Professional Documents
Culture Documents
By
Amitabh Dey
Professor/Research Scholar
Principal – NSHM School of Hotel Management
Arrah, shibtola, Durgapur – 713212
TEL: +91-9933049428
MAIL ID: amitabh.dey@nshm.com
P.R.Sandilyan
Professor/Research Scholar
NSHM School of Hotel Management
Durgapur-12
Tel: 03432533813/14/16
Mail ID: ganesh_pr2001@yahoo.co.in
Gautam Bandopadhyay
Assistant Professor
Manojit Mitra
Research Scholar
National Institute of Technology
(Deemed University), Durgapur
Tel: 03432544805
Mail ID: manojit.mitra@nshm.com
0.0 Abstract
It has always been accepted and agreed upon that quality comes at a cost. This is true for service
quality also and applicable to the hospitality industry likewise. In modern days, Human Resource
Managers have recognized the need to keep well motivated employees to maintain quality
standards in service delivery. The aim of this study is to describe the role between Incentives
with employee performance and quality of service delivered. Change of employee‟s performance
and service quality due to incentives are examined to pave the way for further study and
research.
The best way to keep employees well motivated is by means of Incentives and most
organizations understand and apply this to get the best from their employees. The nature of
Human Resource practices in the catering and Hospitality Industry is reviewed and how
incentives affect the performance of employees and service quality is studied. This literature and
sample data based research will offer insight into the relation between performance of employees
and incentives. This will help Human Resource Managers to plan and adopt appropriate methods
to motivate employees and get the best results in terms of performance and service quality.
The literature concerning Human Resource Management and performance is briefly reviewed,
and its relevance to Hotel Industry and service quality and performance is addressed. Service
The aim of this study is to describe the relationship between Incentives with employee
attitudes are examined to pave the way for further study and research.
1.0 Introduction
Human Resource has been identified by most Human Resource Managers and Employers
globally as the most essential ingredient necessary for the success of any business. This belief
holds good for the Hospitality Establishments also. Hospitality organizations thrive on the
customer‟s perception of value for money in terms of amenities and service. Service being a
perishable and intangible commodity it goes without saying that it is more difficult to measure
and track. This challenge is unique to service product organizations worldwide and each one has
developed a yardstick to study and track the performance of their employees in accordance to the
location and market where they operate. In West Bengal also the HR managers face a similar
challenge and strive to meet the ever increasing demands of the modern day traveler and
customers. India being a labor market and West Bengal being one of the slower developing
areas, the challenge before the HR managers in this area is huge. They have to match the
strike a balance between the two. This study is mainly to ascertain how far the efforts of these
employers and HR managers in this region have been successful in achieving the expectations. A
total of twelve establishments falling across various category cities in the region have been
examined for this study. There were some essential hypotheses that were examined for the
purpose of this study. Firstly it was taken that the rewards and incentive packages in metro cities
would be higher and more suited to meet the expectations of the employees because the
employees had plenty of options to switch jobs. Secondly it was taken that rewards and
remuneration had a direct bearing on employee performance and service quality. Thirdly it was
expected that service quality standards and expectations of customers in metros would be much
more as compared to the customers of smaller cities and towns. Lastly it was assumed that
employer expectations in terms of delivery in metros would also be higher as compared with the
smaller cities.
P Joshi & D. N. Venkatesh, (2006) (H. R Management Pg 325, Remuneration centers around
factors such as job complexity, the company‟s ability to pay, and executive human capital.
Zeithaml, Bitner and Gremler, 2006, Services are characterized by intangibility, heterogeneity,
C.B Mamoria, S.V. Gankar, Personnel Management Text and Cases Himalaya Publishing House
Page No 460 Chapter 17, Incentives – Different people value things differently. Enlightened
managers realized that all people do not attach the same value to monetary incentives, bonus,
Prizes or trips. Employee views these things differently because of age, marital status, economic
C.B Mamoria, S.V. Gankar, Personnel Management Text and Cases Himalaya Publishing House
Page No 491, Chapter 18, Employee Benefits and services – It is important to note that
„financial‟ incentives are paid to specific employees whose work is about standard. „Employee
benefits and Services‟ on the other hand, are available to all employees based on their
These benefits are usually known as “fringe benefits” – as they are offered by the employer to
the employee as a “fringe”. Different terms have used for these benefits such as, “ fringe
McGraw-Hill Publishing Company Limited, New Delhi, Pay and Benefits Chapter 8, Page no
169, Pay and benefits constitute an important element in human resource management. A
number of considerations like theoretical, public policy and legeal framework, company
objectives, labour market situation, pressures from unions and competition, etc. impinge upon
policies and programmes concerning pay and benefits. Job evaluation and pay surveys provide
A.M. Sarma, Understanding Wage System, Himalaya Publishing House, Wage Incentives
Chapter 5, Page No 95 Ninth Revised Reprint 2009, The term “incentives” has been used both in
the restricted sence of participation and in the widest sence of financial motivation. The concept
of incentive implies increased willingness or motivation to work and not the capacity to work. It
refers to all the plans that provide extra pay for extra performance in addition to regular wages
or all the employees of a firm are partially or wholly related to some measure of productive
output.
Dean R. Spitzer, (2007) (Super Motivation pg- 165) the most important component of in any
reward system is the relationship that exists between rewards and performance. While a few
employees are rewarded generously for their performance, most employees receive few, if any,
Robert L. Mathis & John H. Jackson, (2004), (H R Management 10th edition Pg-84) Pay and
benefit must be competitive, which means they must be close to what other employers are
providing and what individuals believe to be consistent with their capabilities, experience, and
performance.
B. Mamoria & S.V. Gankar, (2001), (H.R management 6th edition pg- 303) A reward can be
anything that attracts a employees attention and stimulates him to work. There can be monetary
David A. DeCenzo, 1998, Personnel Human Resource Management reward that is not visible to
the employees may fail to get the desired motivating effect from the employee. On the other
hand, a truly visible reward gets the attention not only of individuals but also of their peers. This
latter quality means visible rewards can contribute to satisfying an employee‟s esteem and
recognition needs. An effective reward would be flexible in terms of the amount given and
whether it is given to everyone in the organization. The annual performance bonus, for instance
of a high flexibility. It can be adjusted upward or downward or eliminated, each year depending
Burack and Boldsmith, Human Resource Management, Pg 259, “An incentive scheme is a plan
frequently built on monetary reward (incentive pay or monetary bonus), but may also include a
K Aswathappa, 1997, Human Resource Management, 5th edition, Pg- 285, Remuneration is the
Remuneration occupies an important place in the life of an employee. His standard of living,
status in the society, motivation, loyalty, and productivity depend upon the remuneration he
receives. For the employer too, employee remuneration is significant because of its contribution
to the cost of production. Besides, many battles (in the form of strike and lock outs) are fought
between the employer and the employees on issue relating to wages or bonus.
T.V. Rao, 1991, Reading in Human Resource Development, pg-118, Performance Rewarding is
involved only when an employee is rewarded for high performance in his job over a period of
time, usually a year or two) and this should be differentiated from other forms of reward and
awards such as those for bravery, social services, best employee and sportsmanship. Performance
awards are generally given to individuals for doing consistently outstanding work in their jobs
3.0 Methodology
A questionnaire was framed and administered to employees of the service industry from select
establishments in West Bengal to collect their responses on the relation between Incentives and
verified. Further statistical and mathematical tools were used to establish the relationship
between Incentives and rewards with employee performance and service quality. The outcome of
the analysis was studied and elaborated to draw appropriate conclusions. Initial Factor analysis
confirmed the fact that with the exception of one question where the answer was overall similar,
(Question on the effect of incentives and rewards on the performance of employees and service
quality) there was a divide in the opinion of employees in the rest of the questions.
Here the average of the responses collected from about hundred employees on their views on
Incentives and its effect on service quality and employee performance was first calculated and
analyzed using various parameters of age, income group, qualification, gender and location. The
CROSSTABS
/TABLES=age BY income
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
Crosstabs
age group * income segment Crosstabulation
Count
income segment
0-1 lakh/yr 1-2 lakh/yr 2-3 lakh/yr 3-5 lakh/yr above 5 lakhs Total
25-30 yrs 8 6 2 3 5 24
31-35 yrs 1 4 7 4 0 16
36-40yrs 2 7 0 7 3 19
Total 36 22 11 20 10 99
Chi-Square Tests
N of Valid Cases 99
a. 18 cells (72.0%) have expected count less than 5. The minimum expected count
is .71.
CROSSTABS
/TABLES=age BY education
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
Crosstabs
age group * qualifications Crosstabulation
Count
qualifications
25-30 yrs 8 5 6 0 5 24
31-35 yrs 1 1 6 1 7 16
36-40yrs 2 0 6 0 11 19
above 40 yrs 0 0 3 0 4 7
Total 28 15 24 1 31 99
Chi-Square Tests
N of Valid Cases 99
a. 15 cells (60.0%) have expected count less than 5. The minimum expected count
is .07.
Chi-Square tests were performed to check the interdependency of the attributes like age,
income group, gender, employee category and it was verified that most of these attributes
were interdependent. In the above table the 4th column reads less than 0.5 and proves the
Only income and gender was similarly proved to be independent. ## (See Appendix 1)
Dependent Variable:Average
a
Corrected Model 77.135 18 4.285 15.289 .000
Total 124.958 98
Tukey B
Subset
age group N 1 2 3
36-40yrs 19 1.1009
income segment
Homogeneous Subsets
Average
Tukey B
income segment N 1 2 3
Profile Plots
There were similarity in the views between the age groups of below 30, 30 to 40 and
those above 40 years or in other words there emerged three categories of responses.
The responses of employees with 2-3lakhs/annum were closer to those with a higher
income. There was negligible difference between the responses of employees in the
similar in their responses, where as much differences existed between the under graduates
and post graduates. However it was clear that undergraduates were mainly being used as
cheap labor and they had neither much income nor scope for growth.
Employee category showed that junior employees differed in their views with middle and
senior employees.
Gender had no or negligible influence on the employee category or the income group.
6.0 Conclusion
On analysis of the collected data various interesting results were visible. The interdependence of
age group, income segment and education was established by means of Chi-Square tests and
ratified the existing hypotheses on the same, which could be useful for further research work in
the area. Further the two-way ANOVA helped to group the employees in various sub groups.
Another hypothesis that was verified was that there was no effect of gender on the income or
employee category. So it was established that both genders had equal scope for performance and
growth. However the gender ratio of employees still is far different and also signifies that there
are more men than women in employment at all levels. The incentives were more acceptable to
the higher income group and also the fact was established that the lower income segment were
not very happy or content with what incentives that was being offered. The effect of education
was clearly established and also was seen that undergraduates were more likely to be fitted into
the lowest income groups and not much scope for higher paid positions as the graph showed no
remuneration policies of the organization where as there was marked difference in the views of
lower category employees. Here one can also perceive that a lot of undergraduates were
employed and who probably never got any benefits in terms of rewards and recognition as well
as career growth. Organizations must look at making some policies to help these employees to
get educated or trained and provide them with opportunity to grow. Graduates and professionals
on the other hand showed that even though they belonged to a lower income group, there were
plenty in the middle and higher category also. This showed that they had the potential to grow
based on their education. Similar was the status of post graduates and higher. As the junior
employees had more interaction with the customers at various establishments studied, it is
imperative that the organizations look at these employees carefully and increase the satisfaction
levels of this segment. Location of the establishment had some effect on the satisfaction of the
employees as employees in metro cities were provided with better remuneration as compared to
the employees of smaller towns. Further it is necessary for organizations to invest more on the
employees at the junior levels and plan for them as this would help them in their efforts to
deliver service quality. Also we can justly state that employees must also try and upgrade
themselves if they wish to have career growth and better remuneration. Organizations using
unskilled and inefficient employees as cheap labor would lose their standards and ultimately
suffer as the customer would not like to pay for poor service quality and shift his loyalty to other
business units.
Human Resource Management 10th edition, 2004, Robert L. Mathis & John H. Jackson
Robert L. Mathis & John H. Jackson, (2004), Human Resource Management 10th edition
B. Mamoria & S.V. Gankar, (2001), Human Resource management 6th edition
B. Mamoria & S.V. Gankar, (2001), (H.R management 6th edition pg- 303)
A.M. Sarma, Understanding Wage System, Himalaya Publishing House, Wage Incentives
Chi-Square Tests.
CROSSTABS
/TABLES=age BY gender
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
Crosstabs
age group * gender Crosstabulation
Count
gender
25-30 yrs 20 4 24
31-35 yrs 13 3 16
36-40yrs 17 2 19
above 40 yrs 6 1 7
Total 77 22 99
Chi-Square Tests
N of Valid Cases 99
a. 3 cells (30.0%) have expected count less than 5. The minimum expected count
is 1.56.
CROSSTABS
/TABLES=age BY ec
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
Count
25-30 yrs 11 8 5 24
31-35 yrs 5 9 2 16
36-40yrs 8 8 3 19
above 40 yrs 0 5 2 7
Total 54 32 13 99
Chi-Square Tests
N of Valid Cases 99
a. 7 cells (46.7%) have expected count less than 5. The minimum expected count
is .92.
CROSSTABS
/TABLES=income BY ec
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
Count
1-2 lakh/yr 20 2 0 22
2-3 lakh/yr 1 9 1 11
3-5 lakh/yr 0 18 2 20
above 5 lakhs 0 0 10 10
Total 54 32 13 99
Chi-Square Tests
N of Valid Cases 99
a. 7 cells (46.7%) have expected count less than 5. The minimum expected count
is 1.31.
CROSSTABS
/TABLES=income BY gender
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
Crosstabs
income segment * gender Crosstabulation
Count
gender
1-2 lakh/yr 17 5 22
2-3 lakh/yr 9 2 11
above 5 lakhs 7 3 10
Total 77 22 99
Chi-Square Tests
N of Valid Cases 99
a. 4 cells (40.0%) have expected count less than 5. The minimum expected count
is 2.22.
CROSSTABS
/TABLES=income BY education
/FORMAT=AVALUE TABLES
/STATISTICS=CHISQ
/CELLS=COUNT
Crosstabs
income segment * qualifications Crosstabulation
Count
qualifications
1-2 lakh/yr 0 4 5 0 13 22
2-3 lakh/yr 0 2 2 1 6 11
3-5 lakh/yr 0 1 13 0 6 20
above 5 lakhs 0 1 4 0 5 10
Total 28 15 24 1 31 99
Chi-Square Tests
N of Valid Cases 99
a. 16 cells (64.0%) have expected count less than 5. The minimum expected count
is .10.
Comments
Filter <none>
Weight <none>
Missing Value Handling Definition of Missing User-defined missing values are treated as
missing.
Warnings
Post hoc tests are not performed for qualifications because at least one group has fewer than two
cases.
Between-Subjects Factors
Value Label N
2 1-2 lakh/yr 22
3 2-3 lakh/yr 11
4 3-5 lakh/yr 20
5 above 5 lakhs 9
qualifications 1 UG 28
2 G 15
3 PG 24
4 PhD 1
5 Professional 30
Dependent Variable:Average
Total 124.958 98
Dependent Variable:Average
income segment qualifications Mean Std. Error Lower Bound Upper Bound
a. This level combination of factors is not observed, thus the corresponding population marginal mean is not
estimable.
Tukey B
Subset
income segment N 1 2 3
Profile Plots
/DESIGN=income ec income*ec.
Comments
Filter <none>
Weight <none>
Missing Value Handling Definition of Missing User-defined missing values are treated as
missing.
Between-Subjects Factors
Value Label N
2 1-2 lakh/yr 22
4 3-5 lakh/yr 20
5 above 5 lakhs 9
3 SENIOR 12
Dependent Variable:Average
Total 124.958 98
Dependent Variable:Average
a. This level combination of factors is not observed, thus the corresponding population marginal mean
is not estimable.
Tukey B
Subset
income segment N 1 2 3
Tukey B
employee N Subset
JUNIOR 54 -.1265
MIDDLE 32 1.2057
SENIOR 12 1.5347
Profile Plots
Comments
Filter <none>
Weight <none>
Missing Value Handling Definition of Missing User-defined missing values are treated as
missing.
Warnings
Post hoc tests are not performed for qualifications because at least one group has fewer than two
cases.
Value Label N
3 SENIOR 12
qualifications 1 UG 28
2 G 15
3 PG 24
4 PhD 1
5 Professional 30
Dependent Variable:Average
Total 124.958 98
Dependent Variable:Average
a. This level combination of factors is not observed, thus the corresponding population marginal mean
is not estimable.
Tukey B
employee Subset
category
(junior,
middle or
senior) N 1 2
JUNIOR 54 -.1265
MIDDLE 32 1.2057
SENIOR 12 1.5347