International Journal of Management (IJM)

Volume 7, Issue 6, September–October 2016, pp.116–122, Article ID: IJM_07_06_013

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ROLE OF HR PRACTICES IN EMPLOYEES’

SATISFACTION: A CASE STUDY ON 3-STAR HOTELS
OF AHMEDABAD, GUJARAT
Neela Multani
Assistant Professor, Department of Science & Humanities,
SVBIT, Unava, Gujarat, India.

ABSTRACT
Human Resource Management is an integral part of any organization and when it is about
hospitality industry HR department plays a crucial role in organization’s growth, because only
satisfied employees can serve better to the customers. Human resource department not only recruit
the best employees but also guide their career map. The purpose of this study is to find out that how
and which HR practices play an important role in increasing employees’ satisfaction in hotel
industry. This study focuses on lower level employees of 3-star hotels in Ahmedabad, Gujarat. A pilot
study was conducted first and HR executives/managers of hotels were interviewed. On the basis of
these interviews, factors which affect employees’ satisfaction were identified and questionnaire was
designed for employees. Responses were taken from the lower level employees of the hotels. This
study shows that employees are satisfied with working conditions and somewhat with the salary and
other benefits they are receiving. The employee turnover rate observed in hotel industry is relatively
high.
Key words: Employee Satisfaction, Hotel Industry, HR Practices.
Cite this Article: Neela Multani, Role of HR Practices in Employees’ Satisfaction: A Case Study on
3-Star Hotels of Ahmedabad, Gujarat. International Journal of Management, 7(6), 2016, pp. 116–
122.
http://iaeme.com/Home/issue/IJM?Volume=7&Issue=6

1. INTRODUCTION
Hotel industry is one of the fastest growing sectors of the economy. Due to globalization, business
opportunities between countries have increased. Now a day, people tend to travel more across countries for
business, tourism and other purposes and the need for good places to stay during visits gave boost to the
requirement of good hotels across the globe. Indian hospitality has a great image since very early times in
the history of travel and tourism. But in modern concept of mass tourism, Indian hotel industry started very
late compared to the hotel industry elsewhere in Europe and America and evolved at a snail’s pace. Though
our hotel industry is small in size yet qualitatively we are not only at par with the best hotel industry in the
world but the best in some respect. Some of the Indian hotel groups are outstanding in providing hospitality
and the best services and facilities to the tourist. As we know that hotel industry is a service industry and
only best service can give satisfaction to the customer which helps in the growth of any hotel [1].

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 Role of HR Practices in Employees’ Satisfaction: A Case Study on 3-Star Hotels of Ahmedabad, Gujarat

2. BRIEF HISTORY OF AHMEDABAD HOTELS

Ahmedabad the city ruled by Ahmed Shah Abdali, during the 13th century was also famous as Manchester
of India for its clothing. The city has owned a name and fame to the various sectors and then started including
towards the hotel industry. The first modern hotel in Ahmedabad was ‘CAMA’ started in 1960. After seeing
the success of CAMA the revolution came in the market and then KARNAVATI and NATRAJ hotel started.
After this it has been boom period of (ITDC) revolution in India. They took over operations of hotel
Karnavati and Karnavati Ashok came into limelight. The “Quality Inn” was the first international hotel brand
entering into the city and with the launching of ‘Quality Inn’ suites ‘SHALIN’ Ahmedabad found place on
world hoteliering map. They started the first revolving restaurant in city and were the first one to introduce
the concept of International cuisine, but after few years Quality Inn and SHALIN a parted. Hotel Ummed
which was owned by Ummed Singh was doing average business which was given to Trident a mid-market
brand of Oberoi hotels and then again to SOFITEL group and then to Taj group of hotels to be re-launched
as “TAJ UMMED” in year 2000 on management franchised basis. Balwas hotel which is located near Nehru
Bridge was second hotel in city to take International brand and was re-launched as “HOLIDAY INN”. After
successful operations for few years and with a good market standing the promoter terminated the agreement
with HOLIDAY INN and re-launched them as another International brand “LE MERIDIAN”. Even finest
hotel of the Ahmedabad CAMA also replicated this new trend by re-launching in market with Sarovar Park
Plaza in year 2000 and was renamed as Cama Park Plaza [1].

3. INTRODUCTION TO HR DEPARTMENT OF HOTEL INDUSTRY

In hotel industry employees come in direct contact with the customers, so they need well trained and satisfied
workforce and this led the need for human resource department in hotel industry. The various functions
performed by the HR department are Manpower Planning, Recruitment, Training and Development
Programs, Performance Appraisal, Industrial Relations, Wage and Salary Administration [2].
In all large hotels, there is well established training division of the personnel department. Its objectives
are to increase output and sales, to improve employee’s knowledge, skill and attributes to work, to improve
recruitment, to improve employee’s loyalty and to improve image of the company. The purpose of this study
is to identify the HR Practices in hotels and their role in employees’ satisfaction.

4. EMPLOYEE SATISFACTION
Employee satisfaction simply means employees are how much happy and content with their job [3]. Satisfied
employees are more productive for any organization. There is a direct relationship between employee attitude
and customer satisfaction. In spite of their best efforts, unhappy and dissatisfied employees cannot conceal
their dissatisfaction during interaction with customers. For any organization, it is important to evaluate
employee satisfaction level to identify and resolve the problems related to dissatisfaction before they impact
on customers. In addition to this, other benefits of measuring and improving employee satisfaction are
reduced turnover, training need assessment, streamlined communication, and reduction in absenteeism, etc.
It also helps in attracting quality employees.

5. LITERATURE REVIEW
Good Human Resource Management (HRM) practices create positive environment within the organization
which in result encourages positive employee behavior and thus enhanced service quality (Sheng-Hshiung
Tsaur & Yi-Chun Lin 2004) [4]. Mohinder Chand, Anastasia A. Katou (2007) studies about identification
of various HRM practices and its effect on organization performance in Indian hotel industry and they find
out that there is a positive relation between hotel performance and various HR practices like recruitment and
selection, manpower planning, training and development and pay systems[5]. S. C. Bagri, Suresh Babu &
Mohit Kukreti (2010) on their study on Taiwan hotel industry concluded that employee turnover rate is
relatively high in hotels because employees are not satisfied with the working conditions in spite of getting
good salary [6]. Mohinder Chand (2010) investigates the effects of HRM practices on service quality,

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 Neela Multani

customer satisfaction and performance in the hotel industry and he conclude that good HRM practices have
positive influence on service quality of the hotel which leads to customer satisfaction and hence the better
hotel performance[7].

6. PROBLEM STATEMENT
In the era of hotel industry HR department presence was not felt in the past. However, in the late ‘90’s service
industry started booming and hotel industry started showing its colors. The various categories of hotels like
3, 4, 5 stars came into existence which provided varied numbers of services and luxuries to their customers.
The basic aim of service industry is customer satisfaction and to maintain customer satisfaction it is very
important to maintain employee satisfaction. Therefore, HR department came into existence that can look
after the employee related activities for employee satisfaction. This study is to know about various HR
practices carried out in hotel industry for employee satisfaction.

7. OBJECTIVES OF THE STUDY

The objectives of the study are:
• To study about various HR practices carried out in hotels
• To identify the factors leading employee satisfaction
• To assess the lower level employees’ satisfaction level

8. RESEARCH HYPOTHESES
• H0: There is association of rewards & recognition with respect to tenure of work
H1: There is no association of rewards & recognition with respect to tenure of work
• H0: There is association between education qualification & salary range
H1: There is no association between education qualification & salary range
• H0: There is association between performance appraisal & salary range
H1: There is no association between performance appraisal & salary range

9. RESEARCH METHODOLOGY
Twelve three star hotels of Ahmedabad city were approached for the purpose of the study. The degree of
satisfaction of employees on the parameters was quantified by using a 5 - point Likert’s scale. A pilot study
was conducted in which HR Executives/Managers of the hotels were interviewed. This pilot study helped
for designing questionnaire with relevant factors which affect employee satisfaction. For data collection 145
respondents were contacted by convenient random sampling method. The exploratory cum descriptive
research design was adopted for this study. After the field work data was analyzed by using statistical
software SPSS 15.0.

9.1. Research Approach

The structured questionnaire was prepared on the basis of objectives of the study. Employees were contacted
directly with the permission of their supervisor for data collection.

9.2. Research Instrument

The structured questionnaire consists of multiple choice questions was used to collect data. The questionnaire
was prepared in such a way that it includes all the relevant information needed for the study.

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 Role of HR Practices in Employees’ Satisfaction: A Case Study on 3-Star Hotels of Ahmedabad, Gujarat

10. DATA COLLECTION

The data were collected both from the primary and secondary sources. For primary data collection structured
questionnaire was used with close ended questions on the 5 points Likert’s Scale. The secondary data were
collected from books, articles, research papers, journals and hotel management institute.

11. DATA ANALYSIS

For analyzing the data, proper tools and techniques were used. As the questionnaire was already classified
in different heads, it becomes easy to classify the raw data which comes under heads like corporate culture,
communication, career development, training program, employee’s role in the organization, working
conditions, employee’s immediate manager, benefits/compensation packages, about top management, work
itself, rewards/recognition, performance management and other policies.
Questionnaire contains two parts: part A contains close ended questions and theses data are analyzed
with the help of charts. Hypotheses tested with the help of chi-square test on the parts B. Statistical Package
for social sciences (SPSS) has been used to analyze and interpret the data collected with the help of the tool
via Chi-square test.

Table 1 Satisfaction level of employees

Highly Highly
Factors Satisfied Neutral Dissatisfied
satisfied dissatisfied
Corporate Culture 30% 48% 21% 0.50% 0.50%
Communication 31% 52% 16% 1% 0%
Training & Career
30% 51% 18% 0.50% 0.50%
Development Program
Employee's Role 26.50% 57% 16.50% 0% 0%
Teamwork & Cooperation 28% 55% 17% 0% 0%
Working Conditions 27% 53% 19.50% 0.50% 0%
Employee's Immediate
27% 54% 18% 1% 0%
Manager
Benefits/ Compensation
24% 58% 17% 1% 0%
package
Top Management 27% 56% 14.50% 2.50% 0%
Work Itself 34% 48% 17% 1% 0%
Rewards/ Recognition 31% 57.50% 11% 0.50% 0%
Performance Management 22% 57% 19% 2% 0%
Other Policies 27% 50% 20% 2% 1%
Average 28% 53.6% 17.2% 1% 0.2%

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 Neela Multani

Figure 1 Employees’ satisfaction level

From the above table and graph, we can say that most of the employees in hotels are satisfied with the
HR practices followed in their hotels. On an average 28% employees are highly satisfied, 53.6% satisfied,
17.2% neutral, 1% dissatisfied and 0.2% highly dissatisfied with hotel’s HR practices. Association between
various factors like rewards & recognition, tenure of work, educational qualifications, performance appraisal
and salary range were also tested as below.

11.1. Hypothesis Testing: [Chi-Square]

11.1.1. Hypothesis 1
H0: There is association of rewards & recognition with respect to tenure of work
H1: There is no association of rewards & recognition with respect to tenure of work

Chi-Square Tests
Approx.
Symmetric Measures Value Sig. Asymp. Sig.
Value df (2-sided)
Nominal by Phi Pearson Chi-Sq 64.136a
.665 .040 46 .040
Nominal
Cramer's V Likelihood Ratio 53.296 46 .214
.470 .040
Linear-by-Linear
Contingency 1.459 1 .227
.554 .040 Association
Coefficient
N of Valid Cases 145
N of Valid Cases 145
a.63 cells (87.5%) have expected count less
minimum expected count is .07.

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 Role of HR Practices in Employees’ Satisfaction: A Case Study on 3-Star Hotels of Ahmedabad, Gujarat

The above result shows that the Chi-Square value is less than 0.05, so H1 is not rejected. So we can say
that there is no association of rewards & recognition with respect to tenure of work & phi value shows that
there is stronger relationship of non-association.

11.1.2. Hypothesis 2
H0: There is association between education qualification & salary range
H1: There is no association between education qualification & salary range

Chi-Square Tests Symmetric Measures

Asymp. Sig.
Value df (2-sided) Value Approx. Sig.
Pearson Chi-Squa 42.586a 2 .000 Nominal by Phi .542 .000
Likelihood Ratio 41.007 2 .000 Nominal Cramer's V .542 .000
Linear-by-Linear N of Valid Cases
42.199 1 .000 145
Association
N of Valid Cases a.Not assuming the null hypothesis.
145
a.2 cells (33.3%) have expected count less than 5 b.Using the asymptotic standard error assuming
minimum expected count is 1.21. hypothesis.

The above result shows that the Chi-Square value is more than 0.05, so H0 is not rejected. So we can say
that there is no association between education qualification & salary range & phi value shows that there is
strong relationship of non-association.

11.1.3. Hypothesis 3
H0: There is association between performance appraisal & salary range
H1: There is no association between performance appraisal & salary range

Chi-Square Tests
Symmetric Measures

Asymp. Sig.
Value df (2-sided) Value Approx. Sig
Pearson Chi-Square 7.406a 6 .285 Nominal by Phi .226 .285
Likelihood Ratio 6.879 6 .332 Nominal Cramer's V .160 .285
Linear-by-Linear N of Valid Cases 145
Association 2.656 1 .103
a.Not assuming the null hypothesis.
N of Valid Cases 145
a. 6 cells (50.0%) have expected count less than 5. The b.Using the asymptotic standard error assum
minimum expected count is .10. hypothesis.

The above result shows that the Chi-Square value is more than 0.05, so H0 is not rejected. So we can say
that there is association between performance appraisal & salary range & phi value shows that there is
stronger relationship in association of performance appraisal & salary range.

12. CONCLUSION
Basically employee satisfaction is dependent on benefits package, training and development, relationship
with supervisor, working conditions, teamwork and cooperation, recognition and rewards, empowerment
and communication. Companies should be mindful of these variables of satisfaction. From the Chi-Square
analysis we can say that association is not possible between the tenure of work, performance appraisal &

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 Neela Multani

rewards/recognition as the turnover ratio is very high in Hotel Industry. Performance appraisal is linked with
the salary range & both have a strong association. In most of the surveyed hotels we can conclude that
education is not related to the salary range as it is a service industry, it is totally skilled based as the person
appointed as senior Chef is an undergraduate & his salary range is between 8000 and 12000 rupees.

RECOMMENDATIONS
• There is a hike in salary but it is very low, so it should be raised to some extent.
• The turnover ratio is found to be high in this industry, however, the management tries to curb it through giving
increments & counseling but apart from that they can provide job enrichment for the employees who are
potential and are leaving the hotel.
• It is also found that most of the hotels complained about absenteeism, so management should come up with
initiative like rewarding the employees who have not taken any leaves or minimum leaves during last three to
six months.
• Hotels have HR department but they don’t carry out proper HR activities like training, performance
management, employee welfare etc. So the management needs to think about redeveloping HR department
who looks after all major activities of HR.
• To increase the job satisfaction level of the employees, the hotels should concentrate mainly on the incentive
and reward structure & the motivational session.

REFERENCES
[1] Reports of Institute of Hotel Management, Gandhinagar.

[2] Human Resource Practices in Hotel Industry. http://www.slideshare.net/hemanthcrpatna/a-project-report-

on-hr-practice-in-hotel-industry

[3] Employee Satisfaction.http://www.custominsight.com/employee-engagement-survey/what-is-employee-

satisfaction.asp

[4] Linb Yi-Chun, Tsaura Sjeng-Hshiung. Promoting service quality in tourist hotels: the role of HRM
practices and service behavior. Journal of Tourism Management. 25(4), 2004, pp. 471–481

[5] Chand Mohinder, Katou Anastasia A. The impact of HRM practices on organizational performace in the
Indian hotel industry. Journal of Employee Relations. 29(6), 2007, pp. 576-594.

[6] Dr. Bidyut Jyoti Gogoi, Antecedents of Drivers of Satisfaction in Hotel Industry and Its Impact on
Customer Loyalty. International Journal of Management (IJM), 6(8), 2015, pp.31-41.

[7] Bagri S. C., Babu S. & Kukreti M. Human Resource Practices in Hotels: A Study from the Tourist State
of Uttrakhand, India. Journal of human resources in hospitality & tourism, 9(3), 2010, pp. 286-299.

[8] Chand Mohinder. The impact of HRM practices on service quality, customer satisfaction and performance
in the Indian hotel industry. The international journal of human resource management. 21(4), 2010, pp.
551-566.

[9] Gaurav Gupta and Urvashi Singh, A Study of ERP System for Employee Satisfaction in an IT
Organization. International Journal of Management (IJM), 5(10), 2014, pp.25-32

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