Benchmarking Practices in The Hotel Indu

BENCHMARKING PRACTICES IN THE HOTEL
INDUSTRY IN NAIROBI, KENYA
By
OKOMBO, PHILIP ALINYO
This research project is presented in partial fulfilment of the requirements

for the award of degree of Master of Business Administration of the
University of Nairobi.
November 2013
DECLARATION
I, Philip A. Okombo, do hereby declare that this research project report is my original
work and has not been submitted to the University of Nairobi, or any other university
for academic credit.
Signature: __________________________ Date: ______________

PHILIP ALINYO OKOMBO
This research project report has been submitted for examination with my approval as
the University Supervisor.
Signature: __________________________ Date: ______________

DR. OWINO A. OKWIRI
Department of Management Science
School of Business
UNIVERSITY OF NAIROBI
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ACKNOWLEDGEMENTS
I give God all the glory for bestowing upon me His favour, and strength to complete
this project; which I believe is a major step towards realizing my destiny. Many
thanks go to Pastor Anthony Ngwatha and the Fountain of Praise Tabernacle family
for their prayers of success.
My most sincere gratitude goes to my supervisor, Dr. Owino Okwiri, for his
dedication and interest in providing consistent guidance and constructive feedback
throughout the course of this project. Your approach to tackling every aspect of the
project systematically; attention to detail; and insistence on brevity was most
enlightening. I also wish to acknowledge Mr. Tom Kongere, the project moderator,
and Dr. James Njihia, Chairman, Department of Management Science, for reviewing
the proposal document leading to the research proposal presentation.
I wish to mention special thanks to Dr. Joe Wadawi and Mr. Collins Haggai, both
professional colleagues in the hospitality industry, for advice and contribution in ideas
for this study. Thank you to my fellow classmates with whom I shared this journey;
and whose constructive criticisms and comments during visits to our supervisor
contributed immensely to the success of this project. Many thanks go to respondents
from the hotel industry in Nairobi who completed the research questionnaire to
provide valuable information that informed this study.
I dedicate my deepest and special appreciation to my family for their support and
encouragement throughout the period of my studies for MBA. I am forever indebted
to my wife, Rose, for her dedication; her emotional and financial sacrifices towards
the accomplishment of this project. God bless you in a big way. To our children:
Michelle, Sharon, Michael, and Aunty Leah. You all assisted in own small ways; I
wish you success in your own academic journeys that still lie ahead of you.
Finally, I wish to thank everyone else, whose names I cannot mention due to space,
for his or her contribution to the success of this project. God bless you all.
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DEDICATION
To God, our creator:
Who gives us power to excel and make wealth;
To my dear wife, Rose Vutare:
Your love, moral and financial support to see me through the MBA programme is
invaluable;
To our children, Michelle, Sharon and Michael:
May this inspire you to realize your highest academic achievements early in life;
To my uncle: Cornelius Obulutsa:
Your encouragement has propelled me to my academic achievements;
and
To my mother, Juliah Nyangasi: for your love.
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ABSTRACT
The hospitality industry is served by a variety of service organizations that need to
continuously monitor the quality of services offered through various quality
improvement tools, including benchmarking. This study sought to establish the extent
of application of benchmarking in hotels in Nairobi, Kenya; and to determine the
process metrics used in the hotel industry in Kenya. The study was conducted through
a cross-sectional statistical survey in which 20 out of 30 targeted hotels returned the
completed questionnaire, representing response rate of 66.67.67 per cent. The data
was analysed to generate descriptive statistics presented in pie charts, frequency
tables, means and correlation matrices. The study found that the majority of the hotels
surveyed were aware of, and applied benchmarking in their operations. Among other
perceptions, the hotels considered benchmarking to be a useful way to assess hotel
performance; a means to share knowledge and enhance the quality of services. The
study determined in order of importance, the various reasons that motivate hotels to
adopt benchmarking as well as the benefits they hoped to gain from implementing
benchmarking in their operations. The reasons considered most important were
effectiveness of benchmarking in quality enhancement; helping to provide better
services to guests; and maintain competitive advantage. The study identified the
barriers to implementing benchmarking in hotels, with confidentiality of information
being cited as the most significant. The study determined process metrics used as a
basis for comparing a hotel’s services with other establishments in Guest Room
values, Front Office services, and Food and Beverage operations. The most important
factors in guest room values were: cleanliness of the room, quietness of the room,
comfort of the bed/pillow and atmosphere. In front office services, the factors
considered most important were: courtesy of employees; reasonable room rates; and
promptness of check-in and check-out; while in food and beverage operations,
courtesy of employees; speed of service; variety/quality of food and beverages
offered; and promptness of seating allocation were the most important. The study
encountered some limitations in terms of methods and instrument of data collection;
lack of cooperation from respondents; and absence of an up-to-date official list of
classified hotels by the Kenya Hotels and Restaurants Authority. This study
recommends further research on a wider scope on application of specific types of
benchmarking, such as competitive benchmarking in the hotel industry in Kenya.
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TABLE OF CONTENTS
DECLARATION ------------------------------------------------------------------------ i
ACKNOWLEDGEMENTS ---------------------------------------------------------- ii
DEDICATION ------------------------------------------------------------------------- iii
ABSTRACT ---------------------------------------------------------------------------- iv
LIST OF TABLES -------------------------------------------------------------------- vii
LIST OF FIGURES ------------------------------------------------------------------ viii
CHAPTER ONE: INTRODUCTION ---------------------------------------------- 1
1.1 Background to the Study ---------------------------------------------------------- 1
1.2 Benchmarking ----------------------------------------------------------------------- 1
1.3 The Hotel Industry in Kenya ----------------------------------------------------- 3
1.4 Statement of the Research Problem -------------------------------------------- 5
1.5 Research Objectives ---------------------------------------------------------------- 7
1.6 Value of the Study ------------------------------------------------------------------ 7
CHAPTER TWO: LITERATURE REVIEW ------------------------------------ 9
2.1 Introduction -------------------------------------------------------------------------- 9
2.2 Types of Benchmarking ----------------------------------------------------------- 9
2.3 Benefits of Benchmarking ------------------------------------------------------- 12
2.4 Factors Affecting Application of Benchmarking in Hotels --------------- 14
2.5 Summary of Literature Review ------------------------------------------------- 16
CHAPTER THREE: RESEARCH METHODOLOGY ---------------------- 18
3.1 Introduction ------------------------------------------------------------------------- 18
3.2 Research Design -------------------------------------------------------------------- 18
3.3 Target Population------------------------------------------------------------------ 18
3.4 Data Collection --------------------------------------------------------------------- 19
3.5 Data Analysis, Presentation and Interpretation ---------------------------- 20
CHAPTER FOUR: DATA ANALYSIS, RESULTS AND DISCUSSION - 21
4.1 Introduction ------------------------------------------------------------------------- 21
4.2 Results -------------------------------------------------------------------------------- 22
4.2.1 Awareness and Application of Benchmarking --------------------------- 22
4.2.2 Perceptions of Benchmarking ------------------------------------------------ 24
4.2.3 Methods Preferred for Benchmarking ------------------------------------- 30
4.2.4 Barriers to Implementation of Benchmarking --------------------------- 32
4.2.5 Process Metrics Used in the Hotel Industry ------------------------------- 33
4.3 Data Analysis and Discussions -------------------------------------------------- 36
4.3.1 Tests for Statistical Significance of Values -------------------------------- 37
4.3.2 Differences Between Means - Barriers to Benchmarking -------------- 41
4.3.3 Metrics Used in the Hotel Industry in Kenya ----------------------------- 42
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4.4 Discussions and Interpretation ------------------------------------------------- 43
4.4.1 Benchmarking Awareness and Application ------------------------------- 43
4.4.2 Process Metrics Used in the Hotel Industry ------------------------------- 45
CHAPTER FIVE: SUMMARY, CONCLUSION AND
RECOMMENDATIONS ------------------------------------------------------------ 47
5.1 Introduction ------------------------------------------------------------------------- 47
5.2 Summary ---------------------------------------------------------------------------- 47
5.3 Conclusion --------------------------------------------------------------------------- 49
5.4 Limitations of the Study ---------------------------------------------------------- 49
5.5 Recommendations ----------------------------------------------------------------- 50
5.6 Suggestions for Further Research ---------------------------------------------- 51
REFERENCES ------------------------------------------------------------------------ 52
APPENDICES ------------------------------------------------------------------------- 54
Appendix 1: List of Hotels for Survey -------------------------------------------------- 54
Appendix 2: Letter of Introduction ----------------------------------------------------- 55
Appendix 3: Research Questionnaire--------------------------------------------------- 56
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LIST OF TABLES
Table 1: Awareness of Benchmarking by Hotel Classification --------------------------- 23
Table 2: Benchmarking Awareness Correlation Matrix ----------------------------------- 24
Table 3: General Perceptions of Benchmarking -------------------------------------------- 25
Table 4: Reasons to Adopt Benchmarking -------------------------------------------------- 25
Table 5: Perceived Benefits of Benchmarking ---------------------------------------------- 26
Table 6: Benchmarking Perceptions Correlation Matrix ---------------------------------- 27
Table 7: Reasons for Benchmarking Correlation Matrix ---------------------------------- 28
Table 8: Benefits of Benchmarking Correlation Matrix ----------------------------------- 29
Table 9: Methods Preferred for Benchmarking by Hotel Classification ---------------- 31
Table 10: Methods Preferred for Benchmarking by Hotel Size -------------------------- 31
Table 11: Barriers to Benchmarking by Hotel Classification ----------------------------- 33
Table 12: Guest Room Values Frequency Table ------------------------------------------- 34
Table 13: Front Office Service Attributes Frequency Table ------------------------------ 35
Table 14: Food and Beverage Service Attributes – Frequency Table ------------------- 36
Table 15: Variance Analysis for Benchmarking Awareness ------------------------------ 37
Table 16: Variance Analysis for Perceptions of Benchmarking -------------------------- 38
Table 17: Variance Analysis for Reasons for Benchmarking ----------------------------- 39
Table 18: Variance Analysis for Benefits of Benchmarking ------------------------------ 40
Table 19: Variance Analysis for Barriers to Benchmarking ------------------------------ 41
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LIST OF FIGURES
Figure 1: Participating Hotels by Classification -------------------------------------------- 21
Figure 2: Participating Hotels by Size -------------------------------------------------------- 22
viii
CHAPTER ONE: INTRODUCTION
1.1 Background to the Study
The hospitality industry is the world’s fastest growing industry, and with increased
volume of travel around the world, it is bound to remain on the rise in the near future.
The industry is served by a variety of service organizations, which are constantly
working towards providing quality products and services to meet customers’
requirements. There are a number of tools or techniques that organizations can use for
ensuring quality in their business operations at strategic levels. One of the most
commonly applied tools is benchmarking.
1.2 Benchmarking
The concept of benchmarking has been defined variously by different researchers and
scholars. According to Min, Min and Chung (2002), benchmarking is a continuous
quality improvement process by which an organization assesses its internal strengths
and weaknesses; evaluates comparative advantages of leading competitors; identifies
best practices of industry functional leaders; and incorporates these findings into a
strategic action plan geared to gaining a position of superiority. It is a process of
identifying, sharing and using knowledge and best practices by measuring against
defined standards or benchmarks. In other words, it involves continuously monitoring
the value customers put on the company’s product and comparing it with the best.
In the hospitality industry, the benchmarking concept can be applied to a number of
processes that constitute operational activities within the industry. These processes
include the following: accommodation reservation process; guest check-in process;
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procedure for making up a hotel guest room; and procedure for serving a meal in the
restaurant. These processes and many others in the hospitality industry can be
measured against some defined benchmarks. A benchmark refers to a metric or
standard, which is the actual measurement or data collected to carry out the
benchmarking process (Okwiri, 2010). Thus the benchmarking process leads to
establishment of benchmarks. For illustration, cycle time for making up a guest room
and the speed of complaint resolution are briefly explained below.
Cycle time for completing a given process or task can be a defined benchmark for
process effectiveness and operational efficiency in hotel operations. For example, a
hotel can carry out experiments with several room attendants to determine a realistic
cycle time for making up a standard hotel room and determine a standard cycle time
for the hotel. The hotel management can then use the defined standard as a basis for
determining the optimal number of staff needed to service all the hotel’s rooms in a
given time period. A shorter cycle time means that fewer room attendants would be
needed; which should translate into lower operating costs that lead to operational
efficiency of the hotel’s housekeeping department.
The speed of complaints resolution is another standard by which guests can put value
to a hotel’s services. A guest who is dissatisfied with any part of a hotel’s service or
product will usually raise a complaint with guest contact employees such as a room
attendant, receptionist or restaurant server. The time within which the complaint is
resolved can be translated into a benchmark for the hotel’s complaints resolution
process. This could be in terms of minutes, hours or days, depending on the nature of
the complaint and the type of appropriate solution for each complaint. For example, if
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a guest complains about bad food during lunch service, a solution should be offered
within minutes during the meal period. A short cycle time means guest complaints are
resolved quickly, leaving guests satisfied. Guest satisfaction index can be considered
as a measure of process effectiveness and operational efficiency. Satisfied guests are
likely to bring more business to the hotel through repeat visits or recommendation of
the hotel’s services to other prospective customers by word of mouth.
1.3 The Hotel Industry in Kenya
The hotel industry in Kenya is closely connected to the tourism industry as both
sectors are key stakeholders in the two industries combined, and rely on each other to
sustain their operations. The tourism sector has recorded impressive growth results in
terms of foreign exchange earnings and international visitor arrivals to Kenya.
According to the Kenya Economic Survey (2012), Kenya’s foreign exchange earnings
increased by 32.8 per cent from KShs.73.7 billion in 2010 to KShs.97.9 billion in
2011; while international visitor arrivals, mostly holidaymakers, rose from 1.6 million
in 2010 to 1.8 million in 2011, a rise of 13.3 per cent. New hospitality establishments
have also been developed in many parts of the country to cater for the increased
numbers of foreign visitors as well as domestic travellers. In this regards, the hotels
and restaurants sector recorded growth at 5.0 per cent in 2011 compared to 4.2 per
cent in 2010 (Kenya Economic Survey, 2012).
This growth of the hotel and tourism industry can be attributed to a number of factors,
including, advancements in information and communications technology that have
revolutionized operations in the hotel industry. Using computers has simplified most
hotel operations that were previously tedious to undertake manually such as handling
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reservations for accommodation, check-in and check-out of guests, billing and
accounting. Many hotels now use computerized hotel information systems such as
Opera Property Management System and Micros Point of Sale System in operations.
According to the Kenya Economic Survey (2012), the following factors also
contributed to the growth of tourism: promotion in new markets like Asia;
repositioning the country as a high value destination through the Brand Kenya
Initiative; political stability; and improved security and infrastructure in the country.
In terms of employment, the labour market recorded 520,100 new jobs in 2011
compared to 498,600 new jobs in 2010, representing an increase of 4.7 per cent. In
total, 74,200 new jobs were created in the modern sector (building and construction,
energy, tourism, transport and financial services) in 2011 compared to 61,300 in 2010,
contributing 14.3 per cent of total jobs created. Annual average nominal earnings
increased by 5.3 per cent in 2011 while the real average earnings declined by 8.1 per
cent due to inflation. The increased earnings have had a knock-on effect of higher
levels of disposable income that enable more nationals to travel for business and/or
leisure using improved, varied, faster and safer modes of travel. Domestic travel by
air is now more readily available and affordable than before.
The key issues are competition from emerging tourist destinations, internal
competition within Kenya, and improved communication that enables customers to
obtain information very conveniently. Increased supply moves bargaining power to
the consumer of tourism products. Self-catering and other substitutes mean increased
demand for higher level customer experience. Cost competitiveness and agility in
services and products are issues for competition among operators in the hotel industry.
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1.4 Statement of the Research Problem
As a continuous quality improvement process, benchmarking involves continuously
monitoring the value customers put on the company’s product and comparing it with
the best. For benchmarking to be undertaken effectively, standards have to be
established for the various processes that constitute operational activities in the hotel
industry. For example, a shorter cycle time for making up a guest room implies lower
operating costs because fewer room attendants will be required; while a faster speed
of resolving guest complaints means fewer dissatisfied guests. The standards so
established become the defined benchmarks for process effectiveness and operational
efficiency in hotel operations.
The hotel and tourism industry in Kenya has seen some significant growth in terms of
visitor arrivals, foreign exchange earnings, and development of new hospitality
establishments in various parts of the country in the recent past (Kenya Economic
Survey, 2012). This growth can be attributed to a number of factors, including
competition from emerging tourist destinations, internal competition within Kenya,
and improved communication that enables customers to obtain information
conveniently. Consequently, operators in the hotel industry have to maintain the
quality of services and products in order to remain competitive. In this context, they
could adopt benchmarking as one of the tools to achieve this operational objective.
Some empirical research has been done on performance measurement in the hotel
industry in Kenya. In a study to investigate the impact of managerial characteristics
on key performance indicators in the Kenyan hotel industry, Wadongo, Odhuno,
Kambona, and Othuon (2010) found that majority of the managers had formal training
5
up to diploma level, and were relatively experienced in hospitality operations in
Kenya. The study also found that performance measurement in the hotel industry was
based more on financial measures than competitiveness and other non-financial
measures, which the study concluded could be an indicator that performance
measurement within the Kenyan hospitality industry was not balanced. In another
study, Akuma, (2007) found that four types of benchmarking, namely internal,
competitive/performance, external, and strategic benchmarking were currently in use
as a tool for continuous improvement by parastatals in the Ministry of Agriculture.
However, the parastatals faced challenges in the use of the benchmarking technique in
terms of analyzing and gaining a deeper understanding of their own processes;
scarcity of resources; unavailability of appropriate benchmarking partners; and
government bureaucracy in running parastatals.
Other researchers have undertaken conceptual research studies on benchmarking as a
tool for promoting continuous service quality improvement in hospitality operations.
Yasin and Zimmerer (1995) found that organizations may innovate and learn as they
respond to their competitive environment by embracing benchmarking in their
operations sub-systems and service sub-systems. The focus here is on the potential
benefits to be derived from the successful integration and incorporation of
benchmarking into their corporate culture.
None of the previous studies on benchmarking in Kenya has focussed on the hotel
industry. The lack of published empirical research may be attributed to several factors
such as: whether operators in the Kenyan hotel industry are aware of the
benchmarking concept; the sizes of hotel establishments in Kenya compared to other
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countries; and cost implications of undertaking benchmarking activities. There is also
lack of, or access to, reliable competitors’ information that would enable competitive
benchmarking to take place. Most competitors would be reluctant to share their
operations’ sensitive information with other establishments (Elmuti and Kathawala,
1997; and Akuma, 2007).
In view of the limitations of the previous studies on benchmarking, the aim of this
research was to investigate the applicability of benchmarking in the hospitality
industry in Kenya; and to determine the factors influencing its application to realize
improvements. This was intended to determine the level of perceptual understanding
of the benchmarking concept within the hotel industry in Kenya. In order to achieve
this purpose, this study set out to answer two questions: to what extent is
benchmarking being applied in Kenyan hotels; and what constraints lie in the path of
applying benchmarking to achieve or make improvements?
1.5 Research Objectives
The research questions were to be answered by achieving the following objectives:
i) To establish the extent of application of benchmarking in hotel operations and
service in Nairobi, Kenya.
ii) To determine the common process metrics used in the hotel industry in Kenya.
1.6 Value of the Study
The aim of this research was to investigate the current position regarding the
application of benchmarking in Kenyan hotels, which can be used as a tool for
efficiency and effectiveness in operations. The preliminary background research to
7
the problem established that no empirical research had been undertaken on application
of benchmarking practices in the Kenyan hotel industry. This study was undertaken to
fill this information gap through the published research report.
This study is also significant as it adds to the body of knowledge in general. This
research report should be a valuable source of reference for general knowledge on
benchmarking in hotel operations for scholars and other stakeholders in the hospitality
and tourism industry. It may also spur further research on benchmarking practices in
hotels or other industries.
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CHAPTER TWO: LITERATURE REVIEW
2.1 Introduction
This chapter presents a review of literature on the concept of benchmarking as applied
to the hospitality industry. The first section is dedicated to the review of literature on
types of benchmarking; the second discusses benefits of benchmarking; while the
third section evaluates literature on process metrics used in benchmarking in the hotel
industry. The last section summarises the literature reviewed on points of agreement
and clarifies issues which have not been addressed; and whether such issues could be
incorporated in this study.
2.2 Types of Benchmarking
Published literature suggests different types of benchmarking with suitability
depending on operational and strategic objectives. Most authors and researchers
including Camp (1989), Elmuti and Kathawala (1997), and Wöber (2001) categorize
benchmarking into four types as internal benchmarking, competitive benchmarking,
functional benchmarking, and process benchmarking. Each type is described below.
According to Elmuti and Kathawala (1997), internal benchmarking is the simplest
form that benchmarks against operations within the organization because most
companies have similar functions inside their business units. It entails comparing the
organization’s internal activities and processes of one unit or branch against other
units or branches. The main objective is to determine the internal performance
standards of the organization. Other researchers have found that once the objective of
establishing operating standards within the organization has been attained, internal
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benchmarking assists company managers in identifying their Strengths, Weaknesses,
Opportunities, and Threats (SWOT); and therefore improve economic efficiency of
the company (Yasin and Zimmerer, 1995; and Wöber, 2001).
Competitive benchmarking involves the comparison of the company’s products,
services or processes with those of direct competitors in the same market such as
comparing McDonald’s versus Burger King or Kenya Breweries Ltd versus Keroche
Breweries Ltd. This is undertaken mostly after an internal benchmarking activity; and
the internal information has been documented and analysed so that it can be compared
to external data (Camp, 1989). According to Elmuti and Kathawala (1997), this type
of benchmarking is quite difficult to undertake, because access to information about
competitors’ processes is not easy.
Functional benchmarking is externally performed against industry leaders or the best
functional operations of certain companies. It focuses on specific functions such as
accounting or marketing, which are common to most organizations. The
benchmarking partners usually share some common technological and market
characteristics, but are not direct competitors, so they are more willing to contribute
and share information (Elmuti and Kathawala, 1997).
Process benchmarking focuses on the best work processes by emphasizing on the
similarity of procedures and functions rather than the business practices of the
company that one is benchmarking with. This type of benchmarking can be applied to
organizations from different sectors of the economy (Elmuti and Kathawala, 1997).
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In another conceptual research paper with consistent findings, Bhutta and Huq (1999)
describe two additional types of benchmarking: generic and strategic benchmarking.
According to Bhutta and Huq, generic benchmarking compares processes against best
process operators regardless of industry; while strategic benchmarking is undertaken
when a company is attempting to change its strategic direction and wishes to compare
its performance against the competition in terms of strategy. The major limitation of
conceptual research papers is the lack of objective observation of phenomena;
implying that such research cannot be replicated anywhere else. However, an
empirical study would strengthen or disprove the findings reported.
In conclusion, Elmuti and Kathawala (1997) caution that each company should
evaluate carefully its own perspective of benchmarking and how they wish to apply
the process. The company should determine whether their focus is on financial results
or on meeting customer requirements, since this is the only effective way to begin the
benchmarking process.
The authors cited in the categorization of benchmarking tend to agree in their
definitions of benchmarking. A closer study of these definitions leads to the
conclusion that there are basically three types of benchmarking: competitive,
functional, and generic benchmarking which are capable of being applied both
internally and externally. For instance, competitive benchmarking may be internal if a
company wishes to compare operations of two departments with similar work
processes and products, such as two restaurants in the same hotel. Externally, such a
comparison would be between restaurants in different hotels.
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Functional benchmarking can be undertaken internally as well as externally. In a
hotel set up, this could mean comparing the functions or processes in housekeeping
department with those of the accounting department. Externally, it may involve
benchmarking a hotel’s work processes with those of a tour operator. For generic
benchmarking, the internal application in hotel operations could be based on issues
such as guest satisfaction index. The department that records the highest level in a
given operating period can be set as the benchmark for other departments.
From this analysis, it is not easy to categorize benchmarking as strictly internal or
external. It can go either way depending on one’s point of reference. Two
organizations in completely unrelated industries can engage in a form of generic
benchmarking that may be referred to as collaborative benchmarking. For example,
the University of Nairobi could benchmark its procurement work processes with those
of Kenya Airways Ltd so that the two organizations can benefit from each other’s
input, since they are not competitors in the same industry.
2.3 Benefits of Benchmarking
From the different studies done on benchmarking, organizations can expect to derive
certain benefits by applying benchmarking practices in their operations. According to
Elmuti and Kathawala in their conceptual research paper, the main objective of
internal benchmarking is to determine internal performance standards of an
organization by enabling the sharing of a multitude of information; and opportunity to
transfer them to other parts of the organization (Elmuti and Kathawala, 1997).
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An organization must first understand the concept of benchmarking before applying it
in its operations. From an external perspective, such an organization will become
aware of what practices other companies are applying in their operations. The
organization can then adopt industry best practices and incorporate them in its
operations to attain superior performance (Camp, 1989).
Benchmarking that focuses on the external environment should lead the company to
set its goals and objectives based on the industry’s best-in-class, which ensures that
the organization meets customers’ needs to a level that cannot be argued against
(Camp, 1989). Effective goals and objectives also enable the organization to establish
methods of measuring each area in terms of units of output and cost, thus supporting
the process of budgeting, strategic planning and capital planning (Elmuti and
Kathawala, 1997).
Benchmarking can enable the organization to set effective and measurable goals
which lead to better work processes that result in increased productivity at a lower
cost. The organization would then be able to understand its own administrative
operations better; identify targets for improvement; eliminate waste; and improve its
market share (Elmuti and Kathawala, 1997). Thus, a hotel that achieves short cycle
times for making up guest rooms can expect to employ fewer room attendants, in
effect realize increased productivity at lower cost.
Benchmarking may actually contribute to improved operational performance, first
through the firm’s understanding of its competitive position and its strengths and
weaknesses, and second through providing a systematic process for effecting change
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Wöber (2001). Increased productivity should lead to improved products or services
that meet or exceed customers’ requirements to enable the organization remain
competitive in business. In fact, the end-result of any typical work process, whether
delivering a physical product or a service, should be something of value that meets the
needs of the next customer in the process or those of the end-user (Camp, 1989).
Finally, the foregoing benefits of benchmarking should enable the organization that
applies benchmarking to rise to a position of competitive advantage. The organization
must understand the competition through competitive benchmarking of products,
services or work processes; and develop effective plans to deliver those products and
services competitively (Camp, 1989). That means the company must consistently
deliver products or services of superior quality at a lower cost than its nearest rival to
maintain its competitive advantage.
The above arguments in support of benchmarking imply that all reputable companies
should be applying the concept in their operations. On the contrary, many companies
do not practise benchmarking, possibly due to the following reasons. Most
organizations are not aware of the benchmarking concept; difficulty of accessing
information on competitors’ operations renders competitive benchmarking difficult;
and lack of financial and other resources to undertake the benchmarking process. This
study will attempt to validate or disprove these reasons as part of its research.
2.4 Factors Affecting Application of Benchmarking in Hotels
Published literature confirms the applicability of benchmarking as tool for
performance improvement in the hospitality sector. (Min et al., 2002; and Nassar,
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2012). The authors identify performance elements of the industry that can be used in
a benchmarking exercise (Min et al., 2002); while the views and perspectives of the
sector towards benchmarking are determined (Nassar, 2012). This literature is
investigated to provide a common perception of the application of the concept.
Min et al., (2002) used an empirical study to carry out external (competitive)
benchmarking to prove that dynamic benchmarking can be used as a service
improvement tool in hotels. The researchers used two key dimensions: guest room
values and front office service attributes to determine the “best practice” hotel among
Korean luxury hotels in a study carried out in Seoul, South Korea in the year 2000.
Findings from this study indicate that the most important attribute in determining hotel
service quality is cleanliness of a guest room; followed closely by courtesy of hotel
employees; quietness of a guest room; handling of complaints; and comfort of
bed/pillows. The study also found that due to increasing competition in the hotel
industry, hotels need to continuously improve service standards by applying dynamic
benchmarking to achieve service excellence.
In a separate study, Nassar (2012) sought to investigate the current state,
understanding and opinions of benchmarking in the Egyptian hotel sector in order to
establish perceived benefits, obstacles and possible improvements. The researcher
used the descriptive approach with a structured self-administered questionnaire to
conduct the research. Findings reveal the current benchmarking practices in three
major areas. According to the research, most hotels in Egypt have benchmarking
experience regardless of their location or size. The hotels demonstrate a positive
attitude towards benchmarking; and perceive it to be a useful tool in assessing
15
performance as well as a means of increasing competitiveness and quality. The study
also found that implementation of benchmarking faces some challenges, including:
lack of capacity to carry out such a qualitative study; time constraints; competitive
barriers; cost; resistance to change; and lack of knowledge sharing among hotels
(Nassar, 2012).
The two studies (Min et al., 2002 and Nassar, 2012) employed empirical research,
which involved observable phenomena. According to Min et al., (2002) the specific
service metrics used are comparable across the hospitality industry as well as in other
service settings such as hospitals and the banking sector. This confirms the views of
the people in the industry. Nassar (2012) addresses attitudinal issues with regard to
awareness of the benchmarking concept in the hotel industry, which can be greatly
influenced by the culture of a place. This implies that these studies can be replicated
in other industries or regions, where results might vary due to cultural differences
between the different regions. Nevertheless, these empirical research findings are
consistent with those of a conceptual research by Elmuti and Kathawala (1997).
2.5 Summary of Literature Review
From the literature reviewed, it appears that benchmarking has been applied in some
context in the evaluation of competitive benchmarking among Korean luxury hotels as
well as in the determination of current benchmarking practices in the Egyptian hotel
sector. The findings reveal that the factors affecting implementation of benchmarking
constitute the process metrics that are comparable across industries. They form a
credible process for benchmarking activities that are applicable to most front office
services, and to some back office processes such as purchasing, receiving, storing, and
16
issuing that cut across different industries. This implies that the same can be applied
to benchmarking activities in any industry in Kenya, including hotels. However, it is
difficult to predict which type of benchmarking can be applied, or is being applied in
Kenyan hotels without a survey of the industry.
There is a consensus among the authors on the different types of benchmarking that
can be applied, the major ones being internal, competitive, functional, and process
benchmarking. The last three can be easily applied by all types of organizations since
the organization is always comparing itself against some external entity. On the other
hand, internal benchmarking depends on the size of the organization; it must be large
enough with many departments or have several units in different geographical
locations to compare against each other. Attitudinal aspects as seen from the positive
views of the people in the industry indicate the readiness of organizations to adopt
benchmarking, especially if its effectiveness could be proven in their operations.
The empirical research carried out on competitive benchmarking in hotels in other
regions focussed on room values and front office services; there appears to be a gap
on food and beverage services. Could this research incorporate this section of hotel
operations in its study? The answer was yes, as this was likely to bring out vital
findings in benchmarking practices in food and beverage services. Hence, this
research extended data collection to include food and beverage services within the
hotel. On this score, this exploratory research sought to address the limited
availability of literature on benchmarking practices in the hotel industry in Nairobi,
Kenya. This formed an important guide to the research methodology.
17
CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Introduction
This chapter presents the procedures that the researcher followed in carrying out the
research for this study. It describes the research design; the target population; data
collection; and data analysis, presentation, and interpretation.
3.2 Research Design
This research followed the descriptive approach as the study sought to establish the
current situation regarding the extent to which benchmarking was being applied in
Kenyan hotels; and to determine the factors affecting its application to achieve
improvements. The research was conducted as a statistical study based on several
cases to achieve generalizability to the industry. In terms of time dimension, the study
used a cross-sectional study, which entails the collection of data at a single point in
time (Bryman and Bell, 2007).
3.3 Target Population
For the choices made above, the researcher obtained information for this study from
classified hotels of varying sizes found within the localized geographical area of
Nairobi city. This geographical area was targeted because it fitted in well with the
time dimension selected for the study. The list of hotels surveyed (Appendix 1), was
compiled with reference to the Kenya Gazette (2003) and a website:
http://www.kenyaspace.com/Hotels.htm, (25/06/2013), where 25 hotels within
Nairobi were listed. The researcher was also aware of hotels that have been
constructed recently, and added them to the population frame on the basis of
18
knowledge of their operating, so no bias was intended. The list comprised hotels of
different classifications from 2 stars to 5 stars; and different sizes by number of rooms
and by number of employees. Data was collected from these hotels in a survey to
enable performance of a realistic analysis from which the findings could be
generalized to the hotel industry in Kenya.
3.4 Data Collection
Primary data for this study was gathered using the drop and collect self-administered
questionnaire as it was considered most convenient with regard to cost and the time
dimension selected. The request for information was directed to the chief operating
officer or operations manager in each establishment. The questionnaire was
accompanied by an introductory letter (Appendix 2) to inform the respondent about
the nature and purpose of the study, and to request them to complete the questionnaire.
The questionnaire in Appendix 3 collected basic information about the establishment;
awareness of benchmarking; reasons and benefits of adopting benchmarking; barriers
to implementing benchmarking; and the importance of various service attributes for
comparing a hotel’s services with other establishments.
Items for the questionnaire were obtained from past studies on benchmarking by
different researchers from different regions, and adapted for this study. Questions to
determine awareness and perception of benchmarking; and quality improvement tools
were adapted from Nassar (2012). The researcher drew questions on reasons for, and
barriers to adopting benchmarking from both Nassar (2012) and Magd (2008), while
factors for gauging the importance of perceived benefits of benchmarking were
19
adapted from Magd (2008). Question items to obtain data on how hotels compare
their services with other establishments were adapted from Min et al. (2002).
Data on basic information was rated on nominal scale, while data for the rest of the
questions was rated using ordinal and interval scales. Respondents were required to
indicate their degree of agreement with given statements using the Likert scale of 1 to
5; while they were asked to rank other variables in order of importance.
3.5 Data Analysis, Presentation and Interpretation
The completed questionnaires were checked for completeness and consistency; and
coded for analysis. Data was coded and categorized based on means and standard
deviations for question items that were measured using the Lickert scale of 1 to 5.
This descriptive statistics are used to identify the presence or absence of the variable.
A mean score above the median value of 3.0 would be a significant indication of the
presence of the variable being measured. Ranking items were coded and categorized
based on mode to signify the level of usage or importance of the variable being
measured. The degree of usage or measure of importance was categorized as being
high, medium or low. The analysed data is described using pie charts, and a variety of
tables in the next chapter.
20
CHAPTER FOUR: DATA ANALYSIS, RESULTS AND
DISCUSSION
4.1 Introduction
This chapter reports on data analysis and findings of the study. The research
objectives were to establish the extent of application of benchmarking in hotel
operations and service in Nairobi, Kenya, and to determine the common process
metrics used in the hotel industry in Kenya. The data was analyzed to generate
descriptive statistics as described in this chapter.
Out of thirty (30) hotels within the city of Nairobi to which the questionnaires were
distributed for this study, only twenty (20) validly completed questionnaires were
returned, representing a response rate of 66.67 per cent. The hotels were categorized
according to their star rating as shown in Figure 1, where nine (9) were classified as 3
star hotels; five (5) were in the 4 stars class; while six (6) were 5-star hotels.
Figure 1: Participating Hotels by Classification
Distribution of Participating Hotels by Classification
5-Star Hotels; 3-Star Hotels;

30.00% 45.00%
4-Star Hotels;
25.00%
3-Star Hotels 4-Star Hotels 5-Star Hotels
Source: Research Data (2013)
21
The hotels were also categorized into different sizes based on number of rooms. This
categorization is shown in Figure 2 as follows: eight (8) hotels were small size (up to
100 rooms); eleven (11) were medium size hotels (101 – 300 rooms) and one (1) hotel
was large size (more than 300 rooms).
Figure 2: Participating Hotels by Size
Distribution of Participating Hotels by Size

Large (Above 300
Rooms); 5.00%
Small (Up to 100

Rooms); 40.00%
Medium (101 -
300 Rooms);
55.00%
Small (Up to 100 Rooms) Medium (101 - 300 Rooms) Large (Above 300 Rooms)
4.2 Results
To determine the extent of application of benchmarking in hotels in Nairobi, specific
indicators were sought from the participating firms. The results obtained are
presented based on awareness of benchmarking; perception of benchmarking; barriers
to benchmarking; methods preferred for benchmarking; and metrics most used for
benchmarking in the hotel industry.
4.2.1 Awareness and Application of Benchmarking
To determine the awareness benchmarking within hotels in Nairobi, respondents were
asked to indicate on a scale of 1 to 5, the level of awareness of benchmarking in their
22
establishments. The participants’ responses are summarized by way of mean scores
and standard deviations based on hotel classification as shown in Table 1.
Table 1: Awareness of Benchmarking by Hotel Classification

Awareness of Benchmarking by Hotel Classification
Hotel N Mean Std.
Classification Deviation
Hotel is aware of what 3 Stars 9 4.44 0.73
benchmarking is all about 4 Stars 5 4.40 1.34
5 Stars 6 4.83 0.41
Total 20 4.55 0.83
Hotel has applied benchmarking 3 Stars 9 4.33 1.00
at least once in the last five years 4 Stars 5 4.00 1.73
5 Stars 6 4.83 0.41
Total 20 4.40 1.10
Hotel regularly compares 3 Stars 9 4.56 0.88
performance with other hotels 4 Stars 5 5.00 0.00
5 Stars 6 5.00 0.00
Total 20 4.80 0.62
The individual mean scores for all indicators based on the three hotel classifications
are well above the median value of 3.00 as seen from Table 1. The overall mean and
standard deviation for awareness of benchmarking is 4.55 and 0.83 respectively.
Benchmarking application registered a mean of 4.40 and standard deviation of 1.10,
while comparing a hotel’s performance with other establishments attained a mean of
4.80 and standard deviation of 0.62. The high mean scores for the different classes
indicate a high level of awareness of benchmarking across hotels of all classes.
A test for correlation between the indicators for benchmarking awareness is shown in
the correlation matrix in Table 2. There is high correlation between awareness of
benchmarking and application of benchmarking at 0.85, which is way above the
significance level of 0.70. This confirms that respondents who are well aware of
benchmarking are likely to be applying it in their operations.
23
Table 2: Benchmarking Awareness Correlation Matrix
Correlations - Awareness of Benchmarking
Hotel is aware of Hotel has applied Hotel regularly
what benchmarking benchmarking at compares
is all about least once in the performance with
last five years other hotels
Hotel is aware of what
benchmarking is all about
1.00
Hotel has applied
benchmarking at least once 0.85* 1.00
in the last five years
Hotel regularly compares
performance with other 0.23 0.13 1.00
hotels
* Correlation is significant at the 0.01 level (2-tailed).
4.2.2 Perceptions of Benchmarking
The study sought to elicit views from the participants on their perception of the
concept of benchmarking. Respondents were presented with several statements on
general perceptions of benchmarking obtained from existing literature and asked to
indicate their extent of agreement on a scale of 1 to 5, where 1 represents “extremely
disagree” and 5 represents “extremely agree”. The results presented in Table 3
indicate the means and standard deviations for variables which scored above the
median value of 3.00. The results indicate a very high perception of benchmarking
among the hotels as most of the scores are way above the significance level.
24
Table 3: General Perceptions of Benchmarking
N = 20
Significance
Perceptual Statement Std.
Mean (Above 3.00)
Deviation
Benchmarking is a useful way to assess hotel
4.80 0.41 Sig.
performance
Benchmarking is a means to share knowledge 4.80 0.41 Sig.
Benchmarking is a means to enhance quality
4.70 0.47 Sig.
of services
Benchmarking is for competitive strategy 4.65 0.59 Sig.
Benchmarking is a means of connecting to
4.60 0.60 Sig.
other players in the sector
Benchmarking is a means to understand how
4.45 0.94 Sig.
others operate
Respondents were asked to rate a number of statements as the reasons for adopting
benchmarking. The results are shown in Table 4 below. Most of the statements were
rated above the median score of 3.00, implying that most respondents agreed with
these statements as reasons that drive them to adopt benchmarking in their operations.
Table 4: Reasons to Adopt Benchmarking

N = 20
Significance
Reasons to Adopt Benchmarking Std.
Mean (Above 3.00)
Deviation
Proven to be effective in quality enhancement 4.75 0.44 Sig.
Helps to provide better services for guests 4.75 0.44 Sig.
Maintain and increase competitive advantage 4.70 0.47 Sig.
Achieve continuous improvement in quality 4.60 0.75 Sig.
Learn other processes 4.40 0.75 Sig.
Increase profits/profitability 4.30 0.98 Sig.
Approved by top hotel management 3.75 1.41 Sig.
Management chain company recommends it 3.65 1.42 Sig.
Ensure uniformity in operations 3.55 1.36 Sig.
The study also sought to establish the perceived benefits of benchmarking by
determining the level of importance that respondents attached to each benefit. In a list
of statements derived from existing literature that describe benefits of benchmarking,
respondents were asked to rate each perceived benefit in terms of importance on a
25
scale of 1 to 5, where 1 represents “unimportant” and 5 represents “very important”.
The results showing the mean scores and the standard deviations are presented in
Table 5. All the benefits were perceived to be important or very important by the
majority of the respondents as depicted by the high mean scores.
Table 5: Perceived Benefits of Benchmarking

Total (N = 20) Significance
Benefits of Benchmarking Overall Std. (Above
Mean Deviation 3.00)
Improved customer satisfaction 4.90 0.31 Sig.
Quality improvement 4.70 0.47 Sig.
Improved response rate (to customer concerns) 4.65 0.67 Sig.
Process improvement 4.65 0.67 Sig.
Improvement in people management 4.55 0.69 Sig.
Setting of internal standards 4.55 0.51 Sig.
Influencing the strategic decision-making
4.50 0.69 Sig.
process
More effective and efficient management of
4.45 0.76 Sig.
resources
Innovative approaches to business improvement 4.25 0.91 Sig.
A test for correlation between the variables for determining the perception of
benchmarking was done using the Pearson correlation; the results are presented in
correlation matrices in Table 6, Table 7 and Table 8.
Under benchmarking perceptions (Table 6), there were significant correlations
between several factors. The highest positive correlation was observed between
benchmarking as a useful way to assess hotel performance and benchmarking as a
means of connecting to other players in the sector (0.729); and between benchmarking
as a means to share knowledge and benchmarking for competitive strategy (0.568).
26
Table 6: Benchmarking Perceptions Correlation Matrix
Pearson Correlation Coefficients
A means of Only A means to A means to
A useful way A means to For
connecting to usable for understand enhance
to assess hotel Expensive share competitive
other players large/chain how others quality of
performance knowledge strategy
Benchmarking is: in the sector hotels operate services
A useful way to assess
1
hotel performance
A means of connecting to
0.729** 1
other players in the sector
Expensive -0.246 -0.107 1
Only usable for large/chain -0.398 0-.455* -0.036 1
hotels
A means to understand
-0.027 0.242 0.095 0.130 1
how others operate
A means to share
0.062 0.086 -0.022 0.265 0.109 1
knowledge
For competitive strategy 0.349 0.479* 0.012 -0.070 0.014 .568** 1
A means to enhance
0.491* 0.487* -0.127 -0.174 0.439 .491* .553* 1
quality of services
**Correlation is significant at the 0.01 level (2-tailed).
*Correlation is significant at the 0.05 level (2-tailed).
27
Table 7: Reasons for Benchmarking Correlation Matrix
Maintain Increase Achieve Pressure Learn Ensure Manage- Approved Provide Effective in
and profits/ continuous from or other uniformity ment by top hotel better quality
Reason to
increase profitability improve- external processes in company manage- services enhance-
Benchmark
competitive ment in agencies operations recommends ment for ment
advantage quality it guests
Maintain and
increase competitive 1
advantage
Increase profits/
0.206 1
profitability
Achieve continuous
improvement in 0.683** 0.243 1
quality
Pressure from
0.000 0.176 -0.076 1
external agencies
Learn other processes 0.505* 0.257 0.111 0.304 1
Ensure uniformity in
0.107 0.186 -0.082 0.127 0.185 1
operations
Management
company 0.306 -0.072 -0.039 0.362 0.284 0.296 1
recommends it
Approved by top
0.357 -0.210 0.149 0.326 0.099 0.213 0.898** 1
hotel management
Provide better
0.630** 0.303 0.471* 0 0.629** 0.328 0.187 0.063 1
services for guests
Effective in quality
0.378 -0.061 0.471* 0.258 0.157 0.066 0.187 0.315 -0.067 1
enhancement
*.Correlation is significant at the 0.05 level (2-tailed).
28
Table 8: Benefits of Benchmarking Correlation Matrix
Improved Improved Quality Process Influencing Setting of Innovative More Improve-
customer response improve- improve- the strategic internal approaches effective and ment in
satisfaction rate (to ment ment decision- standards to business efficient people
Benefits of Benchmarking
customer making improve- management manage-
concerns) process ment of resources ment
Improved customer
1
satisfaction
Improved response rate (to
0.841** 1
customer concerns)
Quality improvement 0.509* 0.651** 1
Process improvement -0.178 0.064 0.484* 1
Influencing the strategic
-0.248 0.171 0.325 0.399 1
decision-making process
Setting of internal standards 0.369 0.438 0.724** 0.438 0.375 1
Innovative approaches to
0.282 0.582** 0.799** 0.409 0.714** 0.708** 1
business improvement
More effective and efficient
-0.023 0.119 0.251 0.119 0.655** 0.414 0.666** 1
management of resources
Improvement in people
0.274 0.554* 0.538* 0.326 0.501* 0.443 0.779** 0.611** 1
management
*Correlation is significant at the 0.05 level (2-tailed).
29
Under reasons for benchmarking (Table 7), the highest level of correlation was
observed between approval by top hotel management and recommendation by
management company at 0.898; followed by correlation between maintaining and
increasing competitive advantage and achieving continuous improvement in quality at
0.683. Other correlations were noted between providing better services for guests and
learning other processes at 0.629.
Among the benefits of benchmarking, (Table 8), correlation was highest between
improved response rate to customer concerns and improved customer service at 0.841;
followed by correlation between innovative approaches to business improvement and
quality improvement at 0.799; and between improvement in people management and
innovative approaches to business improvement at 0.779.
The high levels of correlation indicate that the respondents were quite knowledgeable
about the benchmarking concept. The variables with high correlations were
essentially asking the same question differently, so a respondent with good
understanding of the variables would provide corroborative responses.
4.2.3 Methods Preferred for Benchmarking
Respondents were required to indicate the methods they regularly used to collect
information for comparing their hotel’s performance with other establishments. The
respondents were asked to rank four commonly used methods order of usage by
assigning most used method rank 1 and the least used rank 4. The results are
categorized on the basis of modal rank in Table 9 and in Table 10.
30
Table 9: Methods Preferred for Benchmarking by Hotel Classification
Hotel Classification 3 Stars (N=9) 4 Stars (N=5) 5 Stars (N=6)
Method Used Mode Freq. Mode Freq. Mode Freq.
Rank Rank Rank
Personal visits to observe 1 5 2 4 1 4
Solicit our guests' experience 2 3 3 2 4 3
at other hotels
Established information 3 4 1 2 3 4
sharing arrangements
Shopper Services 4 5 1 2 4 3
According to the results in Table 9, the methods most used to collect information for
benchmarking vary across the different hotel classifications. Personal visits to
observe operations was ranked first by 3-star and 5-star hotels, but ranked second by
4-star hotels. Soliciting guests’ experiences at other hotels was ranked second by 3-
star hotels, but ranked third by both 4-star and 5-star hotels. Established information
sharing arrangements was placed third among the 3-star and 5-star hotels but in placed
first by 4-star hotels; while shopper services was more popular among 4-star hotels
than among both 3-star and 5-star hotels.
Table 10: Methods Preferred for Benchmarking by Hotel Size

Hotel Size Small (N=8) Medium (N=11) Large (N=1)
Method Used Modal Modal Modal
Freq. Freq. Freq.
Rank Rank Rank
Personal visits to observe 1 4 2 6 1 1
Solicit our guests' experience 2 3 3 4 4 1
at other hotels
Shopper Services 4 4 4 5 2 1
Established information 4 4 3 5 3 1
sharing arrangements
Table 10 shows the results for methods preferred for benchmarking based on hotel
size. From Table 10, it can be seen that personal visits to observe operations was
ranked highest by hotels of all sizes. Soliciting guests’ experiences at other hotels was
31
ranked second by small hotels; ranked third by medium hotels, and ranked last by
large hotels. Shopper services was ranked second by large hotels, but ranked fourth
by both the small and medium size hotels. Established information sharing
arrangements was placed in third place by the medium and large hotels but placed
fourth by the small hotels.
The analysis has shown mixed results without any consistent pattern of usage among
the different hotel classifications or sizes. Except for personal visits to observe
operations, which is ranked highest by most respondents, the degree of usage of the
other three methods is varied among the hotel classes and sizes. Therefore, the
method most used does not depend on either the class or the size of the hotel.
4.2.4 Barriers to Implementation of Benchmarking
This study sought to determine whether the establishments faced any barriers in the
process of implementing benchmarking in their operations. Respondents were
presented with a number of possible barriers and asked to indicate their extent of
agreement with them on a scale of 1 to 5, where 1 is “extremely disagree” and 5 is
“extremely agree” with the statement. The responses are reported in Table 11, where
only the barriers with mean scores above the median value of 3.00 are listed and
categorized based on hotel classification. From the analysis, confidentiality of sharing
information with benchmarking partners, and lack of qualified staff to undertake
benchmarking activities were the most significant barriers to benchmarking. Other
barriers, including hotels’ unwillingness to share information; benchmarking being
just another performance tool; and involving too much quantitative data collection,
were considered to be less significant.
32
Table 11: Barriers to Benchmarking by Hotel Classification
Barriers to Benchmarking
N Mean Std.
Hotel Class Deviation Significance
3 Stars 9 3.78 1.20
4 Stars 5 3.80 1.10
Confidentiality Sig.
5 Stars 6 3.67 1.37
Total 20 3.75 1.16
3 Stars 9 4.00 0.87
4 Stars 5 3.40 1.82
Not having qualified staff Sig.
5 Stars 6 3.50 0.84
Total 20 3.70 1.13
3 Stars 9 3.67 1.00
Hotels do not share 4 Stars 5 3.80 1.10
Sig.
information/ knowledge 5 Stars 6 3.00 1.55
Total 20 3.50 1.19
3 Stars 9 3.89 0.33
Just another performance 4 Stars 5 3.20 1.64
Sig.
assessment tool 5 Stars 6 3.00 1.26
Total 20 3.45 1.10
3 Stars 9 3.44 0.88
Too much quantitative data 4 Stars 5 2.80 1.64
Sig.
collection 5 Stars 6 3.33 1.03
Total 20 3.25 1.12
4.2.5 Process Metrics Used in the Hotel Industry
The second objective of this study was to determine the common process metrics used
in the hotel industry as measures of service quality. The study used three key
dimensions, that is, guest room service values, front office service attributes, and food
and beverage service factors to determine the process metrics used by hotels for
comparing their services with those of other establishments. Ten service attributes
were identified from existing literature for each key dimension. The respondents were
asked to rank the attributes in terms of importance on a scale of 1 to 10, by assigning
rank 1 to the factor considered most important. The overall results for each
operational area were categorized using the mode to determine the most important
33
factors as follows: attributes with modal rank 1 – 3 were categorized as being high in
importance; those with modal rank 4 – 6 were assigned medium importance; while
those with modal rank 7 – 10 were considered to be of low importance to the hotel.
The results are reported for each operational area in the following sections.
The results for guest room values for all participating hotels are presented in Table 12.
Table 12: Guest Room Values Frequency Table

Guest Room Values Frequency Table
Mode Frequency Modal
Significance
Service Attribute: (N=20) Rank
Cleanliness of the room 14 1 High
Quietness of the room 6 2 High
Comfort of bed/pillows 7 2 High
Atmosphere 5 3 High
Quality and sufficiency of fixtures 4 4 Medium
Room size 5 6 Medium
Convenience of a working table 6 7 Low
Internet/fax connection 7 8 Low
Complimentary items 10 9 Low
Free local calls 10 10 Low
From Table 12, the attributes with high importance were determined to be cleanliness
of the guest room, quietness of the room, comfort of bed/pillows, and the atmosphere
of the room. Quality and sufficiency of fixtures, and room size are the metrics that
fell in the category of medium importance; while convenience of a working table,
internet/fax connection, complimentary items, and free local calls made the category
of low importance.
In front office operations, respondents were given ten factors considered important in
providing front office services to guests. They were asked to rank them in order of
importance as a means of comparing the hotel’s services with those of other
34
establishments. The ranking results for all the respondents are shown in Table 13
categorized into modal rank in order of importance.
Table 13: Front Office Service Attributes Frequency Table

Front Office Service Attributes - Frequency Table
Mode
Modal
Frequency Significance
Rank
Service Attribute (N=20)
Courtesy of employees 9 1 High
Reasonable room rates 5 1 High
Promptness of check-in and check-out 6 2 High
Thoughtful consideration of repeat guest 6 4 Medium
Flexibility of hotel policy on accommodation issues 5 4 Medium
Convenience of reservation 5 5 Medium
Handling of complaints 6 6 Medium
Variety/quality of sports and recreational facilities 6 8 Low
Efficiency of a business centre 6 8 Low
Hotel and tour guide 7 10 Low
From Table 13, it can be observed that courtesy of employees, reasonable room rates,,
and promptness of check-in and check-out were assigned high significance.
Thoughtful consideration of repeat guests; flexibility of hotel policy; convenience of
reservation; and handling of complaints were rated as being of medium significance.
The factors rated at low significance include variety/quality of sports and recreational
facilities; efficiency of business centre; and hotel and tour guide.
The metrics used in food and beverage operations were determined by asking
respondents to rank, in order of importance, ten attributes that contribute to the quality
of service in food and beverage operations on a scale of 1 to 10, where rank 1 was
assigned to the attribute considered most important, and 10 to the least important. The
overall results are presented in Table 14 categorized based on modal ranks.
35
Table 14: Food and Beverage Service Attributes – Frequency Table
Food & Beverage Service Factors - Frequency Table
Modal
Modal
Frequency Significance
Rank
Service Attribute (N=20)
Courtesy of employees 10 1 High
Speed of service 4 1 High
Variety/quality of food and beverages offered 7 2 High
Promptness of seating allocation 3 3 High
Convenience of table reservation 7 5 Medium
Handling of complaints 5 6 Medium
Thoughtful consideration of repeat guests 6 7 Low
Ambiance/atmosphere of food and beverage
8 Low
outlet 5
Reasonable price (meals and drinks) 6 9 Low
Flexibility of hotel policy on food and beverage
14 10 Low
issues
From the results in Table 14, the respondents regarded four attributes to be highly
significant. These were courtesy of employees, speed of service, variety or quality of
food and beverages offered; and promptness of seating allocation. Those regarded to
be of medium significance were convenience of table reservation; and handling of
complaints. Four attributes were ranked low in importance. These were thoughtful
consideration of repeat guests; ambiance/atmosphere of food and beverage outlet;
reasonable price (meals and drinks); and flexibility of hotel policy on food and
beverage issues.
4.3 Data Analysis and Discussions
The data was subjected to variance analysis using one way ANOVA to test for
statistical significance of values being above the median value of 3.00. The tests were
conducted separately for various sets of variables used in the survey. The results of
analysis are discussed in the following sections.
36
4.3.1 Tests for Statistical Significance of Values
The computed statistics for differences between means of the indicators used to
determine the awareness and perceptions of benchmarking are presented in separate
tables for different sets of indicators. Table 15 depicts the differences between means
for the indicators of benchmarking awareness and application.
Table 15: Variance Analysis for Benchmarking Awareness

ANOVA - for Awareness of Benchmarking
Sum of df Mean F Sig.
Dependent Variable Squares Square
Hotel is aware of Between Groups 0.694 2 0.347

what benchmarking Within Groups 12.256 17 0.721 0.482 0.626
is all about Total 12.950 19
Hotel has applied Between Groups 1.967 2 0.983
benchmarking at Within Groups 20.833 17 1.225 0.802 0.465
least once in the
last five years Total 22.800 19
Hotel regularly Between Groups 0.978 2 0.489
compares Within Groups 6.222 17 0.366 1.336 0.289
performance with
other hotels Total 7.200 19
Note:
For all ANOVA tables, df = degrees of freedom; Sig. = calculated p value; standard
p=0.05
The results in Table 15 show the significance levels for all the variables to be greater
than the standard value of 0.05; this implies that there were no statistically significant
differences between groups as determined by one-way ANOVA.
The computed statistics for differences between means of the different sets of
variables on perceptions of benchmarking are presented as follows: Table 16 for
general perceptions of benchmarking; Table 17 for reasons to adopt benchmarking;
and Table 18 for benefits of benchmarking.
37
Table 16: Variance Analysis for Perceptions of Benchmarking
ANOVA - for Perceptions of Benchmarking
Dependent Variable
Squares Square
Benchmarking is a Between Groups 0.367 2 0.183
useful way to assess Within Groups 2.833 17 0.167 1.100 0.355
hotel performance Total 3.200 19
means of connecting to Within Groups 6.256 17 0.368 0.740 0.492
other players in the
sector Total 6.800 19
Benchmarking is Between Groups 1.094 2 0.547
expensive Within Groups 23.856 17 1.403 0.390 0.683
Total 24.950 19
Benchmarking is Between Groups 1.528 2 0.764
only usable for Within Groups 16.222 17 0.954 0.801 0.465
large/chain hotels Total 17.750 19
means to understand Within Groups 15.633 17 0.920 0.716 0.503
how others operate Total 16.950 19
means to share Within Groups 2.833 17 0.167 1.100 0.355
knowledge Total 3.200 19
Benchmarking is for Between Groups 0.194 2 0.097
competitive strategy Within Groups 6.356 17 0.374 0.260 0.774
Total 6.550 19
means to enhance Within Groups 3.056 17 0.180 3.184 0.067
quality of services Total 4.200 19
The analysis results in Table 16, indicate that the levels of significance for all the
variables under general perceptions of benchmarking were greater than 0.05, so there
were no statistically significant differences between the groups as determined by one-
way ANOVA.
38
Table 17: Variance Analysis for Reasons for Benchmarking
ANOVA - for Reasons to Adopt Benchmarking
Dependent Variable
Squares Square
Maintain and Between Groups 1.144 2 0.572
increase competitive Within Groups 3.056 17 0.180 3.184 0.067
advantage Total 4.200 19
Between Groups 6.478 2 3.239
Increase profits/
Within Groups 11.722 17 0.690 4.697 0.024
profitability
Total 18.200 19
Achieve continuous Between Groups 2.411 2 1.206
improvement in Within Groups 8.389 17 0.493 2.443 0.117
quality Total 10.800 19
Pressure from Between Groups 0.278 2 0.139
government or Within Groups 15.722 17 0.925 0.150 0.862
external agencies Total 16.000 19
Learn other
Within Groups 8.389 17 0.493 2.443 0.117
processes
Total 10.800 19
Ensure uniformity in
Within Groups 34.356 17 2.021 0.147 0.864
operations
Total 34.950 19
Management chain Between Groups 4.828 2 2.414
company Within Groups 33.722 17 1.984 1.217 0.321
recommends it Total 38.550 19
Approved by top
Within Groups 27.333 17 1.608 3.239 0.064
hotel management
Total 37.750 19
Helps to provide Between Groups 0.417 2 0.208
better services for Within Groups 3.333 17 0.196 1.062 0.367
guests Total 3.750 19
Proven to be Between Groups 0.694 2 0.347
effective in quality Within Groups 3.056 17 0.180 1.932 0.175
enhancement Total 3.750 19
Except for one variable in Table 17, the levels of significance for all the other
variables were greater than 0.05. That means there were no statistically significant
differences between groups for these variables as determined by one-way ANOVA.
For the exception variable, that is, increase profits or profitability, the significance
level as determined by one way ANOVA was (F(2,17) = 4.697, p = .024), thus there
was a statistically significant difference between the groups for this variable.
39
Table 18: Variance Analysis for Benefits of Benchmarking
ANOVA - for Benefits of Benchmarking
Dependent Variable
Squares Square
Improved customer
Within Groups 1.556 17 0.092 1.336 0.289
satisfaction
Total 1.800 19
Improved response Between Groups 0.694 2 0.347
rate (to customer Within Groups 7.856 17 0.462 0.751 0.487
concerns) Total 8.550 19
Quality improvement Within Groups 3.556 17 0.209 1.541 0.243
Total 4.200 19
Process
Within Groups 7.556 17 0.444 1.119 0.350
improvement
Total 8.550 19
Influencing the Between Groups 0.244 2 0.122
strategic decision- Within Groups 8.756 17 0.515 0.237 0.791
making process Total 9.000 19
Setting of internal
Within Groups 4.133 17 0.243 1.679 0.216
standards
Total 4.950 19
Innovative Between Groups 0.328 2 0.164
approaches to Within Groups 15.422 17 0.907
0.181 0.836
business
Total 15.750 19
improvement
More effective and Between Groups 0.428 2 0.214
efficient Within Groups 10.522 17 0.619
0.346 0.713
management of
10.950 19
resources Total
Improvement in
Within Groups 8.922 17 0.525 0.026 0.974
people management
Total 8.950 19
From the table above, it can be observed that the levels of significance for all the
variables were greater than the standard of 0.05. This implies that there were no
statistically significant differences between the groups as determined by one way
ANOVA.
40
4.3.2 Differences Between Means - Barriers to Benchmarking
A test for statistical significance was performed for the variables under barriers to
benchmarking using one way ANOVA. The results are displayed in Table 19 below.
Table 19: Variance Analysis for Barriers to Benchmarking

ANOVA - Barriers to Benchmarking
Dependent Variable
Squares Square
Not having qualified Within Groups 22.700 17 1.335 0.562 0.580
staff Total 24.200 19
Too much Between Groups 1.394 2 0.697
quantitative data Within Groups 22.356 17 1.315 0.530 0.598
collection Total 23.750 19
Too much Within Groups 20.833 17 1.225 1.190 0.328
complicated work Total 23.750 19
Hotels do not share Between Groups 2.200 2 1.100
information/ Within Groups 24.800 17 1.459 0.754 0.486
knowledge Total 27.000 19
Just another Between Groups 3.261 2 1.631
performance Within Groups 19.689 17 1.158 1.408 0.272
assessment tool Total 22.950 19
Data comparability is Within Groups 30.756 17 1.809 0.676 0.522
difficult Total 33.200 19
Within Groups 36.033 17 2.120 0.275 0.763
Lack of resources Total 37.200 19
Sufficient Between Groups 0.667 2 0.333
organizational Within Groups 24.533 17 1.443 0.231 0.796
practices Total 25.200 19
Within Groups 25.022 17 1.472 0.655 0.532
Staff resistance Total 26.950 19
Within Groups 25.689 17 1.511 0.020 0.980
Confidentiality Total 25.750 19
It is observable from Table 19 above that the significant values for all the variables
were greater than the standard of 0.05, meaning there were no statistically significant
differences between groups.
41
4.3.3 Metrics Used in the Hotel Industry in Kenya
The study sought to determine the different metrics used in the hospitality industry as
indicators of service quality for purposes of comparing hotel’s services with other
establishments. The researcher obtained various service attributes from past studies
and adapted them for this study. The attributes were assessed under three key
dimensions of Guest Room Values, Front Office Services and Food and Beverage
Operations. The research sought to determine the level of importance the respondents
attached to each metric as a measure for comparing their services with other
establishments.
For Guest Room Values (Table 12), the attributes that received the highest ranking by
the respondents were: cleanliness of the guest room, ranked first by 14 out of 20
respondents; followed by quietness of the room; comfort of the bed/pillows; and room
atmosphere as the most important factors on which hotels compare their services with
other establishments. Convenience of a working table; internet/fax connection;
complimentary items; and free local calls were rated as the least important metrics.
In Front Office Services (Table 13), the factors accorded high importance were
courtesy of employees, reasonable room rates, and promptness of check-in and check-
out; whereas thoughtful consideration of repeat guests, flexibility of hotel policy on
accommodation, convenience of reservation, and handling of complaints were
assigned medium importance as factors for comparison of services with other
establishments. Variety and quality of sports and recreational facilities, efficiency of a
business centre, and hotel and tour guide were ranked the lowest in importance.
42
In Food and Beverage Operations (Table 14), four factors, namely: courtesy of
employees; speed of service; variety and quality of food and beverages offered; and
promptness of seating allocation, were considered to be of high importance as factors
for comparing services with other establishments. Two factors rated as medium in
importance were convenience of table reservation, and handling of complaints. The
remaining four factors were ranked low in importance. These include, thoughtful
consideration of repeat guests, ambiance/atmosphere of food and beverage outlet,
reasonable price (meals and drinks), and flexibility of hotel policy on food and
beverage issues.
4.4 Discussions and Interpretation
This study was undertaken with a view to achieving two objectives: to establish the
extent of application of benchmarking in hotel operations and service in Nairobi,
Kenya; and to determine the common process metrics used in the hotel industry in
Kenya. This section covers discussions and interpretation of the results on the basis of
the research objectives.
4.4.1 Benchmarking Awareness and Application
The results and analysis of data on awareness revealed high levels of benchmarking
awareness and application across hotels of all sizes and classes. Awareness and
application of benchmarking recorded overall mean scores of 4.55 and 4.40
respectively. The correlation matrix showed a high correlation between the two
variables at 0.85. The result confirms that the objective of the study to determine the
extent of application of benchmarking in the hotel industry in Nairobi has been
achieved. This finding is consistent with that of Nassar (2012) that benchmarking
43
experience across the Egyptian hotel sector was not dependent on hotel size or
location, but rather benchmarking experience was confirmed among hotels of different
sizes and in different locations.
On the other indicators of benchmarking awareness, this study found that most
respondents perceived benchmarking to be a useful tool for assessing hotel operations;
a means to share knowledge, and enhance quality of services; and as a tool for
competitive strategy. By sheer coincidence, these findings correspond in similar order
of rating to those of Nassar (2012), who observed that understanding of benchmarking
was intended to be a learning process as well as a means of increasing competitive
advantage.
On reasons for adopting benchmarking, this study found that most hotels in Nairobi
indicated that they would adopt the concept if its effectiveness in quality enhancement
could be proven; helps to provide better services to guests; and helps maintain
competitive advantage. The finding is consistent with that of Magd (2008) in the
study of benchmarking in Egyptian organizations, where these indicators scored
highly in levels of importance as reasons for adopting benchmarking (Table 4). In
addition, this study found that hotels in Nairobi have adopted benchmarking because
of the expected benefits, which included the following: improved customer services;
quality improvement in services; improved response rate to customer concerns (Table
5). Again, these findings agree with those of Magd (2008) that improved customer
satisfaction; improved response rate to customer concerns; and quality improvement
were ranked highest in level of importance.
44
In this study, the following were rated as the most significant barriers to
implementation of benchmarking. Confidentiality was ranked highest, followed by
lack of qualified staff; and unwillingness by hotels to share information or knowledge.
These findings are consistent with Nasser (2012) where the same variables were rated
as significant barriers to implementation of benchmarking. In another study, Magd
(2008) found that confidentiality was rated the least significant barrier to
implementation of benchmarking as compared to this study (Table 11).
Confidentiality seems to be quite prominent, probably out of fear by organizations that
engaging in a benchmarking partnership might lead to giving out sensitive information
about one’s operations to competitors. On the contrary, Nassar (2012) commented
that such partnerships may in fact benefit all stakeholders involved by establishing
standards of good practice in key areas, and increase the implementation of
benchmarking. This finding is supported by Bhutta and Huq (1999) and Elmuti and
Kathawala (1997).
4.4.2 Process Metrics Used in the Hotel Industry
In the second objective, this study set out to determine the process metrics used in the
hotel industry in Kenya. The study used three key operational areas: guest room
values, front office services and food and beverage operations to determine the
importance hotels attached to these service attributes as factors for comparing
services. In the findings of guest room values, cleanliness of the room, quietness of
the room, comfort of the bed/pillow, and atmosphere were given the highest
significance in comparing services with other establishments. These findings concur
with those of Min et al., (2002) in a research on dynamic benchmarking of Korean
luxury hotels.
45
In front office services, this study found that courtesy of employees; reasonable room
rates; promptness of check-in and check-out; and thoughtful consideration of a repeat
guest were the most important factors on which comparison of services with other
establishments was based. This finding corresponds with that of Min et al., (2002),
where the same attributes were ranked highest in order of importance (although not in
similar order) as attributes of determining hotel service quality. Handling of
complaints was ranked much lower in order of importance by the hotels in Nairobi
compared to the study by Min et al., (2002).
This study included food and beverage operations in determining process metrics used
in the hospitality industry. This area was not covered by any of the previous studies
cited in the literature review. Nevertheless, the findings of this study show that
courtesy of employees; speed of service; variety/quality of food and beverages
offered; and promptness of seating allocation were considered the most important
factors on which to compare services with other establishments. Some of these factors
such as courtesy of employees and handling complaints have been used in employee-
customer contact situations like in front office services, and the results are not too
dissimilar (Min et. al., 2002).
Overall, on the strength of the findings reported, it can be concluded that the two
objectives of this study have been achieved. This is can be attributed to the high mean
scores recorded for variables used to test for this. The study has also determined the
process metrics used in the hotel industry in terms of importance that is consistent
with findings from other studies elsewhere.
46
CHAPTER FIVE: SUMMARY, CONCLUSION AND
RECOMMENDATIONS
5.1 Introduction
This chapter summarizes the study findings and derives conclusions from the findings
on application of benchmarking in the hotel industry in Nairobi; and the common
process metrics used in the industry. Limitations of the study are highlighted and
some recommendations for further research are offered.
5.2 Summary
Data was collected from twenty (20) out of thirty (30) hotels of different
classifications and sizes within the city of Nairobi. This represents a response rate
66.67 per cent. The data was analysed, discussed and interpreted on the basis of the
study objectives, which were to establish the extent of application of benchmarking in
hotel operations and service in Nairobi, Kenya; and to determine the common process
metrics used in the hotel industry in Kenya.
In the first objective, this study set out to determine the extent to which benchmarking
was being applied in hotel operations in Nairobi. The findings have revealed a high
level of awareness and application of benchmarking among hotels of different classes
and sizes, with overall mean scores of 4.55 and 4.40 respectively. The findings also
revealed a high level of correlation at 0.85 between the variables testing for awareness
and application of benchmarking.
47
Indicators of perceptions of benchmarking returned findings that the majority of
respondents in the study had a wide experience of benchmarking. The respondents
agreed with most of the statements on perception of benchmarking; as well as reasons
for and perceived benefits of benchmarking. The variables were highly rated on a
scale of 1 to 5, where most of variables achieved mean scores above the median score
of 3.00. These findings were confirmed with tests of significance performed on
different sets of variables as presented in chapter four. Additionally, the results of
correlation tests performed on different sets of variables returned significant
correlations between different variables, further confirming reliability of the survey
results.
The study findings reported mixed results among the different hotel classes and sizes
on methods of collecting information for benchmarking purposes. Only one method,
personal visits to observe operations in other establishments, was consistently ranked
highly by all hotels regardless of class or size. The preference of other methods seems
to have no bearing on hotel class or size as no distinct pattern could be observed in the
way the respondents ranked them.
The study also sought to determine the process metrics used in the hotel industry in
Kenya by measuring the importance hotels attached to the various service attributes in
guest room values, front office services and in food and beverage operations. The
findings on these attributes have shown a high level of consistency with the findings
from previous studies in other regions and from which these attributes were adapted.
This level of consistency confirms that it is possible to replicate a given study in a
different setting of the same industry and obtain similar results.
48
5.3 Conclusion
From the findings of this study, some conclusions can be arrived at concerning
awareness, application, and perception of benchmarking in the hotel industry in
Nairobi. The findings indicate a high level of awareness and application of
benchmarking. The findings on other variables, including perceived benefits of
benchmarking, and barriers to benchmarking, are consistent with findings from
previous studies done in different regions. This study concludes that operators in the
hotel industry value benchmarking as an important continuous improvement tool.
In determining the process metrics used in the hotel industry, the study has revealed a
high level of appreciation of the attributes among the majority of hotels. The
consistency of findings from this study with previous studies confirms that it is
possible to replicate a given study in the same industry with a different set of
respondents and obtain similar results. The similarity of findings on service factors in
front office services to findings of the same in food and beverage operations show a
similarity of perceptions in most employee-customer service encounters. From this, it
can be concluded that some process metrics such as courtesy of employees, and
handling of complaints, and reasonable rates or prices, apply in different service areas.
5.4 Limitations of the Study
This study encountered limitations in the methods of data collection, research
instrument, and context of the study. The study was based on cross-sectional design
to collect data at a single point in time from many subjects. Delays by some of the
respondents in completing the questionnaires within the limited time resulted in many
questionnaires not being retrieved for inclusion in data analysis.
49
The limitation with the research instrument arose from the fact that it was a self-
administered drop and collect questionnaire. It was not practically possible to seek
clarifications where respondents failed to provide responses in the expected manner.
Two questionnaires were omitted from the analysis because responses to the ranking
questions were not appropriately indicated. The data collection aspect also lacked
sufficient cooperation from some of the participants. In some establishments, it was
difficult to access the appropriate officer to complete the questionnaire. In one case,
the questionnaire was returned without responses because the “manager” was too
busy; while one hotel that is part of an international chain declined to participate in the
survey because they perform internal benchmarking between their units.
The study also faced a limitation in context. This study was designed to survey
establishments in a limited geographical area, which essentially limited population
size for the study. Coupled with the less than 100 per cent response rate, it diminished
the results to be generalizable to the whole hotel industry in Kenya.
5.5 Recommendations
From the findings and conclusions of this study, some recommendations are made as
follows. A higher level of cooperation from the operators in the hotel industry would
go a long way in enabling research and development of knowledge in general for the
industry. It is also recommended that operators in the industry develop open channels
of communications between themselves and other stakeholders, as both stand to
benefit from the knowledge base that would result from regular research and reporting
on issues affecting the hotel industry.
50
The hotel classifications indicated in the results may not reflect the correct class of
each hotel that participated in the survey due to lack of an official classification record
from the Kenya Hotels and Restaurants Authority. Indeed, some hotels indicated their
class to be 3-stars in the research instrument, yet they were identified as 2-star hotels
in Appendix 1. It is recommended that the Kenya Hotels and Restaurants Authority
regularly updates the list of classified hospitality establishments in the country. This
would ensure that any research carried out in the hospitality industry based on
classification would reflect the true status of the establishments studied.
5.6 Suggestions for Further Research
This study has established that hotels in Nairobi do practise benchmarking in general.
However, the study was limited in scope and size; hence, it may not be statistically
appropriate to generalize the findings of this study to the hotel industry in Kenya.
This exploratory study set out to determine the extent of benchmarking application in
the hotel industry in general. Respondents were not asked to specify the type of
benchmarking being applied. It is suggested that future research could be undertaken
to determine the different types of benchmarking being applied, such as internal,
competitive, functional or process benchmarking. The research could also be
expanded to cover a wider geographical area, so that with data from a larger
population size it would be statistically significant to generalize the results to the
whole industry.
51
REFERENCES
Akuma, O. E., (2007). “A survey on the use of benchmarking as a continuous
improvement tool by the Ministry of Agriculture Parastatals in Kenya.” MBA
Research Projects, University of Nairobi, Nairobi.
Bhutta, K. S. and Huq, F., (1999). “Benchmarking - best practices: An integrated
approach.” Benchmarking: An International Journal, 6(3) 354-268
Bryman, A. and Bell, E., (2007). Business Research Methods, 2nd ed., Oxford
University Press Inc., New York, New York.
Camp, R. C., (1989). Benchmarking: The search for industry best practices that lead
to superior performance.ASQC Press, Milwaukee, Wisconsin.
Cooper, D. R. and Schindler, P. S., (2011).Business Research Methods, 11th ed.,
McGraw-Hill/Irwin Inc., New York, New York.
Elmuti, D. and Kathawala, Y. (1997). “An overview of benchmarking process: A tool
for continuous improvement and competitive advantage.” Benchmarking for
Quality Management & Technology, 4(4) 229-243.
http://www.kenyaspace.com/Hotels.htm, accessed 25/06/2013.
Kenya National Bureau of Statistics, (2012). “Economic Survey, 2012”. Ministry of
State for Planning, National Development and Vision 2030. Nairobi.
Magd, H. A. E., (2008). “Understanding benchmarking in Egyptian organizations: an
empirical analysis”. Benchmarking: An International Journal, 15(6) 742-764.
Min, H., Min, H. and Chung, K. (2002). “Dynamic benchmarking of hotel service
quality,” Journal of Services Marketing, 16(4) 302-321.
52
Nassar, M. (2012). “Exploring the current benchmarking practices in the Egyptian
hotel sector.” Benchmarking: An International Journal, 19(6) 730-732.
Okwiri, O. A., (2010). Lecture 4: “Key Techniques and Tools” [PowerPoint Slides]
Strategic Quality Management Unit, University of Nairobi, Nairobi.
Republic of Kenya (2003). Gazette Notice No. 3976. The Hotels and Restaurants
(Classification of Hotels and Restaurants) Regulations, Government Printer,
Nairobi.
Wadongo, B., Odhuno, E., Kambona, O. and Othuon, L., (2010). “Key performance
indicators in the Kenyan hospitality industry: A managerial perspective.”
Benchmarking: An International Journal, 17(6) 858-875.
Wöber, K. W., (2001). “Benchmarking for Tourism Organizations: An eGuide for
Tourism Managers.” National Laboratory for Tourism and eCommerce,
University of Illinois, Urbana-Champaign.
Yasin, M. M. & Zimmerer, T. W., (1995). “The role of benchmarking in achieving
continuous service quality.” International Journal of Contemporary
Hospitality Management, 7(4) 27-32.
53
APPENDICES
Appendix 1: List of Hotels for Survey
No. Hotel Name Star Rating
1 Hotel Ambassadeur 2 Stars
2 Kenya Comfort Hotel 2 Stars
3 Mvuli House B & B 2 Stars
4 Parkside Hotel- Kenya 2 Stars
5 Meridian Court Hotel 3 Stars
6 Oakwood Hotel 3 Stars
7 Marble Arch Hotel- Kenya 3 Stars
8 Red Court Hotel 3 Stars
9 Sentrim Boulevard Hotel 3 Stars
10 Silver Springs Hotel - Kenya 3 Stars
11 West Breeze Hotel 3 Stars
12 Hill Park Hotel 4 Stars
13 Jacaranda Hotel 4 Stars
14 Ole Sereni Hotel 4 Stars
15 Westhouse One Degree South Hotel 4 Stars
16 Sarova Panafric Hotel 4 Stars
17 Sentrim Six-Eighty Hotel 4 Stars
18 Southern Sun Mayfair Hotel, Nairobi 4 Stars
19 Crowne Plaza Hotel 5 Stars
20 Fairmont, The Norfolk 5 Stars
21 Hilton Hotel, Nairobi 5 Stars
22 InterContinental Hotel, Nairobi 5 Stars
23 Laico Regency Hotel, Nairobi 5 Stars
24 Nairobi Safari Club – Kenya 5 Stars
25 Nairobi Serena Hotel 5 Stars
26 Safari Park Hotel and Casino 5 Stars
27 The Boma Hotel, Nairobi 5 Stars
28 The Sarova Stanley 5 Stars
29 The Tribe Hotel 5 Stars
30 Winsor Golf Hotel and Country Club 5 Stars
Adapted from The Kenya Gazette (2003) and http://www.kenyaspace.com/Hotels.htm,
26/06/2013
54
Appendix 2: Letter of Introduction
Philip Alinyo Okombo
P O Box 59857 – 00200
Nairobi
28th August 2013
Dear Respondent,
RE: BENCHMARKING PRACTICES IN THE HOTEL INDUSTRY IN NAIROBI
I am a student undertaking studies for the degree of Master of Business Administration

(MBA, Operations Management) at the University of Nairobi. I am conducting a study to
determine the extent of application of the benchmarking concept in hotels in Nairobi. Your
establishment was selected to participate in this study as a stakeholder in the hotel industry.
I would appreciate your honesty and willingness to take a few minutes to complete the
attached questionnaire on the concept of benchmarking and its application in your hotel’s
operations. Please respond to all questions appropriately to assist me to complete my research
project.
Your participation is important to this study, and will contribute to our knowledge and
understanding of the benchmarking concept in the hotel industry. I would like to assure you
that this survey is being undertaken for educational purposes. All information provided will
be treated strictly confidential; and will be used only for the intended purpose. If you wish to
obtain a copy of the research report, an electronic copy may be provided upon request.
Thanking you in advance for your participation, I remain,
Yours sincerely
Philip Alinyo Okombo

Telephone No.: 0720 732062; Email: [email protected]
55
Appendix 3: Research Questionnaire
BENCHMARKING PRACTICES IN THE HOTEL INDUSTRY IN NAIROBI, KENYA
A. General establishment information
Establishment ID Number (Case number)
1. Hotel Classification – please tick one option:
2 Stars 3 Stars 4 Stars 5 Stars
2. Affiliation/Management of the hotel – please tick one option:
Independent Part of International Chain: Local Chain
3. Number of rooms – please tick one option:
Under 50 51 – 100 101 – 200 201 – 300 Above 300
4. Number of Employees – please tick one option
Under 50 51 – 100 101 – 200 201 – 300 Above 300
B. Please indicate the extent to which you agree or disagree with the following statements
by putting a tick in the appropriate box using the scale below:
1 = Extremely Disagree 2 = Somewhat Disagree 3 = Not Sure
4 = Somewhat Agree 5 = Extremely Agree
Somewhat
Somewhat
Extremely
Extremely
Not Sure
Disagree
Disagree
Agree
Agree
5 In our hotel we are aware of what benchmarking is

all about
6 In our hotel, we have applied benchmarking at least
once in the last five years
7 In our hotel, we regularly compare how we perform
with other hotels
56
C. Study the 4 methods of collecting information for comparing your hotel’s standards
with those of other establishments, and then rank the methods by assigning rank 1 to the
method most used in your establishment such that the least used method is ranked 4.
For purposes of this study, no two methods should share a rank.
Rank
8 Personal visits to observe
9 Shopper services
10 Solicit our guests’ experience at other hotels they have stayed at
11 Established information sharing arrangements
D. How frequently do you use each method below in collecting information for comparing
your hotel’s standards with those of other establishments? Tick the appropriate box
using the scale below:
1 = Never 2 = Rarely 3 = Sometimes 4 = Often 5 = Always
Sometimes
Always
Rarely
Never
Often
12 Personal visits to observe
13 Shopper services
14 Solicit our guests’ experience at other hotels they
have stayed at
15 Established information sharing arrangements
E. To what extent do you agree with each of the statements below regarding the perception
of benchmarking in your hotel? Tick the box that applies to you on the scale below:
Somewhat
Somewhat
Extremely
Extremely
Not Sure
Disagree
Disagree
Agree
Agree
16 Benchmarking is a useful way to assess hotel

performance
17 Benchmarking is a means of connecting to other
players in the sector
18 Benchmarking is expensive
19 Benchmarking is only usable for large/chain hotels
20 Benchmarking is a means to understand how others
operate
21 Benchmarking is a means to share knowledge
22 Benchmarking is for competitive strategy
23 Benchmarking is a means to enhance quality of
services
57
F. Indicate the extent to which you agree with the statements below as reasons to adopt or
continue to adopt benchmarking. Tick the box that applies to you on the scale below:
Somewhat
Somewhat
Extremely
Extremely
Not Sure
Disagree
Disagree
Agree
Agree
24 Maintain and increase competitive advantage
25 Increase profits/profitability
26 Achieve continuous improvement in quality
27 Pressure from government or external agencies
28 Learn other processes
29 Ensure uniformity in operations
30 Management chain company recommends it
31 Approved by top hotel management
32 Helps to provide better services for guests
33 Proven to be effective in quality enhancement
G. How important are the following to your establishment as benefits that may accrue from
benchmarking? Tick the box that applies to you using the scale below:
1 = Unimportant 2 = Of Little Importance 3 = Moderately Important
4 = Important 5 = Very Important
Unimportant
Importance
Moderately
Important
Important
Important
Of Little
34 Improved customer satisfaction Very
35 Improved response rate (to customer concerns)

36 Quality improvement
37 Process improvement
38 Influencing the strategic decision-making process
39 Setting of internal standards
40 Innovative approaches to business improvement
41 More effective and efficient management of
resources
42 Improvement in people management
58
H. To what extent do you agree or disagree with each of the statements below as barriers
to carrying out benchmarking in hotels? Tick the box that applies to you using the scale
below:
Somewhat
Somewhat
Extremely
Extremely
Not Sure
Disagree
Disagree
Agree
Agree
42 Not having qualified staff
43 Too much quantitative data collection
44 Too much complicated work
45 Hotels do not share information/knowledge
46 Just another performance assessment tool
47 Data comparability is difficult
48 Lack of resources
49 Sufficient organizational practices (no need for
benchmarking)
50 Staff resistance
51 Confidentiality
I. Study the following Guest Room service factors that may be used as a basis for
comparing your hotel’s services with those of other establishments. Rank the factors in
terms of their importance, by assigning position 1 to the most important such that the
least important will have position 10. For purposes of this study, no two factors should
share a rank.
Rank
52 Cleanliness of the room
53 Quietness of the room
54 Comfort of bed/pillows
55 Quality and sufficiency of fixtures
56 Atmosphere
57 Room size
58 Convenience of a working table
59 Internet/fax connection
60 Complimentary items
61 Free local calls
59
J. Study the following Front Office service factors that may be used as a basis for
share a rank.
Rank
62 Courtesy of employees
63 Handling of complaints
64 Promptness of check-in and check-out
65 Thoughtful consideration of repeat guest
66 Convenience of reservation
67 Reasonable room rates
68 Variety/quality of sports and recreational facilities
69 Hotel and tour guide
70 Efficiency of a business centre
71 Flexibility of hotel policy on accommodation issues
K. Study the following Food and Beverage service factors that may be used as a basis for
share a rank.
Rank
72 Courtesy of employees
73 Handling of complaints
74 Promptness of seating allocation
75 Thoughtful consideration of repeat guest
76 Convenience of table reservation
77 Reasonable price (meals and drinks)
78 Variety/quality of food and beverages offered
79 Ambiance/atmosphere of food and beverage outlet
80 Speed of service
81 Flexibility of hotel policy on food and beverage issues
The End
Your participation in this survey is highly appreciated. Thank you for your time!!!
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Benchmarking Practices in The Hotel Indu

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BENCHMARKING PRACTICES IN THE HOTEL

INDUSTRY IN NAIROBI, KENYA

This research project is presented in partial fulfilment of the requirements

Signature: __________________________ Date: ______________

Signature: __________________________ Date: ______________

To God, our creator:

Who gives us power to excel and make wealth;

To my dear wife, Rose Vutare:

To our children, Michelle, Sharon and Michael:

To my uncle: Cornelius Obulutsa:

Your encouragement has propelled me to my academic achievements;

To my mother, Juliah Nyangasi: for your love.

1.1 Background to the Study

The industry is served by a variety of service organizations, which are constantly

working towards providing quality products and services to meet customers’

commonly applied tools is benchmarking.

scholars. According to Min, Min and Chung (2002), benchmarking is a continuous

quality improvement process by which an organization assesses its internal strengths

and weaknesses; evaluates comparative advantages of leading competitors; identifies

strategic action plan geared to gaining a position of superiority. It is a process of

defined standards or benchmarks. In other words, it involves continuously monitoring

In the hospitality industry, the benchmarking concept can be applied to a number of

include the following: accommodation reservation process; guest check-in process;

measured against some defined benchmarks. A benchmark refers to a metric or

benchmarking process (Okwiri, 2010). Thus the benchmarking process leads to

and the speed of complaint resolution are briefly explained below.

process effectiveness and operational efficiency in hotel operations. For example, a

efficiency of the hotel’s housekeeping department.

as a measure of process effectiveness and operational efficiency. Satisfied guests are

the hotel’s services to other prospective customers by word of mouth.

1.3 The Hotel Industry in Kenya

terms of foreign exchange earnings and international visitor arrivals to Kenya.

cent in 2010 (Kenya Economic Survey, 2012).

including, advancements in information and communications technology that have

contributed to the growth of tourism: promotion in new markets like Asia;

air is now more readily available and affordable than before.

competition within Kenya, and improved communication that enables customers to

obtain information very conveniently. Increased supply moves bargaining power to

As a continuous quality improvement process, benchmarking involves continuously

the best. For benchmarking to be undertaken effectively, standards have to be

of resolving guest complaints means fewer dissatisfied guests. The standards so

efficiency in hotel operations.

visitor arrivals, foreign exchange earnings, and development of new hospitality

Survey, 2012). This growth can be attributed to a number of factors, including

competition from emerging tourist destinations, internal competition within Kenya,

and improved communication that enables customers to obtain information

conveniently. Consequently, operators in the hotel industry have to maintain the

industry in Kenya. In a study to investigate the impact of managerial characteristics

on key performance indicators in the Kenyan hotel industry, Wadongo, Odhuno,

based more on financial measures than competitiveness and other non-financial

measures, which the study concluded could be an indicator that performance

competitive/performance, external, and strategic benchmarking were currently in use

as a tool for continuous improvement by parastatals in the Ministry of Agriculture.

terms of analyzing and gaining a deeper understanding of their own processes;

scarcity of resources; unavailability of appropriate benchmarking partners; and

government bureaucracy in running parastatals.

Other researchers have undertaken conceptual research studies on benchmarking as a

tool for promoting continuous service quality improvement in hospitality operations.

respond to their competitive environment by embracing benchmarking in their

Signature: ____________ Date:

Signature: ____________ Date: