Right Hiring Can Give Competitive Advantage to Organisatins-A Study of Internal Service Quality Perspective in Indian Hotel Industry

Right Hiring Can Give Competitive Advantage to Organisatins-A Study of Internal Service Quality Perspective in Indian Hotel Industry

Dr Prerna Dawar1, Dean and Academics,

Geeta Engineering College, Panipat1

Ms Manika Batra2 Assistant Professor,

KVA DAV College for Women, Karnal2

Abstract- The tourism and hospitality industry has emerged as key industry at global level. There is perhaps no country in the world which is not relying on this industry to prosper its economy. Its positive impact on balance of trade, employment generation and gross income etc is appreciated by one and all. The industry is likely to overtake arms and ammunition and oil and petroleum industry to become the topmost industry of the world in next decade or so. The tourism and hospitality industry is contributing significantly to Indian economy also. It is among the top 15 industries of the country to attract highest FDI since the beginning of new millennium. The sector earned an FDI of US$ 7862.08 million from March 2000 to February 2015. Hotel industry is one of the major variant of tourism and hospitality industry. In Hotel Industry employees play a very important role as they are in direct contact with the customers so Internal service quality i.e satisfaction of employees with the service received from the internal service providers play a very important role here. One of the important strategy of internal service quality is Hiring The Right People, so the present study makes an attempt to analyze the hiring strategies of selected five star hotels of North India by garnering the views of the employees pertaining to their expectations and actual perception about the services being rendered to them. The employees perspective on various hiring strategies like service competencies, service inclination, being preferred employer etc are ascertained and analyzed in this paper. The study assumes a greater importance as the players chosen for the study represent highly esteemed five star hotels of India.

RESEARCH TYPE- Empirical

FINDINGS- There exists difference in the perception and expectations of the employees as far as their dimensions of internal service quality are concerned. All the hotels have been found to be struggling on the service quality dimensions such as competing the best people and be the preferred employer which indicates that hiring strategy of the hotels is not good. However the selected hotels are comparatively doing better in hiring the people for service competencies and service inclination aspect of service quality.

PRACTICAL IMPLICATIONS- The administrative wing of the hotels should start viewing service quality from the employees perspective and make necessary changes in their service quality endeavours.

KEY WORDS- Internal Service Quality, Service competencies, Service inclination, Empowerment

1. INTRODUCTION

   The hospitality industry is one of the biggest in the world, rivaling even fuel and rice production companies. At global level, hotel industry is measured at US $ 6.5 trillion in 2015. India hotel industry is worth US $ 30 billion at this point and maintaining a healthy double digit growth rate. Factors such as Government making an endeavor to promote tourism in the country, increasing affluences of people, shift of the people towards entertainment and travel during off times and so on are making hotel business a lucrative one for the share-holders. With ever-intensifying and cut-throat competition in the Indian hotel industry, the success of the hotels especially luxury ones depends upon the satisfaction level of customers. Satisfaction of customers, to a great extent depends upon the service quality they are getting from the hotels. Such an external service quality is said to be dependent upon motivation level of employees which in turn depends upon internal service quality. Internal service quality and external service quality thus are fast turning out to be the key for success of hotels. The present study has made an endeavour to assess the internal service quality in selected five star hotels of India.

   Internal Service quality play a very important role here which means satisfaction of employees with the service received from the internal service providers and therefore Internal Service quality can be used as a strategic differentiation weapon to build a distinctive advantage which competitors would find difficult to copy. Furthermore, quality does not improve unless it is measured. However, unlike manufactured goods quality, internal service quality is an elusive and distinctive construct. Hence, the measurement of internal service quality has to be based on perceived quality rather than objective quality because services are intangible, heterogeneous and their consumption and production occurs simultaneously. As the most important strategy of Internal service quality in hospitality industry is hiring the right people so present study includes an examination of hiring strategies of selected five star hotels by analyzing the employees expectations and perceptions of five star hotels of North India. This analysis of service quality would enable management to better direct financial resources to improve internal service quality orientation in

   those areas that have the most impact on employees perceptions of service quality. This evaluation is essential in todays competitive, challenging and cost-conscious market.

2. REVIEW OF LITERATURE

   Each and every research work, its planning and execution is highly dependent on the thorough review of literature on the subject. This helps the researcher to familiarize with work already been done and also helps to trace down the gaps, the unexplored area and those research problems that have not been covered or considered earlier, for future considerations and studies. The prominent studies pertaining to internal service quality in hospitality sector, irrespective of the measuring scale used have been discussed below.

   Service quality was defined as the result of comparison between customer expectation about service and their perceptions of the way the service had been performed (Gronroos, 1984; Parsuraman et al, 1985, 1988, 1991, 1994); the delivery of excellent or superior service relative to customer expectation (Zeithmal and Bitner, 1996); as well customer interpretation of their experience (Garavan, 1977). So its quite clear that all the concepts of service quality were discussed from the point of view of external customers however, internal customers are equally important (Barnes and Morris, 2000). Thus, a lot of obstacles to service quality improvements were detected like lack of visibility; difficulty in assigning specific accountability; time required to improve service quality; delivery uncertainties (Ghobadian et al, 1994); and variability (Gummersson , 1991).

   The quality of staff and its impact on the quality of customer service had proved to be vital to the organizations (Papasolomou-Doukakis, 2002). So treating employees as customers could give an organization a competitive advantage and subsequently the importance of internal service quality was recognized (Farner et al, 2001). An internal customer was defined as any member of the organization(employee) receiving service and products from other members of the organization to carry out ones job (Zeithaml and Bitner, 1996) and Internal marketing is generally considered as a planned effort using a marketing like approach to internal customer in an organization to deliver customer satisfaction (Lings, 2004).

   Theoretical aspects of internal service quality have been discussed by Barnard, 938. Service profit chain was also based on the concept that profitability of a firm is derived from customer satisfaction which in turn is derived from employees satisfaction (Heskett et al, 1994; Walker et al, 2006). So organization effectiveness can be improved by internal performance indicators of organization structures and processes ie internal service quality (Gilbert and Parhizgari, 2000). The health of an organization depends upon degree to which employees share common values and how well the employees are served in organizations activities (Dotchin and Oakland, 1994). M. Isabel Sanchez- Hernandez, Francisco J. Miranda (2011) presented the first empirically tested model showing that internal marketing (IM) is a factor of success in new services development.

   Philmore Alleyne, Liz Doherty, Dion Greenidge (2006) measured the extent of the adoption of human resource management (HRM), the existence of a formal HR strategy, and the development of the HR function in the hotel industry. Because employee morale affects customer satisfaction the managers of the international tourist hotels need to cultivate good relations with their internal staff (Chien-Wen Tsai , 2008). For the attempts of the hospitality industry to attain service quality as sustainable competitive advantage, researchers affirmed that hospitality organizations are actively receptive to service quality initiatives, such as the British Standards Institute, the European Quality Award, the Malcolm Baldrige National Quality Award, and the Edwards Deming prize. In addition, the hospitality organizations pay close attention to raising service quality through investment in human resources development (Narangajavana, 2007).

   Dr. S. J. Manjunath, Sheri Kurian (2010) indicated that the Hospitality & Tourism Industry requires more adequate policies and standards in the Human Resources Management in order to minimise the highest rate attrition prevailing in this sector on the basis of a study in Five star Hotels in Bangalore. Since the Employee satisfaction is directly linked with customer satisfaction, it is very important that Hotel Management gives more focus on to retention of their employees and improve their work culture in order to optimise the productivity and the satisfaction. Especially in service sector, employees motivation is very important in terms of ensuring the continuous of service quality (Hays & Hill, 1999).

   Nils Timo, Michael Davidson (2005) examined employment relations practices and labour market features of 4-5 star luxury multinational chain (MNC) and domestic hotels operating in Australia and discussed the implications that competing on price and quality has on employment, wages and training. Masaru Yamashita, Tatsuya Uenoyama (2006) analyzed the factors that encouraged an increasing number of Japanese employees to move across the corporate boundaries in the course of career development, and then understanding the nature and the consequences of the corporate human resource practices in response to it. Internal service quality results in Customer Relationship Management (CRM). Motivated and committed employees are more apt in developing stable relationship with customers (Hennig and Tharau, 2004). Such employee, in fact, make deliberate efforts to know the expectations of their customers which is ultimately culminated into customers loyalty and lifelong relationships with them (Rafiz and Ahmed, 2003). This exercise ensure that a well maintained data base of customers is kept by the companies for relationship building purposes (Simons et al, 2003)

   Service organization emphasises on the quality of work life (QWL) for their employees tends to have better sales growth, asset growth and return on asset growth (Lau, 2000). Thus, it is an established fact that internal service quality is absolutely crucial to the performance of the business organizations (Yeung et al, 1997).

   So it can be said that the to determine whether the job and work life needs of the employees are being met organizations conduct periodic internal marketing research to assess employees need and satisfaction (C.Hegge- Kleiser, 1993).

3. RESEARCH OBJECTIVES

   • To study the existing service quality orientation of selected five star hotels of India and to find the key factors that impede service quality delivery in these hotels.

   • To study the relative importance of internal service quality and factors affecting hiring strategy in these hotels.

   • To examine the expectations of the employees of selected hotels on various hiring strategies of internal service quality

   • To assess how the employees actually perceive service quality of their hotels.

   • To assess the gap if any in expectations and actual perception of the employees.

   • To give some practicable suggestions to the selected hotels so that their service quality is perceived well by their employees.

4. HYPOTHESES Keeping in mind the objectives of the study,

   following hypotheses have been tested:

   H01: There is no significant difference in expectation and perception of the employees concerning Competing the best people strategy in selected hotels.

   H02: There is no significant difference in expectation and perception of the employees concerning Hiring people for service competencies and service inclination strategy in selected hotels.

   H03: There is no significant difference in expectation and perception of the employees concerning Be the preferred employer strategy in selected hotels.

5. RESEARCH METHODOLOGY

   This is an empirical study. The researcher has made use of both field as well as documentary data to attain the objectives of the study. The field data has been collected to garner the views of the managers of the five star hotels pertaining to problem in hand with the help of structured questionnaires. The questionnaire addressed to the employees aims at getting insights on the hiring strategies of internal service quality in selected hotels.

   The researcher has made use of different sampling techniques during the various stages of the survey. Initially, it was to be decided as to which five star hotels would become part of study. Purposive and convenience sampling techniques have been used to arrive at the decision in this regard. The purpose of the research is to analyse internal service quality in five star hotels. Thus purposively 6 five star hotels have been selected for the study. For convenience the choice of hotels has been confined to North India only, as the region is more accessible to the researcher. Again in choosing employees to respond to the questionnaire on internal service quality has largely been done according to convenience of the researcher in this regard. Thus a blend of purposive and convenience sampling have been used to accomplish the objectives of the study. The total number of employees that have been included in the sample are 300 (50 from each hotel). The reliability of questionnaire was checked by cronbachs alpha whose value came out to be 7.3 which is quite satisfactory.

   The researcher has also undertaken an intensive literature scanning pertaining to problem in hand. The obvious aim was to undertake her study in right earnest. Various books, journals, magazines and newspapers of repute have helped the researcher immensely in gathering secondary information. The data so collected have been analyzed with the help of SPSS software using various statistical techniques like mean, standard deviation, combined t-test, etc and presented with the help of appropriate statistical tables.

6. SCOPE OF THE STUDY

   The present study has been confined to six prominent five star hotels of North India. All the hotels are amongst the leading five star hotels of India. Hotel Park and Hotel Hilton are situated in the capital of India, New Delhi. Country Inn and Suites of Ghaziabad and Hotel Leela Ambience of Gurgaon are located in the National Capital Region (NCR). Hotel Mounview is situated in the capital of Haryana and Punjab i.e. Chandigarh. Last hotel taken for study is Hotel Majestic Park Plaza of Ludhiana. So basically all the six hotels are from North India and all the hotels are amongst the reputed hotels of India.

7. RESEARCH THRUST

   The thrust of this study is on the following dimensions of service quality as discussed with the help of figure

   Figure 1: Retaining the best people strategy

   Compete for the best people

   Hiring The Best People Strategy

   TABLE 1 Employees Expectations and Perceptions on

   Competing for the Best People

   Hire people for service competencie s and service inclination

   S. N o.	Name of The Hotel	Mean Differe nce (P- E)	SD	S.Mea n Error	T	Df	Sig
   1	Hotel Leela Ambience, Gurgaon	-.9600	.6047	.0855	-11.22	49	.000
   2	The Park, New Delhi	-1.160	.5481	.0775	-14.96	49	.000
   3	The Hilon, Delhi	-1.640	.8271	.1169	-14.02	49	.000
   4	Country Inn &Suites, Ghaziabad	-2.300	.6776	.0958	-24.00	49	.000
   5	Hotel Mountview, Chandigarh	-2.680	.7406	.1047	-25.58	49	.000
   6	Hotel Majestic Park Plaza, Ludhiana	-1.400	.6388	.0903	-15.49	49	.000

   Be the preferred employer

   Source: Service marketing by Valarie Zeithmal

8. ANALYSIS AND INTERPRETATION

   The response of the respondents on the above said dimensions of service quality is as follows:

   • HIRE THE RIGHT PEOPLE

   To effectively deliver service quality, considerable attention should be focused on hiring and recruiting the service personnel. Needless to say, it is good hiring that culminates into enhanced productivity of employees and better external service quality. For a good hiring, it is imperative for the organisation to compete for the best available personnel. Besides, its incumbents inclination towards the said service must also be seen while hiring. It is however important to note that if organisation is looking for skill set and inclination in incumbents, they also see what the organisation can give to them in return. It is thus, also important for the organisation to have in it, what makes it a preferred one among the prospective employees.

   1. Compete For The Best People

      To get the best people, organisation needs to identify them and compete with other organisations to hire them. Leonard berry and A. Parasuraman refer to this approach as competing for talent market share. They suggest that firms act as marketers in their pursuit of best employees, just as they use their marketing expertise to compete for customers. The views of the employees of the selected hotels concerning whether their hotel competes for the best people has been explained with the help of table 1.

      Source: Employees survey

      Table 1 indicates that all the selected hotels have witnessed negative mean (P-E) score on competing for the best people. In other words, employees perceptions have not fully matched their expectations concerning how far their respective hotel strives to get the best employees in their kitty. Relatively speaking, Hotel Leela Ambience, The Park and Majestic Park Plaza with mean difference (P-E) less than -1.5 are performing comparatively better on this front. These are closely followed by the Hotel Hilton with a mean difference of -1.64. Hotel Mountview and Hotel Country Inn with high negative mean (P-E) scores of -2.6 and -2.3 respectively are poorly rated for not doing their due on competing for the best people. In other words, their offers are not lucrative enough for the prospective employees to give them the preference over other hotels for joining their ranks. It must be realized that such an approach culminates into a situation wherein they will have second rated employees in their ranks. Expecting top rated services from lower rated employees is perhaps asking too much from them. The ultimate result is poor external service quality which is nothing short of a suicidal tendency in case of five star hotels. Hotel Mountview and Country Inn needs to change their approach and must start offering better to prospective employees so that these may compete for best lot available in the market. This is how these hotels can hope to give best to the final customer also.

   2. HIRE PEOPLE FOR SERVICE COMPETENCIES AND SERVICE INCLINATION

      Service employees need two complementary capacities: service competencies and service inclination (B.Schneider and colleagues, 1991). Service competencies are the skills and knowledge required to do the job. Service inclination includes interest in doing service related activities which is reflected in their attitudes towards service and orientation towards serving customers and others on the job. An ideal selection process includes both service competencies and service inclination, resulting in employee hires that are high on both dimensions (Schneider and Schechter). Service effectiveness is directly linked with these two attributes (J.Hogan, R .Hogan and C M Busch, 1984). The performance of the hotels under study on this aspect has been explained with the help of Table 2.

      TABLE 2 Employees Expectations and Perceptions on Hiring People for Service Competencies and Service Inclination

      S.No	Name of The Hotel	Mean (P-E)	SD	S.M ean Erro r	T	Df	Sig
      1	Hotel Leela Ambience, Gurgaon	-1.140	.40 45	.057 2	– 19.9 2	49	.00 0
      2	The Park, New Delhi	-1.000	.83 29	.117 8	– 8.48 9	49	.00 0
      3	The Hilton,Del hi	-1.160	.73 84	.104 4	– 11.1 0	49	.00 0
      4	Country Inn &Suites, Ghaziabad	-1.180	.69 07	.097 6	– 12.0 7	49	.00 0
      5	Hotel Mountview , Chandigarh	-1.400	.67 00	.094 7	– 14.7 7	49	.00 0
      6	Hotel Majestic Park Plaza, Ludhiana	-1.220	.67 88	.096 0	– 12.7 0	49	.04 4

      Source: Employees Survey

      Table 2 indicates greater inclination of selected hotels towards taking note of competency and service inclination of incumbents while recruiting. All the selected hotels have got negative mean rating just in excess of 1. This argues well for them. The better scores of hotels on this front than on competing for the best people indicate that hotelswant quality employees in their kitty.. The hotels must realize that aspiring for competent and inclined employees is good

      but these can be attracted, if and only if, they offer them enough for their likings.

   3. BE THE PREFERRED EMPLOYER

   One way to attract the best people is to be known as the best preferred employer in a particular industry or in a particular location. The goal of being a preferred employer includes extensive training, career opportunities, excellent internal support, attractive incentives and quality goods and services that employees are proud to be associated with. The performance of the selected five star hotels on this front is depicted with the help of table 3.

   TABLE 3 Employees Expectations and Perceptions on their Hotels being Preferred Employer

   S. No .	Name of The Hotel	Mea n (P- E)	SD	S.Mean Error	T	Df	Sig
   1	Hotel Leela	–	.6064	.0857	-10.02	49	.000
   	Ambience,	.860
   	Gurgaon	0
   2	The Park,	–	.7709	.1090	-11.37	49	.000
   	New Delhi	1.24
   		0
   3	The Hilton,	–	.7743	.1095	-7.488	49	.000
   	Delhi	.820
   		0
   4	Country Inn	–	.5803	.0820	-25.59	49	.000
   	&Suites,	2.10
   	Ghaziabad	0
   5	Hotel	–	.6060	.0857	-21.00	49	.000
   	Mountview,	1.80
   	Chandigarh	0
   6	Hotel	–	.5345	.0755	-13.22	49	.000
   	Majestic Park	1.00
   	Plaza	0
   	Ludhiana

   Source: Employees Survey

   Table 3 indicates that with the negative mean difference (P-

   E) score less than 1, Hotel Hilton, Delhi (-0.82) and Hotel Leela Ambience, Gurgaon (-0.86) are leading and proving themselves to be the best preferred employers. Hotel Majestic Park Plaza, Ludhiana and The Park, New Delhi are at third and fourth place respectively. Interestingly, these were the hotels which got better rating on competing for the best employees. In other words, their efforts towards competing for best employees is forcing them to offer better to prospective employees which in turn is making them preferred employers also. It is however, Hotel Country Inn, Ghaziabad and Hotel Mountview, Chandigarh which have not been rated as preferred employers. There is a task cut out for them to improve their rating on this front. At the outset, these two hotels would have to make genuine efforts to improve themselves on various components viz. training and development, monetary and non-monetary incentives, promotion, retirement benefits etc. and

   subsequently such improvements on papers has to be offered to the prospective employees. The result would definitely be an improved rating on being preferred employer. This is how these hotels can get best employees in their kitty who are also striving to deliver external service quality to their customers.

9. FINDINGS OF THE STUDY

Indian Hotel industry is a rapidly evolving industry that has become increasingly competitive and dynamic in the global arena. It is gaining universal acceptance as a potent engine for inclusive socioeconomic progress because of the jobs created and infrastructure developed. It has potential to stimulate other economic factors through its forward and backward linkages and ability to create more employment due to its multiplier effect on economy. To promote this industry even Ministry of Tourism, Government of India is also taking initiatives. The Hotel and Restaurant industry has contributed between 1.2 and 1.5% of GDP over the last eight years (Ministry of Tourism report, 2015). Not only this the overall growth in hotel industry in developing countries like UK, USA, Spain, China, France has also strongly witnessed a tremendous growth during the recent years of 21st century despite certain natural calamities. The tourism and hospitality sectors direct contribution to GDP totaled US$ 44.2 billion in 2015. Not only this, in 2014, the tourism and hospitality industry contributed Rs7.64 trillion and 36.7 million jobs to the Indian economy. The direct contribution of this industry to GDP is expected to grow

7.2 per cent per annum to US$ 88.6 billion by 2025( India Brand Equity Foundation Report, 2015).

So the importance of this industry is quite obvious and service quality can increase the efficiency of this industry to a large extent.

It has been observed that selected hotels have failed to match the expectations of their employees on internal services quality fronts. In each and every case expectation scores have been higher than perception scores. In fact, a significant difference has been detected between expectations and perception scores, in case of all the hotels. It may, thus be said that Indian Five Star Hotel Industry would have to pull up its socks on hiring aspect of internal service quality.

Four of the selected six hotels, viz., Hotel Leela Ambience, The Park, The Hilton and Hotel Majestic Park Plaza have been found making decent efforts to compete for the best people. The other two hotels namely Hotel Mountview and Country Inn and Suites have been found making lacklustre efforts in this regard.

The employees of all the hotels meanwhile have rated their hotels as making genuine efforts for hiring employees keeping in mind competency and inclination to serve customers. This argues well for Indian 5-Star Hotel Industry.

The employees of Hotel Leela Ambience and The Hilton to a great extent and Hotel Majestic Park Plaza and The Park to a lesser extent consider their respective hotel as a preferred employer. It means that any employee or prospective employee would prefer doing job in the same rather than looking at any other hotel in this regard.

SUGGESTIONS

Keeping in mind findings of the study, following suggestions may be given to the hotels under study:

At the outset, the hotels under study should make genuine efforts to know the expectations employees. The study has revealed a significant gap in the expectations and actual perceptions of both of them. It means the hotels are either not understanding the expectations of the employees or are not doing enough to meet those expectatons. Whatever may be the reason, all this culminates into dissatisfied employees and customers. The same in turn has a bearing on internal as well as external service quality. The hotels, especially less performing ones must try to bridge the gap between expectations and perceptions of the employees

Hotel Mountview and Country Inn and Suites needs to pull up their socks and start competing for the best available employees. Better employees serve the customer better which result in better service quality perception of customers. To attract best employees, the selected hotels need to offer them best and subsequently doing everything to retain them with pride. This will also make them the preferred employers.

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