisfaction facets, and the 10
top and bottom question responses, there was found a difference between the 12 satisfaction
facets ratings and 10 top and bottom questions represented by the areas. The areas such as
satisfaction with your job and satisfaction with leadership were represented by three and two
questions in the 10 positive questions, but based on the overall employee satisfaction facet mean
scores, those areas were on the 8th
(satisfaction with your job) and 7th
(satisfaction with
leadership) places in the overall ratings. Satisfaction with your department, which was ranked as
the number one among all 12 employee satisfaction facets, was represented in the top 10 positive
questions just by one question. On the contrary, comparing the bottom ratings, the satisfaction
with the Interact program, received the lowest customer satisfaction percentage (44.0%), and
also was represented by two questions in the top 10 negative satisfaction questions.
Vision/mission satisfaction area was represented by three questions, so it took the first place in
41
the top 10 negative satisfaction questions, while it was ranked as the ninth in the overall
employee satisfaction facets with a 55.6% score.
Table 7. Top 10 positive employee satisfaction response questions
______________________________________________________________________________
Question Frequency, (%)
I am proud of the work I do 91.3
I have a good understanding of our overall company vision 90.4
I like the kind of work I do 86.5
How Sat. are you with the leadership provided by: Chairman / CEO 86.3
I enjoy the work I do 86.2
How Sat. are you with the leadership provided by: President 84.4
How would you rate the overall quality of work done in your department 82.9
I would recommend Sea Island as a place to work to friends 81.9
How would you rate the level of customer service (internal or external) 81.1
provided by your department
We are recognized as the finest resort and resort community 80.3
in the world by our: Guests
______________________________________________________________________________
(n-not provided)
42
Table 8. Top 10 negative employee satisfaction response questions
______________________________________________________________________________
Question Frequency, (%)
My department has enough of the following to do quality work: Staff 38.7
To what extent do you feel KRA's have been an effective means 34.9
of defining your responsibilities
We offer our employees: Performance Recognition 34.1
We offer our employees: Open Communication 32.8
We offer our employees: Advancement Opportunities 31.5
Most employees feel free to voice their opinions openly at the resort 31.5
My department has enough of the following to do quality work:
Equipment 30.9
To what extent does the Interact program help you to: Feel successful 30.5
To what extent is your immediate supervisor / manager good at:
Giving you regular feedback on your performance 29.6
Keeping you informed about management actions and/or decisions 29.4
______________________________________________________________________________
(n-not provided)
4.3 Statistical analysis
The Spearman's rho correlation coefficient was calculated by the researcher in order to
see if there was significant relationship between customer satisfaction factors in two hotel
properties. In order to define the Spearman's rho correlation, the researcher assigned the similar
numbers to all the satisfaction statements of both Hotel A and B, and then did the rank order
procedure in Excel in the way that the statement and the mean score were tight together (See
Appendix D). Using Appendix D, the researcher determined the ranks of all 47 statements in
both Hotel Properties A and B, calculated the Rank Difference (D) which was 0 (that means that
43
the rank order was determined correctly), and the Squared Rank Difference (D^2) which was
5852. The formula
was used to calculate the Spearman's rho correlation coefficient.
Six statements out of 47 were equally ranked by the Hotel A and B customers. As for the
top 5 common ratings, Hotel A and B had just two similar satisfaction statements (satisfaction
with the shooting school and always treated with respect). The other tendency is at the bottom 5
common ratings, four out of five satisfaction statements were both low ranked in two hotel
properties. Those statements are: is the finest resort in the world, can't imagine a world without,
is the most unique resort I have ever visited, and satisfaction with problem handling. The strong
positive relationship of (r=0.66) was found between the Hotel A and B of the resort on the East
Coast and customer satisfaction factors. Those areas that were ranked high by the customers of
the Hotel A were also highly ranked by the Hotel B customers. Table 9 represents the
calculations that were done by the researcher to determine the Spearman's rho correlation
coefficient. The Spearman's rho coefficient test was also run in the SPSS at the 0.01 significance
level to verify the researcher’s rating and mathematical calculations.
44
Table 9. Spearman's rho correlation coefficient calculation
______________________________________________________________________________
Statements
Ranks Rank Squared
Hotel Hotel Difference Difference
A B (D) (D^2)
Satisfaction with the shooting school 1 2 -1 1
The pool cleanliness 2 16 -14 196
Always treated with respect 3 4 -1 1
The staff being attentive 4 34 -30 900
The bell man/butler service 5 14 -9 81
Always treated fairly 6 6 0 0
The recreational activities being fun 7 30 -23 529
Satisfaction with the transportation
services 8 36 -28 784
The overall experience at check-in 9 8 1 1
The overall reservation process 10 21 -11 121
Satisfaction with the concierge service 11 3 8 64
The overall quality of the course 12 26 -14 196
Likelihood to recommend 13 5 8 64
Always count on a fair/sat. resolution 14 10 4 16
Employees are perfect examples of
genuine Southern hospitality 15 18 -3 9
The beach being clean 16 1 15 225
The reservation process 17 29 -12 144
Satisfaction with the stables or
horseback riding 18 31 -13 169
The staff being knowledgeable 19 33 -14 196
Overall satisfaction 20 17 3 9
Is a name I can always trust 21 12 9 81
Always delivers personalized service 22 7 15 225
The overall experience with resort
facilities 23 25 -2 4
45
Table 9 (continued)
Perfect for me 24 23 1 1
Always delivers on promises 25 22 3 9
Feel proud 26 15 11 121
The staff being courteous 27 24 3 9
The overall experience with
housekeeping 28 9 19 361
The overall experience at checkout 29 11 18 324
The overall experience with your room
or suite 30 13 17 289
The staff being attentive 31 32 -1 1
Employees are great at anticipating my
needs 32 28 4 16
Is a place where I can always relax and
disconnect from day to day problems 33 19 14 196
Is the perfect place to spend quality
family time 34 40 -6 36
The overall golf experience being top
class in the world 35 35 0 0
The caddie being helpful 36 20 16 256
The food quality 37 37 0 0
Satisfaction with the spa 38 38 0 0
Overall, how satisfied were you with
the treatment received at the spa 39 43 -4 16
Intent to repurchase/continue to use 40 27 13 169
The overall spa experience being top
class in the world 41 42 -1 1
Is a place where kids can learn values,
traditions, and manners 42 39 3 9
46
Table 9 (continued)
The overall dining experience being
top class in the world 43 41 2 4
Satisfaction with problem handling 44 47 -3 9
Is the most unique resort I have ever
visited 45 45 0 0
Can't Imagine a world without 46 46 0 0
Is the finest resort in the world 47 44 3 9
Total Sum 0 5852
______________________________________________________________________________
(n=47) p<.01
A Person’s correlation coefficient was also run on the relationship between the hotel
property and customer satisfaction levels of the resort on the East Coast. A 0.01 significance
level was also set for the test purposes. Much like the Spearman's rho correlation coefficient, the
strong positive association was found between two hotel properties and satisfaction statements.
The Person’s correlation coefficient was (0.843).
Paired sample t-test was run in order to determine if there was a significant difference in
customer satisfaction in two hotels A and B based on the customer’s responses to the
questionnaire. The t equal to (-2.5), and the probability of (0.016) were found. Like in the
previous two tests, there was found to be statistical significant difference between the Hotel A
and B customer satisfaction statements. There is a statistical significant difference between
customer satisfaction levels in the Hotel A and B, as the p-value (0.016) is less than 0.05 (See
Table 10).
47
Table 10. Paired Samples Test Hotel A and Hotel B
______________________________________________________________________________
Mean Std. Deviation Std. Error Mean t df Sig. (2-tailed)
-.07787 .21267 .03102 -2.510 46 .016
______________________________________________________________________________
(n=47)
48
CHAPTER 5
SUMMARY
The major purpose of this study was to identify customer and employee satisfaction
levels in the lodging industry by the example of two hotel properties of a resort on the East
Coast, and also to define most significant factors of the customer and employee satisfaction. This
study included 267 customers. The exact number of employees who participated was unknown.
The customer satisfaction survey was constructed and administered by a consulting
agency, via telephone with customers who stayed at the resort 30 days prior to the survey.
Customers indicated satisfaction/dissatisfaction levels with six areas at the resort.
Top 10 and lowest 10 customer satisfaction factors were determined for both hotels A
and B. Also, four areas were selected for the customer satisfaction analysis: staff, room
divisions, recreation, and conflict resolution. Satisfaction with Room Divisions received the
highest overall mean scores (4.64-for Hotel A, and 4.83- for Hotel B), while Conflict Resolution
area received the lowest satisfaction scores for both of the Hotels A and B (4.51- for Hotel A,
4.48- for Hotel B). Satisfaction with Staff was ranked slightly lower than Satisfaction with Room
Divisions, being given the second place in the overall rating of four research areas. Customer
Satisfaction with Recreation was ranked as the third area.
The range score between the highest and the lowest customer satisfaction rating for
Hotel A was found to be 1.44, and for Hotel B 1.6. As for the overall customer satisfaction in
two hotels, the overall customer satisfaction for the Hotel A was 4.5 (90%), and for the Hotel B
was 4.58 (91.6%).
49
There was a strong positive relationship found between Hotel A and Hotel B in customer
satisfaction factors. Those areas that were ranked high by the customers of the Hotel A were also
highly ranked by the Hotel B customers. There is a statistical significant difference between
customer satisfaction levels in the Hotel A and B.
The employee satisfaction questionnaire was created and administered by the human
resources department of the resort. The employees’ responded satisfaction/dissatisfaction
regarding their job in twelve areas of satisfaction which were: the company;
vision/mission/values; interact; your job; your department; physical work environment;
communications; leadership, supervision and management effectiveness; teamwork; pay,
opportunity, and benefits; career development and training; quality; and demographic
information.
For employee satisfaction determination, the mean percentage scores of all positive and
negative employees’ responses was calculated and grouped based on 12 employee satisfaction
facets. Satisfaction with Your Department received the highest positive total percentage mean
score of 81.1%, and the lowest negative total percentage score of 3.7%. Satisfaction with the
Interact program implemented by the resort received the lowest positive mean percentage score
of 44.0%, and the highest negative means percentage score of 25.7%. Satisfaction with the
Physical Work environment received a second place with a positive satisfaction percentage score
of 69.1%. Satisfaction with the Company, being given 67.2% - positive total mean percentage
score, scored third.
The 10 top positive and 10 bottom negative employee satisfaction response questions
were identified. There was a difference between the 12 satisfaction facets ratings and 10 top and
50
bottom questions represented by the areas. Satisfaction with your department facet, which was
ranked as the number one among all 12 employee satisfaction facets, was represented in the top
10 positive questions just by one question.
5.1 Conclusions
As in previous studies’, this study used interviews with the customers after their service
experience to report their satisfaction degree regarding various aspects of service and
organizational system; similar to Nicholls, Gilbert, and Roslow (1998) research.
The findings of this study, satisfaction with the hospitality experience is the total sum of
satisfactions with several individual elements of all the services that the company offers is
similar to the Pizam and Ellis research results of 1999. In this study it was found that the overall
customer satisfaction for the Hotel A is 4.5 (90%), and for the Hotel B is 4.58 (91.6%), which is
the mean score of six areas of the customer experience.
This findings of this study is also comparable to Kandampully and Suhartanto’s (2003)
research who found that satisfaction with housekeeping is the most significant factor to
determine customer loyalty. This study found that Satisfaction with Room Divisions area, which
includes housekeeping, received the highest overall mean scores for both of the hotels.
Findings by Butcher and Heffernan (2006) showed that the actual length of wait time had
a direct impact on social regard, and was moderated by friendly employee behavior and apology
for slow service. There is a similar relationship in this study to Boshoff and Leong (1998) who
found that a personal apology is strongly related to customer satisfaction. This research, revealed
the area of Conflict Resolution received the lowest customer satisfaction scores for both of the
Hotels (4.51- for Hotel A, 4.48- for Hotel B).
51
As for the employee satisfaction, according to The Conference Board reports today
(2005), employees were mostly dissatisfied with promotion policies and bonus plans. This study
found that Pay, Opportunity, and Benefits facet was ranked as number 10 among the 12
employee satisfaction facets.
Staw, Sutton, and Pelled (1994) conducted a cross- subject study in psychology,
sociology and organizational behavior that indicated employees with positive emotions will have
more favorable outcomes in their work. In this study Satisfaction with the Physical Work
environment was ranked second by the resort employees among the 12 employee satisfaction
facets.
5.2 Discussion
Customer and employee satisfaction factors are highly discussed topics today both in
theory and practice. They may become even more important in the near future. Pizam and Ellis
(1999) stated more than 15,000 academic and trade articles have been published on customer
satisfaction. Very few studies analyze customer satisfaction and employee satisfaction factors in
the hotel industry, particularly in the resorts on the East Coast. That is why this research findings
may be valuable for future research.
Today companies need to excel in both customer satisfaction and employee satisfaction
to gain: positive reputation; business growth; increase profitability; image; work atmosphere;
and loyal employees.
As Holmund and Kock (1996) proved the cost of attracting new customers is five times
higher than keeping the existing ones (cited in Kandampully, & Suhartanto, 2003, p.4), the
knowledge of customers’ expectations has become essential for companies because it influences
52
the repetition of purchases and word of the mouth recommendations. Reichheld and Sasser’s
research (1990) found that 25-28 percent profit increase can be produced by 5 percent increase in
customer loyalty.
This research may have practical value for hotel managers by providing them with both
high and low satisfaction ratings by customers and employee. This research may assist
hospitality managers to better understand customer and employee satisfaction factors. Better
understanding of these factors, hotel managers may be able to make organizational and
operational changes to increase the loyalty of existing and prospective customers, improve
recruitment and training for employees, and motivate personnel.
These results may be used by hotel managers to identify their hotel’s strengths and
weaknesses, threats and opportunities for future improvement. The analysis of customer
satisfaction factors may benefit customer satisfaction for various hotel departments. The analysis
of employee satisfaction levels may raise the awareness of special challenges in particular
departments for providing customer service, and highlight issues in personnel training.
By comparing customer satisfaction from this study, Nicholls (1998) study, and
Anderson, Fornell, and Rust (1997), we may hypothesize that customer satisfaction plays a
leading role in productivity and company’s success, as the satisfied customers is the best
marketing tool for the organization. Managers should take into consideration the benefits of
measuring customer satisfaction within different areas of the hotel, as Kandampully and
Suhartanto’s study (2003) stated, various departments of hotel operations have a different
importance for the hotel customers.
Hospitality managers should also take note of a key finding in this study: customer
satisfaction with problem resolution. This study found dining experience being lowly rated by
53
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY
A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY

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A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY

  • 1. A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY By Ksenia Novikova B.S., Voronezh State University, 2006 A Thesis Submitted in Partial Fulfillment of the Requirements for the Master of Science in Recreation Degree. Department of Health Education and Recreation In the Graduate School Southern Illinois University Carbondale May 2009
  • 2. UMI Number: 1464981 INFORMATION TO USERS The quality of this reproduction is dependent upon the quality of the copy submitted. Broken or indistinct print, colored or poor quality illustrations and photographs, print bleed-through, substandard margins, and improper alignment can adversely affect reproduction. In the unlikely event that the author did not send a complete manuscript and there are missing pages, these will be noted. Also, if unauthorized copyright material had to be removed, a note will indicate the deletion. ______________________________________________________________ UMI Microform 1464981 Copyright 2009 by ProQuest LLC All rights reserved. This microform edition is protected against unauthorized copying under Title 17, United States Code. _______________________________________________________________ ProQuest LLC 789 East Eisenhower Parkway P.O. Box 1346 Ann Arbor, MI 48106-1346
  • 3. THESIS APROVAL A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY By Ksenia Novikova A Thesis Submitted in Partial Fulfillment of the Requirements for the Degree of Master of Science in the field of Recreation Approved by: Dr. Regina B. Glover, Chair Dr. Marjorie Malkin Dr. T.C. Girard Graduate School Southern Illinois University Carbondale January 28, 2009
  • 4. AN ABSTRACT OF THE THESIS OF Ksenia Novikova, for the Master’s of Science degree in Recreation Resource Administration, presented on 28 January 2009, at Southern Illinois University Carbondale. TITLE: A STUDY OF CUSTOMER SATISFACTION FACTORS AND EMPLOYEE SATISFACTION IN THE HOSPITALITY INDUSTRY MAJOR PROFESSOR: Dr. Regina B. Glover The major purpose of this study was to identify customer and employee satisfaction levels and the most important satisfaction factors in the lodging industry by the example of two hotel properties of a resort on the East Coast. This study included a sample of 267 customers, while the exact number of employees was unknown. The customer satisfaction survey was prepared by the consulting agency. It was conducted in the form of a 10-minute telephone interview with the customers who stayed at the resort 30 days prior to the survey. The customers indicated their satisfaction levels with six areas of the customer experience at the resort such as dining experience, golfing experience, experience with spa, beach club experience, experience with facilities/activities, and guest problems experience. Top 10 and lowest 10 customer satisfaction factors were found for both hotels of the resort. Four similar factors out of 10 positive ones were found to be in both of the hotel properties. Nine similar factors out of 10 were ranked as least satisfying in both of the hotels. The range score between the highest and the lowest customer satisfaction rating for the Hotel A was found to be 1.44, and for B Hotel 1.6. As for the overall customer satisfaction in two hotels, the overall customer satisfaction for the Hotel A was 4.5 (90%), and for the Hotel B was 4.58 (91.6%). i
  • 5. To identify the customer satisfaction factors, four areas were selected for the analysis: staff, room divisions, recreation, and conflict resolution. Satisfaction with Room Divisions received the highest overall mean scores (4.64-for Hotel A, and 4.83- for Hotel B), while Conflict Resolution area received the lowest satisfaction scores for both of the Hotels (4.51- for Hotel A, 4.48- for Hotel B). The employee satisfaction questionnaire was created by the human resources department of the resort. The employee satisfaction survey was represented by 12 areas: the company; vision/mission/values; interact; your job; your department; physical work environment; communications; leadership, supervision and management effectiveness; teamwork; pay, opportunity, and benefits; career development and training; quality; and demographic information. To determine the employee satisfaction levels, the mean percentage scores of all positive and negative employees’ responses were calculated. Satisfaction with Your Department received the highest positive total percentage mean score of 81.1%, while satisfaction with the Interact program implemented by the resort received the lowest positive mean percentage score of 44.0%. Similar to customer satisfaction, the 10 top positive and 10 bottom negative employee satisfaction response questions were identified. The strong positive relationship (r=0.66) was found between the Hotel A and B of the resort and customer satisfaction factors. Those areas that were ranked high by the customers of the Hotel A were also highly ranked by the Hotel B customers. A Person’s correlation coefficient was run on the relationship between the hotel property and customer satisfaction levels. The strong positive association was found between two hotel properties and satisfaction statements. Paired sample t-test was also run in order to determine if there was a significant difference in customer satisfaction in two hotels A and B based on the customer’s responses to ii
  • 6. the questionnaire. The t equal to (-2.5), and the probability of (0.016) were found. There was found to be statistical significant difference between the Hotel A and B customer satisfaction statements. iii
  • 7. ACKNOWLEDGMENTS I would like to thank: My advisor Dr. Regina Glover for her leadership, support, motivation, hard work and attention to details throughout this thesis. She played a major role for two years of my graduate school, investing her energy, and time into my personal and academic growth. The members of my committee, Dr. Marjorie Malkin and Dr. T.C. Girard for their helpful comments, patience, and understanding, as well as great classes that I had a chance to take with their instruction. I'd like to thank all the faculty members and the administrative staff of the Department of Health Education and Recreation. They each contributed to my professional development, and helped me with understanding of the American education system. I would not have been able to complete my Masters degree without support of my family and friends. Their confidence in my abilities has been driving me to succeed and accomplish the goals that I set. iv
  • 8. TABLE OF CONTENTS Abstract............................................................................................................................................ i Acknowledgments.......................................................................................................................... iv List of Tables ................................................................................................................................ vii List of Figures..............................................................................................................................viii Chapter 1 Introduction .................................................................................................................... 1 Background..................................................................................................................................... 1 The statement of the problem ......................................................................................................... 2 Research questions.......................................................................................................................... 2 Null hypotheses............................................................................................................................... 3 Significance of the study................................................................................................................. 3 Delimitations................................................................................................................................... 4 Limitations...................................................................................................................................... 5 Definitions....................................................................................................................................... 5 Chapter 2 Literature review ............................................................................................................ 7 Issues in customer satisfaction........................................................................................................ 8 Cultural value................................................................................................................................ 14 Waiting time.................................................................................................................................. 19 Issues in employee satisfaction..................................................................................................... 21 Chapter 3 Methodology ................................................................................................................ 25 Description of the Sample............................................................................................................. 25 Instrument ..................................................................................................................................... 26 Data collection procedure ............................................................................................................. 27 Data preparation and statistical procedures .................................................................................. 27 v
  • 9. Chapter 4 Data Presentation.......................................................................................................... 29 Results........................................................................................................................................... 29 Research Sample........................................................................................................................... 29 Statistical analysis......................................................................................................................... 43 Chapter 5 Summary ...................................................................................................................... 49 Conclusions................................................................................................................................... 51 Discussion..................................................................................................................................... 52 Recommendations......................................................................................................................... 55 References..................................................................................................................................... 57 Appendices.................................................................................................................................... 60 Appendix A................................................................................................................................... 61 Appendix B................................................................................................................................. 666 Appendix C................................................................................................................................. 889 VITA............................................................................................................................................. 94 vi
  • 10. LIST OF TABLES Table 1. Top 10 Customer Satisfaction Factors in A Hotel.......................................................... 31 Table 2. Top 10 Customer Satisfaction Factors in B Hotel.......................................................... 32 Table 3. Lowest 10 Customer Satisfaction Factors in A Hotel..................................................... 33 Table 4. Lowest 10 customer satisfaction factors in B hotel........................................................ 34 Table 5. Customer satisfaction factors grouping in 4 major areas................................................ 36 Table 6. Overall employee satisfaction facets of the resort on the east coast............................... 39 Table 7. Top 10 positive employee satisfaction response questions ............................................ 42 Table 8. Top 10 negative employee satisfaction response questions........................................... 43 Table 9. Spearman's Rho correlation coefficient calculation ....................................................... 45 Table 10. Paired samples test hotel A and hotel B ....................................................................... 48 vii
  • 11. viii LIST OF FIGURES Figure 1. Customer Satisfaction Factors in A and B Hotel………………………………36 Figure 2. 12 Employee Satisfaction Facets………………………………………………41
  • 12. CHAPTER 1 INTRODUCTION 1.1 Background Customer satisfaction is considered to be a key element for a company’s success in the market; a leading criterion in determining the quality of service or product to the customers; and it is also crucial for organizational survival. Customer satisfaction, loyalty, and the image of the business, have become the most discussed and relevant topics in research for the service industry, especially for hotel management theory and practice, being considered as the next source of competitive advantage (Woodruff, 1997, cited in Nasution, & Mavondo, 2008). The measurement of customer satisfaction has become an important issue for researchers in service marketing and hospitality management. According to Drucker, customer satisfaction is, and has always been, “the mission and the purpose of every business” (Drucker, 1973, p.79 cited in Kandampully, J. & Suhartanto, 2003, p. 5). Moreover, it is known that one of the goals of corporate culture is to retain and satisfy both the current and past customers. Shoemaker and Lewis (1999) claimed that for many years hospitality enterprises believed in creating as many new customers as possible as the goal of marketing, while hoteliers thought it is much more important to satisfy those customers who are on the property; although “the real goal was to continue to find new customers” (p. 345). It has been proven by researchers (Holmund & Kock, 1996, p.289 cited in Kandampully, & Suhartanto, 2003, p.4) that the cost of attracting new customers is five times higher than keeping the existing ones. The knowledge of customers’ expectations is essential for companies because it influences the repetition of purchases and word of the mouth recommendations. 1
  • 13. Furthermore, Reichheld and Sasser’s research (1990) indicates that a profit increase of 25-28 percent can be produced by 5 percent increase in customer loyalty (Reichheld & Sasser, 1990 cited in Kandampully, & Suhartanto, 2003, p. 4). Each and every organization starts with the employees, the people who bring the organization alive and who are responsible for the output. Without the employees the hotel would be just a structure made of steel, iron, and glass (The Need for Employee Counseling, 2006). Employees are the most important asset the company has. Employee satisfaction levels can affect the quality of service, and therefore are believed to be related to customer satisfaction issue in the hospitality service industry, where front line employees have constant interaction with customers and can affect the overall company’s profitability and success. 1.2 The statement of the problem The primary purpose of this study was to understand customer and employee satisfaction factors and overall level of satisfaction in the resort setting. More specifically the study examined the customer satisfaction and employee satisfaction in the lodging industry in two hotel properties of a resort on the East Coast. 1.3 Research questions 1. What are the most important customer satisfaction factors in a Hotel A and B in a Resort on the East Coast of the US? 2. What are the biggest problems in customer satisfaction in a Resort on the East Coast by the example of the Hotel A and Hotel B? 3. What are the employee satisfaction levels in the lodging industry by the example of a Resort on the East Coast? 2
  • 14. 4. What are the strongest and the weakest areas of employee satisfaction in a Resort on the East Coast? 5. Is there a relationship between customer satisfaction rankings in two hotel properties of a Resort on the East Coast based on the customer satisfaction survey? 1.4 Null hypotheses 1. There is no significant difference in customer satisfaction rankings in two properties of a Resort on the East Coast. 1.5 Significance of the study The issue emphasized in the present research/study concerning customer satisfaction and employee satisfaction is of great importance today and expected to be even more important in the future. The research on the topic of customer satisfaction is increasing along with the importance of quality in service and production areas. More than 15,000 academic and trade articles have been published on this topic (Pizam, & Ellis, 1999, p.327). Several conferences and profound literature review publications have been devoted to the topic of customer satisfaction (Daym 1977; Hunt,1977; LaTour & Peat, 1979; Smart, 1982; Ross, et al., 1987; Barsky, 1992; Oh and Parks, 1997 cited in Pizam, & Ellis, 1999, p.327). The research has a practical and economic significance as the growth of service in the world’s developed economies continues to dominate. Today companies need to excel in both customer satisfaction and employee satisfaction in order to gain business growth, a positive reputation, an increase in the company’s overall profitability image, work atmosphere, positive employee attitudes, and behaviors. 3
  • 15. Due to increasing competition among the hotel chains, the issue of customer satisfaction and employee satisfaction becomes relevant both for research and practice. The value of the study of customer satisfaction and employee satisfaction is increasing along with the importance of improving quality in hotel service, as well as the significance of reducing turnover and employee training. The knowledge obtained from this research may have applicability and practical value for hotel managers toward the development of creative strategies to maintain existing customer loyalty, increase prospective customers, improve management, and motivate personnel. The research results could be used by hotel managers in identifying their hotel’s strengths and weaknesses. The benefits of measuring customer satisfaction in various hotel departments raises the awareness of special challenges in the particular departments in providing service that could better satisfy the customers, enhance the use of customer service management and personnel training, and identify the best possible practices for quality service, and customer and employee satisfaction. This study is also important because there have been very few studies that would analyze customer satisfaction and employee satisfaction in the hotel industry, particularly in the Resort on the East Coast. 1.6 Delimitations 1. The study was limited to one resort setting on the East Coast. 2. Only 267 customers were used in the study. 3. No information was available for the researcher on the exact number of the employees who completed the employee satisfaction survey. 4. Data collection for the Employee Satisfaction occurred during the month of October, 2003. 5. Customer Satisfaction Surveys and data for this study were only received from December to February 2005 and are restricted to the outside agency interpretation. 4
  • 16. 6. The sample for the study was chosen from the guest list who stayed at the resort within 30 days prior to the survey. 1.7 Limitations 1. The results of this study may be generalized to only customers and employees of a small portion of the lodging industry. 2. There were some differences in lodging facilities between the two hotel properties. 3. Information may not accurately reflect the opinion of the total population. 4. Customer satisfaction data were provided by the outside consulting organization to the resort, and may not include all factors of customer satisfaction. 5. The employee satisfaction survey designed by the resort human resources may not include all factors of employee satisfaction. 6. Opinions of the employees might have been influenced by the management. 7. Human error in the transfer of data might have occurred. 8. Validity and reliability of the surveys used was not available to the researcher. 1.8 Definitions 1. Customer satisfaction is a psychological concept that involves the feeling of well-being and pleasure that results from obtaining what one hopes for and expects from an appealing product and/or service (WTO, 1985 cited in Pizam, & Ellis, 1999, p.327). 2. Job satisfaction is an employee’s overall perceived evaluation of the job situation (Bettencourt & Brown , 1997 cited in Mount, & Frye, 2000). 3. Service loyalty is the degree to which a customer exhibits repeat purchasing behavior from a service provider, processes a positive attitudinal disposition toward the provider, and 5
  • 17. considers using only this provider when a need for this service arises (Kandampully, & Suhartanto, 2003, p.6). 4. The main areas of the resort setting in this study are represented by Room Divisions, Recreation, Conflict Resolution, and Staff. The grouping of the existing data into those areas was done by the researcher. 5. Room Divisions Department of the resort includes reservations, bellman/butler service, front office, concierge service, and housekeeping. Eight statements regarding Room Divisions Department area of the customer satisfaction survey were used to describe this term. 6
  • 18. CHAPTER 2 LITERATURE REVIEW The purpose of this chapter was to provide an overview of the related literature in order to understand customer satisfaction factors (i.e. pricing, waiting time for service, and satisfaction factors with different hotel departments) and their relation to employee satisfaction in the lodging industry. The review of literature contains various sources of information including recent publications in the following research journals, such as Journal of Contemporary Hospitality Management, Journal of Hospitality & Leisure Marketing, Hospitality Management, Journal of Hospitality and Tourism, International Journal of Contemporary Hospitality Management, International Journal of Hospitality Management, Journal of Consumer Marketing, Marketing Science. The review of literature includes such topics as the measurement of customer satisfaction in hospitality enterprises (Pizam, & Ellis, 1999); the importance of customer satisfaction and hotel reputation in gaining customer loyalty (Kandampully, & Suhartanto, 2003); measurement of customer satisfaction regarding personal service and service setting (Nicholls, Gilbert, & Roslow, 1998); links between waiting time for service and service outcome (Butcher, & Heffernan, 2006). Due to the minimal available research done on the topic of customer satisfaction factors with regard to different hotel departments as well as employee satisfaction, this review focuses on general customer and employee satisfaction factors in various service industries, on service quality, customer loyalty, and value. As for the employee satisfaction, the literature review was concentrated on studies done before, concerning general job satisfaction factors, positive employee emotions, and favorable outcomes at the workplace (Staw, Sutton, & 7
  • 19. Pelled, 1994), as well as a study about the impact of hotel size and service type on employee job satisfaction (Mount, & Frye, 2000). This chapter is divided into two main sections: issues in customer satisfaction, and issues in employee satisfaction. 2.1 Issues in customer satisfaction Customer relations are known as of a greater value in the service industries than in the production industry. Nicholls, Gilbert, and Roslow (1998) concentrated their research on measurements of customer satisfaction. Their research adds to the developed knowledge base in hospitality industry by examining the service satisfaction in 15 various industries. Nicholls, Gilbert, and Roslow identify viewpoint differences between supporters of the notion of service quality and proponents of the alternative of service satisfaction. Their research explores the relationship between satisfaction and quality. It also points out the instrument of measurement of customer satisfaction. Taking into consideration the increasing value of time in American culture, this research focused on the immediate service encounter, not on past experiences. The research was accomplished by using personal interviews with service organization customers immediately after their service experience. The sample population included customers who were exiting from their experience of service. The survey that was offered to the customers included 29 statements that required respondents to report their satisfaction degree regarding certain service elements. The statements covered such aspects as service, organizational system, and security. The results from the responses outline the domain elements of the service experience that contributed to customer satisfaction. Research findings from the data demonstrated that “the highest public sector mean rating, 3.69, was less than the lowest private sector mean rating, 3.93” (Nicholls, at. al., 1998, p. 246). According to the statistics from the 8
  • 20. research, customers’ private sector organizations were rated higher than public sector ones. Customer satisfaction, being “consumers’ reaction to their most recent experience of service,” is an indicator of a company’s success and profit, because the delighted customers usually return and become the best marketing tool for the organization (Nicholls, at. al., 1998, p. 247). The research results can be used by managers of service organizations in identifying their companies. The benefits of measuring customer service in various industries raise of awareness of special challenges in the customer service industry, enhance the use of customer service management, and identification of the best possible practices for quality service. Anderson, Fornell, and Rust (1997) also emphasized the leading role of customer satisfaction and productivity for the company’s success. Their research stresses that companies need to excel in both customer satisfaction and productivity, in other words in “quality” and “quantity,” in order to gain business growth, positive word of mouth about the company, and as an increase in the company’s overall profitability and image. The objective of the research is to find out whether there are situations with tradeoffs between customer satisfaction and productivity, its purpose being an examination of the relationships between customer satisfaction and productivity. The literature review on this topic represents two opposite view points, one school stating that customer satisfaction and productivity are compatible since improvements in customer satisfaction can result in less handling of returns and complaint management, and at the same time lower the costs of future transactions, and the second school stating that increasing customer satisfaction results in growing costs due to the improvement of product attributes. 9
  • 21. During the research of Anderson et. al., the empirical hypothesis was formed to analyze measures of customer satisfaction, productivity, and profits, stating that the association between changes in customer satisfaction and productivity “should be more negative for services than goods”, and “the interaction and probability should be more negative (…) for service than for goods”. The Swedish Customer Satisfaction Barometer (SCSB) was used to measure these variables. The research included an analysis of major competitor companies in such industries as airlines, banking, basic foods, charter travel, gas stations, department stores and many others that share 70 percent of the market. SCSB used a computer–aided telephone survey method to find the sampling group of customers for each company. The respondents were selected based on their recent usage of company’s product or service. The questionnaire included 10-point scales to collect multiple measures. SCSB also measured the Return of Investment (ROI) and labor productivity for each company. The outcomes of the research show the association between satisfaction and productivity for goods as positive, and significant at (0.94), while the association between satisfaction and productivity for services turned out to be negative and significant at (- 10.81). The findings of the research indicate that “service exhibits ‘tradeoffs’, while goods do not”. A 1% increase in both customer satisfaction and productivity should be associated with 0.356% increase in ROI for goods, but only 0.22% increase for service. The research proves that tradeoffs are more likely for services rather than for goods. The research done by Pizam and Ellis in 1999 entitled “Customer satisfaction and its measurement in hospitality enterprises,” identifies and analyzes various concepts of customer satisfaction, and also furnishes organizations with relevant methods of value measurement of customer satisfaction. The research also analyses global issues and main cultural differences in 10
  • 22. customer satisfaction. This research resulted in the development of nine distinct theories of customer satisfaction. Most of these theories “are based on cognitive psychology, some have received moderate attention, while other theories have been introduced without any empirical research” (p.327). The theories that were developed by consumer behaviorists have been applied by researchers (Barsky, 1992; Barsky & Labagh, 1992; Saleh & Ryan, 1991; Ekinci & Riley, 1998) in lodging areas, in restaurant spheres (Dube et al., 1994; Bojanic and Rosen, 1994; Lee & Hing, 1995; Oh & Jeong ,1996), foodservice industries (Almanza et al., 1994), and tourism (Pizam & Milman, 1993; Danaher & Arweiler, 1996; Ryan & Cliff, 1997; Hudson & Shepard, 1998) (cited in Pizam, & Ellis, 1999, p.327). Customer satisfaction measurement serves two roles for organization; it provides information and also enables communication with customers. Lewis and Chambers give a mathematical depiction of overall customer satisfaction. The research points out that regional, cultural and other cross-cultural aspects have to be taken in consideration in measuring customer satisfaction (Pizam, & Ellis, 1999, p.335). Parasuraman (1985, as cited in Pizam, & Ellis, 1999, p.327) concludes that service quality should be measured by the formula (Q=P-E), P- being the customers’ perception scores, and E- being the customers’ expectation scores. The higher the positive score (P), the greater the positive amount of service quality (Q), or vice versa (Pizam, & Ellis, 1999, p.330). According to the research results, the satisfaction with the hospitality experience is the total sum of satisfactions with the individual elements of all the products and services that the company offers (Pizam, & Ellis, 1999, p.327). Overall, the process of monitoring, analyzing, and measuring of customer satisfaction is beneficial to any hospitality enterprise, and results in the company’s positive image and good reputation for recommendations that influence the repeat purchase and/or customer return. 11
  • 23. Kandampully and Suhartanto’s research (2003) was focused on customer loyalty as the dominant factor of success of business. Identifying loyalty as “positive long –term relationship between service provider and customer,” (p.7) this research indicates that loyalty extends beyond customer satisfaction and image, addressing the issues of customer return and friend recommendation. Thus, there is a tendency now that companies try to perceive both customer satisfaction and image to build the best long-term strategy (Selnes, 1993, cited in Kandampully, & Suhartanto, 2003, p.9). Regression analysis was used for analyzing data collected from five different chain hotels in New Zealand. Two hundred thirty seven guests received a questionnaire and a cover letter through the reception desk during the check-in procedure, where 158 surveys were returned, while 106 (45%) surveys were used for the research. The 0.7 Cronbach’s alpha value as a cut – off proved the reliability of the test. As for the validity, the regression analysis was an appropriate method for testing three hypotheses: H1: That the holistic and attributes dimension of hotel image is positively related to customer loyalty . H2: That customer satisfaction with reception, housekeeping, food and beverage, and price is positively related to customer loyalty. H3: That hotel image and customer satisfaction with hotel performance significantly explain the variance in customer loyalty. (Kandampully, & Suhartanto, 2003, p.13) The findings indicate that various departments of hotel operations, as well as price factors have a different importance for the hotel guests. The research findings suggest that the image of the hotel, as well as customer satisfaction including housekeeping, food and beverage 12
  • 24. department, reception, and pricing are the most important factors in custom loyalty determination. Convenience and accessibility are also named as relevant factors in guest return decisions. According to research findings, housekeeping is considered to be the most significant factor in determining customer loyalty for the hotel chains. The research concludes that customer loyalty is a very time-specific and non-permanent factor, which is why it requires continuous and consistent investment. Therefore, maintaining and developing customer loyalty is a key factor for long-term success of any hotel management. Matzler, Renzl, and Rothenberger, (2006) examined the relationship between quality, satisfaction, and price as central criteria that determine the purchasing and post-purchasing process which has been theoretically and empirically studied by many researchers (Kano, 1984; Anderson et al., 1994; Fornell, 1992; Yeung & Ennew, 2000; Keaveny 1995; Varki & Colgate, 2001; Oh, 2003; Baumgartner, 2002 and others cited in Matzler, Renzl, & Rothenberger, 2006, p. 179-196). This research is dedicated to the finding of “drivers of service and price satisfaction, and the impact of service and price satisfaction on loyalty” (Matzler, et. al., 2006, p.179). The authors of the research imply that both quality and price as perceived by the customers need to be measured by hotel managers. The present study investigates different approaches, stating that “price is a stronger driver of customer value than quality,” and is easy to evaluate comparing to quality, while others argue that quality has a stronger impact on guest satisfaction (Matzler, et. al., 2006, p.181). Another issue that was investigated in the present research was cultural influence on satisfaction and loyalty. The data for the study was taken from the Austrian Guest Satisfaction Barometer, which was to measure guest satisfaction with 25 hotels and their services, price, and loyalty and provided the participating hotels with benchmarking data (Matzler, et. al., 2006, p.183). The standardized self-administered questionnaire for hotel guests 13
  • 25. has been used as a research data collection method. The questionnaire consisted of 26 items which were to measure various aspects of a service on a 5 – point scale; loyalty in terms of the intention to recommend the hotel to others was measured on a 5 point scale also with 5 - representing “yes, for sure,” and 1 - representing “no, definitely not.” (Matzler, et. al.,, 2006, p.184). Price and service satisfaction were measured using a 100% scale (0%-completely dissatisfied, 100%-completely satisfied). Overall 1,555 questionnaires were completed. The results statistically proved that the drivers of price and service satisfaction are not the same. According to research, the price satisfaction was also very much influenced by the service dimensions; thus, both service and price satisfaction significantly impact loyalty (R^2=.76). The research had several findings: first, the relative importance of service dimensions for overall service satisfaction differs from their importance for price satisfaction. Second, price satisfaction has a stronger impact on loyalty than service satisfaction. Third, the finding is relating to cultural differences, as it assumes that the guests’ nationalities are a strong moderator of the relationships investigated in this study (Matzler, et. al., 2006, 191). 2.2 Cultural value Tsaur, Lin, and Wu’s conducted the research “Cultural differences of service quality and behavioral intention in tourist hotels” in 2005. With increasing global competition, the understanding of the cultural influences of service becomes an important issue for service companies (Tsaur, et. al., 2005, p. 43). The hotels were chosen as an example for the present research because they offer individual services for tourists form all over the world. Some researchers (Winsted, 1997; Donthu & Yoo, 1998; Mattila, 1999; Furrer, Liu and Sirakumar, 2000 cited in Tsaur, et. al., 2005, p. 43) studied the relationships between culture and service 14
  • 26. quality in hotel industries. However, it is important to mention that very little research has been done “regarding the cultural influences on service quality and behavioral intention” (Tsaur, Lin, & Wu, 2005, p. 43). The purpose of the 2005 study is an explanation of the role of culture in the relationship between the quality of service and the inattention of the service provider staff. Based on the literature review, the research indicates that culture is a crucial point that influences perceived service quality and staff behavior. For the study, 282 international travelers departing from CKS Airport in Taiwan were selected by using a simple sampling approach. The sample included tourists from 26 countries that represent three cultural group clusters similar to the cultural groupings of European, Asian, and English Heritage (Tsaur, Lin, & Wu, 2005, p. 48). The respondents were asked to complete a questionnaire while they were waiting for the plane’s departure. The survey consisted of a questionnaire designed to measure the perceptions of tourists with regard to service quality and staff behavior. A SERVQUAL scale was also used in the study to measure the difference between customers’ expectations and performance. The results of the research indicated that in contrast to Asian and European groups, tourists from English Heritage cultures perceived better service quality regarding tangibles, reliability, assurance, and empathy, but there was no significant variation among these three groups considering the “responsiveness” (Tsaur, Lin, & Wu, 2005, p. 58). The results of the research supported previous findings by Mattila, 1999; Furrer et. al., 2000; and Donthu and Yoo, 1998 cited in Tsaur, et. al., 2005, p. 58), who concluded that European and English Heritage groups would expect empathy, attention, and care about them from the hotel service provider, 15
  • 27. and demand a high level of service quality (Tsaur, et. al., 2005, p. 58). The findings of the research are very useful for the hospitality managers in dealing with culturally diverse clients, and helpful in the improvement of the customers’ perceived service quality. Another research study that concentrates on the role of culture being the main category that influences customer satisfaction with various pricing policies was done by Mattila and Sunmee in 2006 who investigated the topic of “A cross-cultural comparison of perceived fairness and satisfaction in the context of hotel room pricing.” With globalization and international trade development, the number of businessmen, as well as leisure travelers is increasing fast. There have been many previous studies in social psychology (Fiske et al., 1998 cited in Mattila, & Sunmee, 2006, p.146) that proved that “psychological processes are culturally contingent.” Also, previous research on this topic demonstrated the difference in customer expectations of Western and Asian consumers. Thus, most consumer behavior research is based on theories developed in Western societies (e.g., Maheswaran and Shavitt, 2000 cited in Mattila, & Sunmee, 2006, p.146). That is why there is not enough knowledge about cross- cultural generalizability of customer behavior theories (Mattila, & Sunmee, 2006, p.147). The goal of Mattila and Sunmee’s research is to examine cross-cultural differences in East-Asian and American consumers’ perceptions of fairness regarding hotel room pricing (Mattila, & Sunmee, 2006, p.147). Taking into consideration that most hotels use differential pricing as a form of revenue management, the present study was determined to find how different outcomes of price (as worse, same, or better price) and price information influence fairness and customer satisfaction of people from the U.S. as an example of a Western individualistic culture, and people from South Korea as an example of an Eastern collective culture (Mattila, & Sunmee, 2006, p.147). 16
  • 28. A quasi-experimental design of (2 culture: American, Korean) x (3 outcome: better, same, worse) x (2 information present, absent) was used as a method of study. Two hundred eighty nine American and 302 South Korean travelers who were waiting for a plane in Washington, DC and in South Korea airports were chosen as the subjects of study, 63% of the total participants being male. The respondents were frequent users of hotels, as 43% responded that they had stayed in a hotel over six times during the past year, while 39% stayed more than six times, though for leisure travelers the figure was lower (Mattila, & Sunmee, 2006, p.149). The survey with hypothetical scenario questions was used as the research instrument, translated in both languages. The researchers manipulated the price perceptions of the customers by indicating a price that was better, same or worse than either the price they paid during their last visit to the hotel, or the price that was given to another customer. They crossed the three levels of outcome with two levels hotel’s pricing policy information. A seven-point Likert scale was used to measure satisfaction with the reservation process, the Pearson correlation coefficient being 0.64. The research findings indicate that U.S. consumers “preferred equitable outcomes in pricing to either better or worse outcomes” (p.152). In other words, Americans, due to their individualistic orientation, are less influenced by information explaining price changes. Korean consumers, because of their group harmony orientation rather than individual interest, “gave relatively low fairness and satisfaction ratings regardless of the outcome” (p.152). In their research, Iglesias and Guillen (2004) differentiate the concepts of perceived value and customer satisfaction, showing that they are not synonymous. They claim that being an intangible product, service itself is simultaneously characterized, and therefore it is very difficult 17
  • 29. to measure customer satisfaction and perceived value separately. The research focuses on the assumption that customer satisfaction is positively affected by perceived quality of received service, while perceived prices do not have the same huge impact on customer satisfaction. The restaurants in Northeast Spain were chosen as research sites. The hotel and restaurant sector was chosen for Iglesias and Guillen’s research, because it produces 80 percent of the Spanish Gross Domestic Product, and plays a leading role in the Spanish economy (Iglesias & Guillen, 2004, p.375). The empirical work was based on a survey database prepared in 1997, employing a non-probabilistic procedure, and obtaining 156 valid surveys. The participants of the survey were 60 % females and 40 % males with university education, the mean age of 35, and an income level around EUR 1,500. The variables were measured through a ten-point interval scale, where 1 represented “very low”, and 10 ”very high” with respect to the opinion stated about total perceived price, value and satisfaction. The results of the comparison of the means indicates that the total perceived price does not have a considerable impact on customer satisfaction levels, whereas quality does. This research has a great importance for restaurant management, because is shows that customer satisfaction must be taken into account while implementing various policies of customer satisfaction. The research also underlines that there is a high level of variability in restaurant service, which is why the level of service quality and customer satisfaction may vary tremendously form one customer to another, as well as from one employee to another. Research indicates that in order to offer quality service to satisfy their customers, restaurant managers have to hire qualified personnel, and empower them to make decisions when it comes to special customer demands and preferences, for example the manner they want a dish to be cooked. Of further importance for restaurant management is the knowledge of the reasons that lead 18
  • 30. customers to require the services from the specific restaurant. Among the most common reasons are family celebrations, leisure, and time. Discussing time issue, optimization of the customer waiting time is a fundamental task for all businesses that provide services to customers, especially the hospitality industry. Researchers Butcher and Heffernan (2006) investigated specific aspects of waiting time that can help in providing more cost-effective outcomes for companies. Their research concentrates on the assumption that “social regard plays a mediating role between the length of customer wait, friendly and apologetic employee behaviors and service outcomes such as repeat visit intentions” (p.35). This research accumulates many opinions on this topic, including an overview of diverse literature. The main focus of the literature is on customer relation research in the service management and hospitality field, as well as the field of social psychology. 2.3 Waiting time Many researchers examined the relationship between waiting time and customer satisfaction. For example, Davis and Vollman, 1990 (cited in Butcher, & Heffernan, 2006, p.35) studied the conditions of time of the day, of the week, and location in the terms of waiting time and degree of satisfaction. Further, Honric (1984) and Maister (1985) suggested managerial actions related to perceived length of customer waiting time (cited in Butcher, & Heffernan, 2006, p.35). Jones and Dent (1994) discovered that smiling faces and apologies to customers make the waiting more bearable (cited in Butcher, & Heffernan, 2006, p.36); Boshoff and Leong (1998) found that a personal apology is strongly related to customer satisfaction (cited in Butcher, & Heffernan, 2006, p.37). 19
  • 31. Four hypotheses were stated for the Butcher and Heffernan’s research study: H1: Perceived wait length will be positively associated with repeat visit intentions and word of mouth. H2: An apology will positively influence service outcomes, such as repeat visit intentions and word of mouth in the wait situation. H3: Friendly employee behavior will moderate the impact of a long wait on service outcome measures, such as repeat visit interactions and word of mouth. H4: Wait perception, an apology and employee friendliness will positively affect social regard. (Butcher, & Heffernan, 2006, p.40) A 2x2x2 between-subject experimental design was used as a research method to test the hypotheses. One hundred fifty one first-year students of an Australian University were randomly selected as a convenience sample for the present research, including 38.9% males. Written vignettes were developed for the study for the café settings. Among the dependent variables that were manipulated were the “actual length of wait duration friendliness of service employee, and whether an apology was offered to the customer by the service employee” (p.41). The dependent variable was the word of the mouth. Both independent and dependent variables were measured using a seven-point Likert scale. Each questionnaire contained a vignette and twenty-five questions based on the activities in a vignette. The analysis of variance (ANOVA) (2 actual wait length x 2 friendly service x 2 apology) was used to illustrate the difference in rating of the dependent measure of social regard (Butcher, & Heffernan, 2006, p.43). 20
  • 32. The research had two main findings. The first finding stated that social regard plays a main role in repeat purchase and word of mouth. The second finding showed that the actual length of wait time had a direct impact on social regard, and was moderated by friendly employee behavior and apology for slow service (Butcher, & Heffernan, 2006, p.48). 2.4 Issues in employee satisfaction According to The Conference Board press release (2005), 50% of all Americans are satisfied with their jobs, which indicate a 10% decline from 1995. But in these 50% only 14% are “very satisfied” (U.S. job satisfaction keeps falling, The Conference Board reports today, 2005). The sample size for this report is five thousand U.S. households which were contacted by TNS, which is a leading marketing information company. This information pointed out that one quarter of American employees are showing up to work only to pick up a paycheck. The largest decline in job satisfaction, from 60.9% to 49.2% was among workers of 35-44 years of age. As for the income perspective, the household with the income of $25,000 to $35,000 had the biggest decline in job satisfaction. Employees were mostly dissatisfied with promotion policies and bonus plans. Wages were also rated as poor, only 33.5% were satisfied with their pay (2005). Syptak, Marsland, and Ulmer (1999) in their study “Job satisfaction: Putting Theory into Practice” stated that employee satisfaction and retention have been a research topic for many years. In the 1950s, Herzberg developed the theory that includes two components of job satisfaction: motivation and so called “hygiene.” According to Herzberg, motivation “create satisfaction by fulfilling individuals’ needs for meaning and personal growth”, for example achievement, recognition and advancement (Syptak, Marsland, & Ulmer, 1999, p.2). Hygiene factors can not motivate people, but they can minimize dissatisfaction. Hygiene factors include 21
  • 33. policies, supervision, salary, and working conditions. Hygiene issues have to be taken into consideration in order to create favorable environment for employee satisfaction and motivation. The customers’ perceptions of the service quality and their satisfaction with the service mainly depend on the interaction with the employee. Wangeheim, Evanschitzky, and Wunderlich (2007) conducted a study that analyzed the relationships between employee and customer satisfaction. Different researchers (Berhnardt, et al., 2002, Koys 2001, Ryan et al. 1996, and Tornow & Wiley, 1991 cited in Wangeheim, Evanschitzky, and Wunderlich, 2007, p. 690) proved that there is a positive association between employee and customer satisfaction. Harter et. al. found support that there is a positive link between employee and customer satisfaction by conducting a meta- analysis of 7,939 business units in 36 companies (Wangeheim, Evanschitzky, & Wunderlich, 2007 p.691). Tornow and Wiley (1991), Bernhardt et al. (1996), and Koys (2001) state that there is a strong correlation between employee attitudes and customer satisfaction in automobile finance and restaurant chain sectors (cited in Wangeheim, Evanschitzky, & Wunderlich, 2007, p.691). Data for Wangeheim, Evanschitzky, and Wunderlich’s research was collected from customers and employees of a European retail chain in the Do-it-Yourself (DIY) market (p.692). A pre-test was conducted in 2001, and resulted in 53,645 customer and 1,659 employee questionnaires at 99 outlets. LISREL 8.54 was used for the purpose of analysis. According to the research findings, perceived quality and perceived price had the largest effect on customer satisfaction, but employee job satisfaction was also proven to be a statistically significant factor. Moreover, the correlation analysis of cashiers’(.172), with p<.05 and storeroom workers’(.162) with p<.05 scores of work satisfaction and customer satisfaction scores 22
  • 34. with the service proved that employee job satisfaction is related to customer satisfaction, even for the employees who do not have direct contact with customers. Staw, Sutton, and Pelled (1994) conducted a cross- subject study in psychology, sociology and organizational behavior that proved that positive emotions help employees to obtain favorable outcomes at work. The data for this study was collected by Michigan’s Survey Research Center at two times, separated by 18 to 20 months. The total number of participants for both periods of time was 272 employees (152-men, 120 women), with the mean age 37.58. The data was collected both times at a hospital and two manufacturers automobile accessories in the Midwest Predictor. Dependent and control variables were used for the study. Positive emotion at workplace was a predictor variable. As for the dependent variable, it included two measures of work achievement such as supervisor evaluation and pay at time, and two measures of the employee’s social environment (supervisor and coworker social support) (Staw, Sutton, & Pelled, 1994, p.60). Age, education, gender, and rated intelligence were controlled variables in this study. The findings of Staw, Sutton, and Pelled’s study found that employees with positive emotions will have more favorable outcomes in their work. The following predicted relationships were supported by the research: 1) employees who had positive emotions in the workplace received more favorable supervisor evaluation and had a greater pay increase in 18 months 2) employees with greater positive emotions at time one had a better supervisor and coworker support at time two, enriching the overall organizational supportive social contest The other finding was that the relationship between job enrichment and positive emotion was considered to be not significant. 23
  • 35. Mount and Frye’s research (2000) examines employee satisfaction issue from the prospective of hotel size and service type. Segmentation is considered to be a standard for the corporate development in the hospitality industry. The leading hotel companies buy, sell, and create new brands for specific target markets constantly. Robert Shaw stated that eight largest hotel companies controlled 66 brands in 1999 (cited in Mount, & Frye, 2000, p. 60). The hotel organization structure is different for extended stay, limited service and full-service type of hotel service. This research focuses on the job satisfaction of hotel employees from 52 hotel properties operated by private hotel company. Fifty two properties included 22 full-service hotels, 17 limited services, and 13 extended stay hotels in 22 states. The research objective was to determine whether hotel size and type has an impact on employees’ job satisfaction. 2,102 questionnaires were received, while 1,991 were used for the research. Individual response rate of the various hotels was between 36% and 100%. Mount and Frye found that job satisfaction was positive related to customer satisfaction among resort employees, cruise ship employees, and fast service restaurant employees. Moreover, satisfaction was found as negatively related to turnover. Independent sample t-tests were used to measure the difference in satisfaction between different hotel service types. The findings of this research show that there are no relationships between the employee satisfaction, and the hotel size, but there is a significant relationship between employee satisfaction and the type of the hotel service, and employees of the limited service hotels are more satisfied than full- service ones (p. 65). 24
  • 36. CHAPTER 3 METHODOLOGY The purpose of this study was to identify customer and employee levels of satisfaction in the lodging industry, and also to define most significant factors of both employee and customer satisfaction, as well as to examine the relationships between customer satisfaction and employee satisfaction. This chapter will discuss the sample of the study, its description, instrument, data collection, and data analysis procedures. 3.1 Description of the Sample This study was conducted using data collected at a resort on the East Coast. This resort is considered to be one of the finest community resorts in the World. There are three different hotels in this resort family, in order not to name them; they will be called the A Hotel, the B Hotel, and the Rental Cottages for the research purposes. The A Hotel is a very famous hotel in the industry; it was a recipient of many awards in its nearly 80-year history. A Hotel has a "boutique" style, and it is represented by 156 rooms, including 56 beachfront options. The A Hotel also includes the new 65,000-square-foot spa and the Beach Club. The Spa has a salon, a workout center, and indoor squash courts just to name a few. Among other recreational activities that the A Hotel offers are golf, tennis, horseback riding, yacht cruises, and shooting lessons. The B Hotel is a 40-room golf clubhouse. The B Hotel is famous for featuring three championship golf courses. The Cottage Rentals Department of the resort enables to rent one-third of about 500 homes and 44 condominiums. The cottages vary from 3 to 9 bedrooms homes. Typical minimum rental time for the Cottages is one week, even though 3 days are possible in some cases. 25
  • 37. The sample of study is represented by 267 customers, 171 of which stayed in the A Hotel and 96 stayed in the B Hotel. The sample size was determined by 50 guests from the A Hotel property who were interviewed per month, and 105 guests from B Hotel property were interviewed during the quarter period. Employee Satisfaction Surveys were distributed to all level employees in all the departments of the resort during October 2003. The exact number of employees who completed the survey was not available for the researcher. 3.2 Instrument The instruments used in this study were designed in a form of the customer and employee satisfaction questionnaire. The employee satisfaction survey was developed by the human resources department of the resort, while the customer satisfaction questionnaire was created by the outside consulting agency. The customer satisfaction questionnaire contains 52 statements total. The first 11 items on the questionnaire are copyrighted from consulting firm survey, while 41 others are unique to this particular resort setting. The customer satisfaction questionnaire is represented by the 6 following areas: dining experience; golfing experience; spa experience; beach club experience; experience with facilities/activities; and guest problems. The questionnaire statements are graded on the five–point Likert scale, with 1 rating “strongly disagree” to 5 “strongly agree.” The employee satisfaction survey consists of 12 facets of satisfaction which are: the company; vision/mission/values; interact; your job; your department; physical work environment; communications; leadership, supervision and management effectiveness; teamwork; pay, opportunity, and benefits; career development and training; quality; and demographic information. The questionnaire consists of 89 questions represented by 86 26
  • 38. statements and 3 multiple choice questions that address demographics. The 86 statements questionnaire includes both a five–point Likert scale, and a 6 point –point Likert scale to better understand the factors that mostly affect employee satisfaction. 3.3 Data collection procedure Customer and employee satisfaction data were provided by the company. Employee satisfaction survey was done by the company in October 2003. As for the customer satisfaction, the data was restricted to the report that was presented by the outside consulting agency in November 2004. Researcher does not have information about the validity and reliability of either survey. The customer satisfaction survey was done in the form of a 10-minute telephone interview with the guests who stayed at the resort 30 days prior to the survey. The list of the guests was provided by the resort to the consulting agency. The list was broken down by the facility that the guests used during their stay and/or other relevant guest segmentations. Permission was granted by SIU Human Subjects Committee to conduct the study in this resort setting (Appendix A). 3.4 Data preparation and statistical procedures SPSS (Statistical Package for the Social Sciences) version 15.0 was used to enter, code data, and analyze data. Customer satisfaction data were provided in the form of report, with questions and percentages for the certain small areas and imported into SPSS. For the customer satisfaction analysis, the main departments and services were grouped together by the researcher and mean scores for the distinct areas were calculated to better 27
  • 39. understand the most important customer satisfaction factors based on the data obtained from the company. For the employee satisfaction, the data were grouped by the A and B hotel and the researcher did the pair comparison of two properties of the resort. Also, top positive and top negative employee satisfaction factors were found, and main areas and/or departments that had best results and most difficulties were determined based on the data from the company. Mean scores were calculated for 12 facets of the employee satisfaction. Correlation coefficient (Pearson r) was calculated to determine if there is a relationship in customer satisfaction of the two hotels in the Resort setting. 28
  • 40. CHAPTER 4 DATA PRESENTATION 4.1 Results The purpose of this study was to identify customer and employee satisfaction factors and levels of satisfaction in two hotel properties of the Resort on the East Coast. The participants of the study were customers, who stayed at the resort in September, October, and November 2004, and the employees of the resort of October, 2003. The customers’ responses to a questionnaire (Appendix B) regarding their satisfaction levels with various areas of the two hotel properties were used to determine results of this study. The customer satisfaction questionnaire was constructed by the consulting agency. The employees’ responses to a questionnaire (Appendix C) regarding their job satisfaction within 12 areas of satisfaction were also used in order to determine results of this research study. The employee satisfaction survey was created by the human resources department of the resort. 4.2 Research Sample With the assistance of the Human Resources department of the resort the data were sent to the researcher via email in the form of the Excel tables for the customer satisfaction questionnaire, wich included the mean scores of satisfaction with certain areas of the two hotel properties. The employee satisfaction data were also sent as to the researcher in the form of Excel tables with the mean percentages of the employees’ satisfaction. The customer satisfaction survey was represented by 52 statements within 6 areas of customer experience at the resort such as dining experience, golfing experience, experience with spa, beach club experience, experience with facilities/activities, and last but not least guest 29
  • 41. problems. The list of participants is represented by 267 customers, where 171 customers stayed in the A Hotel and 96 stayed in the B Hotel during the period of September, October, and November 2004. Of there, fifty customers were interviewed in a month period from the A Hotel, and 105 customers were interviewed in the same quarter period from B Hotel. The customer satisfaction survey was conducted in the form of a telephone interview (about 10 minutes) with the customers who stayed at the resort 30 days prior to the survey. The list of the guests was provided by the resort to the consulting company, and was divided by the facility at which customers used during their stay. The survey statements were graded on the five–point Likert scale, with 5 rating “strongly agree” to 1 rating “strongly disagree.” In attempt to better understand the most and the least important customer satisfaction factors in two hotel properties of the Resort on the East Cost, the researcher did a rank order transformation of the customer satisfaction data for the A and B Hotels. Forty nine of the 52 statements were common in two hotel properties. Three satisfaction factors that were available only for one of two hotels were not taken into consideration in this study. These factors are satisfaction with tennis, satisfaction with the charter fishing, and satisfaction with junior staff activities. Table 1 represents the top 10 customer satisfaction factors out of 49 available in the Hotel A. The statements were graded on a five –point Likert scale, with 5- rating “strongly agree,” to 1 - rating “strongly disagree” (See Table 1). One factor (satisfaction with the shooting school) received the highest customer rating equal to 5.0. 30
  • 42. Table 1. Top 10 customer satisfaction factors in Hotel A ______________________________________________________________________________ Satisfaction factor Mean Score Satisfaction with the shooting school 5.0 The pool cleanliness 4.92 Always treated with respect 4.90 The staff being attentive 4.89 The bell man/butler service 4.84 Always treated fairly 4.76 The recreational activities being fun 4.76 Satisfaction with the transportation services 4.76 The overall experience at check-in 4.75 The overall reservation process 4.75 (n=171) Note: The higher the score the greater the agreement. Table 2 indicates the 10 customer satisfaction factors that were highly rated by the customers of the Hotel B (See Table 2). Two customer satisfaction factors (the beach being clean and satisfaction with the shooting school) received 100% satisfaction score of 5.0. Three items were tied at 4.89: always delivers personalized service, the overall experience at check-in, and the overall experience with housekeeping. 31
  • 43. Table 2. Top 10 customer satisfaction factors in Hotel B ______________________________________________________________________________ Satisfaction factor Mean Score ______________________________________________________________________________ The beach being clean 5.0 Satisfaction with the shooting school 5.0 Satisfaction with the concierge service 4.96 Always treated with respect 4.95 Likelihood to recommend 4.93 Always treated fairly 4.92 Always delivers personalized service 4.89 The overall experience at check-in 4.89 The overall experience with housekeeping 4.89 Always count on a fair/sat. resolution 4.86 ______________________________________________________________________________ (n=96) Note: The higher the score the greater the agreement. By looking at the descriptive information from the tables 1 and 2, and also by comparing the top 10 mean scores and statements of two hotel properties, there were 4 similar factors for both hotel properties. These factors were satisfaction with the shooting school, always treated with respect, always treated fairly and the overall experience at check-in. Satisfaction with the shooting school received a perfect (5.0) satisfaction mean score in the Hotels A and B. Three other common statements were slightly higher ranked in Hotel B. 32
  • 44. Table 3 indicates 10 customer satisfaction factors of the Hotel A that received the lowest customer satisfaction scores. The statement, is the finest resort in the world, was considered as the least satisfying with a mean score of 3.56. Table 3. Lowest 10 customer satisfaction factors in Hotel A ______________________________________________________________________________ Satisfaction factor Mean Score ______________________________________________________________________________ Is the finest resort in the world 3.56 Can't Imagine a world without 3.60 Is the most unique resort I have ever visited 3.73 Satisfaction with problem handling 4.00 The overall dining experience being top class in the world 4.02 Is a place where kids can learn values, traditions, and manners 4.07 The overall spa experience being top class in the world 4.09 Intent to repurchase/continue to use 4.17 Overall, how satisfied were you with the treatment received at the spa 4.22 Satisfaction with the spa 4.25 ______________________________________________________________________________ (n=171 per month) Note: The higher the score the greater the agreement. Ten lowest customer satisfaction factors of the Hotel B are represented in Table 4. The least mean number of satisfaction (3.4) was for satisfaction with problem handling factor. 33
  • 45. Table 4. Lowest 10 customer satisfaction factors in Hotel B ______________________________________________________________________________ Satisfaction factor Mean Score ______________________________________________________________________________ Satisfaction with problem handling 3.40 Can't imagine a world without 3.50 Is the most unique resort I have ever visited 3.76 Is the finest resort in the world 3.87 Overall, how satisfied were you with the treatment received at the spa 3.90 The overall spa experience being top class in the world 3.92 The overall dining experience being top class in the world 4.12 Is the perfect place to spend quality family time 4.14 Is a place where kids can learn values, traditions, and manners 4.25 Satisfaction with the spa 4.30 ______________________________________________________________________________ (n=96) Note: The higher the score the greater the agreement. Nine similar factors out of 10 were ranked as least satisfying in both of the hotels. Satisfaction with the problem resolution, spa, dining experience, as well as the resort being the best and most unique one in the world were rated low in both of the hotels. The range score between the highest and the lowest customer satisfaction rating for the A Hotel is (1.44), while for B Hotel the range score is (1.6). The B Hotel seems to be more satisfying in terms of customer satisfaction ratings, even though the range between the most and least satisfying aspect of customer service is 0.16 mean scores higher than in the Hotel A. As for 34
  • 46. the overall customer satisfaction in two hotels, the overall customer satisfaction for the Hotel A is 4.5 (90%), and for the Hotel B is 4.58 (91.6%). Another way to look at this data is presented in Figure 1. The bar graph easily identifies "satisfaction with problem handling" as the statement with the greatest difference (1.6) between both hotels. The statement with the greatest agreement (.75) between both hotels was "satisfaction with the spa." Figure 1. Lowest 9 Customer Satisfaction Factors in A and B Hotel To better identify the satisfaction factors, four areas were selected by the researcher for further analysis: staff, room divisions, recreation, and conflict resolution. For both satisfaction with staff and satisfaction with room divisions 8 statements were identified; for the satisfaction with recreation 10 statements were identified by the researcher; and for the satisfaction with conflict resolution 4 statements were identified in order to define the areas that have the highest and lowest level of satisfaction based on the customers’ responses to the questionnaire (See Table 5). 35
  • 47. Two areas such as satisfaction with Food and Beverage and satisfaction with Other factors were not taken into consideration for this research. The mean scores were calculated for each of four designated areas. Satisfaction with Room Divisions received the highest overall mean scores (4.64-for Hotel A, and 4.83- for Hotel B), while Conflict Resolution area received the lowest satisfaction scores for both of the Hotels A and B (4.51- for Hotel A, 4.48- for Hotel B). Satisfaction with Staff was rated a little lower than Satisfaction with Room Divisions, being given the second place with the scores (4.67- Hotel A, and 4.74- for Hotel B) in the overall rating of four research areas. Guest Satisfaction with Recreation was ranked as the third area with the mean scores of (4.54- for Hotel A, and 4.52-for Hotel B). Table 5. Customer satisfaction factors grouping in 4 major areas ______________________________________________________________________________ Area of Satisfaction Satisfaction factor Mean Score Hotel A Hotel B ______________________________________________________________________________ Staff Employees are perfect examples of genuine 4.68 4.77 Southern hospitality Always delivers personalized service 4.64 4.89 Employees are great at anticipating my needs 4.51 4.68 The staff being attentive 4.52 4.66 The staff being knowledgeable 4.65 4.60 The staff being courteous 4.58 4.73 The staff being attentive 4.89 4.60 Always treated with respect 4.90 4.95 Overall Mean Score for the Staff Satisfaction 4.67 4.74 ______________________________________________________________________________ 36
  • 48. Table 5 (continued) ______________________________________________________________________________ Room Divisions The reservation process 4.67 4.68 The overall experience at check-in 4.75 4.89 The bell man/butler service 4.84 4.82 The overall experience with your room or suite 4.53 4.83 The overall experience with housekeeping 4.55 4.89 The overall experience at checkout 4.54 4.85 The overall reservation process 4.75 4.75 Satisfaction with the concierge service 4.73 4.96 Overall Mean Score for the Room Divisions Satisfaction 4.64 4.83 ______________________________________________________________________________ Recreation The overall golf experience being top class 4.39 4.46 in the world The overall quality of the course 4.71 4.70 The caddie being helpful 4.36 4.75 Satisfaction with the spa 4.25 4.30 The overall spa experience being top class 4.09 3.92 in the world Overall, how satisfied were you with the 4.22 3.90 treatment received at the spa The pool cleanliness 4.92 4.78 The recreational activities being fun 4.76 4.67 Satisfaction with the stables or horseback riding 4.67 4.67 Satisfaction with the shooting school 5.00 5.00 Overall Mean Score for the Recreation Satisfaction 4.54 4.52 ______________________________________________________________________________ 37
  • 49. Table 5 (continued) Conflict Resolution Satisfaction with problem handling 4.00 3.40 Always count on a fair/sat. resolution 4.69 3.86 Always treated fairly 4.76 4.92 Always delivers on promises 4.60 3.74 Overall Mean Score for the Conflict Resolution 4.51 4.48 ______________________________________________________________________________ (n=171 for the Hotel A, and n=96 for the Hotel B) Another part of this research contains finding Employee Satisfaction levels at the same resort on the East Coast. The employee satisfaction survey which was developed by the human resources department of the resort was distributed to all level employees throughout the resort during October 2003. The number of employees who completed the survey was not available for the researcher. The survey includes of 12 facets of satisfaction: the company; vision/mission/values; interact; your job; your department; physical work environment; communications; leadership, supervision and management effectiveness; teamwork; pay, opportunity, and benefits; career development and training; quality; and also demographic information. The questionnaire included 89 questions, with 86 statements and 3 multiple choice questions addressing demographics. The 86 statements questionnaire includes both a five–point Likert scale, and a 6 point –point Likert scale to better understand the factors that mostly affect employee satisfaction. For employee satisfaction, the data available for the researcher were grouped based on 12 employee satisfaction facets, and the mean percentage scores of the all the positive, negative, and not able to assess employees’ responses were calculated (See Table 6). Figure 2 presents this data in bar graph format. 38
  • 50. Table 6. Overall employee satisfaction facets of the Resort on the East Coast ______________________________________________________________________________ Facets of Satisfaction Positive Negative Total Total % % ______________________________________________________________________________ The Company 67.2 12.7 Vision/Mission/Values 55.6 15.8 Interact 44.0 25.7 Your job 57.0 10.5 Your Department 81.1 3.7 Physical Work environment 69.1 11.9 Communications 53.4 20.0 Leadership, Supervision, and 58.3 18.1 Management Effectiveness Teamwork 66.1 15.2 Pay, Opportunity, and Benefits 55.4 14.9 Career Development and Training 61.5 15.9 Quality 60.2 18.9 ______________________________________________________________________________ (n-not provided) Note: The remaining percent falls into the neither satisfied nor dissatisfied area 39
  • 51. 0 10 20 30 40 50 60 70 80 90 The Company Vision/Mission/Values Interact Your job Your Department Physical Work environment Communications Leadership, Supervision, and MNGT Effectiveness Teamw ork Pay, Opportunity, and Benefits Career Development and Training Quality Negative Total % Positive Total % Figure 2. 12 Employee Satisfaction Facets As for the demographic information, 60.4%-males, and 39.6%-females participated in the employee satisfaction survey, 14.0% respondents preferred not to answer to the gender question. Among those employees, 16.9% - employees were employed less than one year, 48.5% - were employed from one to five years, 15.1% - were employed from six to ten years, 8.3% - for eleven to fifteen years, 4.6% - for sixteen to nineteen years, and 6.7% - for over twenty years, while 12.0% - preferred not to answer this question. Satisfaction with Your Department received the highest positive total percentage mean score of 81.1%, and the lowest negative total percentage score of 3.7%, while satisfaction with the Interact program implemented by the resort received the lowest positive mean percentage score of 44.0%, and the highest negative means percentage score of 25.7%. Satisfaction with the Physical Work environment received a second place with a positive satisfaction percentage score 40
  • 52. of 69.1% and negative percentage score of 11.9%. The third place received the facet satisfaction with the Company, being given 67.2% - positive total mean percentage score, and 12.7% - negative total mean percentage score. Also, 10 top positive and 10 top negative employee satisfaction response questions were found (See Tables 7 and 8). Based on Table 7, satisfaction with your job, was represented by three questions in the top 10 positive questions, satisfaction with leadership was represented by two questions, and satisfaction with communications, with company, with your department, with vision/mission, and with quality were represented by one question. Based on Table eight, 10 top negative satisfaction questions, the facet satisfaction with vision/mission was represented by three questions, satisfaction with interact, with quality, and leadership by two, and satisfaction with communications by one question. Comparing the data of the overall means of the employee satisfaction facets, and the 10 top and bottom question responses, there was found a difference between the 12 satisfaction facets ratings and 10 top and bottom questions represented by the areas. The areas such as satisfaction with your job and satisfaction with leadership were represented by three and two questions in the 10 positive questions, but based on the overall employee satisfaction facet mean scores, those areas were on the 8th (satisfaction with your job) and 7th (satisfaction with leadership) places in the overall ratings. Satisfaction with your department, which was ranked as the number one among all 12 employee satisfaction facets, was represented in the top 10 positive questions just by one question. On the contrary, comparing the bottom ratings, the satisfaction with the Interact program, received the lowest customer satisfaction percentage (44.0%), and also was represented by two questions in the top 10 negative satisfaction questions. Vision/mission satisfaction area was represented by three questions, so it took the first place in 41
  • 53. the top 10 negative satisfaction questions, while it was ranked as the ninth in the overall employee satisfaction facets with a 55.6% score. Table 7. Top 10 positive employee satisfaction response questions ______________________________________________________________________________ Question Frequency, (%) I am proud of the work I do 91.3 I have a good understanding of our overall company vision 90.4 I like the kind of work I do 86.5 How Sat. are you with the leadership provided by: Chairman / CEO 86.3 I enjoy the work I do 86.2 How Sat. are you with the leadership provided by: President 84.4 How would you rate the overall quality of work done in your department 82.9 I would recommend Sea Island as a place to work to friends 81.9 How would you rate the level of customer service (internal or external) 81.1 provided by your department We are recognized as the finest resort and resort community 80.3 in the world by our: Guests ______________________________________________________________________________ (n-not provided) 42
  • 54. Table 8. Top 10 negative employee satisfaction response questions ______________________________________________________________________________ Question Frequency, (%) My department has enough of the following to do quality work: Staff 38.7 To what extent do you feel KRA's have been an effective means 34.9 of defining your responsibilities We offer our employees: Performance Recognition 34.1 We offer our employees: Open Communication 32.8 We offer our employees: Advancement Opportunities 31.5 Most employees feel free to voice their opinions openly at the resort 31.5 My department has enough of the following to do quality work: Equipment 30.9 To what extent does the Interact program help you to: Feel successful 30.5 To what extent is your immediate supervisor / manager good at: Giving you regular feedback on your performance 29.6 Keeping you informed about management actions and/or decisions 29.4 ______________________________________________________________________________ (n-not provided) 4.3 Statistical analysis The Spearman's rho correlation coefficient was calculated by the researcher in order to see if there was significant relationship between customer satisfaction factors in two hotel properties. In order to define the Spearman's rho correlation, the researcher assigned the similar numbers to all the satisfaction statements of both Hotel A and B, and then did the rank order procedure in Excel in the way that the statement and the mean score were tight together (See Appendix D). Using Appendix D, the researcher determined the ranks of all 47 statements in both Hotel Properties A and B, calculated the Rank Difference (D) which was 0 (that means that 43
  • 55. the rank order was determined correctly), and the Squared Rank Difference (D^2) which was 5852. The formula was used to calculate the Spearman's rho correlation coefficient. Six statements out of 47 were equally ranked by the Hotel A and B customers. As for the top 5 common ratings, Hotel A and B had just two similar satisfaction statements (satisfaction with the shooting school and always treated with respect). The other tendency is at the bottom 5 common ratings, four out of five satisfaction statements were both low ranked in two hotel properties. Those statements are: is the finest resort in the world, can't imagine a world without, is the most unique resort I have ever visited, and satisfaction with problem handling. The strong positive relationship of (r=0.66) was found between the Hotel A and B of the resort on the East Coast and customer satisfaction factors. Those areas that were ranked high by the customers of the Hotel A were also highly ranked by the Hotel B customers. Table 9 represents the calculations that were done by the researcher to determine the Spearman's rho correlation coefficient. The Spearman's rho coefficient test was also run in the SPSS at the 0.01 significance level to verify the researcher’s rating and mathematical calculations. 44
  • 56. Table 9. Spearman's rho correlation coefficient calculation ______________________________________________________________________________ Statements Ranks Rank Squared Hotel Hotel Difference Difference A B (D) (D^2) Satisfaction with the shooting school 1 2 -1 1 The pool cleanliness 2 16 -14 196 Always treated with respect 3 4 -1 1 The staff being attentive 4 34 -30 900 The bell man/butler service 5 14 -9 81 Always treated fairly 6 6 0 0 The recreational activities being fun 7 30 -23 529 Satisfaction with the transportation services 8 36 -28 784 The overall experience at check-in 9 8 1 1 The overall reservation process 10 21 -11 121 Satisfaction with the concierge service 11 3 8 64 The overall quality of the course 12 26 -14 196 Likelihood to recommend 13 5 8 64 Always count on a fair/sat. resolution 14 10 4 16 Employees are perfect examples of genuine Southern hospitality 15 18 -3 9 The beach being clean 16 1 15 225 The reservation process 17 29 -12 144 Satisfaction with the stables or horseback riding 18 31 -13 169 The staff being knowledgeable 19 33 -14 196 Overall satisfaction 20 17 3 9 Is a name I can always trust 21 12 9 81 Always delivers personalized service 22 7 15 225 The overall experience with resort facilities 23 25 -2 4 45
  • 57. Table 9 (continued) Perfect for me 24 23 1 1 Always delivers on promises 25 22 3 9 Feel proud 26 15 11 121 The staff being courteous 27 24 3 9 The overall experience with housekeeping 28 9 19 361 The overall experience at checkout 29 11 18 324 The overall experience with your room or suite 30 13 17 289 The staff being attentive 31 32 -1 1 Employees are great at anticipating my needs 32 28 4 16 Is a place where I can always relax and disconnect from day to day problems 33 19 14 196 Is the perfect place to spend quality family time 34 40 -6 36 The overall golf experience being top class in the world 35 35 0 0 The caddie being helpful 36 20 16 256 The food quality 37 37 0 0 Satisfaction with the spa 38 38 0 0 Overall, how satisfied were you with the treatment received at the spa 39 43 -4 16 Intent to repurchase/continue to use 40 27 13 169 The overall spa experience being top class in the world 41 42 -1 1 Is a place where kids can learn values, traditions, and manners 42 39 3 9 46
  • 58. Table 9 (continued) The overall dining experience being top class in the world 43 41 2 4 Satisfaction with problem handling 44 47 -3 9 Is the most unique resort I have ever visited 45 45 0 0 Can't Imagine a world without 46 46 0 0 Is the finest resort in the world 47 44 3 9 Total Sum 0 5852 ______________________________________________________________________________ (n=47) p<.01 A Person’s correlation coefficient was also run on the relationship between the hotel property and customer satisfaction levels of the resort on the East Coast. A 0.01 significance level was also set for the test purposes. Much like the Spearman's rho correlation coefficient, the strong positive association was found between two hotel properties and satisfaction statements. The Person’s correlation coefficient was (0.843). Paired sample t-test was run in order to determine if there was a significant difference in customer satisfaction in two hotels A and B based on the customer’s responses to the questionnaire. The t equal to (-2.5), and the probability of (0.016) were found. Like in the previous two tests, there was found to be statistical significant difference between the Hotel A and B customer satisfaction statements. There is a statistical significant difference between customer satisfaction levels in the Hotel A and B, as the p-value (0.016) is less than 0.05 (See Table 10). 47
  • 59. Table 10. Paired Samples Test Hotel A and Hotel B ______________________________________________________________________________ Mean Std. Deviation Std. Error Mean t df Sig. (2-tailed) -.07787 .21267 .03102 -2.510 46 .016 ______________________________________________________________________________ (n=47) 48
  • 60. CHAPTER 5 SUMMARY The major purpose of this study was to identify customer and employee satisfaction levels in the lodging industry by the example of two hotel properties of a resort on the East Coast, and also to define most significant factors of the customer and employee satisfaction. This study included 267 customers. The exact number of employees who participated was unknown. The customer satisfaction survey was constructed and administered by a consulting agency, via telephone with customers who stayed at the resort 30 days prior to the survey. Customers indicated satisfaction/dissatisfaction levels with six areas at the resort. Top 10 and lowest 10 customer satisfaction factors were determined for both hotels A and B. Also, four areas were selected for the customer satisfaction analysis: staff, room divisions, recreation, and conflict resolution. Satisfaction with Room Divisions received the highest overall mean scores (4.64-for Hotel A, and 4.83- for Hotel B), while Conflict Resolution area received the lowest satisfaction scores for both of the Hotels A and B (4.51- for Hotel A, 4.48- for Hotel B). Satisfaction with Staff was ranked slightly lower than Satisfaction with Room Divisions, being given the second place in the overall rating of four research areas. Customer Satisfaction with Recreation was ranked as the third area. The range score between the highest and the lowest customer satisfaction rating for Hotel A was found to be 1.44, and for Hotel B 1.6. As for the overall customer satisfaction in two hotels, the overall customer satisfaction for the Hotel A was 4.5 (90%), and for the Hotel B was 4.58 (91.6%). 49
  • 61. There was a strong positive relationship found between Hotel A and Hotel B in customer satisfaction factors. Those areas that were ranked high by the customers of the Hotel A were also highly ranked by the Hotel B customers. There is a statistical significant difference between customer satisfaction levels in the Hotel A and B. The employee satisfaction questionnaire was created and administered by the human resources department of the resort. The employees’ responded satisfaction/dissatisfaction regarding their job in twelve areas of satisfaction which were: the company; vision/mission/values; interact; your job; your department; physical work environment; communications; leadership, supervision and management effectiveness; teamwork; pay, opportunity, and benefits; career development and training; quality; and demographic information. For employee satisfaction determination, the mean percentage scores of all positive and negative employees’ responses was calculated and grouped based on 12 employee satisfaction facets. Satisfaction with Your Department received the highest positive total percentage mean score of 81.1%, and the lowest negative total percentage score of 3.7%. Satisfaction with the Interact program implemented by the resort received the lowest positive mean percentage score of 44.0%, and the highest negative means percentage score of 25.7%. Satisfaction with the Physical Work environment received a second place with a positive satisfaction percentage score of 69.1%. Satisfaction with the Company, being given 67.2% - positive total mean percentage score, scored third. The 10 top positive and 10 bottom negative employee satisfaction response questions were identified. There was a difference between the 12 satisfaction facets ratings and 10 top and 50
  • 62. bottom questions represented by the areas. Satisfaction with your department facet, which was ranked as the number one among all 12 employee satisfaction facets, was represented in the top 10 positive questions just by one question. 5.1 Conclusions As in previous studies’, this study used interviews with the customers after their service experience to report their satisfaction degree regarding various aspects of service and organizational system; similar to Nicholls, Gilbert, and Roslow (1998) research. The findings of this study, satisfaction with the hospitality experience is the total sum of satisfactions with several individual elements of all the services that the company offers is similar to the Pizam and Ellis research results of 1999. In this study it was found that the overall customer satisfaction for the Hotel A is 4.5 (90%), and for the Hotel B is 4.58 (91.6%), which is the mean score of six areas of the customer experience. This findings of this study is also comparable to Kandampully and Suhartanto’s (2003) research who found that satisfaction with housekeeping is the most significant factor to determine customer loyalty. This study found that Satisfaction with Room Divisions area, which includes housekeeping, received the highest overall mean scores for both of the hotels. Findings by Butcher and Heffernan (2006) showed that the actual length of wait time had a direct impact on social regard, and was moderated by friendly employee behavior and apology for slow service. There is a similar relationship in this study to Boshoff and Leong (1998) who found that a personal apology is strongly related to customer satisfaction. This research, revealed the area of Conflict Resolution received the lowest customer satisfaction scores for both of the Hotels (4.51- for Hotel A, 4.48- for Hotel B). 51
  • 63. As for the employee satisfaction, according to The Conference Board reports today (2005), employees were mostly dissatisfied with promotion policies and bonus plans. This study found that Pay, Opportunity, and Benefits facet was ranked as number 10 among the 12 employee satisfaction facets. Staw, Sutton, and Pelled (1994) conducted a cross- subject study in psychology, sociology and organizational behavior that indicated employees with positive emotions will have more favorable outcomes in their work. In this study Satisfaction with the Physical Work environment was ranked second by the resort employees among the 12 employee satisfaction facets. 5.2 Discussion Customer and employee satisfaction factors are highly discussed topics today both in theory and practice. They may become even more important in the near future. Pizam and Ellis (1999) stated more than 15,000 academic and trade articles have been published on customer satisfaction. Very few studies analyze customer satisfaction and employee satisfaction factors in the hotel industry, particularly in the resorts on the East Coast. That is why this research findings may be valuable for future research. Today companies need to excel in both customer satisfaction and employee satisfaction to gain: positive reputation; business growth; increase profitability; image; work atmosphere; and loyal employees. As Holmund and Kock (1996) proved the cost of attracting new customers is five times higher than keeping the existing ones (cited in Kandampully, & Suhartanto, 2003, p.4), the knowledge of customers’ expectations has become essential for companies because it influences 52
  • 64. the repetition of purchases and word of the mouth recommendations. Reichheld and Sasser’s research (1990) found that 25-28 percent profit increase can be produced by 5 percent increase in customer loyalty. This research may have practical value for hotel managers by providing them with both high and low satisfaction ratings by customers and employee. This research may assist hospitality managers to better understand customer and employee satisfaction factors. Better understanding of these factors, hotel managers may be able to make organizational and operational changes to increase the loyalty of existing and prospective customers, improve recruitment and training for employees, and motivate personnel. These results may be used by hotel managers to identify their hotel’s strengths and weaknesses, threats and opportunities for future improvement. The analysis of customer satisfaction factors may benefit customer satisfaction for various hotel departments. The analysis of employee satisfaction levels may raise the awareness of special challenges in particular departments for providing customer service, and highlight issues in personnel training. By comparing customer satisfaction from this study, Nicholls (1998) study, and Anderson, Fornell, and Rust (1997), we may hypothesize that customer satisfaction plays a leading role in productivity and company’s success, as the satisfied customers is the best marketing tool for the organization. Managers should take into consideration the benefits of measuring customer satisfaction within different areas of the hotel, as Kandampully and Suhartanto’s study (2003) stated, various departments of hotel operations have a different importance for the hotel customers. Hospitality managers should also take note of a key finding in this study: customer satisfaction with problem resolution. This study found dining experience being lowly rated by 53