COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF MANAGEMENT

“ASSESSMENT OF SERVICE QUALITY AND EMPLOYEE

ENGAGEMENT: THE CASE OF FIVE STAR HOTELS IN
ETHIOPIA”

A research paper submitted to school of Graduate Studies in

partial fulfillment of the requirements for the Master of
Science (MSC) degree in Quality Management and
Organizational Excellence.
BY: KALKIDAN SOLOMON
ID. No GSR/1063/09
ADVISOR: ETHIOPIA LEGESSE(D.Sc.)

June, 2018
Addis Ababa
Approval Sheet
The undersigned certify that I have read and hereby recommend to the Addis Ababa
University School of Graduate Studies Department of Management to accept the thesis
submitted by Kalkidan Solomon entitled: Assessment of Service Quality and Employee
Engagement: The Case of five star hotels in Ethiopia which is prepared for the partial
fulfillment of MSc degree in Quality Management and Organizational Excellence.

Advisor: ______________________

Signature: ____________________

Date: ________________________
 ADDIS ABABA UNIVERSITY School of Graduate Studies

Assessment of Service Quality and Employee Engagement: The Case of

five star hotels in Addis Ababa, Ethiopia

By: Kalkidan Solomon

College of Business and Economics

Approved by Board of Examiners:

_____________________ _____________ _____________
Advisor Signature date
_____________________ ______________ ______________
Examiner Signature date
_____________________ ______________ ______________
Examiner Signature date
_____________________ ______________ _____________

ii
DECLARATION

I, the undersigned, declare that, this study “Assessment of Service Quality and
Employee Engagement: The case of five star hotels in Ethiopia” is my original work
and has not been presented for a degree in any other university, and that all
sources of materials used for the study have been duly acknowledged.

Declared by:
Name____________________________
Sign_____________________________
Date_____________________________

Confirmed by Advisor:
Name____________________________
Sign_____________________________
Date_____________________________

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 Table of Contents
CHAPTER ONE ...................................................................................................................................... - 1 -

INTRODUCTION ................................................................................................................................... - 1 -

1.1 Background ............................................................................................................................... - 1 -

1.2 Problem Statement/Research Gap ................................................................................................... - 4 -

1.3 Research Questions ......................................................................................................................... - 7 -

1.4 Objectives of the Study ................................................................................................................... - 7 -

1.4.1 General Objective .................................................................................................................... - 7 -

1.4.2 Specific Objectives .................................................................................................................. - 7 -

1.5 Scope of the study ........................................................................................................................... - 8 -

1.6 Limitation of the study .................................................................................................................... - 8 -

1.7 Significance of the study ................................................................................................................. - 8 -

1.8 Key Terms/Definitions of this Study .............................................................................................. - 9 -

CHAPTER TWO ................................................................................................................................... - 11 -

LITERATURE REVIEW ...................................................................................................................... - 11 -

2.1 Quality........................................................................................................................................... - 11 -

2.2 Service Quality.............................................................................................................................. - 11 -

2.3 Relationship Quality ..................................................................................................................... - 12 -

2.4 Measuring service quality ............................................................................................................. - 12 -

2.5 Developing Service Improvement Strategy in the organization ................................................... - 12 -

2.5.1 Listening ................................................................................................................................ - 12 -

2.5.2 Reliable Service ..................................................................................................................... - 13 -

2.5.3 Service Design ....................................................................................................................... - 13 -

2.5.4 Service Recovery ................................................................................................................... - 14 -

2.5.5 Surprise Customers ................................................................................................................ - 14 -

2.5.6 Fair Play ................................................................................................................................. - 14 -

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 2.5.7 Servant Leadership................................................................................................................. - 15 -

2.6 The critical role of employees in service delivery ........................................................................ - 15 -

2.7 Employee Engagement ................................................................................................................. - 16 -

2.8 How does an organization engage its employees? ........................................................................ - 16 -

2.9 Factors driving Employee engagement ......................................................................................... - 18 -

2.11 Results of Engaged employees ................................................................................................... - 20 -

2.12 History of Hotel Industry in Ethiopia ......................................................................................... - 20 -

2.13 Service Quality in Hotel Industry ............................................................................................... - 21 -

2.13.1 Customer Satisfaction: ......................................................................................................... - 22 -

2.13.2 Customer Loyalty:................................................................................................................ - 22 -

2.13.3 Brand Image: ........................................................................................................................ - 22 -

2.14 Service Quality in Ethiopia ......................................................................................................... - 23 -

2.15 Service quality in the tourism sector ........................................................................................... - 23 -

2.16 How service quality can be improved in the organizations? ....................................................... - 24 -

2.17 Five star hotel quality standard ................................................................................................... - 24 -

CHAPTER THREE ............................................................................................................................... - 33 -

METHODOLOGY ................................................................................................................................ - 33 -

3.1 Research Design............................................................................................................................ - 33 -

3.2 Population of the study ................................................................................................................. - 33 -

3.3 Sample of the study ....................................................................................................................... - 33 -

3.4 Data analysis and Presentation...................................................................................................... - 35 -

3.5 Ethical Considerations .................................................................................................................. - 35 -

CHAPTER FOUR.................................................................................................................................. - 36 -

RESULTS AND DISCUSSION ............................................................................................................ - 36 -

4.1. Status of service quality among 5 star hotels in Addis Ababa ..................................................... - 36 -

4.1.1 Tangible Elements.................................................................................................................. - 36 -

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 4.1.2 Reliability of quality services ................................................................................................ - 37 -

4.1.3 Assurance and safety.............................................................................................................. - 38 -

4.1.4 Empathy of staff ..................................................................................................................... - 38 -

4.1.5 Responsiveness of the hotels.................................................................................................. - 39 -

4.2. Engagement of frontline employees in decision making and idea generation ............................. - 40 -

4.3 Employee engagement’s relationship with service quality & employee satisfaction ................... - 44 -

4.4. Customers level of satisfaction and their opinion on quality of services ..................................... - 45 -

CHAPTER FIVE ................................................................................................................................... - 51 -

Summary of Findings, Conclusions and Recommendations.................................................................. - 51 -

5.1 Summary ....................................................................................................................................... - 51 -

5.2 Conclusion .................................................................................................................................... - 53 -

5.3 ....................................................................................................................................................... - 54 -

Recommendations ............................................................................................................................... - 54 -

REFERENCES ...................................................................................................................................... - 56 -

APPENDIX 1 ........................................................................................................................................... - 1 -

APPENDIX 2 ........................................................................................................................................... - 1 -

APPENDIX 3 ........................................................................................................................................... - 2 -

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 ACKNOWLEDGEMENTS

The journey of completing my study could not be realized without the support and encouragement
of my colleagues, friends, and family. I am deeply thankful to these individuals for their invaluable
contributions. Dr. Ethiopia Legesse my thesis advisor, for assisting me in shaping this research
paper. My mother W/o Zenebech Mengistu who always feel my gaps. W/o Azeb Aberra who
always supported me when I needed help, make me feel strong with her uncountable words of
encouragement. W/o Seble Teshome for giving a listening ear to my complaints during times of
frustration, humorous telephone conversations we had come as timely refreshing breaks.

I would like also to thank W/o Tsion, Ato Zearyam, Ato Mesfin and Ato Tariku staffs of different
hotels who assisted me in the time of data collection. Many thanks also, to Betlehem Zewdu and
Netsanet Berhanu for helping me in distribution of letters and a lot more. . I want to also thank W/t
Fikir for taking care of my baby Leul when I needed time to focus on my study.

Finally, and most importantly, I am greatly blessed to have faithful family and I express deep
appreciation for their unfailing love. I specially thank my husband Dr. Hibret Alemu for always
being there for me in every aspect. Thanks for helping me in so many different ways, too numerous
to mention. And my wonderful children, Yamlak, Mena and our new addition Leul, for always
making me smile and for understanding on those times when I was working on this paper instead
of playing with them. I hope that one day they can read this study and understand why I spent so
much time in front of my computer.

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ACRONYMS

WOM word of mouth

eWOM electronic word of mouth

SR service recovery

IDI In-Depth interview

SQ service quality

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ABSTRACT

The Hotel industry has been growing fast in Addis Ababa, Ethiopia in the past years. This is attributed to the fast
economic growth and associated matters relate to conference tourism, increased flow of tourism and globalization.
There are growing concerns about quality of services provided by 5 star hotels. Hence, the main objective of this
research is to explore quality of service provided by 5 star hotels in Addis Ababa and to assess the relationship
between employee engagement and improvement in quality of service and employee satisfaction. The research design
of this study is qualitative exploratory research design. All of the seven 5 star Hotels found in Addis Ababa were
included in the study. As two of the hotels were not willing to participate in the study, primary data was collected from
five of the hotels. To complement this, information from the tripadvisor website was utilized. Primary data was
collected from in-depth interview conducted with 15 interviewees. The findings of this study revealed that the quality
of service provided by most of the 5 star hotels in Addis Ababa is generally good. Inconsistent and low speed internet
service and lack of adequate parking area are the two major problems of the 5 star hotels. In addition, low quality
complimentary breakfast and limitations with regard to providing correct and comprehensive information are also
problems. Employees generally participate in providing feedbacks that help to improve quality of service to their
supervisors but decisions are mainly made by higher level managers. Positive relationship is observed between
employee engagement and improvements in quality of service and satisfaction of employees is identified. Addressing
the problem of internet connectivity, shortage of parking space, and quality of complementary breakfast need to be
improved to enhance quality of services provided by 5 star hotels. Engaging employees at different levels is also
necessary to enhance employees’ satisfaction and service quality.

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 CHAPTER ONE

INTRODUCTION

1.1 Background

The world is in a time when a new economic paradigm characterized by speed, innovation, short
cycle times, quality, and customer satisfaction is highlighting the importance of intangible assets
particularly an engaged human capital. This rapidly changing business environment is increasingly
forcing organizations to look for obtaining an engaged work force as unique source to build a
sustainable competitive advantage and fulfill their vision. Thus, having an engaged human
resource is deemed to be the most important source of giving excellent service which will result
in competition to win in the market. (Siyum, 2015)

Satisfaction is an immediate response to consumption, while service quality is interpreted as the

overall impression of a customer's judgment concerning service provision. Service quality is
influenced by expected service and perceived service. If services are received as expected, the
service quality is satisfactory, but if the services received exceed their expectations, customers will
be delighted, and will perceive service quality as excellent and vice versa (Hussain, 2015, P 168)

Service excellence cannot be achieved in the short-term, nor can you ever truly say that we have
‘achieved’ excellence because it’s a journey not a destination; the quest for excellence will mean
that we are constantly pushing the bar to get even better at what we do. This journey clearly
requires a great deal of commitment on our behalf, but also from those who work with and for us.
That is probably the real challenge in seeking to strive for service excellence: how can you get all
our employees to really care, to really want to go that extra mile, to really believe in what we are
trying to achieve? (Ireland, 2013)

Service quality is an important determinant of success in attracting repeat business for a hotel.
While the reasons for the initial visit to a hotel may be due to factors partly outside the control of
management, the ability to create a satisfactory experience for the guest will rest to a considerable
degree within the hands of both management and hotel staff .(Saleh, 1991)

Competition among hotels to attract and retain customers is intense and customers may be
less likely to return to a hotel if the property fails to meet its customers’ expectations relative
to service quality, regardless its price-point. Evidence suggests that service quality is related
to customer satisfaction and customer loyalty. (Heskett et al. (1997) have proposed that
meeting customer expectations relative to service quality has a direct relationship with the
profitability of a service firm. Because service quality drives customer satisfaction and
satisfied customers are more likely to be retained as loyal customers of a firm, good service
quality positively impacts profitability by increasing the customer-base of a firm, allowing a
firm to charge premium prices for their service products, and because of increased employee
retention and productivity – a concept referred to as the service-profit chain. (Rauch, 2015)

Employees’ level of engagement directly affects the quality of service provided by the
Organization. Therefore, highly engaged employees are beneficial to an organization. An engaged
employee is aware of business context, and works with colleagues to improve performance within
the job for the benefit of the organization. Employee engagement is vital to public administration.
When workers are engaged, they positively commit to their organization, willingly make changes,
trust their organization, and aspire to achieve improvements within the organization. They become
more profitable, more customer focused, safer, and more likely to withstand temptations to leave
the organization. The results of engagement include improved productivity, a reduction in
turnover, and amplified customer focus. The world’s top-performing organizations understand that
employee engagement is a force that drives business outcomes. (Markwick, 2009)

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Much research in the public and private sectors has demonstrated that workforce engagement is
significantly correlated with several positive organizational outcomes including the following:

o Higher productivity
o Increased profitability
o Lower levels of sick leave use
o Fewer complaints of unfair treatment
o Less work time missed due to workplace injury or illness
o Lower levels of attrition
o Higher levels of customer satisfaction

There is a general belief that there is a connection between employee engagement and business
results; a meta-analysis conducted by Harter et al (2002, p. 272) confirms this connection. They
concluded that “…employee satisfaction and engagement are related to meaningful business
outcomes at a magnitude that is important to many organizations”. However, engagement is an
individual-level construct and if it does lead to business results, it must first impact individual-
level outcomes. Therefore, there is reason to expect employee engagement is related to individuals’
attitudes, intentions, and behaviors. It is proposed that high levels of engagement lead to both
positive outcomes for individuals, (e.g. quality of people’s work and their own experiences of
doing that work), as well as positive organizational-level outcomes (e.g. the growth and
productivity of organizations). (Zajkoska, 2012)

High organizational performance is greatly facilitated when employees at all levels, including
managers, are engaged. Employees who are not engaged do not commit the attention and effort
required to perform at their best. Two employees, one engaged and one disengaged, with similar
competencies and experience will typically contribute to their organization at very different levels:
the engaged employee will invest discretionary effort in the work to do the best job possible, while
the disengaged employee will do the minimum (Marrelli, 2011).

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Effective communication is an integral part of a well-constructed strategy for driving employee
engagement. Human resource implications of the current business downturn entail acute
communication risks and opportunities. From a risk perspective, poor or no communication about
the effect of disappointing business results on employee benefits, retirement plans, training, or
other components of Total Rewards can lead managers and employees to fill the communication
vacuum with inaccurate and/or inconsistent information. (Zajkoska, 2012)

The aim of this study is to investigate quality of service provided by Ethiopian 5 star hotels and
also to explore the level of employee engagement that managers use in decision making and idea
generation which is expected to result in high customer satisfaction and loyalty.

1.2 Problem Statement/Research Gap

To achieve a set of organizational goals and objectives, companies conceptualize, design and
implement various strategies.

A hotel that is able to compete successfully in its industry through the creation of a sustainable
competitive advantage for its service offering, and positioning its service offering successfully in
relation to its competitors throughout the life cycle of that offering, will eventually retain
customers. In addition to properly manage demands that meet customer satisfaction, a hotel needs
to administer its capacity or ability to supply the demand made by its customers. Human resource
development is also another issue needed to be implemented on the process. Capacitating and
delivering training to the staff is one concern but also retaining and engaging the trained staff is
also another concern. Service organizations should train and retain the skilled staff as one of the
strategies of bringing the organization to the top level in its industry and making better profit. If
not the rate of turn over becomes higher and the employees automatically leave their hotel when
they get promotion and salary increment in another hotel. Hotels should attract the trained/ skilled
workers with better working conditions to avoid brain drain which is a problem observed in other
sectors too. (Molla, 2015)

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Employees who have a strong faith in the values and beliefs of an organization and readily accept
its goals and objectives and are ready to exert extra effort for or on behalf of the organization are
considered to have a very high level of organizational commitment. This suggests that those who
are strongly affiliated to an organization with a higher level of commitment can be motivated to
achieve organizational goals without looking for an opportunity for personal gain. (Dhar, 2015)

The philosophy behind service quality has gained importance in recent years and thus it has
become the focus of many conceptual and empirical researches. The studies undertaken so far;
however, have primarily much more focused on service quality and customer satisfaction. This
study focuses on the in depth understanding of the relationship between service quality and
employee engagement in the context of the developing countries in the case of 5 star hotels
operating in Addis Ababa. (Hailekiros, 2013)

Addis Ababa is experiencing the opening on average of one hotel per month, according to the data
from AHA (2014) the existing sector is marked by four fundamental problems that need a thorough
fix: unmet demand, poor hospitality, unpractical building technicalities and an exaggerated price.

Today Addis Ababa is home to numerous UN offices, countless international companies and
NGOs. The city is also a residence for a lot of diplomatic missions accredited to the government
in Ethiopia, the UNECA, and, of course, the African Union (AU), which is headquartered in Addis
Ababa. These offices are the reasons for the visit of some foreigners who usually come for
meetings and different kinds of work related matters. These people will get the chance to judge
the hotel industry in Addis Ababa. The city is also entry to hundreds of thousands of international
inbound, outbound and transit tourists and passengers. (Kebede, 2014)

The term “employee engagement” means different things to different organizations. Some equate
it with job satisfaction which unfortunately can reflect a transactional relationship that is only as
good as the organization’s last round of perks or bonuses. Others measure engagement by gauging
employees’ emotional commitment to their organization. Although commitment is an important
ingredient, it is only a piece of the engagement equation. (Zajkowska 2012) P 104

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One way for individuals to repay their organization is through their level of engagement. That is,
employees will choose to engage themselves to varying degrees and in response to the resources
they receive from their organization. Bringing oneself more fully into one’s work roles and
devoting greater amounts of cognitive, emotional, and physical resources is a very profound way
for individuals to respond to an organization’s actions. It is more difficult for employees to vary
their levels of job performance given that performance is often evaluated and used as the basis for
compensation and other administrative decisions. Thus, employees are more likely to exchange
their engagement for resources and benefits provided by their organization. (Alan M. Saks 2006)

Five Star Hotels in Addis Ababa deliver all their efforts to provide the best possible and high
quality services to their customers but very often they still fall short of meeting the customers'
expectations because the customers have become more aware of their requirements and demand
higher standards of services. So the young generation should also participate in the improvement
of quality service and be aware of the relationship of employee engagement with providing the
better service as it is the best growing sector of all. (Molla, 2015)

The motivation for studying employee engagement in Hotel Industry of Addis Ababa is to
investigate its contribution to the service quality in the hotels. And assess the challenges that the
hotels are facing in making effort to improve organizational performance through employee
engagement so as to put some possible recommendation to overcome the problems.

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1.3 Research Questions
This research is designed to answer the following questions among 5 star hotels in Addis Ababa:
1. How is the overall service quality?
2. How involved are frontline employees in improving service quality and customer
satisfaction?
3. How does employee engagement help to improve service quality and employee
satisfaction?
4. What is the level of effort being made towards improving quality of service?
5. What are the perceptions of customers about the quality of service?
6. What are the major bottlenecks to deliver quality service?

1.4 Objectives of the Study

1.4.1 General Objective
The general objective of this research is to explore quality of service provided by 5 star hotels in
Addis Ababa and assess the correlation between employee engagement and improvement in
quality of service and employee satisfaction.

1.4.2 Specific Objectives

Specifically, the objectives of this study are to:

1. Explore the status of service quality in 5 star hotels in Addis Ababa.

2. Assess how 5 star hotels involve their frontline employees in decision making and idea
generation to improve quality of services.
3. Explore how employee engagement helps to improve service quality and customer
satisfaction
4. To assess the level of effort made by managers try to improve the quality of service.
5. Assess the perceptions of customers on quality of services provided by 5 star hotels in
Addis Ababa.
6. To identify the obstacles that the management of the hotels face.

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1.5 Scope of the study
The overall scope of this study is to explore the quality of services provided by 5 star hotels in
Addis Ababa. As Ethiopia’s economy has been growing fast in the past years this has created
opportunities for the hotel industry to grow as many people travel for investment, trade,
conferences, and other reasons. On the other hand, as Addis Ababa hosts the African Union and
other international organizations, many more people travel for different reasons. In the past few
years the number of 5 start hotels has grown from just one to about seven. Although the number
of Hotels has grown there are concerns about the quality of service provided by these hotels. Part
of the reason for the sub-optimal quality services could be lack of sufficient involvement of
frontline workers who have the direct interactions with customers in the quality improvement
process. Hence, this study is expected to come-up with findings about the levels of quality of
services including recommendations that will help to improve quality.

1.6 Limitation of the study

There were different bottlenecks that hamper the smooth flow of the research. This required the
researcher to show extraordinary patience and commitment that put its own negative impact to
accomplish the research as needed.

Some hotels didn’t allow interviewing their customers as they said this will invade customer
privacy. In addition, it was very difficult to get the support of managers and supervisors of the
hotels to be interviewed and to allow their employees to be interviewed. To complement this
challenge, feedbacks given by customers on the tripadvisor website was incorporated.

1.7 Significance of the study

This study will benefit hotel managers, employees and customers through providing clear
information concerning the services rendered by Ethiopian 5 star hotels and the trend of employee
involvement on idea generation and decision making for the success of these hotels. It will have a
practical importance on consolidating the understanding and relationship of hotel service quality
and employee engagement for managers and owners towards bringing a sustainable competitive

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advantage and improved service giving strategy to the Five Star Hotel management in Addis
Ababa.

It recommends some basic and valuable inputs in the existing and practical experiences of these
hotels. It can serve as an important data for the newly opening Five Star Hotels to obtain improved
competitive advantages and will help them enter easily into the market.

It also provides possible recommendations to the hotels on how to take action to enhance its
employee's engagement. And help the hotel management identify areas that need attention to meet
and exceed customer expectations. It would also help managers on how to improve the quality of
service which results in getting more loyal customers.

It can be used as an input for development of policies in the tourism sector. Moreover, it will serve
as a stepping stone for those who are interested to conduct advanced research works in the same
field.

1.8 Key Terms/Definitions of this Study

Hotel: A hotel refers to the commercial establishment of providing lodging and meals and other
guest services in general to customers. In Ethiopia to be called a hotel an establishment must have
a minimum of 10 bedrooms, at least each of which must have clean private bathroom facilities.
(Molla 2015)

Service Quality; an author defines service as “any intangible act or performance that one party
offers to another that does not result in the ownership of anything” (Kotler& Keller, 2009: 789)

Employee Engagement: “the harnessing of organization members’ selves to their work roles; in
engagement, people employ and express themselves physically, cognitively, and emotionally
during role performances.” (Zajkowska 2012)

Reliability: - The ability to perform the service dependably, consistently and accurately.

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Responsiveness: - The willingness to help customers and provide prompt service. Assurance: -
The knowledge and courtesy of employees and their ability to convey trust and confidence.

Tangibles: - The physical evidence of service including physical facilities, appearance of

personnel, tools, and equipment used to provide the service.

Empathy: - Caring, individualized attention to its customers.

1.9 Organization of the study

This study is organized in to five chapters. Accordingly, the first chapter commences with the
introduction part; the second chapter discusses the related literature of the study; the third chapter
focus on research methodology and the fourth chapter discusses data presentation and analysis and
finally chapter five stipulates conclusion based on analysis and possible recommendation by the
researcher based on investigation.

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 CHAPTER TWO

LITERATURE REVIEW
2.1 Quality
Quality is a dynamic state associated with product, services, people, processes, and environments
that meet Customer needs and expectations and help produce superior value. Total quality is an
approach to doing business that attempts to maximize an organization’s competitiveness through
the continual improvement of the quality of its products, services, people, processes, and
environments. (David Goetsch, 2010)

2.2 Service Quality

Parasuraman et al. (1985) described service quality as the ability of the organization to meet or
exceed customer expectations. Customer expectations that may be defined as the “desires and
wants of consumers”, i.e., what they feel a service provider should offer rather than would offer.
Definitions of service quality, therefore, focus on meeting the customers’ needs and requirements
and how well the service delivered matches the customers’ expectations of it. Moreover,
Parasuraman et al. (1988) offer the most widely reported set of service quality dimensions. They
suggest that the criteria used by consumers that are important in molding their expectations and
perceptions of delivered service performance known as SERVQUAL: Tangibles, Reliability,
Responsiveness, Assurance and Empathy. (Parasuraman, Zeithaml, and Berry 1988)

Services are taking on an increasing importance both domestically and internationally. In today’s
changing global environment, many businesses are facing intensifying completion, and in order to
achieve competitive advantage and efficiency, businesses have to seek profitable ways to
differentiate themselves. One strategy that has been related to success is the delivery of high
service quality, especially during times of intensive competition in the domestic and international
markets concurs that service has increasingly played a critical role in a hotel’s operations. This
concept has been the subject of many conceptual and empirical studies, and it is generally accepted
that quality has positive implications for an organization’s performance and competitive position.
(Nida, 2018)

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2.3 Relationship Quality
Relationship quality is widely recognized as both a key to developing loyal customers and an
important predictor of a customer’s post purchase behavior (Morgan & Hunt 1994). Whereas
service quality is an overall evaluation of firm’s performance, relationship quality is a strategic
orientation that focuses on improving customer relationship.

2.4 Measuring service quality

The basic characteristics of service, namely variability, inseparability and perishability have
caused some difficulties for academics and practitioners with regards to measuring service quality.
In particular, decisively determining the criteria which will be used for the service quality
evaluation process is not very easy because of the complicated structures In spite of those
difficulties, true quality cannot be developed unless it is measured, thus emphasizing the
importance of service quality measurement. Only service providers who know how consumers
evaluate the service will also know how to lead these evaluations in the desired direction. In
addition, basing user experiences related to a service and distinguishing service differentiation
criteria on this ground is another important reason to realize the measurement process. However,
service marketers understand the need to define the perceptions of service quality correctly when
using it for a competitive advantage (Malhotra et al., 2005).

2.5 Developing Service Improvement Strategy in the organization

A firm can improve the quality of its services by developing the service improvement strategy in
the organization which requires several steps and measures to trigger improvements in the internal
environment. Some steps are explained for managers through which company can improve the
service quality. (Qadeer, 2013)

The following are some of the steps from Leonard, Parasuraman & Zeithmal (1994)

2.5.1 Listening
Generally, quality is defined by the customers and it should be improved according to customer
specifications not the company. Listening, understanding and spending wisely on customer’s
expectations and perceptions can bring improvements in the services of the company as the way
customers required and expect. The most common mistake in service improvement that companies

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do is to spend money in a way that does not improve the services at all. Research shows that
company’s strengths and weaknesses from service perspective are better explained by those who
have experienced it. In order to improve the service, companies should install an ongoing research
system that provides timely and relevant data. Also there is a need to develop service quality
information system in the company. The service quality information system basically provides the
following information.

o Identify Dissatisfied Customers & frequent service failure causes

o Collect customer feedback on continuous basis
o Create customer forums to get ideas of further improvements
o Improve internal service quality by focusing on employee issues and concerns
o Improve customer services by measuring individual employee behavior to use in trainings,
performance evaluations and rewards
o Analyze the company’s service performance compared with competitors to identify
strengths and weaknesses.

2.5.2 Reliable Service

Research reveals that among these five dimensions Reliability is the most important one to judge
the quality of the service. When firms are failed to deliver the promise and make frequent mistakes
in service delivery, customer loses its confidence on the firm’s ability to provide timely and
accurate service at the first end.

2.5.3 Service Design

Reliability in service delivery as expected by the customers depends on how the various elements
in the service system work well together. These elements include people who perform the service,
equipment that required performing the particular service and the physical environment in which
service is actually performed or delivered. Flaws in any part of this service system affect the quality
level. Usually people who are delivering the services are blamed for poor quality however the real
problem lies in the service system design. Service mapping is considered a way to improve the
quality of services. Service mapping is the pattern of performances that makes a service system
design.

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2.5.4 Service Recovery
When a customer face a service problem, either service firms makes things better with the customer
or make it worse sometimes. Three things happen when a customer experience any problem, they
remain dissatisfied and do not voice their complaints, they complain and become satisfied or
become dissatisfied if company does not response well.

Generally customers are reluctant to complain and company should take following steps in such
situations,

o Encourage customers to voice their complaints and make it easy for them by providing free
numbers or comment cards.
o Problem resolution system needs to be developed very effectively in the service firms.
o Response quickly to customer complaints because quick response makes a customer feel that
company is concerned about his/her interests.

2.5.5 Surprise Customers

Customers evaluate the service dimension during the delivery process and it is very difficult to go
beyond customer’s expectations by providing the reliable services only. Therefore managers must
consider the “WOW” factor in their service offerings. To go beyond expectations and delight the
customer demands, firms should offer some surprising elements in their service offerings like
grace, courtesy, uncommon swiftness, understanding and commitment.

2.5.6 Fair Play

The customer expectation lies under the concept of fairness. As customers expect from the service
providers to treat them fairly, fulfil the promises made and be trustworthy. Mainly customer’s
expect companies to provide quick services( responsiveness), to offer comfortable service
facilities and communication channels ( Tangibles), to fulfil the commitments (Reliability) to offer
personal attention and polite dealing ( Empathy) and should provide considerable and competent
services( Assurance). Also should provide the guarantee demonstrate fairness towards service
offerings. It gives the customer a right to evoke the service and charge the compensation if he
becomes dissatisfied.

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2.5.7 Servant Leadership
Delivering high service quality demands an excellent leadership often known as “Servant
Leadership”. These leaders believe in people capacity to view their own roles as standard of
excellence and a direction to achieve their goals by providing necessary equipment, tools and
proper freedom to achieve their tasks. These Leaders believe in investing people by listening to
their concerns, providing those trainings, coaching, and teach them how to inspire and compete in
order to boost company’s productivity and quality standards

Times are changing and so are our views on leadership behavior. In view of the current demand
for more ethical, people-centered management, leadership inspired by the ideas from servant
leadership theory may very well be what organizations need now. Concern about the society we
live in has increasingly become a matter of company policy. It may be that paying attention to all
stakeholders is the key to long-term profits. At present, innovation and employee well-being are
given high priority and so leadership that is rooted in ethical and caring behavior becomes of great
importance. In the relatively new field of positive organizational behavior, leadership recently has
been suggested as a key factor for engaged employees and flourishing organizations.
(Dierendonck, 2011)

2.6 The critical role of employees in service delivery

The interactive nature of service delivery places service employees in a very critical role in the
delivery of quality services. Studies even assert that employees are the “service”, “the
organization” and “the marketers”. Given the metaphor of services as “performances” or “drama”,
in which an employee acts, emotions and attitudes affect the quality of the service and the
employees’ critical role cannot be over emphasized. Previous studies on service encounters also
show that events which delight customers most and which are associated with high perceived
quality are related to the extra behavioral efforts of service personnel. This is understandable
because the extant literature on service quality indicates that most of the criteria by which
customers evaluate the perceived quality of services, such as empathy, reliability, courtesy,
assurance and even tangibility, are all associated with employee favorable behaviors and attitudes.
These favorable behaviors which enhance a harmonious and quality internal service climate, as

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well as customers’ perceptions of service quality, have been described variously as service
orientation customer orientation prosaically behaviors and performance quality. The importance
of such behaviors to process quality and interactive quality has also been noted. (Gupta, 2016)

2.7 Employee Engagement

Engagement has become one of the most significant concepts in the management field in recent
years (Crawford et al. 2014) yet, to date, there has been no systematic review that brings together
and synthesizes the evidence-base relating to engagement. This is concerning in light of the fact
that, within the practitioner community, engagement has caught the interest of policymakers and
employers keen to find new ways of leveraging high levels of performance. It is largely consensual
that the degree of autonomy workers have in their job and the extent to which they participate in
relevant work-related decisions are key dimensions of job quality.

An engaged worker must positively commit to the organization. The employee must be willing to
make changes, which require that he or she cares enough to change. The engaged worker possesses
trust in his or her organization, especially that one’s input and energy will not backfire. An
engaged worker also is certain that his or her effort actually leads to positive results in the
organization, which refers to as the possession of self-efficacy (Rank, Carston, Unger & Spector
2007). Finally, the worker aspires to achieve improvements within the organization, which also
requires that he or she conceptualize the positive effects that can be achieved (Frese 2008).

2.8 How does an organization engage its employees?

Just as researchers study engagement from many perspectives, employee engagement is also
influenced by numerous factors. Employee experiences are shaped by the organization with its
mission, structure, policies, and ways of doing business, as well as the people who staff the
organization. As Mayo determined, the work supervisor is very influential in shaping the worker’s
experience. Supervisor feedback helps employees understand the “effort-performance-reward”
relationship and clarification of expectations (Gaudine & Saks 2001; Wright 2004).

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Effective communication, trust, and a shared normative framework are important within an
organization to foster employee engagement. Organization wide engagement is encouraged by
“pushing power, information, knowledge and rewards to lower levels of the organization”. In a
study which surveyed 186 supervisor subordinate relationships within one of America’s largest
financial institutions, researchers found that workers were more engaged when they exhibited
personal initiative, when 7 their jobs had adequate task complexity, and when supervisors led
through participatory leadership (Rank, Carsten, Unger & Spector 2007).

Clear organizational expectations and goals are integral to successfully engaging employees and
attaining desired results. For example, a study systematically coded, workplace focused, book-
length ethnographies found clear indication that “The highest levels of cooperation, commitment,
and citizenship depend both on organizational coherence and on supportive employment
practices”. On a foundational level, organizations should establish a set of core values. This will
enable employees to choose the values along with the organization at the initiation of their
relationship. From these goals, administrators can develop strategic plans for the organization and
managers can work with their staff in developing plans to achieve these goals. This process helps
to align the organization and engage employees in taking ownership of the work (Selden, Ingraham
& Jacobson 2001).

Clear goals will also support all parties to reference the core values when needed for appropriate
problem solving. Job goals that are challenging, but perceived by the employee as attainable and
worthwhile will have a motivating effect for employees. By providing a clear mission and
expectations, an organization can offer more freedom to employees to do the work with individual
style. This will further engage employees and yield better results for the organization (Brewer &
Selden 2000).

An organization can shape employee characteristics (Posner & Schmidt 1996; Wright 2001) and
as such, the organization should be thoughtful in ensuring this socialization happens purposefully
and productively. Communicating organizational expectations during the time of hire, as well as
orientation and socialization that reinforce the organization norms and expectations can encourage
this socialization. Such measures will also help prevent employee disappointment resulting from

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inaccurate expectations of their employer and job (Paul, Niehoff & Turnley 2000). Engaged
employees are valuable to an organization, but it is important that the process in which an 8
organization develops that engagement is done purposefully to ensure workers’ enthusiasm is
directed productively.

It is important to foster employee engagement by focusing on goal alignment, clearly

communicating boundaries, emphasizing information sharing, and encouraging accountability
Service exchanges between worker and citizen require the worker to sense the right tone and
medium for expressing a point and/or feeling and then to determine whether, when, and how to act
on that analysis. To ignore this combination of analysis, affect, judgment, and communication, is
to ignore the “social lube” that enables rapport, elicits desired responses, and ensures that
interpersonal transactions are constructive. Excellence in people management cannot ignore affect.
It has real human consequences and matters if people are to perform at their best. Emotional labor
is an important component of many roles in the hospitality sector. Often times, front line
employees must manage how they experience, control, and display their emotions. This is an
essential skill in order to develop trust with their clients in order to be successful in their jobs
(Newman, Guy & Mastracci 2009).

2.9 Factors driving Employee engagement

While there are factors related to the individual that determine the extent to which employees
become engaged, there are also organizational related factors that drive engagement. Levels of
engagement can be increased when there is a relationship between employee and manager. In
other words, supportive workplace relationships are important drivers of engagement. Studies
found that supportive management promotes psychological safety, in that when employees feel
that the organization cares about their well-being they are likely to fulfill their obligations by
becoming more engaged. The organization can create an environment through policies,
procedures, and structures to encourage employee engagement. Through the policies and
procedures, employees will have a clear sense of the organization’s vision, mission, and values.
Organizational policies and programs are likely to motivate employees to reciprocate higher levels
of engagement. As such, organizations policies and practices should address employees’ needs
and concerns and demonstrate caring and supportive cultural environment (Saks 2015).

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Through organizational policies, training and development plans can be promoted, employee
achievements recognized, and flexible work arrangements implemented. According to Khan
(1992), jobs that allow employees the opportunity to bring more of themselves into their work will
help to keep them engaged. In addition to meaningful work, employees vary in their levels of
engagement as a function of their perceptions of the rewards and recognition they receive from
their role on the job. While a lack of reward and recognition can lead to burnout, adequate and
appropriate benefits is important for engagement. It is vital for managers to understand the
significance of social exchange for employee engagement. Although research on work engagement
has shown to be positively related to job resources and outcomes such as satisfaction,
organizational commitment, citizenship behavior, low turnover, and performance, little is known
about the influence of organizational service orientation and customer service training on
employee engagement. In HR Special Survey (2008) which was administered across a wide region
of countries, it was stated that employees in higher positions in the organization show higher levels
of engagement. However, in the tourism and hospitality industry frontline staffs occupying entry
level positions play a major role in the success of the organization, highlighting the need for full
engagement at work. For that reason, it is important to know the levels of engagement of frontline
employees in relation to these organizational strategic practices. (Ram, 2011)

2.10 Characteristics of Engaged Employees

According to IES, 2003 an engaged employee has the following characteristics: ·

o Engaged employees have emotional attachment with their job as well as the organization.
o They have trust in the employers of the organization.
o Engaged employees are more committed towards their work as well as the organization.
o Create healthy working environment and respect other employees of the organization. ·
Cooperate with their colleagues to perform effectively.
o Engaged employees perform beyond the expectation of the employers.
o Perform their work in view of goals and objectives of the organization.
o Engaged employees make necessary change as per requirement and keep update with the
knowledge in their field.

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2.11 Results of Engaged employees
The results of engagement include improved productivity, a reduction in turn-over, and better
customer focus. Organizations need engaged employees that are willing go beyond expectations
in order to meet market pressures and run as efficiently as possible. When organizations and
employees interests are aligned, employees “can be counted on to act more frequently in ways that
are consistent with corporate objectives” which affects both productivity and client focus.
Employee engagement and morale have been shown to have a direct relationship to customer
satisfaction, particularly in the exchange of services. As engaged employees affect an
organization’s bottom line (Macy & Schneider 2008) by reducing operational losses (absenteeism,
turn-over, etc,) and increase profitability with more satisfied customers, they simultaneously
improve the organization. In addition, engaged employees make better decisions and are more
adept at problem-solving, which also leads to greater organizational efficiency (Paul, Niehoff &
Turnley 2000).

As the organization improves, workers’ perception of their organization also improves, thereby
causing their engagement with the company to increase. There are external factors that can affect
the level of satisfaction for customers and workers. An individual’s characteristics such as, race,
religion, gender, national origin, ability, health, education level, sexual orientation, and age can
influence satisfaction. Other studies have found in the workplace, women are typically more
satisfied than men, more tenured workers are more satisfied than their juniors, and whites are more
satisfied than non-white individuals. Additionally, research has also suggested that workplaces
with higher staffing levels and more highly educated workers result in higher levels of engagement.
(Southard, 2010)

2.12 History of Hotel Industry in Ethiopia

History has proved that, the development of hotel industry is connected with travelling. Similarly,
the development of hotels in Ethiopia is also associated with the increasing number of travelers
both indigenous and foreigners. Developments in Ethiopia’s foreign relations, particularly during
the reign of Menelik II had, relatively speaking, an impressive impact in the country, by implanting
the seeds of modernization through the importation of European technology and institutions among

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which “hotel” is one subject. Therefore its appearance is Communication Responsiveness
Customer Satisfaction Tangibles Reliability Confidence 36 related with the opening of the society
in to the western world. Development of modern hotels in Ethiopia traces back to the 19th century.
Itegue Taitu hotel, which was built in 1898 (E.C.) at the center of the city (piazza), is the first hotel
in Ethiopia. This hotel is currently half burned due to unspecified reasons and lacks original works
of the past. Taitu Betul (1851-1918), an Ethiopian empress and the wife of emperor Menelik II,
establish this hotel to provide guests a place to rest and dine. From this time up to the Derg regime,
the country had owned for about 50 hotels at a national level and out of these only 19 hotels was
to be star rated hotels, according to the report of Tourism Commission in 1994. Currently, with
the emergence of new and modern hotels in the country, the number has grown considerably and
there were 500 star rated hotels in Ethiopia. And out of these 116 hotels are found in Addis Ababa,
78 are star rated hotels in Addis Ababa out of these 7 of them are luxury or 5 star hotels. According
to Ministry of culture and tourism (2010), out of these 5 star rated hotels, the international chain
hotels are four in number. These are Marriot, Sheraton Addis, and Radisson Blue and Golden
Tulip. (G/egziabher, 2015)

2.13 Service Quality in Hotel Industry

For hotel industry, service quality is an important consideration, so companies striving to attain
maximum customer satisfaction by providing quality services. According to Min, H. and H. Min,
1996 service quality is the life blood for hotel industry and service quality is further linked with
customer satisfaction, customer satisfaction is related with customer loyalty. Service quality is
considered an evaluation between service prospect and what actually has been received. The
survival of hotels in the current competitive environment where most hotels have quite similar
luxurious physical facilities much depends on delivery of service quality aiming to result in
customer delight. Pallet et al. (2003) suggests that quality has to be envisioned, initiated, planned,
delivered, monitored and sustained. They propose that quality problems and key staff issues in
hotels often can be solved with a common “People and Quality” strategy which involves placing
customer needs in the heart of the whole process; seeking suggestions form staff; developing
corporate quality and people philosophy; training and empowering staff; benchmarking and
reviewing (Saleem & Raja, 2014)

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2.13.1 Customer Satisfaction: Customer satisfaction is the internal feelings of every individual
which may be satisfaction or dissatisfaction resulting from the assessment of services provided to
an individual in context to customer’s anticipation by an organization service provides are
continuously trying to improve the service just to satisfy their customer because higher customer
satisfaction leads towards customer loyalty. The most important concept of customer satisfaction
is accepted all around the world is the expectancy disconfirmation theory. This theory was
presented that satisfaction stage is the resultant of distinction between anticipated and supposed
performance. Satisfaction will be encouraging when the actual level of services or products is
better than the anticipated (positive disconfirmation), whereas (negative disconfirmation) when
the product or services level is lower than expected. (Saleem, Raja 2014)

2.13.2 Customer Loyalty: “customer who repurchases from the same service provider whenever
possible and who continues to recommend or maintains a positive attitude towards the service
provider.” Julander et al., (1997) explained that customer loyalty has two magnitudes: the first one
is behavioral and the other is attitudinal. The behavior loyalty means the customer is intend to
repurchase the brand or services from the service provider over time, whereas, attitudinal loyalty
means the customer intend to repurchase and also recommend others which is the good sign of
customer loyalty (Saleem, Raja 2014).

2.13.3 Brand Image: The brand is one of the important assets of the customers through
questionnaire. “Brand is reflected by the brand links held by in consumer memory”. In simple
words brand image is basically what comes into the consumers mind when brand placed in front
of him. Consequently, these associations are building up into the consumers mind from the direct
experience of service they have, after those experiences they make conclusion by contrasting their
previous experiences with the company and the set associations. There are many empirical
evidences that proved customer loyalty and brand image have positive correlation with each other.
Whereas, other researches proved positive contact on brand image by that service quality and
customer satisfaction comprise positive relationship with brand image. Another study found that
image is positively related with customer satisfaction and customer preference in luxury hotels.
This showed that pleasing image leads towards customer preferences and customer satisfaction
whereas, unpleasing image can lead towards customer dissatisfaction (Saleem, Raja 2014)

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Nowadays the stock of hotels in Ethiopia has increased sharply over the last few years. While
tourist accommodation is available as the major attraction, improvement as well as new
construction is taking place, according to ministry of culture and tourism there are 140 hotels in
Addis Ababa, 124 in Amhara, 5 in Afar, 13 in Benshangulgumuz, 19 in DireDawa, 16 in Gambela,
7 in Harar, 74 in Oromia, 14 in Somalia, 78 in Southern Nation Nationality and Peoples, and 38 in
Tigray. (G/Egziabher, 2015)

2.14 Service Quality in Ethiopia

Nowadays, the business environment has become highly competitive and dynamic. Success in this
situation demands firms to develop improved products and design appropriate marketing
programs. Hotel industry in Ethiopia sooner or later will also face the challenges of globalization
in terms of competition which demand improvements in services delivery and level of customer
satisfaction. In the last decades, customer retention is not considered as important as in these days
in our country, Ethiopia. Today, there is high competition in the market in almost every sector.
Currently, business organizations are faced with competition both from local and international
firms, because of globalization. The environment in which they are operating has been consistently
undergoing changes. But most organizations are using marketing strategies that they have been
using in the past with no modifications, especially in retaining customers and making them lifetime
partners. Rethinking of their marketing strategy on customers‟ handling seems a long overdue
activity of most Ethiopian hotels. (Urge, 2017)

2.15 Service quality in the tourism sector

Recently, the dominant position of the manufacturing sector has been overtaken due to the rise of
the service sector. Accordingly, with its international identity, the tourism and accommodation
industry stands among the biggest industries in the world. Tourism, which has become a
supplementary component of lifestyle, is one of the primary players in the economic development
of many countries (Poon and Low, 2005) and it is seen as an indispensable source for foreign
currency inflow. (Dortyol, Varinli, Kitapci, 2013)

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A hotel is a place that offers its facilities and services for sale. The services can vary from just one
to various combinations that can all be thought of as a part of the total market concept of the hotel.
Hotels should make use of Information Technology systems and networking for effective service
delivery and customer focused services. Customers from outside the city need to book their hotels
through the internet, thus the hotels also have to deliver E- Services for the sake of their customers’
satisfaction and to make the reservation easier and accessible. (Molla, 2015)

2.16 How service quality can be improved in the organizations?

Providing excellent services require continuous improvements in the organizational culture, a
culture in which people are challenged to give their best and are rewarded and recognized in the
company to perform to their full potential.

2.17 Five star hotel quality standard

International standard of tourist hotel is high class hotel (from three to five-star level) where
services like bedrooms, catering, conference halls and meeting rooms, multipurpose assembly hall,
swimming pool, Spa (Hot Spring), gymnasium, sauna and massage, other sports facilities like
tennis or squash court, mini-golf or badminton, bowling, table tennis and children playground,
night club with dancing to live music or discotheque or cabaret etc. In this profile study a five star
international tourist standard hotel is considered to provide local and international tourists and
guests services like bedroom, catering (traditional and international), swimming pool, conference
halls and meeting rooms, multipurpose assembly hall, gymnasium, Spa Service and laundry
service. In Ethiopia, the Five Star Hotels are built on the basis of certain standards. These standards
are shown in table-1 depicted below:

Indicative score expected

Category Title from 5 star hotels
Building Exterior 20
Grounds & Gardens 15
Exterior

Parking Access Signage /Points of Entry 20

Safety and Security 12

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 Subtotal of Exterior max points 70
Decoration 20
Furniture 25
Electronic Appliances 8
Wardrobe/Hanging Spaces/ Clothes Hanger 3
Curtains and window covering 15
Flooring, Ceiling, Skirting & Cornices 15
Bedding & Linen 20
Rooms
Bed

Form of Bedding 10
Environmental Control 15
Lighting/Power/Switches 20
Mirrors 9
Accessories 20
Spaciousness and overall Impression 15
Access Security 5
Subtotal Bedrooms max points 317
Type 20
Flooring, Ceiling and Walls 15
Fixtures and fittings 25
Hand Basin and Toilet Areas 2
Toweling 20
Lighting 20
Bath Rooms

Accessories 15
Sub Total Bathrooms Max Points 168
Decoration 15
Furnishings and fittings 15
Flooring, ceiling and skirting 15
Lighting 20
Atmosphere and Ambience 15
Guest Services 5

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 Escalators/Lifts (Applies to all premises of 3 50
floors or more)
Additional Services 20
Sub Total Public Areas Max points 200
Decoration 15
Public Areas

Furnishings and fittings 15

Flooring ceiling and skirting 15
Lighting 20
Atmosphere and ambience 15
Guest Services 50
Escalators, lifts 50
Additional services 20
Sub Total Public Areas Max Points 200

Decoration 15
Furnishings 20
Flooring, ceiling Skirting and cornice 15
Lighting 15
Bar & Dinning

Table Appointments 15
Facilities

Atmosphere and ambience 15

Dinner Presentation 30
Dinner Quality 50
Breakfast 15
Bar 25
Additional Points 15
Sub Total Bar and Dining Facilities Max 285
points
Design Layout 100 or Excellent
Kitchen

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 Sub Total Kitchen 100
Scheduling 20

& Maintenance Material and Equipment storage 20

Bedrooms 15
Keeping

Guest bathrooms 15
House

Public areas 15
Public Toilets 10
Bar, restaurant, dining areas 20
Maintenance 50
Subtotal Housekeeping Maximum Points 165
Welcome Friendliness and attitude 20
Appearance of Staff 15
Reservation and Check-in 20
Porter age 15
Services
General

Room Service 15
Laundry Services 7
Meal Service 20
Check-out Efficiency 15
Tourist Information 15
Communication and Business Facilities 10
Sub Total General Services Max Points 305
Bedrooms 15
Guest Bathrooms 15
Maintenance
Keeping &

Public Areas 15
House

Public Toilets 10
Bar/Restaurant/Dining Areas 20
Maintenance 50
Sub Total Housekeeping Max points 165
Business, conference 25
Addit

Facili
ional

ties

Leisure 20

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 General 25

Subtotal Additional Facilities Max Points 90

Waste 40
Sustainab
ility

Energy 15
Business practices 15
Subtotal Sustainability Max Points 80
Entry security 30
Safety &
Security

Fire safety 30
Medical, first aid 50
Subtotal security and safety Max points 110
Qualifications & training 20
& training
Facilities

Work conditions, staff facilities 20

Staff

Subtotal staff facilities and training max 160

points

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 Grade %
5 star Grand Luxe 90
5 star 80
4 star 70
3 star 60
2 star 50
1 star 30
There are five quality star grades awarded for the standard of facilities and services

 GL Grand Luxe

 Exceptional

 Excellent

 Very Good

 Good

 Acceptable

(Source: Ministry of Culture and Tourism, 2014)

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2.17 Conceptual Framework

Employee
Engagement

Motivated
employees

Employee
satisfaction

Quality service

Loyal
Customers Customer
Satisfaction
Good
Brand
Image

Better Positive
Profit word of
mouth

Figure 1: Extracted from review of related literature

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The aim of this section is to summarize the idea about past literature and to bring out the
contributions for this study area. Thus this part starts with the idea generated and the contribution
follows. The general idea from the past literature is that there is a relationship between employee
engagement and service quality as shown in the figure above.

Employee engagement: When employers have a good communication with their staff and involve
them on idea generation and decision making they become interested on their work. An engaged
worker must positively commit to the organization. The employee must be willing to make
changes, which require that he or she cares enough to change. The engaged worker possesses trust
in his or her organization, especially that one’s input and energy will not backfire. An engaged
worker also is certain that his or her effort actually leads to positive results in the organization.

Employee Satisfaction: customer satisfaction is an outcome of purchase and use resulting from the

buyers' comparison of the rewards and costs of the purchase in relation to the anticipated consequences”.

It is also defined in terms of an emotional state that usually arises in response of evaluating a particular

service. (Qadeer 2013)

Employee Motivation: Motivation is directly related to various employee’ attributes i.e.

satisfaction level, positive recognition and appreciation, feeling personal accomplishment and
receiving positive feedback that leads to positive performance. Through motivation an
organization can retain its employees. (Kundu 2017)

Service Quality: Many services are personnel intensive, customized to suit heterogeneous needs
and preferences. These are jointly produced by both producer and customer(s) and are intangible.
Gronroos model divides customer’s perception about the quality of a specific service into two
dimensions i.e technical and functional quality. It is also known as Technical/Functional Quality
framework. For example, technical quality might consider the effectiveness of car repair,
cleanliness of hotel room. And functional quality might include, the care and manner of personnel
involved in processes of service delivery. (Qadeer 2013)

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As a result of quality service the organization becomes beneficial on satisfying more customers,
creating good brand image and getting a lot of loyal customers. Satisfied customers will more
likely recommend others by positive WOM. When the number of loyal customers increase in
number it shows that revenues of organizations are getting higher. Customers will have a good
brand image as a result of good brand image.

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 CHAPTER THREE

METHODOLOGY
3.1 Research Design
The study used five dimensional SERVQUAL scale to measure the service quality. These
dimensions are: responsiveness, reliability, assurance, tangibility and empathy. These constructs
have higher correlation with each other. (Saleem, 2014)And the study used exploratory research
methods. The population frame was customers and employees of 5 star hotels in Ethiopia

Data was collected using in-depth interview, one for hotel management and employees the other
for hotel customers. Primary data was collected through in-depth interview from five of the hotels
who allowed the researcher to collect data. Secondary sources of data was collected from online
reviews on www.tripadvisor.com.The data analysis was done using qualitative method.

3.2 Population of the study

The data was collected from customers of 5 star hotels located in Addis Ababa city regarding
service quality and from the staff of the hotels regarding employee engagement. The total
population was seven 5 star hotels available throughout the country. In order to get appropriate
data, the study incorporated both primary and secondary sources of data.

3.3 Sample of the study

It was planned to contact all the 7 five star hotels in Ethiopia as data can be collected from the
entire population to end up with an information-rich case study in which the study explore research
questions and gain theoretical insights. But 2 of the hotels refused to allow the researcher to collect
data from them. So a total of 5 hotels participated in the study. From these five hotels 2 of them
didn’t want to let the researcher contact their customers and only allowed their employees to
participate in the study. So 2 employees participated from each of the five hotels which makes a
total of 10 employees. But only three hotels agreed to let their customers participate. 5 customers
were contacted because from Ellili Hotel only one customer was willing to participate and data
was also getting saturated by that time. Convenience sampling was applied to choose sample

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respondents of customers, managers and front line employees for the collaboration of giving
interviews.

From hotels Getfam & Capital Hotels, a front line employee, a manager and 2 customers
participated. From hotels Radisson Blu & Golden tulip the researcher was allowed only to contact
two employees from each hotel. From Ellili hotel two employees and only one customer
participated because another willing customer to involve in the study was not found. Customer
reviews posted on trip advisor website was used for Sheraton Addis & Marriot Executive
Apartments because management of these two hotels didn’t give permission for the research to be
conducted.

No Hotel Employees Customers

Frontline Management
1 Sheraton Addis - - -
2 Getfam Hotel 1 1 2
3 Capital Hotel 1 1 2
4 Readisson Blu Hotel 1 1 -
5 Ellili Hotel 1 1 1
6 Marriot Executive - - -
Apartments
7 Golden Tulip Hotel 1 1 -
Total 5 5 5
15

Customer reviews on tripadvisor.com for Sheraton, Radisson, Marriot and Golden Tulip are
incorporated in the study.

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3.4 Data analysis and Presentation
After the primary and secondary data gathering procedures are completed, the data is transcribed,
coded and analyzed in a way to produce important information that can answer basic questions
and achieve objectives of the study and also show future implications of the study.

The responses of informants/respondents are presented and analyzed qualitatively. Data collected
from interviews and explanations of the qualitative analysis is written in statements.

3.5 Ethical Considerations

To ensure that the study was conducted as thoroughly and ethically as possible, the customers and
employees of hotels participated for this study were made aware that their identities and answers
would remain confidential.

The following ethical guidelines were put into place for the research period:

1. Participants were notified participation is voluntary and that they are free to withdraw at any
time

2. The research data remained confidential throughout the study and the researcher obtained the
participant’s permission to use audio recorders during interview.

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 CHAPTER FOUR

RESULTS AND DISCUSSION

In this section, the findings of the study are presented and discussed section by section based on
the specific objectives of the study. Expressive comments made by respondents are extracted and
presented as quotes.

The findings are presented in four major sections in line with the research questions and the
specific objectives of the study.
Section 4.1: Status of service quality among 5 star hotels in Addis Ababa.

Section 4.2: Engagement of frontline employees in decision making and idea generation.

Section 4.3: Employee engagement and its relationship with service quality and employee
satisfaction.

Section 4.4: Customers level of satisfaction and their opinion on quality of services.

4.1. Status of service quality among 5 star hotels in Addis Ababa

Findings about current status of quality services provided by 5 star hotels in Addis Ababa are
presented in six sub-sections.

4.1.1 Tangible elements.

4.1.2 Reliability of quality services.
4.1.3 Assurance and safety.
4.1.4 Empathy of staff.
4.1.5 Responsiveness of the hotels.

4.1.1 Tangible Elements

Hotels should devote particular attention to tangible elements like physical comfort of the hotels
to achieve higher client satisfaction. The staff also must look professional and presentable because
they are an integral part of the property. The physical appearance of hotel staff helps to maintain

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the overall appearance, but the way they act also contributes to the hotel’s reputation. (Dimitrovski,
2015)

Hotel cleanliness and comfort are the most important factors in hotel selection. From the study we
can say that most of the customers coming to stay in these hotels have no reservations on the
overall settings, cleanliness and the way the hotels are designed and decorated. They find the bed
rooms comfortable; lobby and stair ways clean enough and functional.

This is also seconded by feedbacks written on tripadvisor’s website.

“This is a good hotel with spacious, clean and modern apartments, the service at reception
and concierge was courteous and helpful, a great alternative in Addis and good location.
They offer transport to pick up some groceries nearby” (Customer review on Marriot
Hotel)

One of the complaints raised by the interviewees is related to the electricity plugs; either they are
not working or they are not fit to the different varieties.
“Everything is good but I was wondering why some of the electric plugs do not fit in to the
walls and many of them in my room does not work. It is very simple issue but luxury hotels like
this should worry about these kinds of fittings” (Customer 2, Captial Hotel)
Similarly a reviewer on the tripadvisor website complained about the window size of one of the 5
star hotels.

“A slight disadvantage may be that the architectural design of the building does not include
rooms with some sort of balcony or at least ‘French windows’, because the two rather
small size windows (one each for living and bed room) with plastic frames and handles are
installed at a window sill height of about 1.10m and cannot be opened because of the big-
size curtain rails that jammes the windows.” (Customer review on Marriot Hotel)

4.1.2 Reliability of quality services

Reliability is the foundation for the continued success of hotels by building trust of customers. It
is the ability to perform the promised services in a dependable, accurate and fully responsible
manner, without negligence and failure (R. Hussain, 2015)

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For example having a reliable hotel Internet service allows guests to check emails or join
conference calls easily, rather than going to the nearest coffee shop. Also, being prepared for large
conferences and business meetings with strong internet connectivity needs will increase customer
satisfaction, improve service, and also increase guest loyalty.

Although most of the services are reliable the lack of reliable internet and electricity power
interruptions are mentioned as critical challenges. Hotel managers recognize these but as this is a
country wide problem it has become hard to fix it.

“It was difficult for me to do my work using internet. But I was told that it is a
country wide problem” (Customer 1, Getfam Hotel)

“There were few power breaks during my visit, which had an impact to use
elevators.” (Customer review on Golden Tulip)

4.1.3 Assurance and safety

Knowledge and courtesy of employees and their ability to convey trust and confidence will appeal
the customer visit the hotel again. Most of the participants during the interview stated that they
feel safe while staying in the hotels and almost all looked at reviews before deciding to book their
hotels because it is really important to know the safety of the place they are staying.

“The deco and atmosphere are great and safety isn’t an option it’s compulsory.
And the recommendations given by the staff were great” (Customer review on
Golden Tulip Hotel)

4.1.4 Empathy of staff

Customers become more attracted when individualized attention is provided by the hotel staff.
Employees should deal with customers in a caring manner and having the customer’s best interest
at heart. Employees who understand the needs of their customers have the capability to please and
delight them.

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In this regard, all customers who participated in this study confirmed that staffs are generally
respectful and sympathetic.

“I always get lost when trying to go to the swimming pool but there is one man working
here who always takes me there holding my hands with a smiling face. He really is helpful
for me” (Customer 1, Ellili Hotel)

4.1.5 Responsiveness of the hotels

The responsiveness Service Quality refers to the willingness of the company to help its customers
in providing them with a good, quality and fast service. This is also a very important dimension,
because every customer feels more valued if they get the best possible quality in the service.
(Gunarathne, 2014)

One factor is the speed with which employees respond to users. Although the response time is
important intuitively, research results indicate that it is not always true. It is reported that time is
not a dominate factor until the waiting time becomes too long. (Akkiraju, 2018)

Failing to meet deadlines or ignoring customer inquiries can increase client dissatisfaction in a
hotel service and motivate them to investigate competitor’s services. Although good customer
service is part of customer responsiveness, customer responsiveness takes customer service a step
further. Sean Meehan and Charlie Dawson, explain in a 2002 "Business Strategy Review" article
that customer responsiveness is accurately and insightfully giving customers what they need, want
or don’t yet know they want and doing so more quickly than anyone else.
The findings of the study with regard to responsiveness of the hotels is not universal. Some of the
interviewees complain about the long waiting time before they get what they asked for.

“For example cutlery should be on the table while we eat but I couldn’t find any
this morning so I had to ask the waiter to bring me and I waited almost for 10min
waiting for cutlery. It is very small issue but it is unexpected from a luxury hotel”
(Customer 2, Capital Hotel)

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In summary the general quality of services provided by 5 star hotels in Addis Ababa can be viewed
as good except the unreliability of internet services, electric power interruptions and limitations
with regard to being responsive to customer requests.

In the current competitive environment, where most hotels have similar facilities, the survival of
hotels depends on delivery of quality services. There are three main types of service quality;
physical product, service experience and quality of food and beverage. On the other hand, studies
stressed the increasing role of service quality in the light of the employee motivation required to
support the brand image/promise of the hotel. Studies also demonstrated that the personality traits
of the front-line employees of hotels correlated significantly to the guests’ perception of service
quality. Key indicators for excellent service include employees with a passion for service and for
their work, as well as employee honesty, trustworthiness and ability to deal with emergencies.
Because of this, hotel managers should train their personnel to ensure delivery of polite, respectful
and friendly service. (Lu, Berchoux, Marek, Brendan Chen, 2015)

There is also growing evidence that hotel design has both marketing and strategic implications.
Another aspect of the tangible factors in hotel industry is the ambient conditions that can include
color, music, lighting, seating comfort and overall cleanliness of the places inside the hotels. It has
been confirmed that all of these items have their effect on customers’ perceptions and responses
to the environment (Baker & Collier, 2005; Parasuraman et al., 1988).

4.2. Engagement of frontline employees in decision making and idea generation

It is believed that employee participation in idea generation and decision making will enhance
motivation of staff encouraging them to do more and better and this will ultimately help to improve
quality of services.

As mentioned by majority of the interviewed frontline staff, in most cases they participate in
providing feedback and idea generation but their involvement in decision making is very limited.
In most cases decisions come from top management. Management of these hotels are conscious

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about the importance of engaging employees which can help in increasing the number of loyal
customers.

Exceptionally one of the hotels uses a completely different strategy towards giving the autonomy
to make decisions to the staff. Every person working in that hotel is engaged and clearly enjoying
their work as they have the responsibility to make relevant decisions and report it to their
supervisors.

“In our hotel everyone is empowered and have the right to decide on the spot. The only
requirement is to write a note. We are also called to staff meetings and every staff including
us will be there to generate ideas. We also express our opinions freely” (Employee 2,
Radisson Blu Hotel)

Most of the five star hotels engage their employees by consulting them how to proceed, let them
talk what they have faced with customers but inversely few are way behind than the others and
still do not understand the relationship between engaging employees and achieving larger market
share.

“There is no such kind of experience in our hotel. Everything is being done by management
we are just implementers” (Employee1, Getfam Hotel).

“A lot of ideas come from employees that are useful for decision making so we incorporate
them before passing final decisions and get them commented by our employees before
implementation” (Employee 2, Radisson Blu Hotel)

This shows opinions coming from staff have the strength to change the views of managers and
helps them to get innovative ideas.

Success of any organization depends majorly on its human capital. The employees in the
hospitality industry are valuable assets to their respective organization. The performance and
profitability of the hotels rely mainly on the performance of employees. It also means that these
employees need to be satisfied with various aspects of their job to give their best performance. It
has become extremely important on the part of organization to know their employees better
understand their goals and aspirations as well as expectations from the organization. Efficient

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human capital management and maintaining higher degree of job satisfaction level in hotel
business determine not only the performance of the hotel but also help the growth of the entire
revenue. (Pathak, 2017)

From the responses of most participants employees feel satisfied when they are heard by their
supervisors and when management encourages them to express their observations including some
level of decision making authority but this is not the situation in most of the cases.

“We give our feedbacks to our supervisors but we haven’t seen them considered. Most of
us do not want to raise ideas and give comments. We are here only to cover our living
costs.” ((Employee 1, Getfam Hotel)

And all respondents form the front area who has a direct contact with a number of customers daily
understand the benefits of engaging employees. They believe in its direct relationship with
organization’s performance.

“Employee engagement helps the management to make the right decision.” (Employee 1,
Ellili Hotel)

Successful hotels always include staff training as their important development strategy because it
helps them to have more responsive employees. In this study all the respondents participated in
the study revealed that their employers believe in providing trainings regularly. Because of the
competition the hotel managers are working highly on updating their employees through intensive
trainings like on the job training, online trainings, coaching/mentoring and lecturing.

The employees also stated that the trainings helped them in upgrading themselves in providing the
best services.
“We are given different online trainings like lobster. It helps us upgrade ourselves in many
ways. Cross trainings are given depending on the preference of the staff. It means anyone
working in one department can get trained in another field of department if interested eg.
A lady working in housekeeping can get trained in cooking if is she has the interest. Efforts
are there to make the services uniform with other international chain hotels” (Employee
2, Golden Tulip Hotel)

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Staff training enhances the capabilities of employees and strengthens their competitive advantage.
Effective training will improve the personal characters and professional abilities. Not only
employees, management and organization would benefit from staff training, customers and guests
benefit as well, because of the received quality hotel services. (Xiao 2010)

The key influencers for organizational effectiveness are leadership and employee motivation.
Leadership style extensively influences employee’s commitment and dedication. Good physical
working conditions such as right temperature, adequate lightning, proper ventilation, noise free
atmosphere have positive effects on the motivation and performance of workers. (N.
Kuppuswamy, 2017)

The study revealed that the majority of the hotels are working hard in order to get their employees
motivated to provide best possible service for their customers. But it seems few do not yet
understand the relationship between motivating employees and pleasing customers with the service
they render.
“We are not motivated to give ideas for the management because we have never seen our
ideas taken into action” (Employee 1, Getfam Hotel)

“There was a policy not to accept customers entering to our hotel carrying a food from
outside. I requested the management to allow some customers who come in to our hotel
with their own food because I came to know that their medical situations does not let them
use the food we provide. Rather than losing these customers and their surroundings I
convinced my supervisors that we should let them use the rest of our services. I saw it
implemented and felt proud of myself and encouraged to give other ideas” (Employee 1,
Ellili Hotel)

It shows that this employee felt like she has contributed something valuable and gratified for the
acceptance she has got from her organization. This makes her motivated and comfortable with her
employer. She is working actively towards pleasing the customers that are coming in to stay in the
hotel which results in good performance to let the customers end up being loyal.

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4.3 Employee engagement’s relationship with service quality & employee satisfaction
Employee engagement results from individual feelings such as happiness at work, employee
morale, and job satisfaction. Moreover, it is assumed that engaged employees will contribute
positively to improvement in quality of hotel services and overall organizational performance.
(Levitt, 2017)

All interviewees expressed their positive views on the relation of engaging employees with
improvements in quality of services and this in turn will help to have a lot of loyal customers.
“We are the ones who have direct communication with the customers so engaging
employees plays an important role in providing a better service which helps in getting
better profit”. (Employee 1, Getfam Hotel)

“Motivated staff brings good service that impresses customers and makes them loyal which
results in high profit” (Employee 1, Capital Hotel)

All managers who participated in this study also agreed on the relationship between employee
engagement and better quality service and more profit but most are not practically working on it.
But they agree that this will damage the business that they are running in the world of high
competition.

These days’ organizations are coming with flat organizational structures to make every staff
responsible and active by decreasing the number of hierarchies. This will help shortening service
provision time as every staff gets empowered.

From the responses of participants it is recognized that, A hotel can provide the best quality service
but it may not fulfill all customers’ needs as everyone’s needs are different. It is only when a
customer gets satisfied becoming a loyal customer that we can say good quality services is
provided. It is also revealed that good quality service creates a good brand image in the mind of a
customer and allows the hotels to make more profits.

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4.4. Customers level of satisfaction and their opinion on quality of services
Service firms have been increasingly competing for market share on the basis of delivery time.
Many firms now choose to set customer expectation by announcing their maximal delivery time.
Customers will be satisfied if their perceived delivery times are shorter than their expectations.
(Ho, 2003)

Most of the participants in the interview process expressed that their expectation while deciding
to stay in the 5 star hotels is to find luxurious place to get comfort and an excellent treatment from
the staff. Responsiveness has a top value because they are paying higher to get everything they
need on time.

“Service quality for me is responsiveness for requests and availability of essentials

which includes internet, swimming, Gym, best food and trained staff.” (Customer
1, Capital Hotel)

The services provided by the staff of these hotels has a huge value than the other things like
appearance and taste because as most of them said if the people are good enough to give attention
on customer care the rest of expectations will usually be met. A customer of hotel A wrote the
following review on tripadvisor website.

“The front desk staff are professional and the check-in was flawless, despite our
arrival during the early morning hours. The room is quite, well-appointed and
clean with many amenities. The bathroom is average size” (Customer review on
Sheraton Addis)

How an organization responds to a complaint can also have a major impact on its customer’s post
complaint consumer behavior, from repurchase intentions to likelihood to engage in word-of-
mouth activities, and it may even affect the valence of the word-of-mouth message. (Davidow,
2009)

Key problems that were mentioned by all interviewees consistently are inconsistent and low speed
internet and limited parking space. Guests have many demands that require them to be well
connected to internet at all times. They want strong Wifi available on every part of the compound
as it is a high standard hotel, for a reasonable or free cost. Finding ways to maximize connectivity

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and providing business essentials will keep guests productive and happy. Internet connectivity
problem is the major concern of all interviewed customers.

Most of the hotels have limited parking spaces and complaints are coming largely from visitors
who rent conference halls for meetings and some walk-in guests.
“The hotel was built targeting primarily on international guests but it is now serving more
than expected walk-in guests and organizations who uses our meeting halls. These people
complain because of our small parking space. Most of our room guests do not drive rather
use our shuttle service or may have a driver to pick and drop them off.” (Employee 2,
Radisson Blu Hotel)

The roads of Addis Ababa are becoming more congested by vehicles from time to time;
particularly during peak hours because of the huge amount of cars on the road. So it would be
difficult for hotel users if they couldn’t find a safe place to park their cars.

“Parking is limited and the traffic in front of the hotel is a mess. Otherwise, this is
a really good hotel for Addis standards. Spacious, comfortable rooms (smoking
rooms also still available), comfortable bed, good bathrooms and friendly service.
The hotel has a gym, sports bar, cigar bar, restaurant and lobby café. Reasonably
close to the African Union and 5 to 10 minutes from the airport. Very good choice
in a town that has numerous lousy hotels.” (Customer reviews on Golden Tulip
Hotel)

Some guests also complained about the quality, variety, and taste of complementary breakfast
provided by the hotels.

The most effective way to ensure repeat customers is to provide a product or service that meets or
exceeds the customer’s expectations every time. Unfortunately, when delivering a service, this
task is formidable and, at times, impossible. Although service failure has the potential for
destroying loyalty, effective application of recovery techniques may enable service managers to
maintain or even increase loyalty. (Miller, Craighead, Karwan, 2000)

This study revealed that there are different service recovery mechanisms being applied by the
hotels to address concerns of customers.

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 “I didn’t like the food they brought me for lunch but they changed it for free of charge.”
(Customer 1, Hotel B)

“We upgrade room without additional charge or we put regret letter with a fruit basket in
the room of a disappointed customer” (Employee 1, Ellili Hotel)

When offering the customer something in the form of compensation, it makes him feel valued. It
increases his loyalty to the hotels.

When it comes to luxury, service quality and satisfaction, positive customer experiences are
vitally important, because a positive experience will cause the customer to wish to return or
stay longer and to recommend the establishment to others. In addition, the Internet and social
media make it easier than ever for customers to describe and share their satisfaction or
dissatisfaction, thus influencing others. As a result, hotel operators must concentrate on the
quality of every detail of service encountered by their guests, and the customers’ emotional
judgments about their hotel stays become the basis for the companies’ efforts to differentiate
themselves from competitors and achieve competitive advantages. (Lu, Li 2015)

In this study customer perceptions on frontline employees shows that almost all of them are
satisfied with the service provision in the reception area. None of them had bad experiences rather
inspired by best treatment they have got when they checked in and whenever needed explanation
in different issues.
“It is sometimes difficult to communicate as there are differences in pronunciation
between us. We can see from their faces that they are unable to understand what
we are saying but they are polite and try to fix problems on their own” (Customer
1, Ellili Hotel)

This study discovered that customers are satisfied. Because as they said they have a level of
expectation from a developing country and the service provision that they received exceeds the
expectation they used to have.

Due to its informal, interpersonal nature, word of mouth is a potentially powerful and credible
communication source. Both positive and negative word of mouth are strategically important

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because it is typically associated with extreme satisfaction or dissatisfaction. (Cantallops, Salvi
2014)

Most of the participants noted that they will recommend the hotels they are staying in because they
are gratified with many of the services.

Slight mistakes can affect customer’s general insight towards the overall hotel service so
management of these hotels should work on training the staff on how to approach the customers
and explain everything to them politely in detail. And if mistakes happen they should know that it
should be admitted and apologize customers for what happened or compensation should be
provided to please the customer which will help him forget the incident that may lead into negative
word of mouth. Advancements in information technology and the introduction of new methods of
communication have led to increasingly significant changes in consumer behavior. These changes
have produced a shift in focus in companies’ marketing strategies and business administration,
especially in the hotel industry. Purchase decision processes are composed of several variables that
influence consumer choice for certain products and services. Customers might choose a hotel
based on its location (for instance, close to an airport, tourist location, or city center), brand name,
various facilities (such as swimming pool, children play ground, spa and fitness center), service
quality, price, loyalty program, and quality ratings by past guests. Any or all of these would enter
into the customer choice.

As presented in the quote below one customer was disappointed because incomplete information
was provided about price changes.
“I won’t recommend this hotel because I was cheated with price change. I booked
the room with 92USD online before I came here after I stayed for 5 days I told them
I wanted to extend my stay at last when I check out they told me to pay 146USD for
each extended days. I am so disappointed because they should have notified me
everything first” (Customer 1, Capital Hotel)

Another customer who wrote a review on tripadvisor wrote a complain about the inconsistency of
quality service.

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 “I stayed in this hotel 3 years ago and had a great stay. Even though it is ridiculously
priced I decided to stay here again. This time I was with my wife and wanted to show her
the hotel. It is without doubt the best hotel in Addis with sitting in great splendor and the
gardens are beautiful. The pool area, bar and service by all is superb. However, I was a
little disappointed this time around due to the following:
1. The F&B has really gone down. We had a business lunch in the Indian and it was
bland, no taste, surly service and no atmosphere. We also ate in the Italian at night
and the food was very poor.
2. We upgraded to an Executive Room and it was very small, it had a small patio but no
chairs to enjoy the view. The lounge was good though.
3. An as mentioned before the prices have sky rocketed.”

However, it is a fine hotel in all other areas, we enjoyed the live band at night time too. Go here
if you want the luxury but eat out in Addis!”(Customer review on Sheraton Addis)

Creating and maintaining customer loyalty helps the hotels to develop long term, mutually
beneficial relationships with customers. These loyal customers show attachment and commitment
toward the hotel, and are not attracted to competitor’s offerings. Furthermore, loyal customers are
willing to pay more, express higher buying intentions and resist switching. (Kandampully, Zhang
2015)

Most of the customers who participated in this study stated that they will use the same service in
the future from the same hotel that they are now staying in. And all said that comes from the best
service they have been rendered which makes them decide to come back if they will get another
chance to visit Addis Ababa.

Customer loyalty will bring the confidence in taking a bigger market share, better profits, trust and
positive word of mouth etc. In summary most of the participants got satisfied from the service
because they used to have their own expectation set for an African developing country otherwise
the service quality is generally low compared to other 5 star hotels in other parts of the world.

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 “The service here is significantly different in the level of quality that I saw in Istanbul. The
hotel I stayed in Istanbul was a higher quality in architecture, facilities and resources but
it will not be fair to compare it with this one.” (Customer 2, Capital Hotel)

“I travelled to 95 countries and also stayed in five star hotels of several countries but
comparison doesn’t make sense here. I am really impressed with the service from a
developing country like this. For example Indian five star hotels are a bit more luxurious
than this one because India as a country has more resources than Ethiopia.” (Customer 1,
Ellili Hotel)

“Summing up this is a 2-star hotel by European/international standard, posing as a 5-

star.Ps: They show all sorts of certificate of excellence badges from TripAdvisor,
Booking... at their front office. The figures are far from accurate.” (Customer reviews on
Marriot Hotel)

“I stayed 3 days in this hotel and it's unlike any other international wing of this hotel I've
stayed in. From the first time you enter the front gate and see the police sitting off to the
side with their AK-47, you realize this is a relative island of luxury in a sea of poverty. The
hotel seems to have a lot of security people, including government security people. When I
went for a walk on their small jogging trail, two of the hotel employees questioned if I was
staying in the hotel. One of them wanted me to show him my hotel key to prove I was staying
there. This hadn't happened in any other luxury hotel I stayed in on 3 different continents.”
(Customer review on Sheraton Addis)

The major bottleneck reported from managers was lack of trained personnel in the area of tourism.
The number of professionals in this area is limited so that is an obstacle towards giving the best
service. Because of this problem Hotel C built its own Hotel and Tourism training center to help
minimize the gap.

“We have our own training center employees are trained for free and outsiders are
charged to get the service” (Capital Hotel, Employee 2)

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 CHAPTER FIVE

Summary of Findings, Conclusions and Recommendations

5.1 Summary

The findings have shown that most of the customers are satisfied with the services. As many of
them have their own expectations from a developing country. The services of luxury hotels in
Ethiopia is beyond their expectation. As to the participants it difficult to compare these hotels with
internationally located hotels because of lack of resources and few number of hospitality
professionals found in a developing country like ours. So it still needs improvement to reach to the
excellence of international hotel services.

The study revealed that employees are engaged in many of the hotels even though the level of
engagement is different from hotel to hotel. Managers of luxury hotels in Ethiopia have understood
the importance of employee engagement and already started implementing it in order to give
quality services. Another core concept that they are applying to deliver quality service is giving
trainings to the employees regularly to upgrade their knowledge from time to time to help them
compete with the highly competitive market. From the findings it was seen that huge level of
efforts have been made from the management of these hotels towards providing the best possible
service by trainings employees and trying to give them attention to give feedbacks on day to day
activities to help avoid disappointments from the customer side.

From the study it is clearly seen that employee engagement has a valuable contribution to bring
quality of service which in turn creates customer satisfaction. Because it was recognized that
highly involved/engaged employees get motivated and initiated to perform better than the ones
who are not given attention.

It is recognized that all of these hotels have service recovery mechanisms to compensate
unsatisfied customers to avoid negative WOM. All hotels also try to get feedbacks of customers
in different ways like disseminate feedback forms in the rooms of customers. Checking online
reviews regularly and communicating with frontline employees to help them work on filling gaps.

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With all this there are few customers complaining on the responsiveness of employees and taste
of foods. But the majority participants like the customer handling service and treatments they get
from the employees.

It was seen that in all of the hotels the issue raised as a challenge to deliver quality service is lack
of trained personnel in the sector. There are limited institutes producing hotel and tourism
professionals in the country. So the management of these hotels find if challenging to recruit a well
trained staff who can please customers in a professional way. As the number of these professionals
are few the hotel managers are forced to hire employees with other backgrounds and give different
trainings to make them familiarize with their jobs. Because of this some hotels opened colleges to
train employees and others use more of their time to upgrade the knowledge of their employees
through different online and on the job trainings.

The main Challenges raised from customers are Internet connectivity and parking problems in
most of the hotels. As most of the customers who are staying in these luxury hotels came for
business, they are highly in need of internet connection. And they find it difficult to work and
communicate with their colleagues. As to the participants, parking is not a problem of guests who
use room service but they have seen congested surroundings when they pass by. Guests renting
conference halls are usually the ones who need parking spaces when coming for meetings but
parking spaces of most luxury hotels are crowded and not enough.

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5.2 Conclusion

1) The findings of this study revealed that the quality of service provided by most of the 5 star
hotels in Addis Ababa is generally good compared to the expected level of service from a
developing country like Ethiopia. Most customers had a low expectation when they come but
they found the service quality to be generally good compared to their low expectation.
Otherwise the service quality is generally low compared to services provided by 5 star hotels
in the other parts of the world.

2) Inconsistent and low speed internet service and lack of adequate parking area are the two major
problems of the 5 star hotels. In addition, low quality, few variety complimentary breakfast
and limitations with regard to providing correct and comprehensive information are also
problems.

3) Employees generally participate in providing feedbacks that help to improve quality of service
to their supervisors but decisions are mainly made by higher level managers except with the
case of one hotel by which every staff member has an authority to make relevant decisions.

4) According to the finding of the study there is a positive relationship between employee
engagement and improvements in quality of service and satisfaction of employees. And this is
being widely practiced in most of the 5 star hotels in Addis Ababa.

5) Overall customers are satisfied by the services they get from the 5 star hotels but the lack of
responsiveness to their requests and concerns is a challenge in some hotels. This could be
mainly due to limited decision making power given to the employee.

6) There are various service recovery methods being implemented by the hotels but this will not
be as effective without adequate decision making power given to the staff.

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5.3 Recommendations

Based on the finding of the study the followings are recommended:

 Hotels need to work closely with the Ethio-Telecom company to improve internet
connectivity. Although there is a general connectivity problem in the country still there are
different organizations that get better services because of the importance of the service they
provide. Hence, these hotels need to find a way to show the challenge to the concerned
government body and work diligently to address the serious connectivity problem.

 The limited parking area need to be addressed through close collaboration with the Addis
Ababa city administration land management authority or by working with investors that
can construct parking space close to these hotels.

 Improving the quality of food served as a complimentary breakfast by collecting feedbacks

from customers and by exploring practices from other similar hotels in the other parts of
the world and by training chefs is necessary.

 Involvement of staff in providing ideas and feedbacks should be strengthened and

continued. Similarly giving regulated decision making responsibilities to the staff is
essential. Without this, it will be unlikely to improve responsiveness to customer
complaints and the quality of services will deteriorate from time to time.

 Implementing different initiatives including awarding best performing staff, introducing

competitive benefit packages, providing need based continuous trainings are critical to
maintain motivation of employees which is key to maintain service quality, create loyal
customers, and enhance profitability of the hotels.

 Hotels need also to have a mechanism to collect feedback from the customers. This could
include reviewing feedbacks that are posted online, sending emails asking for feedbacks

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 from customers that stayed in the hotels, inviting external local or international experts to
review services. Without this, it will be hard to stay competitive in the current market.

 Investing in the opening of new training centers mainly tourism sector targeting to produce
well trained professionals who will contribute a lot for these luxury hotels is important. It
was recognized that in most of the hotels top management is filled with foreigners so it will
help minimize the amount of money being paid to bring foreigners if well trained personnel
are large in number locally.

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REFERENCES

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APPENDIX 1

Relationship of constructs with interview questions

Constructs Questions
Employee Engagement 1. How are employees engaged/involved in decision making and idea generation?
2. What do you think are the benefits of engaging employees?
3. Have you ever generated ideas that would be useful for the hotel service and notified to the
management? Are they considered?
4. Have you ever participated in management meetings? Who are the members? How frequently
do they meet?

Satisfied Employees 1. How does organization top management incorporate your feedback? Are you satisfied?
Motivated Employees 1. Have you ever been consulted by the management of the hotel on idea generation and
decision making?

Service Quality 1. What is service quality for you? Service quality in the hotel industry. What is your
expectations from 5 star hotels when you decide to stay in these hotels?
2. What is your feeling about frontline employee’s behavior towards customer handling?
3. Did you have bad experiences while staying in these hotels? Would you explain? How do you
think this will be avoided?
4. How did you find the overall hotel settings, decoration, comfort and cleanliness?
5. Have you seen reliable service? For example what makes you feel that it is reliable?
 6. How responsive are the staff of the hotel? Are you satisfied?
7. Are the employees caring? Did they treat you well?
8. Do you feel safe here? How did you know that it is a safe place to stay?
Better Profit 1. Do you think engaging employees will result in higher revenues?
Loyal Customers 1. Will you choose this hotel among others to come back and use the service in the future?
Good Brand Image 1. What comes to your mind when you hear or see the name of the hotel that you are staying in?
Customer Satisfaction 1. Do you think you are satisfied with the services you got from this hotel?
Positive word of mouth 2. What measure do you take when you get satisfied with the service you get from the hotel? Do
you tell others or recommend this hotel?

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APPENDIX 2

SERVQUAL Dimensions

Reliability
Did you find the guest room ready as promised?
Do you think the hotel staff was fast enough in billing issues?

Tangibility
Do the employees have professional dress code?
Is the room quite comfortable and clean?
Do you think the hotel has good architectural design?
Do you like the setting and materials used to decorate internal part of the hotel?

Responsiveness
Did the staff give you detailed information of the services?
Whenever you request something did the hotel staff respond on time?

Assurance
Did you check the safety of the hotel before booking? How?
What do you expect from the hotel to make your stay safe?

Empathy
Do you think the employees are compassionate and give individual attention for guests?
APPENDIX 3
Participant Number/ __________________

Date: _____________________

Consent Form for Interviews: A Qualitative study on the Assessment of service quality and Employee
engagement: The case of 5 star hotels in Ethiopia

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