Internal Customer in Hospitality

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Abstract:

This paper talks about customer satisfaction and what companies and in this particular case, what a hotel does to increase and/ or maintain it. So basically, hospitality-lodging industry has been focused upon. A survey was conducted to analyze the customer satisfaction levels already persisting in the hotel management world. This was correlated with already defined criteria pertaining to expectations and beliefs of the hotel management. The importance of customer satisfaction has been drawn upon through focusing on the internal customer, these being the hotel’s employees.

Hypothesis Formation:

When employees are given appropriate rewards, are motivated and have high satisfaction levels, this leads to low or minimal turnover. Hence, it can be said that this eventually leads to high customer satisfaction through advanced and increased betterment in customer services provided by these employees.

Introduction:

Customer satisfaction as previously said is the main focus in this paper. However, the perspective is a little different here as subject to what many textbooks or everyday news / papers state. Importance has been given to internal customers of a company; in this case one belonging to the hospitality lodging industry, in other words hotel. A survey was taken focusing on the many aspects of satisfaction involving workplaces and their characteristics. The people who were surveyed are employees of the hotel. They were questioned majorly on the basis of how happy they are with the kind of work, work environment, promotion opportunities etc. that have been given to them here. Their results were concluded to show a correlation between positive employee satisfactions with customer service levels being high.

Internal Customer:

Any company has two kinds of customers- internal and external. The two types might seem similar, but they are different in many aspects. Internal customers are people who are under employment of the company or the organization for which they are working. An internal customer hence could be the employee, the manager, leader, supervisor, lower staff and any employees that are working for any department or service centers that form the organization into a one single whole unit, and aim to deliver the functionality of their roles in accordance with what the organization requires of them. In other words, an internal customer is referred to anyone who is part of the organization, who is not independent of anything, rather is a dependent employee or worker who is reliant on either another employee or internal customer or the organization itself.  (EIQA, 2007)

Customer Satisfaction:

Customer service refers to an act of working towards accomplishing the goals or the individual goals of a customer or a number of customers. This can be accomplished through identifying what a customer demand or looks for in the product he desires, and then delivering to him that need of his in the form of a tangible product or an intangible service. This act of transference o value in the form of product or / and service, can be referred to as provision of customer service; and when this action is done efficiently and in a productive manner that boosting customer happiness or in other words satisfaction, we say that the customer is satisfied with the product/ service.

Whenever there is high customer satisfaction, that customer will keep coming back to that organization for consumption of that good or service and this will lead to a permanent customer retention or in other words loyalty of the customer is made and maintained. This loyalty through the years can lead to increased profitability for the company or the organization that is benefiting from good or efficient customer service resulting into increased customer satisfaction. Value creation is hence a term that has been defined to represent this customer satisfaction because value is created through the transference of the good or service at first and then its intangible value n terms of customer good/ service consumption. (Customer Satisfaction, n.d.)

Customer satisfaction can provide a company or an organization with increased benefits. Some of these are as follows:

  • Reduced price sensitivity
  • Loyalty to the firm/ organization/ company providing customer satisfaction
  • Referring to other people for “trying that product”
  • Repeated purchase and permanency in buying behavior from that company
  • Better employee-customer relationships

These all in a wholesome form direct the company towards a reduction in costs through cost saving and increase profits through increases in revenue. (Benefits of customer satisfaction, n.d ).

Internal Customer Satisfaction:

Deriving from the above argument or discussion regarding customer satisfaction from a broad view, we can see where the line draws between internal and external customer satisfaction. Internal customer satisfaction refers to many things that make the internal customer or the employee to stay with the company or organization longer and serve it ion a better way advancing through the concepts of continuous improvement or Kaizen even. However, one thing to be noted is that this type of customer satisfaction is a little different in material terms specifically as compared to the type of “overall satisfaction” discussed above. Internal customer satisfaction refers to the organization providing its employees with many offers and factors, which make them, feel motivated and eventually decreases their turnover rate and absenteeism. A few of these factors are:

  • Promotion opportunities
  • Other advancement opportunities
  • Appropriate pay packages
  • Perks that include medical benefits, childcare services for free, etc.
  • Paid holidays, company car etc
  • Good employer-employee relationships
  • Good employee-employee work environment and interaction
  • Learning and advancement through broadening of horizons
  • Just rewards
  • A no bias environment
  • Value creation for the human resource

Relation to Guest Satisfaction:

The paper focuses then by moving forwards by developing the argument and stating that when the internal customers or employees are justly treated and are made to feel satisfied, then it can be said that high customer service levels is a result of this. This can lead to a positive cycle of increased customer satisfaction both internal and external henceforth. However, it should be noted that in this case it is being assumed that internal customer satisfaction will lead to external customer satisfaction.

Primary Research:

Hospitality-lodging industry has been focused upon in this survey of customer satisfaction. A survey was conducted to analyze the customer satisfaction levels already persisting in the hotel management world. This was correlated with already defined criteria pertaining to expectations and beliefs of the hotel management. The importance of customer satisfaction has been drawn upon through focusing on the internal customer, these being the hotel’s employees.

Background:

A sample of twenty-eight Singaporean employees in a hotel of the hospitality lodging industry there were randomly selected and then surveyed upon.

The many characteristics of these twenty-eight employees were questioned upon and then evaluations were based on the results of the answers given by these internal customers or employees.

There were a total of twenty-eight employees chosen as mentioned. Out of these twenty-eight employees, the majority was of female employees these being 16 and male employees being 12, forming a 57: 43 ratio respectively (when taking out of 100 or as a percentage).

Age brackets of these employees were varied. Majority of the sample belonged to the age bracket of 26 to 30 year olds. And then 21 to 25 year olds, and then employees over 30 years of age and lastly employees under 21 years of age. This basically also suggests (and will be also concluded upon in the following paragraphs that the majority of the sample size “candidates” or employees chosen for the survey were of mature age and had acquired some form of education that belonged to more advanced levels and not just primary or basic education.

Now coming to the education or qualification levels of these employees, it was found out that (as concluded above also), majority of the sample size population was well-educated and had acquired a degree in undergraduate and graduate programs consisting of the four year college degree. Apart from that 14% only had a graduate degree extending beyond those preliminary four years of degree attained in college. Only 4% had not completed the four years with attainment of only a 2-year college degree. However a main point to be noted is that the education profiles of the employees show that the highest and lowest level of education in this sample of employees consisted of the exact same percentage. That is, 14% of the total were those who had the graduate degree, however another 14% was also the sort who had not even completed or even started college, and had only acquired high-school level graduation.

Apart from this “basic” education in terms of graduation- school and/ or college, the employees had or had not completed or started a or many hotel management courses. Around 61% forming the majority obviously, however had acquired a hotel management major as part of their degree; whereas 39% had not opted for hotel management as their major. It can be hence said for the latter, that they might have kept their options open and landing in hotel management was probably not what they had decided for themselves. This part of the sample also as the name “non-hotel management major” suggests, had little or very less and even minimal information about how hotels are run and managed, when they would have entered this field of work. It can be said for these people, that they must have learned through on-the-job experiences quite a lot too.

Now, when talking about on-the-job learning, it can be said that the time has come to refer to the kind of and the number of years as experience that the employees surveyed had gained by the time that this survey was conducted on them. Majority here also was of a good proportion and in terms of experience the majority had acquired around from 2 to 3 years of experience in hotel management. A high percentage of 21% also had experience extending beyond three years, which is quite exemplary. And only 11% of these 28 individuals or 3 employees out of the 28 interviewed, had a job experience of less than one year.

Job positions or the kind of work that was assigned for these employees selected was basically back of the house that is work that involved operations management and production rather than front end. This pointer about job positions and descriptions is a very important one as it has a very direct relationship with measurement of satisfaction, also with respect to Maslow’s hierarchy of needs. One person out of the 28 interviewed as the manager, the rest with the exception of three employees who were supervisors, can be called lower staff or lower level workers in the hotel.

Among these employees were also workers who were either permanent or temporary or were just doing a term project or a project coursework. However, 21 employees forming a huge majority out of the 28 interviewed were permanent or full-time employees. Half or part-time formed 18%, with internees standing at only 7% or a total of two internees working for the hotel.

Results:

Employees were tested through a series of questions aiming to focus on measuring their satisfaction levels. The questions involved measurement of the differing yet concluding characteristics of satisfaction at work. These characteristics include:

  • What employee benefits are being given
  • What is the impact of the above in terms of absenteeism and turnover
  • What are the “satisfaction conditions” for you as an employee here
  • What employee benefit do you value most

On assessment of these questions and conclusions based on the answers given many things with respect to the pointers above were concluded. All results hence will take these four criteria in viewpoint when forming conclusions.

The results have been summarized in point form as follows:

  • Female employees were more satisfied with their work as compare to male employees in the sample that was interviewed. There was big proof of this, because when asked about satisfaction in general terms, yes females did say that they ere satisfied and males said so less. But, when asked about extreme positive satisfaction, then there were only two females who said yes, and no males who affirmed to this in their case. However, one male employee went as far as by saying that he was very is-satisfied with his job.  (Graph 1)
  • As far as benefits are concerned, employees overall did not seem much happy with the benefits that were being given to them by the hotel. These benefits would include health insurance, child education, leave, retirement and pension plans etc. here one female and one male employee claimed to be very dis-satisfied again forming an extreme viewpoint. But, most remained neutral, which is again not good since satisfaction is measured by the above average feelings of positivity attached to the work and the job itself. Only 4 out of the 28 interviewed could right out say that they were satisfied, showing that the overall employee satisfaction with the kinds of benefits being offered by the hotel was very low. This could mean that many needs of the employees were probably not being met through not providing these plans. (Graph 2)
  • The impact of employee benefits on customer satisfaction, which is the main crux of this research paper, was then analyzed. And when this was asked of the employees, majority agreed by saying that yes if they were not themselves properly satisfied how is it possible that the people who the employees work for- these being customers on the other end would then be satisfied. This view also came very strongly especially from those employees who had taken hotel management as their major. These hotel management majors said that benefits that are provided to the employees has a direct effect on customer service and hence customer satisfaction (external) positively. (Graphs 3-1-1, 3-1-2).
  • Pertaining to the above pointer, job engagement was also studied. This was again high in hotel management majors as compared to non-hotel management majors. This graph showed a linear trend pointing to the fact that a huge majority thought that if they were given proper employee benefits, then their satisfaction levels would increase, increasing thereby loyalty and engagement to the job. (Graph 3-2-2)
  • Owing to the above arguments, now they were asked whether it would lead to the employees not skipping work and staying on the job and not leaving to look for better offers or opportunities. This was again on the same trend as nearly all the hotel management majors remarked by saying that yes they would not want to leave their current jobs and their turnover would decrease and even diminish if they were given appropriate employee benefits. The same trend was again seen for those employees who did not have a major in hotel management.
  • The most important factors that would lead to job satisfaction were then asked for.

The top three here included: (Graphs 4)

  1. Wages; monetary rewards.
  2. Employee benefits (example retirement plans etc.)
  3. Promotion opportunities

However when this data was divided for male and female employees, it was found out that above was the case for male employees but female respondents’ results were a little different. Female employees valued (in order):

  1. Wages
  2. Benefits
  3. Job security
  • Health insurance and retirement plans were the most wanted benefits. Four of five respondents who wanted the cafeteria-style benefit system were hotel management majors. Three out of the three who wanted child care subsidy were over 30 years of age. Knowing what benefits were expected from the internal customers was important so as to clearly define what their needs were and what motivated them driving into satisfaction levels on the high trend.
  • Another factor found out was that 21% of the total respondents summing up to 6 employees said that they did not receive sufficient information on all company benefits when they joined their hotels. Proper training and education benefits according to employees were the kind of benefits they thought they needed still and the hotel should provide them with.

Implications:

  • Employee benefits are very important
  • Employees value monetary benefits most
  • They want to learn and hence training should be a part of their experience at work
  • Benefits should be provided keeping the gender difference in mind
  • Benefits should be provided keeping the age difference in mind
  • Constant evaluation of employee needs should be done to make sure that satisfaction levels are made and maintained
  • Health insurance plans and retirement benefits were the most sought after

Conclusion:

The study aimed at accomplishing what it hypothesized about earlier on. It was proven that yes there does exist a positive relationship between internal customer satisfaction and impact on customer service in terms of quality. Also, that how satisfaction can be made and maintained for internal customers or the employees working for an organization. The hypothesis, in conclusion did stand true.

Works Cited

  • Benefits of customer satisfaction. (n.d.) The benefits of customer satisfaction. Retrieved September 30, 2008, from Sure Vista Solutions Web site: http://www.surevista.com/benefits-customer-satisfaction.html
  • Customer Satisfaction (n.d.) Customer Satisfaction: a critical component of profitability. Retrieved September 30, 2008, from: http://www.1000ventures.com/business_guide/crosscuttings/customer_satisfaction.html
  • EIQA (2007) Internal customer satisfaction. Retrieved September 30, 2008, from: http://www.eiqa.com/index.php?page=the-customer

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