IJCRR - 4(19), October, 2012
Date of Publication: 15-Oct-2012
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THE IMPACT OF EMPLOYEE EMPOWERMENT ON CUSTOMER SATISFACTION IN THE NIGERIAN SERVICE ORGANIZATIONS (A STUDY OF SOME SELECTED HOTELS IN JOS, PLATEAU STATE)
Author: Vem Linus Jonathan, Dakung Reuel Johnmark
Category: General Sciences
Abstract:The role of employees in service organizations is comparable to the role of the service itself. Their importance to the firm is critical to both service delivery and service production. No gainsay that, service is all about the people (employees) because they appear more often to be the most tangible clue to customers? perception of what quality service entails. It is in line this that this paper explored the following objectives: To determine the extent to which employee influences customer satisfaction, as well as establishing the extent to which the concept of empowerment is internalized by the players in the hospitality industry in Nigeria. It also ascertained the rate at which variables like; autonomy, responsibility, access to information, knowledge and competence development, equity reward system and power sharing translates into customer satisfaction, and determine how empowerment is perceived by employees. A sample size of about 400 was adopted from the twenty hotels which were selected at random. Furthermore, the data obtained were analyzed using simple percentage and presented in tables and charts, the hypothesis which states that; there is no significant relationship between employee empowerment and customers? satisfaction was supported following a z-test analyses of population proportion earlier conducted. This implies a weak hegemony between employees? empowerment and customers? satisfaction in the Nigerian hospitality industry. Based on the above inference, the paper further made the following recommendations: Hotel managers in Jos need to internalize the message in employee empowerment through granting of autonomy to employees in discharging their duties. Also the need to upgrade employees? service orientation and investing in training was advocated. Finally, paper also advocated the need for managers to encourage employees to consolidate on their achievements to explore the untapped potentials that abound in the hospitality industry in Nigeria.
Keywords: Customer, Customer satisfaction, Empowerment, Employee Empowerment
One of the important ingredients of success in the market place is customers satisfaction. Customers are the life blood of an organization, so their satisfaction is the top goal of the firm, and are ranked by their satisfaction score. Wirtz (2003), lists the results of customer satisfaction to include: repeat purchase, loyalty; positive word-of-mouth and increased long term profitability. The academic literature postulates that customer satisfaction is a function of the discrepancy between customer?s prior expectations and perception regarding the patronage or purchase (Oliver, 1977; Churchill and Surprenant, 1982; Tse and Wilton, 1988; Yi 1990). When an experience is better than what the customer expects, there is thought to be positive disconfirmation of the expectation, and a favorable customers? evaluation is predicted. The role of employees in service organizations is comparable to the role of the service itself, as pointed out by Zeithaml et al (2002) that, employees are the service and the brand. Their importance to the firm is critical to both service delivery and service production. In services, it is all about the people (employees) because they appear more often to be the most tangible clue to the quality of the service. Zeithaml et al (2002), explains that the people factor in services is a very important element in the evaluation of that service “as all human actors who play a part in service delivery and thus influence the buyers perceptions” from the company?s personnel to the other customers in the service environment. Employees like the mirror of an organization are the interface between the organization and the customer, what they portray is what the customers see and use in their evaluation of the service experience. Zeithaml et al (2002), defines employees? role in the organization and to the customer saying, “satisfied employees make satisfied customers” and vice versa, adding that as the customers of the organization are important to their success so also are the employees relevant. It may therefore be inferred that customer satisfaction is the barometer for a satisfied employee. One of managers? valid rule of thumb that has stood the test of time is their strong position on job satisfaction and commitment. That individual who are not satisfied with their job are not committed to the organization, and because they are not committed, service delivery will certainly suffer serious setback. To dispense quality service to valued customers at the right time, form and place, most customer focused organizations in the 21st century positioned their employees strategically to anticipate and satisfy customers need through employee empowerment. Though the concept of empowerment has been a subject of intense debate, Kreitner and Kinicki (2004), opined that employee empowerment in modern organization gives employee better latitude in the work place. This is seen in the level of autonomy, responsibility, information accessibility and opportunity for creativity of employee in a workplace. Equidistantly, Lawler (1992), added that organization can create the best and flexible employee when high premium is given to knowledge and competence development, equitable reward system and power sharing. Exponents are optimistic that the concept is an important step in the evolution of organizational psychology which has the potential of building hugely more flexible and efficient corporate entities. In line with this, Kreitner and Kinicki (2004) argues that, empowerment enables organizations to be more responsive to the market place, by de-layering unnecessary structure, ensure lateral communication among work teams with minimal supervision to enable top management focus on strategic matters, while the empowered employees grapple with mundane issues. Other proponents argued with reference to the specific nature of service delivery observe that empowerment is becoming a very important issue to organizations producing services. In that, the customers and the employees are engaged simultaneously, this inseparability is what is considered by the organization in choosing how best to serve its customers. Therefore, the inability of the management to control the service encounter makes the employees responsible for the quality of service delivered to the customers. In order for the management to trust that the employees are successful in dealing with their customers, they have to give the employees the authority and necessary support to succeed at it.
Hospitality industry in Nigeria, particularly Plateau State, even though is still at its low level of activities and growth, offers vast opportunity to investors to explore the tourism potentials of the State. To succeed, investors must understand the interplay of success factors in the industry. One notable characteristic in hospitality organizations is the general offering in the industry that is averagely similar, even though they may engage in different approaches to gain more market share and customers? loyalty in the industry. When organizations compete in standardize product, the available success option is to differentiate themselves from their rivals by offering customers higher quality of services than their competitors hence, provides basis of their competition to be defined by their services. It is noteworthy to say that most players in the service industry in Nigeria have not fully internalized the significant interface between the organization and the customers; this is apparently manifested in their attitude towards employee empowerment. Because employees are the voice and face of the organization, Ashis (2008) observes that failure to train them to provide quality service, to know what to do and how to do it can simply amount to a paradox of value. He also acknowledged the need for employees to have the requisite authority to make decisions regarding customer satisfaction which is the basis of empowerment. However, Kreitner and Kinicki (2004) posit that; “like other widely heralded management concept, such as TQM, 360-degree reviews, team and learning organization etc, empowerment has its faire share of critics and unrealistic expectations. In consonance with their observations, Doughty (2004), argues from both political economist and organizational psychologist point of views. From the former he said, employee empowerment represent a cunning strategy by an insidious management to gull workers not only into acquiescing in their own oppression but also into coming up with clever method of intensifying that oppression. He critique further by describing empowerment as exemplifying the tradition of noble proletarian struggle for recognition, respect and the rightful sharing of power in the work place, and hence subject themselves to the exploitative york of their pay masters. Unfortunately, most working environment today as observed by Doughty (2004), are characterized by mental anguish, emotional fatigue and existential angst unleashed on employees by their “bosses” consequently, they are treated with less respect than the think they deserve, some who are seen to be “respected” are subjected to constant monitoring and expose to arbitrary and capricious discipline. Their opinions are dismissed and have no say in their work schedules, to worsen their woes; they are supervised by petty micro managers who do not believe neither recognizes their sincere contributions to common project. In spite all these, organizations expect nothing short of customer satisfaction.
Having analyzed the context in which customer service is dispensed, in today?s organizations and need to improve and strengthen the interface between the organization and customer satisfaction, the paper seeks to unravel some critical issues which include:
1. To what extent does employee empowerment influences customer satisfaction
2. To what extent is the concept of empowerment internalized by the players in the hospitality industry in Nigeria
3. How does the identified variables such as; autonomy, responsibility, access to information, knowledge and competence development, equity reward system and power sharing translated into customer satisfaction
4. How is empowerment perceived from the employees? perspective?
Objectives of the Paper
In line with the research questions mentioned earlier, the following objectives are crafted:
1. To determine the extent to which employee influences customer satisfaction.
2. To establish the extent to which the concept of empowerment is internalized by the players in the hospitality industry in Nigeria.
3. To ascertain how the identified variables such as; autonomy, responsibility, access to information, knowledge and competence development, equity reward system and power sharing are translated into customer satisfaction.
4. To find out how empowerment is perceived by employees.
Ho: There is no significant relationship between employee empowerment and customer satisfaction in the Nigerian hospitality industry.
LITERATURE REVIEW AND THEORETICAL FRAMEWORK
Concept of Employee Empowerment Employee empowerment is neither a new or simple management concept. Nick, Jack, Warren and Barbara (1993) asserted that, it as a complex management tool that over 50 years of research has proven that, when applied properly, can be effective in improving performance, productivity and job satisfaction. Because of the overwhelming scholarly interest it has attracted over the years, there has been a multi facet dimensions to employee empowerment making it a difficult concept to define (Honold 1993). The beginnings of the concept of employee empowerment can be found in several places. The socio-technical approach (Lewin, 1951) combined two aspects of work in a systemic manner. The idea of job enrichment (Herzberg, Mausner et al., 1959) work was focused on increasing control and decisionmaking in one?s work. The literature on job autonomy, (Herzberg, Mausner et al., 1959; Herzberg, 1968; Hackman and Oldham, 1976; Menon, 1995) addresses another component of what is today referred to employee empowerment. Many writers have seen employee empowerment from leadership perspectives saying; approach to leadership that empowers subordinates as a primary component of managerial and organizational effectiveness is also called employee empowerment (Honold 1993, Bennis, 1989; Block, 1987; McClelland, 1975). Another dimension has its beginnings in the analysis of internal organization power and control which showed that the sharing of power and control increases organizational effectiveness. Aligning with this perspective, Legge (1995) argued that empowerment should be seen in terms of redistributive model whereby power equalization is promoted for trust and collaboration. Base on the aforementioned, it is clear that the central focus here, whether it is seen from individual of organizational paradigm, involves power redistribution through transfer of control such that employee have latitude to make and implement their own decision (Greasely, Bryman, Dainty, Price Soetanto and King 2005). Other rhetoric such as Conger and Kanungo (1988) attempted to distinguish between relational and motivational aspect of empowerment, even though in the long run the two seems as are intertwined. Relation examine the tie between managers and worker prior and after empowerment, while the motivational dimensions centered on process in which initiative is pass to the employee to feel motivated.
Why employee Empowerment is Critical in Nigeria
Nigerians and indeed Africans are still grappling with the understanding and implementation of management concepts. When compared with the early exposure and erudite contribution of pragmatist, such as classicist, behaviourialist etc in the Western and European context it be justified that, they are better placed on a pedestal. This paper is not in any way making case for mediocrity and ineptitude but rather acknowledging the sincere challenges that might emerge in the process of articulating and internalizing very conceptual management practice like employee empowerment in Nigeria. Considering the immense benefit accruable to organizations and individuals, it will be regarded as “Penny wise” on that part of organizations to ignore such a workplace revolutionary trend under any guise what so ever. Below are some reasons why employee empowerment is critical: ? Global competition and ever changing business environment requires empowered employee who can rapidly respond to customers? “wildest” expectations by not only responding to them, but take the lead on their behalves to ensure efficiency and performance (Greasly et al 2005). ? Lead to building a pool of knowledgeable employees, who works with least supervision. Information sharing as argued by Wilkinson (1998), is cardinal to empowerment, this involve exposing employee to basic knowledge and accepted work behaviour, which can result into employee job mastery giving managers leeway to focus on strategic matters. ? Reduce employee turnover and enhances retention capacity. Greasly et al(2005) contends that employee who considered themselves empowered are unlikely to experience conflict and ambiguity in their role to certain extend, as they are capable of controlling their work environment. This development Nykodym, Simoenetti, Waren, and Welling (1994) acknowledged; reduces emotional strain on the employee. Similarly, empowered employees have high possibility of job satisfaction, motivation, and organizational loyalty.
Concept of Customer Satisfaction
Consumer satisfaction is central to the fields of management and marketing. With evidence of strategic links between satisfactions and overall firm performance (Anderson, Fornell and Lehman, 1992), it is now common to find mission statements designed around the satisfaction notion, marketing plans and incentive programs that target satisfaction as a goal and consumer communications that trumpet awards for satisfaction achievements in marketplace. Satisfaction generally is conceptualized as an attitude like judgment following a purchase act or based on a series of consumer- product/service interaction (Yi, 1990). The popular view is that the confirmation/ disconfirmation of preconception product/service standards are the essential determinant of satisfaction (Erevelles and Leavitt 1992; Oliver 1996). By far, the most common are predictive expectations of attribute performance, as incorporated in the expectations – disconfirmation (ED) model of satisfaction response (Boulding et al 1993; Oliver 1996, Tse and Wilton 1988). Desires based on features and benefits that are considered ideal or inspirational in the service quality domain have also been recommended (Westbroole and Reilly, 1983). Other models use equity expectations based on what the consumer believes reasonably should occur given the product/ service price (Oliver and Swan, 1989), and experience based norms derived from personal experiences or information received (Cadotte, Woodruff, and Jenkins, 1987). Although these four (4) types of comparison standards reflect the four principal satisfaction models articulated within the CS paradigm, past researchers probably have overemphasized the significance of predictive expectations and the ED model (Cadotte, Woodruff, and Jekins, 1987). A few CS paradigm researchers have gone beyond these cognitively toned model formulations to consider the affective nature of satisfaction (Oliver, 1996; Westbrook, 1995). Perhaps most intriguing is Oliver?s (1996), suggestion that there exist five different modes or prototypes of satisfaction: contentment (with its primary affect of acceptance or tolerance), pleasure (a positive reinforcement state that involves the evocation or enhancement of a positive, well- liked experience and primary affect happiness), relief (a negative reinforcement state occurring when an aversive state is removed), novelty (expectations of the unexpected that yield a primary affect of interest or excitation) , and surprise (a primary affect of either delight or outrage as occurs when service (in our case, service quality) perform outside the range of expectations). The customer satisfaction level has been analyzed in two terms i.e material customer satisfaction (MCS) level and abstract customer satisfaction (ACS) level. Customer satisfaction in material sense denotes the aggregate position of firm (hotel) in terms of fee charged, frequency with which problems are faced and post purchase behavior of the customers. In abstract sense, customer satisfaction level denotes the position of a firm (let?s say hotel) in terms of post purchase or patronage behavior, the efficiency of facilities provided and the examples of others using facilities of the same hotel (Komal, 2009). Material Customer Satisfaction (MCS) level has been examined on the basis of three variables as stated above (fee charged, problems faced and post purchase or patronage behavior). ? Fee charged by the hotels is one of the variables taken for checking customer satisfaction level. If customer feels that the fee charged by the hotel is reasonable then he is satisfied and vice-versa. This implies that there is direct relationship between fee charged and customer satisfaction ? Second parameter for measuring MCS level is problem faced by the customers while using facilities of a particular hotel. If consumers are facing problems more frequently, customer satisfaction level will be less and vice-versa. Hence, there is indirect relation between the problems faced and customer satisfaction. ? Post purchase or patronage behavior has been analyzed through two statements (Komal, 2009). If they are agreeing with these statements, then their customer satisfaction level is rated high. Post purchase or patronage behavior has direct reaction with customer satisfaction level.
Employee empowerment and Customer Satisfaction
In service industry, like the hospitality business, it is evidenced that employees are the interface between organization and their customers, they determine the possibility of actualizing organizational objective through quality service delivery, and because they have contact with the customers directly, it is logical that they understand them, know their needs, and meet those needs even better. Organizations that empower their employees have a likelihood of succeeding in terms of customers satisfaction. This is illustrated below:
As illustrated above customer satisfaction is central to organizational objectives with evidence of strategic links between satisfaction and overall firm performance (Anderson, Fornell and Lehman, 1992). It is now common to find mission statements designed around the satisfaction notion, marketing plans and incentive programs that target satisfaction as a goal and consumer communications that trumpet awards for satisfaction achievements in marketplace. Although satisfaction has been conceptualized in terms of either a single transaction (i.e. an evaluative judgment following the purchase occasion) or a series of interactions with a product over time, Anderson and Fornell (1994), noted that nearly all satisfaction research has adopted the former, transaction- specific view. Indeed, several observers have chastised the marketing field for treating satisfaction as a static evaluation derived from a lone trial event, noting that comparison standards are likely to change with consumer experience (Iacobuca, Grayson, and Ostrom, 1994). Due to the role of the employees in service organizations, and the value customers place on services being rendered by them, the management would have to adopt a system or approach that can yield satisfactory results. There are basically two approaches that a company can choose to adopt: The traditional method of delegation and the empowerment approach. a) The traditional approach: Is characterized by simplification of tasks, clear division of labor, substitution of equipment and systems for employees, and little decision-making discretion afforded to employees. b) Empowerment approach: Less emphasis is put on the systems surrounding the service employees who are given more discretion and autonomy. Many studies have shown that due to the nature of services, empowerment approach tends to have a distinct impact on the service delivery process, customer perceived service quality, the service quality and customer satisfaction. Service organizations (for instance hospitality) in contrast to organizations that are into the production of physical goods have a different approach and contact method with their customers which are more personal. Hence, the issue of empowerment as regards to how employees are equipped to make independent decisions regarding offering quality services that will satisfy customers is pertinent. Furthermore, employee empowerment as a part of the internal marketing process in an organization which when correctly implemented can have a decisive impact on job satisfaction of employees as well as customer satisfaction. The role of employees in service organizations is comparable to the role of the service itself. As pointed out by Zeithaml et al (2002), employees are the service and the brand. Their importance to the firm is critical to service delivery. Employees like the mirror of an organization are the interface between the organization and the customer, what they portray is what the customers see and use in their evaluation of the service experience. According to Zeithaml et al (2002), “satisfied employees make satisfied customers” and vice versa, as the customers of the organization are important to their success so also are empowered employees. The empowered employees? relationship with the customer has a huge relevance. Its balance is necessary to the success of the both parties in the exchange relationship as their influence on the service and ultimately customer satisfaction is very substantial (i.e. sustenance of the business). These customercontact employees according to Zeithaml et al (2002) are referred to as boundary spanners.
The study was undertaken to evaluate the impact of employee empowerment on customer satisfaction in the Nigerian service organizations (a study of some selected hotels in Jos, Plateau state). One may wonder why the choice of this population as subject of research, seeing that product here is standardized. This is simply because the services offered in this very important sector have gone through varying degree of change and sophistication in recent times with customer at its focal point. To actualize the objectives of this study, two sets of questionnaires were developed and administered to both employees and customers of the selected Hotels. The study interacted with the selected target from twenty (20) registered hotels before administering the questionnaires to ensure they have experienced the services of the hotel or have interacted with the customers prior to the study. Simple random sampling method was adopted in the selection of participants in the study. A total of 400 questionnaires were distributed to the respondents out of which 300 were customer related questionnaire while 100 questionnaires were distributed to employees. Data collected were presented using simple descriptive statistical method, such as percentage and charts. Hypothesis for the study which states that; there is no significant relationship between employee empowerment and customer satisfaction was tested, and z-test of population proportion was used to analyse the data obtained from the responses of the customers and employees.
DATA ANALYSIS AND RESULTS
The questionnaires distributed were 400 (100 for employees and 300 for customers of some selected hotels in Jos). However, only 350 were properly filled and returned (80 for staff and 270 for customers).
From the table above 40(50%) of the respondents agreed that members in a shift are not blamed for any service failure, 50% disagreed; 50(62.5%) strongly agreed that the supervisor bears responsibility for customers? satisfaction or disappointment, 37.5% strongly disagreed; 60(75%) strongly disagreed that they, not their immediate superiors bear responsibilities for errors committed or successes achieved, 25% strongly agreed. On the average it could be seen that 37.3 indicates positive responsibility, while 62.5 indicates negative responsibility. We could hence deduce here that there is poor empowerment with respect to handling of responsibility of the employees in the hospitality industry in Jos metropolis. Access to information: The above table reveals that 47(58.8%) of the respondents disagreed that their employers often share critical information concerning the mission and the vision of the organization, 41.2% agreed; 65(81.3%) disagreed that all necessary information they need to perform their job effectively are available at their disposal, 18.7% agreed; 55(68.8%) disagreed that their supervisors/management always give them the necessary clues on key success factors on the job, 31.2% agreed; 45(56.3% agreed that their achievements and successes recorded are always communicated to them, 43.7% disagreed. On the average it could be seen that 36.9 indicates positive access to information, while 63.2 indicates negative access to information. We could hence deduce here that there is poor empowerment with respect to access to information of the employees in the hospitality industry in Jos metropolis. Reward: From the table above it could be seen that 68(85%) of the respondents agreed that their pay is not necessarily subject to organizational performance, 15% disagreed; 70(87.5%) strongly agreed that their pay packages and the work they do is less than they deserve, 12.5% disagreed; 52(65%) disagreed that employees? initiative are always rewarded in their organizations, 35% agreed. On the average it could be seen that 20.8 indicates positive reward system, while 63.2 indicates negative reward system. We could hence deduce here that there is poor empowerment with respect to reward system of the employees in the hospitality industry in Jos metropolis. Autonomy: The above table shows that 54(67.5%) of the respondents strongly agreed that their supervisors must direct them before they embark on any action, 32.5% disagreed; 50(62.5%) agreed that customers? needs are met better without supervisors? input, 37.5%) disagreed; 60(75% strongly agreed that their supervisors have confidence in the ability of their team members always, 25% disagreed. On the average it could be seen that 56.7 indicates positive autonomy, while 63.2 indicates negative autonomy. We could hence deduce here that there is good empowerment with respect to autonomy of the employees in the hospitality industry in Jos metropolis.
The responses of the respondents (customers of the hotels) as presented on the table and figure above reveal that 103(38.3%) opined that they patronize the hotels regularly, 120(44.5%) observed that they are not satisfied with the services of the hotels. 117(43.3%) agreed that employees of the hotels they patronize are always happy when attending to them, 120(45.5%) disagreed that employees of the hotels consult their supervisors before attending to them. 105(39.6%) of the respondents? assessed the handling of responsibilities by the employees of the hotels they patronize as good. 138(51.1%) rated the level of innovativeness of the employees as a result of their autonomy in attending to them at 41-60%, 151(55.9%) agreed that employees of the hotels show some sense of patriotism to their customers, while 178(65.9%) enunciated that the areas that the employees need to serve them better is through training of employees and upgrading the standard of the hotels.
DATA ANALYSIS AND INTERPRETATION Ho:
There is no significant relationship between employee empowerment and customer satisfaction in the Nigerian hospitality industry
The computed z which is 1.32 is less than the table value = 12.59 Hence, we accept the null hypothesis which states that; there is no significant relationship between employee empowerment and customer satisfaction in the Nigerian hospitality industry while the alternate hypothesis which states that there is a significant relationship between employee empowerment and customer satisfaction in the Nigerian hospitality industry was not supported. Discussion of Findings Hypothesis tested above is quite revealing, this is because findings differs the logical order. Ordinarily one would expect that negative employee empowerment as analysed in table 5 above would translate to negative customers satisfaction, but rather in spite of the unfavourable responses by the employees regarding empowerment, customers seems to be at home with the services rendered. One might attribute the weak hegemony in findings to low exposure, and dearth of world class facilities since the hospitality industry in this context is still at its infancy stage, hence customers? indifference to employee empowerment might be explained in increase in demand for such services.
Employees like the mirror of an organization are the interface between the organization and the customer, what they portray is what the customers see and use in their evaluation of the service experience. This study was aimed at ascertaining the impact of employee empowerment and customer satisfaction, taking an empirical study of some selected hotels in Jos, Plateau. Concept of employee empowerment, why employee empowerment is critical in Nigeria, employee empowerment and delegation of power, concept of customer satisfaction, employee empowerment and customer satisfaction were reviewed. Furthermore, the result of the hypothesis tested revealed that there is a significant relationship between employee empowerment and customer satisfaction.
Based on our findings, we hereby advance the following recommendations:
1. Since there is poor empowerment with respect to handling of responsibility, access to information and reward of the employees in the hospitality industry in Jos metropolis, management of these hotels should improve on their employee empowerment. 2. Hotels in Jos metropolis should maintain the pace of granting their employees autonomy in areas of discharging their tasks 3. To better serve their customers, the hotels in Jos metropolis should upgrade their standards and invest more in the training of employees. 4. Since customers? rating of the level of innovativeness of the employees as a result of their autonomy in attending to them is between 41-60%, hotels in Jos metropolis should keep encouraging their employees to consolidate on their achievements to explore the untapped potentials that abound in the hospitality industry in Nigeria.
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