Employee performance recognition techniques on customer satisfaction

Employee performance credit entry techniques on node ecstasy immediately a days process pains is dominating the business world. In exploitation countries it is observed that the largest growing area of business is serving effort. Worldwide smart set gardenings and in business the cross culture encounter ship encour eond servicing sector to grow in developing countries.In Restaurant manufacturing a part of the offering is a work and it is very pop industry in Pakistan. Chains of eating houses are non only the direct source of food in most cities of Pakistan up to now more(prenominal) than local chains of eating house with a very unique taste at low cost are competing with the international chains of restaurant. In Pakistan Restaurant industry is highly warlike in terms of prize of run caterd by restaurants as a quality of services has signifi pott effects on the profitableness and success of restaurants.The luxuriant Food Restaurant Market is a growing ind ustry in Pakistan relying heavily on the changing lifestyle patterns, commonwealth growth of the target age group and the related increase in employment of women. With todays hectic lifestyles, time-saving products are increasingly in demand the most obvious being the fast food. The cast of growth in consumer expenditures on fast food has led most opposite segments of the food-away-from home market for much of the last one decade.Restaurant is consisting of a group of citizenry that are linked with one another to satisfy a single intention to satisfy the customers. If these group of concourse those are called cozy customers are satisfied than they try more and more to satisfy the true(a) external customers which ultimately increases the profit of the restaurant. And for this it is very infallible to satisfy internal customers and many restaurants are expanding much of their earnings in satisfying them by providing them variant rewards that may be on the nose a Thank-you L etter or formal represent in annual function of organisation. In restaurants the concept of internal customers is most suitable for front line staff because customers triumph is largely depends on them. In a restaurant customer and employee impinging is the set-back representation of a service and on that basis customer perceived the service of customers. All businesses go on healthy if their employees are healthy and wellbeing and that contribute to a excellent performance and that pay backs successful (MacDonald, 2005). It is necessary for restaurant to recognize their employees incontrovertible contributions and achievements even though these are very small. Nothing can motivate employees more than the receiving award. Recognition of employees can be in many forms like, pay increments, appreciation letter, employee awards, physical and vocal support and promotions etc. it is suggested by many authors to recognize employees in front of other employees because this forget motivate employees behavior and as well as motivate other employees to cash in ones chips hard to receive such an appreciation in front of all other employees. Every employee never demands only monetary hire they also charter recognition and for this the recognition of employees is more coarse in corporate world, Nelson (2005) in his book 1001 ways to reward employees gave so many evidences and ways to recognize employees. It is the common understanding that if employee is motivated that lead work more and satisfy more customers and if customers are satisfied that will ultimately increases the profit of organization and thats main objective of any business.It has been observed that person visit a restaurant at first time on anothers recommendations and he/she is satisfied from the services than it is likely to revisit the restaurant in future and do the recommendations to others in future. In attracting and retaining the customers restaurant industry is one of the highly com petitive industry and for this restaurant managers and operators have a clear picture ab place the customers needs, wants and perception of customers that will finally decide about the success and failure of restaurant. To understand customers needs and wants and factors that influence them will provide a clear idea to the restaurant managers and operators to wee-wee, design, develop and deliver the right offerings to the customers that will make customers more satisfied (Syed, Conway, 2006). It is observed that if loyal customers increase by 5 to 10% that will increases the profit up to 100%, and this is the priming for which many restaurants make themselves customer oriented and make their objective customer first and for this reason they are getting success and increasing their profits.Problem StatementTo study the relationship between employee performance recognition techniques and customer satisfaction in restaurant industry.HypothesisRelationship The measure of what kind of relation does employee performance recognition techniques have with customer satisfaction in restaurant industry.H1 in that kettle of fish is positive relationship between employee performance recognition techniques and customer satisfaction.Outline of the StudyRestaurant industry is very fast growing industry in Pakistan which is partially service oriented and in service industry it is observed that if employee is know against its performance than customers are more satisfied from that employees service. The aim of this study was to how employees are recognized in service industry and how these employee performance recognition techniques are related or associated with customer satisfaction in restaurant industry of Pakistan.DefinitionsEmployee performance recognition Employee performance recognition is essentially a positive feedback to let employee know that their performance and efforts are determined and appreciated by coworkers and the organization.Employee performance rec ognition techniques These are just alsols or rewards by which employee performance is recognized. guest satisfaction client satisfaction is a measure of customer expectation either it meets or thrash about the product or service supplied by the company.CHAPTER 2LITERTURE REVIEWRestaurant IndustryThis has been observed since decades that the business world has been dominated by services. Now a days service industry is largest, rapidly growing and more profitable industry in the developing countries due to the reason of cross culture encounter ships of business and worldwide company cultures. The only industry which even survives in recession was the restaurant industry. The result for restaurant industry to boom is, people dont have to cook and they eat out. Now days, people have meal outside not only on planned occasions even more as an afterthought (Mogelonsky, 1998).Changing life style of people of Pakistan has resulted in the expansion of hotel and restaurant industry and due t o the reason this industry is very popular among people of Pakistan. Chains of hotels, restaurants and fast food are not the only or even the primary source of food in Pakistan. The hotel/ restaurant industry of Pakistan has become highly competitive due to the quality of services provided by them and the quality of service in this industry has direct relationship with the profitability and success, this is the reason for which many local fast food chains and restaurants are competing international fast food chains and restaurant in Pakistan that provide good quality of services and unique regional tastes and habits at low cost (Siddiqi, 2007, p. 15). The restaurant industry is growing in Pakistan rapidly which rely heavily on population growth, increase in employment of women and changing life style patterns. In todays changing lifestyle the demand of time saving products is increased and the top of argument among them is fast food. more organizations nowadays focusing on improvin g quality of a service because they recognize that service is the only crucial particle in their environment by which customers can be gained and retained and service also serve as competitive advantage. Service is not only crucial for rigorously service based organization the production based industry having a mix of production and service is much focusing on buyer and marketer interaction which also termed as Service Encounters and service encounters decide customers to sustain or not (Gronroos, 1994).For a mix between service and production restaurant is matching example, where customers get meal which is primarily production outcome during this he/she communicates with waiter which is operational or process related or service element of restaurant.Restaurant owners and managers should have a clear understanding of needs, perceptions and wants of customers if they want to attract and retain customers, because customers are the one who choose their existence and this makes res taurant industry more competitive (Gregoire, Shanklin, Greathouse Tripp,1995). Extreme competition observed in restaurants with regard to differentiated services (Koo, Tao and Yeung, 1999 Sundaram, Jurowski and Webster, 1997).In comparison to past years, an increase in the spending of people on fast food, other sectors of food are taken away from home market. Restaurants to bring in the full potential of employees value, they should change the current doctrine this can be done through understanding the relationship of competitive advantage and high performance work practice (Murphy Olsen, 2008).Employee Performance Recognition TechniquesThere is no business in the world which is not striving or a good and healthy state. Only contribution of successful performance of employees can make organization successful (Economic and Social Research Council, 2006 MacDonald, 2005). It has been noticed that firms to sustain competitive in the market they have a constant focus on improvement of service quality (Stevens, Khutson and Patoon, 1995 Parasuraman, Berry and Zeithaml, 1991). Human resource processes are directly associated with employee military capability and that will in return produce job satisfaction or dissatisfaction (Rainey, 1991), and job satisfaction produces motivation which affects employee work efforts and productivity that ultimately affects customer satisfaction (Lawler, 1994).All employees have given responsibilities and they also have incorrupt responsibilities and they are supposed to act in a directed way (Fisscher, Nijhof and H. Steensma, 2002). This somehow subjective morality which is more concerned about common-sense, but actual responsibility may be beyond role morality. Pointing out demands and responsibilities of ones role to be filled is role morality (Werhane and Freeman, 1999).Every organization is focusing on measuring and evaluating performance of employees by using different tools like balanced score cards to motivate employees ac cording to their performances (Kaplan and Norton, 1996). This has been observed that performance measurement procedures not always give clear results in measuring elements like motivation, decision making or goal directed behavior both positive and prejudicious results appeared. Result of one performance measurement tool is positive in measuring one particular situation bit it gives negative result in measuring other particular situation. In restaurant industry this is easy and more reliable way to get the feedback from customers or involving customers in evaluating the performance of employees (Hopkins, 2005). Employee should not only be assessed by responses to work role rather it should be assessed in social contexts that how it shape attitudes and wants (Salancik and Pfeffer 1978), and emotions expressed in organization (Rafaeli and Sutton 1989). This way of measuring employee attitudes has opened many different areas to be studied at organizational take aim such as depressio n, liking, positive and negative effect, happiness and optimism (Staw, Sutton Pelled, 1994). To get coveted results from employees it is necessary to recognize employees for their work. Employee recognition is the best way to get satisfaction among employees, this sometimes known as thank you category. For employees nothing more important than just a simple thank you for job that performed well by employee. It is necessary to recognize employees on their good work, positive contributions and achievements even though that should be too small. Recognition doesnt mean just to say thank you, that could be in many forms such as promotions, company awards, pay raises, physical support, verbal counsel etc. what recognition is given to employee is not necessary but employee is recognized is the real recognition. It is to be suggested by many researchers that recognition should be given in public because nothing can more motivate employee than to achieve an award or honoring achievement in front of the whole company formally. This may also give motivation to other employees that they should also be honored for quality of work and achieving high results. It is also observed that none of the factor can be more motivating than to receive an award (Hopkins, 2005).Sometimes rewards are treated as psychological commission which believes that when employee comes to know that their customers are satisfied then these employees will work hard more effectively because they themselves will be satisfied. Sometimes the rewards are also act as implicit. It is belief of management that a dour run satisfied customer is more profitable for organization. Management motivates employees by communicating this belief that if the firm is more profitable than employee will remain employees and even ear more wages. In some organization employee wages/salaries are directly stick with the customer satisfaction or quality measures (Hauser, Simester, Wernerfelt, 1994). Clive Mettrick, an exe cutive of the company once said to reward and to recognize positive results of employees is important factor in employee retention. To retain qualified employees to engage them in customer satisfaction, resource management and performance improvement organization should maintain reward and recognition programs (Freed, 1999).Akerlof and Kranton (2005) quoted If an organization is going to function well, it should not rely solely on monetary compensation schemes. In his book 1001 Ways to Reward Employees, Nelson (2005) gives plenty of proofs and multiple awards used in companies. Employee considering award as incentive assume recognition as important source of motivation (for example, by receiving award). Employee put all his efforts not to demolish award with the money that went with it. Awards are valuable for the employees because they convey appreciation and recognition on behalf of colleagues and the public. Award may give a feeling of commitment because it creates an emotional b ond by connecting the winner with the institution (Bruno Susanne, 2009). Reward and recognition is the way of grievous employees that organization value employees efforts (Evans and Lindsay, 2003). It is seen that many of the companies through billions of dollars for employees reward and recognition processes but the results showed that such processes are not of value for them even these create de-motivation among employees (Spitzer, 196).Coveys (1994) term bugger off with the end in mind is may be used in designing Reward and Recognition system for employees, before developing the system it is necessary to consider the key objectives that organization has to achieve. McAdams (2000) suggested attaching rewards with business goals and objectives which, he recommended, are revenue financial return, growth, customers satisfaction and reducing operating expenses. Any organization may make as many rewards as possible but sometimes they become of no use because they create a feeling of being controlled, the best resultant of this is to involve employees in developing reward and recognition system of organization (George and Weimerskirch, 1994). Employers and Managers should not recognize employees as they want but recognize employees as they want to be recognized (Branham, 2001).For employees performance measurement customer feedback plays a vital role, if servers provide good/bad service to customer so customer will provide good/bad feedback about employees. So, more emphasis should be on quality of employees service, customers will get more satisfaction (Johnson, 1996 Schneider and Bowen, 1985). This concept should be well understood that if organization is providing employees with quality service then it is likely to be notices that customers will receive higher quality service (Lukas and Maignan, 1996). Some service executives claimed that frontline service employees are actually communicating with customers so they create the level of perceived service qual ity of that organization. The first representation of service firm is interaction between employee and customer and customer usually perceived organization on the basis of interaction between employee and customer (Parasuraman, Zeithaml, and Berry 1985). Therefore, it is vital that frontline customer contact employees must be focused on customers needs and wants (Kelley 1992).Customer SatisfactionSince many years, service quality and customer satisfaction have become a major area of attention to researchers because it was found that both have impact on organization performance and customer behavior. Service quality gives higher profitability (Gundersen, Heide and Olsson, 1996), and also it gives customer satisfaction (Oliver, 1997), and customer satisfaction spread positive word of mouth (Sderlund, 1998).A satisfaction based on outcome or process is also termed as customers satisfaction. Customer satisfaction can simply be defined as judgment of a post consumption of a particular pr oduct or service (Gundersen, et al., 1996). Some studies also showed that customer satisfaction has direct or indirect impact on organization results. Many authors also concluded that organization profitability is directly affected by customer satisfaction (Anderson, Fornell Lehmann, 1994 Yeung, Ging Ennew, 2002 and Luo and Homburg, 2007).All these authors also found that customers satisfaction produces customer subjection that increases repurchase intentions which spread positive word of mouth.Knutson (1988) discussed the factors that are important for customer satisfaction like convenience of location, safety and security, prompt service, and friendliness of employees.Barsky and Labagh (1992) is of the bring in that location and employee attitude are the factors which can easily influence customers satisfaction.Service quality is considered very complex in record its meaning is different from customer to customer but the most common definition could be that comparison between customer expectations and customer perceptions of the service certain by customers (Parasuraman, Zeithaml Berry, 1988 Grnroos, 1982). Some authors are of the view that customer satisfaction represents a sign of service quality (Carman, 1990 Bolton and Drew, 1991). Other authors argue that service quality is a sign of customer satisfaction (Churchill and Suprenant, 1982 Anderson et al., 1994 Oliver, 1997 Oh, 1999 Zeithaml and Bitner, 2003 Jamali, 2007).These authors concord that service quality is cognitive evaluation which may give satisfaction to the customers. So it may be concluded that service quality produces results of customer satisfaction. Customer satisfaction should be measured on criteria of the quality service that is provided to the customers by the services that are attach with the product/ service (Vavra, 1997). Word of mouth recommendations and assume purchase behavior are the major reasons for which customers satisfaction is thought of having a great importance in all type of organization (Berkman and Gilson, 1986).Factors affecting service quality and customer satisfaction guide owners and restaurant managers to develop and deliver the right offerings. Only a part of an offering of a restaurant is service that is intangible and heterogeneous and success of all other parts is dependent on the quality of service that is provided to the customers (Syed, Conway, 2006). It has been observed that a satisfied customer from service provided by restaurant is likely to visit again in the restaurant even recommend to other friends and relatives (Kivela, Reece and Inbakaran, 1999 Pettijohn, Pettijohn and Luke, 1997). Restaurants net profits can be three-fold if a restaurant loyal customers increases from 76 to 81% (Mattila, 2001). Social contacts play an important role in selection of a restaurant almost 44% of customers visit a restaurant first time on recommendation of friends where as only 10% visit restaurant first time with condition custome r (Smith, 1996 Stevens, Khutson, and Patoon, 1995).Most of the restaurants make themselves customer oriented where they have the belief that customer and customers interest comes first without ignoring other stake holders like owners, managers and employees, to make organization long run profitable (Hartline , Michael D., Maxham III, James G., McKee, Daryl O. 2000). Because of intangible, hetero and inseparable nature of service, in service firms customer orientation plays a vital role (Parasuraman, Zeithaml, and Berry 1985). Firms applying customer orientation earn more profitability and perform better service quality than those firms who apply other orientation in their processes (Kelley, 1992).Satisfaction is generally viewed as a broader concept . . . service quality is a component of satisfaction (Zeithaml and Bitner, 2003, p. 85).Satisfaction cant be driven from one source it always be driven from many sources, Bitner and Hubbert (1994) explain satisfaction in two ways servic e encounter satisfaction, this satisfaction or dissatisfaction arrives from specific service encounters and boilersuit satisfaction, this satisfaction based many/ multiple service encounters and experiences, experienced by customer. It shows that service encounter satisfaction at each service encounter develop overall service satisfaction. Olivers (1997) defined customer satisfaction as fulfillment of response. Satisfaction in a very low time grows moldy with overall customers attitude (Oliver, 1997). From the above perspective of customer satisfaction this can be stated that, Service quality can be viewed as whole family picture album, where as customer satisfaction is just one snapshot.CHAPTER 3RESEARCH METHODS3.1 Method of Data CollectionA questionnaire survey consisting of 2 questionnaires, 1 for managers of restaurants (consist of 3 pages) and other for customers (consist of 2 pages) of each restaurant were used to get together the info (Primary) from respondents from restaur ants across Pakistan. The survey was done in the following manner.Personal meeting by winning an appointment with the managers of the restaurantsPersonal meetings with customers those were available in restaurant at that time.3.2 Sampling TechniqueConvenience sampling was done to carry out the research.3.3 Sample sizingThere are two types of data used by researchers to do research, primary and secondary. In primary research questionnaires are used to collect the data that can be qualitative or quantitative. Since every organization is using different techniques to recognize their employees so there was need to use questionnaires to collect the primary data. It is very difficult to reach every restaurant and collect the data because many of restaurants were not willing to share accurate information. tote up sample coat was 420 which include 20 restaurant managers and 400 customers, 20 customers from each of 20 restaurants.3. 4 Instrument of data collectionTwo different questionnai res were developed to collect the data, among which first questionnaire was based on employee performance recognition techniques used in restaurant and the other questionnaire was based on the service characteristics and the service provided by employees and received by customers. Demographics were also asked in both instruments (questionnaires). SPSS was used as tool to analyze the data.3.4.1 Validity and reliability testThe questionnaire was conducted to determine the errors in the design and instruments. Pre-test refers to interrogatory of the questionnaire on a small sample of participants to identify and get rid of potential problems. This has been done to evaluate the questionnaire for clarity, bias, and issues vague, and its importance to the research.Reliability analysis, measurement scales and the things that makes studying the properties to make them. Reliability analysis procedure is used in many cases the number of procedures to calculate the level of reliability and th e relationship between the items listed in the individual level provides information about.Table 3.1Reliability StatisticsCronbachs AlphaCronbachs Alpha Based on Standardized ItemsN of Items.761.762143.5 Research Model DevelopedRestaurant industry is a mixture of service industry and production industry, if any one of them is not up to the standards or customers perception it directly affect restaurant business, so for restaurants it is necessary to make and serve the products as per standards. Service part of restaurant industry is very critical and to cope up with this restaurants recognize their employees by providing them different rewards to motivate them and they motivated these employees work more and in an efficient way and this will directly affect customer satisfaction.This study focused on how restaurants in Pakistan recognize their front employees and how recognizing employees affect customer satisfaction. Every restaurant has different recognizing techniques to recogniz e employees and do these recognizing techniques have any relationship with the customer satisfaction.The following theoretical account has been developed with the help of supervisor.Employee Performance Recognition TechniquesEmployee of the Week/Month/YearCashCertificate of AppreciationWrite-up in the newsletterPraise in the meetingsNominating for out of station TrainingPaid vacation (Time-off)Job redesignCompany sharesPromotionsMore power in the jobFigure 3.2Employee Performance RecognitionCustomer Satisfaction3.6 Statistical techniqueGeneral Linear Model and ANOVA statistical techniques have been used for the study keeping in view the nature of the hypothesis and the data collected.CHAPTER 4RESULTS4.1 Findings and Interpretation of the resultsH1 There is positive relationship between employee performance recognition techniques and customer satisfaction.Parameter EstimatesDependent VariableTotal Customer SatisfactionParameterBStd. ErrortSig.95% Confidence IntervalPartial Eta Squar edLower fountainUpper BoundIntercept.702.858.819.413-.9852.389.002cs_maritalstatus=1.834.1714.866.000.4971.170.058cs_maritalstatus=2.883.1725.119.000.5441.222.064cs_maritalstatus=30a......res_emp_month=01.656.4753.484.001.7212.590.031res_emp_month=10a......res_cash=0-.166.084-1.981.048-.331-.001.010res_cash=10a......res_certificate=0-.395.077-5.118.000-.547-.244.064res_certificate=10a......res_meetings=0.669.2332.876.004.2121.127.021res_meetings=10a......res_training=0.961.2733.522.000.4251.498.031res_training=10a......res_job_redesign=0.389.1243.142.002.146.632.025res_job_redesign=10a......res_power=0-.221.090-2.454.015-.398-.044.015res_power=10a......HRM_Policy=13.2771.0433.143.0021.2275.328.025HRM_Policy=2.481.3471.385.167-.2021.163.005HRM_Policy=3-.916.323-2.838.005-1.551-.282.021HRM_Policy=40a......Fin_Policy=2-.949.239-3.962.000-1.420-.478.039Fin_Policy=30a......Fin_Policy=40a......Mkt_strategies=1-.891.385-2.315.021-1.647-.134.014Mkt_strategies=2-1.160.453-2.562.011-2.050-.2 70.017Mkt_strategies=30a......years_operations.321.1252.574.010.076.567.017a. This parameter is set to zero because it is redundant.InterpretationCustomers having marital status single and married have sig value 0.000 it means marital status is significant, while there Beta values are 0.834 and 0.883 respectively which shows married respondents are most satisfied.Employee performance recognition technique Employee of the month/week/year has sig value of 0.001 which is significant but Beta value 1.656 suggested that customer satisfaction is low where Employee of the month/week/year recognition technique is applied.