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Service Quality and Customer Satisfaction of Front Office in Chinese 5 Star Hotels
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CHAPTER 1
THE PROBLEM AND ITS BACKGROUND
Overview
The main aim of the research is to assess the efficiency of the service quality and
customer satisfaction of five of the largest and widely recognised hotels in China namely
Hilton Hotel in Beijing, Kunlun Hotel, Sheraton Tiajin, Continental Grand Hotel and
Shangri-la. These hotel groups are chosen because of the stiff competition in existence
between the five. The researcher aims to look into the perceptions of the hotel-
restaurants’ customers, staff and managers towards the values underpinning service
quality. Based on the existing literature, we need to justify if the hotel service standards
of the five aforementioned hotel groups are adequate and if there is a need for revision
in their criteria for service quality.
Background and Rationale
Quality generally means “a fulfilment of an expectation” ( 1997). In hotels, or in
any other service industries, “service quality relates to a customer’s subjective
interpretation of his or her experience, different criteria are used by different customer
groups to evaluate service, and these vary depending on the situation and the
circumstances” (1997).
The five dimensions of service quality are: tangibles; reliability; responsiveness;
assurance; and empathy. (2001) explained that the tangible aspects of service quality
comprise all that the client can see, touch, hear, and smell when the services are
delivered. It includes not only the physical output of the service, but also the physical
facilities, the equipment, and the appearance of personnel. Firms should consider
facilities design and promote a positive employee image to current and prospective
clients. Thus, tangibles basically involve physical facilities, equipment, and appearance
of employees (1998). On the other hand, reliability means the ability to perform the
promised service dependably and accurately; while responsiveness refers to the
willingness to help customers and to provide a prompt service. Assurance is the
knowledge and courtesy of employees and their ability to inspire trust and confidence.
Finally, empathy means the caring and attention provided to customers ( 1990).
Hotel Service Quality
(2004) found in their investigation of the service quality of Hilton Hotels that
quality service depends heavily on employees, particularly those at the front-line of
customer contact. (2004) further stated: “…quality service is related to the behaviour of
staff mainly with guests but also with each other to create – directly and indirectly – the
right type of organisational culture that will encourage appropriate employee/guest
exchanges. Quality means providing the customers with an exceptional product by
exceptional staff in terms of service and flexibility”.
The relationship between management and employees, and how the manager
use resources is also cited in literatures as an important factor to provide service quality
in hotels. For instance, (2004) recommended the following to improve service quality in
hotels: management need to have more interaction with the hotel guests to understand
their needs and expectations; management need to delegate more responsibility to the
staff across the hotels so that they can make sensible decisions with the guests; staff
need formal training in service quality to deal with different types of guests and their
needs; and complaints and compliments must be circulated among the hotels so that
staff are aware of problems and merits.
The problem with service quality may perhaps be related with gaps, or the
differences of perception of service quality among managers of the hotel and the
customers (2000). Within service quality, (2000) stated the some of the following factors
that could be affected by gaps: comfortable and welcome feeling; neat appearance of
staff; professionalism of staff; staff with multi-lingual skills; friendliness and courtesy of
staff; special attention given by staff; availability of staff to provide service; performing
the services right the first time; easily accessible reservation system; quick check-in and
check-out; cleanliness; quietness; security; room service; and high quality of food in
restaurants. Similarly, (2001) identified those service attributes as important to service
quality. Some of the other service quality attributes they identified include: guest room
values (comfort of bed pillows, atmosphere, room size, complimentary items, etc.); and
front office services (courtesy of employees, handling of complaints, thoughtful
consideration of a repeat guest, reasonable price, hotel tour guides, flexibility of hotel
policy, and efficiency of business centre, etc.).
Featured hotels in this study are five-star hotels. Five star hotels have above-
average responsibilities to service quality. According to (2003), five star hotels should
have: “Spacious, luxurious establishments offering the highest international standards of
accommodation, facilities, services and cuisine”. Furthermore, they should also have
flawless guest services, giving guests the impression of being very well cared for by
professional attentive staff ( 2003).
Customer Service
Normally, great amount of time is consumed in the mere planning of the
purchase orders of a particular business company. And since most of the time the
transactions involve not only a single client or customer, especially in the case of huge
product and service providers, business establishments’ deal with sub-suppliers with
several forwarders from which a number of consolidations are exchanged. The
workload and time that the inventory managers handle defines the proceeding business
processes that follow and thus, predict and maintain the success and profit of the whole
business organization. That is why, efficiency counts!
The provision of quality customer service is a multi-faceted concept as a number
of factors must be met by the business in order to achieve it. In order to integrate quality
in service provision, it is important that the organization has the right skills, resources
and values. As quality customer service is influenced by various factors, the
involvement of both company management and the employees must be present. In this
paper, it has been made clear that training alone is not sufficient for service quality. The
commitment, leadership and adaptability of the management towards change are also
important for quality service. The values and skills of the employees on the other hand,
must be prioritized as well. They must be given enough empowerment to contribute
effectively towards customer satisfaction.
The importance of quality in customer service has been recognized by
companies worldwide. Several major companies have applied prioritized quality in
customer services, resulting to positive business outcome. Customer satisfaction,
loyalty, employee satisfaction and profit growth are some of the main advantages of this
business practice. In order to cope with the present business challenges, several
businesses have implemented different strategies that will enhance their respective
customer services. Consumer studies, trainings and application of information
technology are some examples of the most commonly used strategies for customer
services.
Service delivery is an interactive and dynamic process that from the consumer's
point of view is much more than a passive exchange of money for a particular service.
Characteristics of services (e.g., intangibility, heterogeneity, simultaneity, and
perishability) often require customers to be actively involved in helping to create the
service value -- either by serving themselves (as in getting food in a buffet restaurant
line or by pumping their own gas) or by cooperating and often working collaboratively
with service personnel (as in settings such as hair salons, motels, universities, or
lawyers' offices) ( 1990).
Research Objectives
The researcher finds it necessary to conduct a study that will tackle the service
quality standards of three of the largest and widely recognised hotel operators in the
world namely Hilton Hotel in Beijing, Kunlun Hotel, Sheraton Tiajin, Continental Grand
Hotel and Shangri-la. The general objective of the project is to compare the service
standards of the 5 hotel-restaurants and assess the adequacy and efficiency of these
standards. Specifically, this study will try to address the following objectives:
1. To examine the assumptions behind service quality as applied in the
hospitality industry in China.
2. To establish the characteristics of the service quality standards of Hilton
Hotel in Beijing, Kunlun Hotel, Sheraton Tiajin, Continental Grand Hotel
and Shangri-la.
3. To identify the opinions of hotel customers, as well as the opinions of
employees and their managers working in the hotel-restaurants studied for
this project towards values underpinning service quality.
4. To draw conclusions about the adequacy and efficiency of service quality
standards of the five hotel-restaurants.
Research Design
This research requires an organised data gathering to answer the objectives. In
this lieu, the research will use the descriptive approach employing a both qualitative and
quantitative research method. That is, a primary research will be carried out in the three
hotel-restaurants (i.e. Hilton Hotel in Beijing, Kunlun Hotel, Sheraton Tiajin, Continental
Grand Hotel and Shangri-la) to assess the opinions of the hotel-restaurants’ customers,
employees and managers towards values underpinning service quality. Questionnaires
will be developed with questions based on service quality attributes and values.
Theoretical Framework
The theoretical framework that will be used in the study is the Input-Process-
Output Model. In the IPO model, a process is viewed as a series of boxes (processing
elements) connected by inputs and outputs. Information or material objects flow through
a series of tasks or activities based on a set of rules or decision points. (1997) Flow
charts and process diagrams are often used to represent the process. ( 1997) What
goes in is the input; what causes the change is the process; what comes out is the
output. (2001) Figure 1.1 illustrates the basic IPO model:
Figure 1.1
Input – Process – Output Model
OUTPUT
INPUT
PROCESS
The IPO model will provide the general structure and guide for the direction of
the study. Substituting the variables of this study on the IPO model, the researcher
came up with the following:
Figure 1.2
Conceptual Framework
· Clarification regarding the the the service quality of the five hotels in China
· Conclusion and Recommendations on the objectives of the study.
INPUT PROCESS OUTPUT
· Literature reviews on service quality and customer satisfaction
· Quantitative Data: Perspective of the hotel managers, staff and hotel customers.
Assessment and analysis of acquired data through observation and interpretation.
Scope and Limitation
The study only scopes within China. The respondents will be strictly and should
be from the hotels mentioned above: Hilton Hotel in Beijing, Kunlun Hotel, Sheraton
Tiajin, Continental Grand Hotel and Shangri-la The scope of the sample, on the other
hand, will be based on purposive sampling which will be conducted on the three hotels.
Guests, managers and staffs from the three hotels will be surveyed.
In terms of literature, the scope of the study is both local and foreign literatures.
The issues scoped within the study include service quality and hotel service.
The study will only be limited to survey and literature review. Furthermore, the
responses of the respondents will be limited only to what the questionnaire asks.
Interviews with managers, on the other hand, will be considered as secondary data to fill
up for the study. This study will be purely descriptive and will only try to survey out the
current service quality issues on the restaurants of those hotels.
Significance of the Study
The study will be significant to the service industry as it will contribute to further
understanding of important service quality attributes in five star hotels. As mentioned,
this study will deal specifically with hotel and not on the general hotel service. This may
contribute to the understanding of a specific hotel service and may provide
recommendations for the improvement of that service.
This study will also be significant to hotels, specifically five star hotels. The
survey of the study will help determine what five-star hotel restaurant customers prefer
in their service experience. It will also help employee management as it may pinpoint
barriers on quality service, which could mostly be related with the service delivery of
employees.
Structure
This management report will be divided into five chapters with related goals.
The succeeding chapter, Chapter 2, will present the concepts and assumptions
behind the concept of service quality, with special emphasis on its application in the
hotel and restaurant industry. By doing so, it is hoped that the nature, advantages and
disadvantages this management concept will be highlighted. Suffice to say, this chapter
will present a review of the related literatures and studies.
The third chapter, meanwhile, will define how the research was carried out. It will
outline the research strategies applied in this study and why they were chosen. These
strategies include who and how the respondents of the study were selected, the data
collection methods and the data analysis techniques applied in this research. Issues of
evidence, trustworthiness and validity will also be given in this chapter as well as the
ethical issues that will be considered upon the implementation of this research project.
Finally, this chapter will wrap up with a projected time frame for the completion of the
project.
On the other hand, as mentioned previously, the researcher will try to determine
the efficiency of service standards in the hotel restaurants studied for this project, i.e.
Hilton Hotel in Beijing, Kunlun Hotel, Sheraton Tiajin, Continental Grand Hotel and
Shangri-la. In particular, these companies’ service standards will be compared among
each other, and the discussion in this lieu will be presented in the fourth chapter.
Basically, it is in this fourth chapter that the research objectives of this study will be
addressed directly.
Finally, the fifth chapter will present a summary of the findings of this study, as
well as the conclusions derived from the findings. The study will wrap up with several
recommendations from the researcher.
CHAPTER 2
LITERATURE REVIEW
Introduction
As mentioned in the previous chapter, concepts and assumptions behind the
concept of service quality, with special emphasis on its application in the hotel and
restaurant industry, will be provided in this chapter. A discussion on service quality will
be done so that the nature, advantages and disadvantages this management concept
will be highlighted. In particular, this literature review on the said concept will be done so
that the researcher’s knowledge on the subject will be further enhanced. This is
particularly important because enhancing one’s knowledge on the intended subject for
investigation helps in the further clarification of one’s research question/s (2003).
Further, even though a researcher may already possess good deal of knowledge about
his/her research area, a literature review will still prove useful as it will establish what
research had already been done that may be related to one’s research area and will
identify, as well, if there are other research currently in progress (2003).
In this literature review, (1996) guides the researcher when they said that a
literature review may help in: finding justification for research objectives; avoiding
repeating works that has been already done; gaining noteworthy insights into the
aspects of one’s research objectives; and, discovering research approaches, strategies
and techniques that may be appropriate to one’s own research.
Now, since all three companies are enlisted among the service industry sector,
my literature review will focus on existing theories, case studies, data sources as well as
previous and current views towards service quality and standards.
Defining Service Quality
If we will look around, we will realise that what dominates society are services.
Organisation and enterprises offering services are numerous, ranging the national and
local government who offer education, health, social security, police, the military,
transport, legal, information, and credit services, to the non-profit private services
groups (i.e. charities, churches, research foundations, mutual societies, and art
foundations) and for-profit services groups (i.e. utilities, hotels, airlines, architects,
restaurants, solicitors, retailers, entertainment, banks, insurance companies, advertising
agencies, consultancy firms, market research companies, and communications) ( 1994).
Because of the dominance of service industry in the society (for instance in America,
almost 70% of employment is in the service sector), many service enterprises and
organisations compete for service quality (1994).
So what is service quality?
Service quality is generally viewed as the output of the service delivery system
(1982). In particular, it is the difference between expectations of service and perceptions
of service actually received ( 2001).
(1998) added that service quality refers to customers' appraisals of the service
core (i.e. the provider of the service) or the entire service organisation. (2001) supports
this argument when he said that service quality can be reflected in both the manner and
the location of the service delivery. Accordingly, clients often make inferences about
service quality based upon tangible and intangible cues (i.e. the tangible and intangible
aspects of the service quality) observed during interactions with the service firm ( 2001).
Tangible aspects of service quality include all that the client can see, touch, hear,
and smell upon the delivery of the services, thus, it basically involves physical facilities,
equipment, and appearance of employees (2001; 1998).
Meanwhile, the intangible aspects of service quality comprise the manner by
which services are delivered (2001). An example of an intangible aspect of service
quality is the service performance, which describes all aspects of the delivery of
services that include: reliability (i.e. the ability to perform the required service
dependably, accurately, and consistently, e.g. solving customer’s problems, accurate
billing and record keeping); responsiveness (i.e. the willingness of staff to provide
prompt and attentive service; accordingly, it is important to make customers feel the
immediacy of the management or the service employee in responding to what the
customers need to know); assurance (i.e. ensuring that clients feel secure and safe
when they provide confidential and/or personal information and winning their trust); and,
empathy (i.e., the management or the service employee must see things from the
vantage point of the client, e.g. being available to the client when needed, providing
convenient hours, understanding specific client needs, giving personal attention, and
keeping the client’s best interests at heart) (2001).
According to g (1998) service intangibility means that services cannot be seen,
tasted, felt, heard, or smelled before they are bought. Meanwhile, service variability is
the quality of services depends on whom provides them as well as when, where, and
how they are provided. Lastly, service perishability constitutes the services that cannot
be stored for later sale or use. Some doctors charge patients for missed appointments
because the service value existed only at that point and disappeared when the patient
did not show up. The perishability of services is not a problem when the demand is
steady. However, when demand fluctuates, service firms often have difficult problems
( 1998).
Service quality tends to focus more on the intangible aspects, and because
intangible aspects don’t involve any product, the quality of services is measured through
the way it is being delivered by the service employee, which may either create
satisfaction or disappointment on the part of the customer.
Customer Satisfaction and Service Quality
In high-contact systems customers can influence the time of demand, the exact
nature of the service, and the quality of service ( 1979). If consumers somehow become
better customers -- that is, more knowledgeable, participative, or productive -- the
quality of the service experience will likely be enhanced for the customer and the
organization (1990). Organizations that capitalize on customers' active participation in
organizational activities can gain competitive advantage through greater sales volume,
enhanced operating efficiencies, positive word-of-mouth publicity, reduced marketing
expenses, and enhanced customer loyalty (1979; 1990). Customers who actively
participate in organizational activities can directly increase their personal satisfaction
and perceptions of service quality (1990; 1990;1996).
There had been a number of strategies implemented by various companies in
order to practice quality customer service. From customer studies to the application of
information technology, several international businesses have confirmed that putting
quality into customer service results to positive outcomes. While the benefits of quality
customer service have already been recognized, it is important to consider that quality
customer service is not dependent on the quantity of trainings or seminars an
organization undergoes but on the level of collaborative effort exerted.
Along with the changing business world, customers change as well, becoming
more demanding and knowledgeable than before. In turn, company management had
shifted their focus on their clients or customers so as to stay successfully in business.
This transition meant that organizations have to completely reformulate their
conventional business aims and purposes from being process-focused to customer-
centered. Rethinking and reformulating the organization on the other hand, entail the
consideration of several factors such as various processes, technology, the
environment as well as the success factors of people (2000). Hence, in order to bring
out exceptional customer services within the company operations, the management
should employ fine-tuned organizational restructuring. Moreover, employing proactive
customer commitment involves the consideration on culture and infrastructure (1997).
The success of integrating quality in a company’s customer services depends
heavily on the management. While some company management send their employees
to training, some managerial factors would have to be used as well. As discussed by
(1990), the manner to which management train, motivate and recognized their
employees results to a significant effect on the quality of customer service they deliver.
The level of commitment the management provides for instance has a direct impact to
the quality of customer service the company provides. According to (2003), it is a
common mistake for most management to think that they are highly committed in
servicing the customers with quality when in fact their commitment is only based on
internal and technical viewpoints.
Interestingly, although there is no consensus in the research community about
the causal relationship of quality and satisfaction, it is commonly assumed that service
quality leads to satisfied customers ( 1994). In fact, early researchers (1984; 1985;
1987) had emphasised the link of service quality with customer satisfaction, which they
argued to be the degree of fit between customer’s expectations and perceptions of
service.
In the survey of (1990), it has been noted that quality, customer satisfaction, and
identification of customer value were identified by their respondent companies as either
important or very important. (1994) support this finding and argue that those companies
that are perceived to have high quality of services and goods had higher market share,
higher return on investment and asset turnover than companies with perceived low
quality, therefore affecting the competitiveness of the company, long-term profitability
and “repurchase intentions” of both existing and potential customers. Now, since service
quality affects competitiveness of the company, long-term profitability and “repurchase
intentions” of both existing and potential customers then simply put, service quality
certainly affects customer satisfaction (1994).
On the other hand, (1999) said that customer criteria determine the definition of
quality and the variables that affect perceptions of quality, although these variables
could accordingly with circumstance, experience, and time. Accordingly, the total
perceived value of service comes from two sources: first, customers perceive value that
originates from the service act itself; and second, customers perceive value that
originates from the quality of the service act ( 1999).
(1998) share this same perspective. To demonstrate this point, (1998) cited the
case of customers leaving a restaurant or hotel, that is, before a customer leaves a
restaurant or a hotel, they are typically asked if they are satisfied or not with the kind of
service they received; if their answer is a “no”, it is typically assumed that the service
was poor.
However, it is also noteworthy to consider direct service providers’ (e.g.,
waitresses) recognition of the fact that at times, even the best service efforts they give
are criticised because there are times that the customer's perceptions of the service are
clouded by the customers’ present state of mind, such as if they are in a bad mood or
have had a disagreement with someone just before arriving at the restaurant ( 1998).
Therefore, in practice, the influence of service quality on customer satisfaction is
affected by other factors, one of which is the customers themselves (1998).
Measuring Service Quality
However, even though “understanding customer expectations and meeting
customer needs is the single most critical issue and determinant of service quality”,
defining service quality as a measure of excellence in terms of perceptions is not
sufficient (1998). This is because it is difficult to measure the perception of the
customers because of its intangible nature – and this complexity triggers the complexity
of controlling or managing service quality. That is, since evaluation of service quality
tends to focus more on its intangible aspect as compared to the more tangible aspect,
this creates difficulty on the evaluators’ part because there isn’t any actual product
involved and the quality of services is measured through the way it is being delivered by
the service employee. The intangibility of services and the simultaneity of service
production and consumption make it complicated for customers to evaluate the quality
of the desired service before it is provided or rendered (1988). Early researchers
( 1987; 1985; , 1985) had already deduced that measuring service quality is difficult
because it involves too many intangible aspects that are complex to quantify.
In addition, although expectations are important, it is actually the difference
between perceptions of a service and expectations for that service that should be used
as the measure of service quality ( 1988).
Nevertheless, many still believe that certain models can measure the amount of
satisfaction that a customer need. In this lieu, two measurement models have been
cited: the SERVQUAL model, and the conjoint analysis method.
The roots of the SERVQUAL can be traced back way back in 1978, when (1978)
argued that service is a complex bundle of explicit and implicit attributes, comprising the
substantive service (the essential function of the service) surrounded by a number of
peripheral services. In the later years, the SERVQUAL model of (1988) was developed,
a methodology that defines five dimensions of service quality (reliability; assurance;
tangibles, which include the physical appearance of people and facilities; empathy; and,
responsiveness). The SERVQUAL Model involves the Gap Analysis. A gap analysis
helps to identify the causes of service quality shortfalls in each or all of the dimensions.
Customers build an expectation of the service to be received depending on four factors:
word of mouth communications (obtained from friends and acquaintances); personal
needs; past experience; and, communications put out by the service company ( 1985).
On the other hand, conjoint analysis is a method for measuring consumers’
trade-offs among product attributes, including service attributes and service dimensions
(2000). Accordingly, it is an alternative measurement to service quality as it provides
better measures to service attributes and can cover and measure large numbers of
attributes depending on the type of conjoint analysis to be used ( 2000). For large
number of attributes, hierarchical conjoint procedures should be used, but otherwise,
the traditional conjoint analysis can be used (2000). In this type of analysis “the
respondents indicate their preference for a series of hypothetical multi-attribute
alternatives which are displayed as list or profiles of attribute” (2000). The responses
will then be analysed to be able to estimate the relative importance of attributes and to
be able to build positive models of consumer preference for new alternatives (2000).
Standards and Quality: Why Relate Standards with Service Quality?
Although standards and quality are two different words, there is perhaps a
relationship between them.
A company that answers to the customer’s demand acquires benefits such as:
greater market share, higher growth rate, premium price, loyal customers, and highly
motivated employees (1974). Because quality is the main ingredient in a product that
delights the customer by either meeting or exceeding expectations (1988), it is often
that perceived quality is based on the perception of the customers. In fact, consumers
today are more willing to pay for quality (1990). Because of this demand for quality, a
standard should thus be set to prevent deviation from the quality that is needed globally.
The standard serves as a guide to organisations on what the customers want because it
provides rules that should be applied (1995).
An example of a standard that can influence quality is the ISO standards (e.g.
ISO 9000 and ISO 9000:2000) because these standards helps in the process control of
the conduct through the documentation or “feedback” that it generates to keep the
process in control ( 1995). (2004) explained that the key elements in ISO’s definition
include: that standard prescribes behaviour or characteristics of people or inanimate
objects - yet, it does not in itself mandate compliance; a standard is an instrument of
governance, but it is more explicit than most social norms; and it differs from a
governmental regulation in that the use of, or compliance with, a standard is by
definition not mandatory.
The downside, however, is that the effectiveness of ISO standards is still
untested on many industries. Nevertheless, even though there are several research that
demonstrate ISO standards’ negative results (i.e. that the implementation of the
standards may result in the development of a static quality system, which increases
bureaucracy and reduces flexibility and innovation; excessive obedience to the
documented procedures may discourage critical thinking, while in many cases process
standardization acts as a barrier for processes improvement; it cannot guarantee
efficacy and effectiveness in customer satisfaction; and can be deteriorating if
implemented badly) ( 1994; 1995; 1994), there are also research on the ISO standards
that enforced their beneficial sides (1993; 1994; 1993; 1991; 1997).
Further, during these times of continuous change and global competition, several
factors such as leanness, flexibility, adaptability and a capacity for differentiation are
deemed necessary for business survival but companies are restricted by the need to
conform by the sanctions of standards such as ISO standards (1999). Thus, in such
situations, standard bodies (or those who regulate companies by applying standards)
should accordingly use extreme caution and deal with specific problems that emerge
daily and with increasing frequency in this constantly changing world (1999).
Frameworks for Service Quality
In high-contact systems customers can influence the time of demand, the exact
nature of the service, and the quality of service ( 1979). If consumers somehow become
better customers -- that is, more knowledgeable, participative, or productive -- the
quality of the service experience will likely be enhanced for the customer and the
organization (1990). Organizations that capitalize on customers' active participation in
organizational activities can gain competitive advantage through greater sales volume,
enhanced operating efficiencies, positive word-of-mouth publicity, reduced marketing
expenses, and enhanced customer loyalty ( 1979; 1990). Customers who actively
participate in organizational activities can directly increase their personal satisfaction
and perceptions of service quality ( 1990; 1990; 1996).
There had been a number of strategies implemented by various companies in
order to practice quality customer service. From customer studies to the application of
information technology, several international businesses have confirmed that putting
quality into customer service results to positive outcomes. While the benefits of quality
customer service have already been recognized, it is important to consider that quality
customer service is not dependent on the quantity of trainings or seminars an
organization undergoes but on the level of collaborative effort exerted.
Along with the changing business world, customers change as well, becoming
more demanding and knowledgeable than before. In turn, company management had
shifted their focus on their clients or customers so as to stay successfully in business.
This transition meant that organizations have to completely reformulate their
conventional business aims and purposes from being process-focused to customer-
centered. Rethinking and reformulating the organization on the other hand, entail the
consideration of several factors such as various processes, technology, the
environment as well as the success factors of people ( 2000). Hence, in order to bring
out exceptional customer services within the company operations, the management
should employ fine-tuned organizational restructuring. Moreover, employing proactive
customer commitment involves the consideration on culture and infrastructure (1997).
The success of integrating quality in a company’s customer services depends
heavily on the management. While some company management send their employees
to training, some managerial factors would have to be used as well. As discussed by
(1990), the manner to which management train, motivate and recognized their
employees results to a significant effect on the quality of customer service they deliver.
The level of commitment the management provides for instance has a direct impact to
the quality of customer service the company provides. According to (2003), it is a
common mistake for most management to think that they are highly committed in
servicing the customers with quality when in fact their commitment is only based on
internal and technical viewpoints.
Nowadays, Customer Relationship Management (CRM) has been a common
system applied by businesses to ensure quality customer service. According to (2000),
CRM aids the organization to stay abreast of its customers’ needs and concerns. In
addition, customer relationship management also helps the organization to respond in
time and appropriately to their customers’ calls. The approach on CRM covers all
business processes that an organization employs so as to determine, select, obtain,
enhance and retain its customers. Indeed, at present, CRM is regarded as the
integration of business processes, technological solutions and advanced analysis,
which enables companies to understand clients from a multifaceted perspective.
Through this understanding, companies are able to establish deeper and more
profitable customer relations.
In order to achieve customer satisfaction, the business should consider individual
customer demands and needs. As every customer need is different from another,
customization is very important. In applying customization, two factors must be taken
into account. First, one must consider whether customization is possible based on the
services’ characteristics and delivery systems. Second, one must identify the amount of
judgment that can be exercised by the customer contact personnel in defining the
nature of service individual customers receive. This is necessary as some service
concepts are standardized while others are able to provide various alternatives and
options (1980).
Some class of services does not only require a high level of customization but
also needs customer contact personnel to deliver the services to the customers. This
type of service provision is also known as prescriptive, where the focus of control is
transferred from the user to the provider. Professional services of the hospitality industry
as well as accounting, medicine, law and architecture are included in this category.
These knowledge industries need to have sufficient education and training so as to
satisfy individual customer needs. This is one of the reasons why literature on service
industry pertains to the interaction between the service provider and the customer as
this relation determines the degree of customer satisfaction. This in particular is
applicable to the hospitality industry (1999).
According to (1980), hospitality professionals are dependent on the contact and
the reception they receive from the customers. Hence, hospitality personnel must have
a certain degree of availability towards the customers, a substantial margin of initiative
and a strong sense personal responsibility. In a tourist interaction, employees in fact
serve as a mediator between the clientele and the structure of the industry. This role is
very much significant in obtaining the desired results of both the customers and the
business. In satisfying the wishes of the customers, the ethical and psychological
factors must also be involved among hospitality professionals. There is considerable
evidence that clients appreciate actual interaction with people; thus, the treatment
clients should receive from service providers must be different from what they receive
on daily routines.
Indeed, customer satisfaction is an important element of the hospital industry that
makes it different from manufactured products. However, while interpersonal skills are
learned from, hospitality and customer service programs, the effectiveness and the
quality of service provided should go beyond eye contact and warm greetings (2001).
The generation of customer satisfaction should then be produced out of effort and good
rapport. Most people equate customer service with personal interaction, while few of
them realize the complexity of business systems involve in it. Without these helpful
systems, the smile or the warm greeting service employees provide will lead to minimal
results.
Meanwhile, Six Sigma is defined by a number of organizations as a measure of
quality that strives for near perfection. The program constitutes a collection of methods
for analyzing complex cause-and-effect relationships which vary according to simplicity
and sophistication so as to discover opportunities for improvement within the business
organization. The main purpose of the program is to eliminate defects in any transaction
process through the use of disciplined and data-driven approach and methodology used
from manufacturing to transactional business processes and from product to service
deals. Using the definition of quality in terms of value rather than in terms of defects, six
sigma quality management programs involves a general approach and a search for
ways to reduce muda in any environment (1999).
Lastly, Total Quality Management (TQM) is a planned procedure for satisfying
internal and external customers and suppliers by integrating the business environment,
continuous improvement, and come through with advancement, growth, and
safeguarding the cycles while changing organizational culture. Furthermore, TQM is an
array of management system throughout the organization, geared to ensure that the
organization to continuously attain or surpass customer requirements. Total Quality
Management is a philosophy of management that is driven by the constant attainment
of customer satisfaction though the continuous improvement of all organizational
processes (1998). It is a management philosophy that seeks to integrate all
organizational functions such as marketing, finance, design, engineering, production,
customer service, and others to focus on meeting customer needs and organizational
objectives (2000).
The best product and service providers continuously update and upgrade their
service deliveries in order to answer the demands of their customers. Customers have
the ever-increasing demand on getting their hands into the products which can lead to
change in business establishment if expectations are not met. Business firms invest on
researches that will define their target customer groups that they believed they could
serve best. Every business person is determined to know what kind of work they would
and would not do for their customers and, in turn, they carefully learn how to fulfill the
needs of each kind of customer in their target markets. (1996) emphasized the idea to
take advantage of the competitive situation not just by being better in how that product
gets sold, serviced, and marketed at the customer interface. It requires that companies
create breakthroughs in how they interact with customers, and design a way of
interacting that makes an indelible impression on customers, one that so utterly
distinguishes them from others that it becomes a brand in itself .
Hospitality Industry in China
Also known as the value of receiving people wholeheartedly and treating them
importantly, hospitality has been recognized as a desirable attitude in dealing with
others, be it within the community or among neighboring countries. At present, the
practice of being hospitable is not only applicable in entertaining others. In most
businesses and corporations, particularly in tourism, hospitality management has been
a valuable means of maximizing the return on investment. Such trend is perhaps
attributable to the common conception that the value of attracting potential clients is
equal in keeping existing ones.
Hospitality industry is among the fastest growing economic sectors worldwide. In
fact, the hospitality industry by itself is recognized as multi-billion dollar and still
progressing industry (1998). While this industry enables the provision of vast services
for the clients, work opportunities are also diverse. Indeed, the provisions of the industry
for the customers are as unlimited as its opportunities for employees. People are able to
work is different areas of interest while still be in a job within the industry. At present,
more workers are employed in service provision than in manufacturing, indicating the
continuous growth of the hospitality industry.
In fact, about eight out of ten workers in China are in various sectors of the
service industry including education, entertainment, retail, transportation and health
care. In the China seventy percent of the country’s gross national product is covered by
service industries. By 2012, it is expected that this percentage will increase to ninety
percent (2004). Likewise, hospitality industry is among the major economic forces in the
UK as its enables growth and creation of job opportunities. According to the (2002), the
business has employed over 1.8 million workers who were distributed within 300,000
hospitality establishments, totaling to revenue generation of more than £64 billion. From
these records, hospitality has indeed become one of the most competitive businesses in
the world.
The intense rivalry in the hotel industry is probable to carry on increasing ( 2000).
Therefore, competition could bring about excess capability in the market. Moreover,
hotel managers are challenged with deterioration in leisure and business travel, stern
immediate, liquidity troubles, and intensifying business failure percentages (1999). In
this framework, continued existence and productivity are indispensable and the
administration of revenue has developed into one manner to deal with this.
Consequently, it is fundamental for executives to recognize where revenue is obtained
from within their trade.
External Analysis
Several business and industries have adopted the trend of hospitality
management primarily because corporate entertaining and hospitality is capable of
effectively establishing networking opportunities. This trend also enables businesses to
create and strengthen business relationships. While, these advantages are valuable
and essential to businesses, an owner may find himself in the midst of disaster as
corporate hospitality is capable of causing major damages as well, particularly on
corporate reputation. Historically speaking, the hospitality business is considered as one
of the oldest industries there is. This is because, long before the use of the term
hospitality management, people are already traveling for leisure or work purposes; they
are already going out to eat or shop. However, as the world continues to change, the
hospitality industry had started to grow and become more diversified. Considering the
accessibility and improvement hospitality services had undergone, the industry indeed
has opened itself to newer business areas and innovations (1998).
The hospitality industry involves businesses such as lodging, restaurant, travel
and tourism, and recreation. All of these aspects, although different, are related to one
another in the aspect of providing quality service to guests. Hospitality management
involves a wide range of planning, organizing and controlling human and material
resources within the business of providing an avenue of good reception and hospitality
to customers (1998). The hospitality industry is said to be one of the oldest industries
that ever existed. People always had the need for a place to stay when traveling to far
places an individuals or groups often prefer eating outside than cooking at home.
Customer satisfaction and quality assurance are espoused throughout the
instruments of total quality control. The instruments of total quality control shape a
mutually dependent system of ideas, methods, and promotional conduits. (1988),
(1988), and (1985) identified four empirically derived doctrines of Japanese total quality
control. The first is to have knowledge of the customer orientation. The subsequent
process is the customer the theory intends the company to consider aspects of the
industry in the eyes of the customer. Another is to supervise by fact, and utilize
statistical techniques so as to acquire objective and precise results. The third aspect is
to make use of the plan--do--check-act (PDCA) sequence to reduce the disparity
involving process performance (actual results) and targets. And lastly, the theory
intends the company to have reverence for humanity, and employ participatory
management. Ishikawa’s quality control has a humanistic outlook of the employee,
specifically that employees can have a say to customer satisfaction and quality
assurance if they are granted appropriate education and training.
The methods of quality control takes in the seven fundamental quality-control
instruments, the seven management instruments, advanced tools, and quality-control
stories. The seven basic quality-control instruments takes account of flow charts,
brainstorming and cause-and-effect figures, check sheets and Pareto charts,
histograms, run graphs and control diagrams, scatter graphs, and stratification. The
seven management instruments contain affinity charts, interrelationship diagraphs,
systematic tables, matrixes, matrix data analysis, process decision program chart
(PDPC) study, and arrow figures. The advanced instruments contain design of
experiments, Taguchi experiments, quality function deployment, flag illustrations, and
foolproof engineering (1988; 1988, 1985).
Internal Analysis
In general, hospitality management is a process that involved planning,
organizing directing and regulating human and material resources. These activities are
performed within the restaurant, travel and tourism, lodging, recreational management,
institutional management as well as in meeting and convention planning businesses.
Though separated, these sectors are actually related to hospitality industry as they all
aim to provide generous and kind services to the customers (1998). The hospitality
industry basically involves hotels and other forms of accommodations, fast food outlets,
bars, retail stores, restaurants. These diverse segments of the hospitality industry made
the business grow and eventually into a highly competitive global business (2003)
Hospitality management has been a highly significant priority as it involves all the
elements needed in a company’s marketing mix. It also offers an essential component
that corporate marketers are after, and that is to attain the opportunity to get quality time
with their clients and prospects. A good corporate hospitality program is beneficial as it
strengthens the relationship shared between the sponsor and its chief constituencies.
Hospitality management enables companies to spend time with them away from the
stress and pressure of the business, creating an environment that is conducive for
business transaction (2004).
The continuing transformation from the traditional industrial framework with its
hierarchical companies to a worldwide, knowledge-founded financial system and
intelligent corporations necessitates human resource purposes to realign and relocate
itself. Considering alternatives and ideals on the relationship between and among
employers and employees resulted to more adaptable pool of skilled staff members and
efficient body of workforce.
Continues researches on how to improve the product and service to the
customers by applying and exhausting the resources available to the company should
be constantly considered. Assessment and evaluation of the perception, attitude and
behaviors of customers towards the products and services provided should be likewise
examined. Innovate, improve, and develop. It should be realized that the direct
relationship of quality to customer satisfaction is an accepted fact that can either make
or break a particular business organization. The company’s deficiency on meeting the
quality requirements it promised to the customers will be very evident in the sales
reports and feedbacks that the company will acquire in reviewing the firm’s performance
to evaluate and assess the business operation and thus, should be similarly
understood.
Chapter 3
Methods and Procedures
This chapter will be dedicated to the description of the methods and procedures
done in order to obtain the data, how they will be analyzed, interpreted, and how the
conclusion will be met. This section is to justify the means in which the study was
obtained and will help in giving it purpose and strength as it will then be truthful and
analytical. All these will help in the processing of the data and the formulation of
conclusions.
Specifically, this research will cover the following: the research design and
method, the respondents or subjects to be studied (which will include the sampling
method), the data collection instrument, and the data analysis. These will be presented
below.
Research Design
The research design chosen both qualitative and quantitative research, which
uses explanatory methods in describing the variables wherein the data, situations, or
other facts collected will be explained or correlated with other data. It is especially useful
when conducting a study wherein the data are immeasurable, such as feelings, beliefs,
thoughts, and others (2000). Furthermore, the study will be descriptive as it will focus
on the conditions set and the nature that surrounds the data and does not focus on the
correlation with other collected facts.
In order to come up with the most suitable research approaches and strategies
for this study, the research process “onion” is used. This is because conducting a
research is like peeling the back layers of an onion—in order to come to the central
issue of how to collect the necessary data needed to answer the research questions
and objectives, important layers should be first peeled away. With the said process, the
researcher was able to create an outline on what measures are most appropriate to be
applied in the study.
It is not unusual for a researcher to first think of his research undertaking by
considering whether one should, for instance, administer a questionnaire or conduct
interviews, thoughts on this question should belong to the centre of the research ‘onion’.
(2003) That is, in order to come to the central issue of how to collect the data needed to
answer one’s research questions, there are important layers of the onion that need to
be peeled away: the first layer raises the question of the research philosophy to adopt,
the second considers the subject of research approach that flows from the research
philosophy, the third examines the research strategy most applicable, the fourth layer
refers to the time horizon a researcher applies to his research, and the fifth layer is the
data collection methods to be used.
The Respondents
The researcher, in choosing subjects or respondents for the topic at hand, is
usually thought of to have the power over who the respondents of the study will be.
Such a task would have been easier, except a researcher cannot simply choose out of
whim; the subjects must be selected carefully with the intention of having subjects who
each posses characteristics that, when put together, will represent a community. It is not
only themselves whom these subjects will represent, but the bigger whole or the whole
population. The characteristics which the researcher has chosen them for will determine
which part of the community they belong and what part of the community they are
representing. Thus, the choosing of the subjects must be based on their characteristics.
In this study, it is necessary to collect information from hotel managers, staff and
hotel customers. The respondents will come from five different five star hotel in China
(i.e. Hilton Hotel in Beijing, Kunlun Hotel, Sheraton Tiajin, Continental Grand Hotel and
Shangri-la). These hotels had criteria before they were chosen: they all implement
service quality.
For the sampling, stratified sampling will be used. To be able to use this, the
researcher must first divide the subjects into groups, which was done through
classifying which hotel these respondents belonged to i.e. Hilton Hotel in Beijing, Kunlun
Hotel, Sheraton Tiajin, Continental Grand Hotel and Shangri-la. Because of standard
service quality procedures, details and report about service quality and customer
satisfaction results were not immediately obtained, thus setting the target date forward a
little. However, the list was finally released and from that list, the researcher did some
random sampling which will satisfy the requirements by arbitrarily choosing such
names to be done.
After choosing these people, the researcher then has to present or distribute the
questionnaires to the hotel managers and staff. Ten questionnaires were distributed
each per hotel. The respondents were given some time before these questionnaires
were collected. Each hotel had the return rate of the following: 9, 8, 9, 7, 9, 10, 10, 8,
10 and 10. Thus, the total number of respondents is 90, which makes up the 90%.
Data Collection Instrument
In order to obtain the desired data, the researcher has chosen to use the
primary research data, which is to collect firsthand the data to be used for the outcome
of the research. In able to do this, the researcher must have a data collection instrument
to be presented to the respondents. Thus, the researchers have chosen obtaining data
through the questionnaire. The questionnaire is administered by writing questions on a
page and distributing it to the respondents, expecting them to return the paper with their
answers on it. This is easier than other methods of data-collection (e.g., interview,
observation, etc.) as particular details may be hard to talk about during interviews and
cannot be drawn out from observation.
The advantage of using the questionnaires method is that the respondents have
time to think of their answers, thus allowing smaller rate of errors. Also, concerning
delicate matters, the respondents may feel more at ease when answering
questionnaires as they are not required to speak with someone else in order to give
information. The disadvantage of the questionnaire method is when the respondents are
unable to read or write; then the questionnaire will be rendered useless by the
respondents as they may need interpreters for the questionnaires. Thus, in case such
that unlikely event may happen, then the researcher will have no choice but to quickly
switch to the interview method, wherein the researcher will be allowed to interact with
the respondent and ask the questions based on the prepared questionnaire.
With regards to the standardized tests performance of urban and suburban schools in China, the following hotels are surveyed: Hilton Hotel in Beijing, Kunlun Hotel, Sheraton Tiajin, Continental Grand Hotel and Shangri-la
Instruments to be used
To determine the perception of the respondents about the service quality and customer satisfaction, the researcher prepared a survey-questionnaire. The respondents graded each statement in the survey-questionnaire using a Likert scale with a five-response scale wherein respondents were given five response choices. The equivalent weights for the answers were:
Range Interpretation
4.50 – 5.00 Strongly Agree
3.50 – 4.00 Agree
2.50 – 3.49 Uncertain
1.50 – 2.49 Disagree
0.00 – 1.49 Strongly Disagree
The decision was made to use a questionnaire for the data collection for this project due to the sensitivity of the information being obtained. It is important for the respondents to be open and honest in their responses. The use of the questionnaire provides the project owner with the ability to test the views and attitudes of the respondents. The questionnaire was designed to allow the collection of specific information about the participants to conduct statistical analysis, e.g. age, sex, social status and society class.
In the interview, open-ended questions were used to obtain as much information as possible about how the interviewee feels about the research topic. Interviews took between one and two hours. The questions being used during the interview have been based on the research questions for this project; they have been reviewed, refined and approved by the project supervisor. The researcher designed a semi-structured interview. Here, the researcher encouraged the interviewee to clarify vague statements and to further elaborate on brief comments. The interviewer did not share his/her own beliefs and opinions.
Data Collection
Data shall be collected from multiple sources, allowing different perspectives to be
taken into consideration in the development of recommendations.
The data sources that will be examined include:
1. A review of the appropriate research literature. This includes examining
studies where customer satisfaction had been used either in a research or
organizational setting. Both technical articles and “how to” articles were
included in the review.
2. One to one interview with the respondents. The interviews shall focus on
service quality in the chosen hotels.
3. Focus group discussion with the management and staff of the five chosen five
star hotels. During the interviews participants will be asked about their
perceptions on the challenges brought by the use of service quality in their
perspective hotels.
4. A survey will be conducted with another set of respondents in order to
investigate their satisfaction when using the services of the chosen five star
hotels
Data Analysis
In order to correctly interpret the data in such a way that its result will reflect
what the study originally intends to show then the researcher must employ the correct
and accurate way of data analysis. The method of data analysis then chosen for this
study of correlation is through grouping the answers by category of by social-class, then
allowing them to be tabulated and analyzed through percentages. Tables may be used
to present these findings in order to show the raw data tabulations and the percentage
of people per school classification has chosen to answer the same.
Thus, simple statistics can be done and applied, and it will be easier to
determine how school administrators and teacher reacted to standardized tests, the
factors that led to their decisions, and the effectiveness of standardized test to schools’
progress.
Summary of Action
This section is dedicated to the summarization of the entire chapter; it will
attempt to show a simplified explanation on how the research took place as well as
explain the different stages it underwent. First, there was the choosing of ten schools
where the research was to be conducted, followed by obtaining the list of teachers who
will respond to the survey questionnaire and hotel managers were interviewed. These
possible candidates were randomly chosen with 10 recipients being chosen per hotel to
answer the questionnaire. The rate of return was high as 90% per hospital returned to
the researcher answered.
Once finished, the researcher attempted to collate the data through simple data
analysis, which involved the grouping of respondents to the hotels and thus being able
to compare their answers to those from different hotels.
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