Description
Hospitality organizations, whether large or small, are complex entities requiring managers to
work through frontline employees to manage every guest’s moment of truth and meet their firms’ goals
and objectives. This study aims to test propositions that firms whose staffing policies and systems are
aligned with their strategic goals and objectives to outperform those firms with poorer organizational
alignment.
International Journal of Culture, Tourism and Hospitality Research
Organizational alignment and hospitality firm performance
J ohn C. Crotts Robert C. Ford Vincent C.S. Heung E.W.T. Ngai
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To cite this document:
J ohn C. Crotts Robert C. Ford Vincent C.S. Heung E.W.T. Ngai, (2009),"Organizational alignment and hospitality firm performance",
International J ournal of Culture, Tourism and Hospitality Research, Vol. 3 Iss 1 pp. 3 - 12
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Organizational alignment and hospitality
?rm performance
John C. Crotts, Robert C. Ford, Vincent C.S. Heung and E.W.T. Ngai
Abstract
Purpose – Hospitality organizations, whether large or small, are complex entities requiring managers to
work through frontline employees to manage every guest’s moment of truth and meet their ?rms’ goals
and objectives. This study aims to test propositions that ?rms whose staf?ng policies and systems are
aligned with their strategic goals and objectives to outperform those ?rms with poorer organizational
alignment.
Design/methodology/approach – Data were collected through a survey administered in winter of 2005
to 200 hourly wage employees from each of four matched hotels. Some 479 completed surveys were
returned yielding a 59 percent response rate.
Findings – Between-group differences in organizational alignment measures were statistically
signi?cant in the directions predicted. Speci?cally, subjects from the high organizational alignment
hotels, on average, reported signi?cantly higher organizational support, employee service commitment
and employee satisfaction as compared to low organizational alignment properties.
Research limitations/implications – The ?ndings of this study provide a strong indication that the
workplace environment is a concept that employees are aware of which in turn in?uences their
commitment and satisfaction.
Practical implications – This research provides managers with an assessment tool useful for ensuring
that a ?rm is being effectively managed.
Keywords Strategic alignment, Hospitality services, Pro?t
Paper type Research paper
M
ost new businesses start with some great advantages in the marketplace. Those
advantages may include bringing a product, known to work in other locations, to a
new market, a great price-value, a beautiful facility, and/or a great location. But can
the organization create a customer experience that keeps customers coming back? This
ultimately is what separates one’s ?rm from the competition. Building customer loyalty starts
with a commitment to deliver excellence at every moment of truth and must extend from
upper management to every frontline employee.
Many opinions are available on howto achieve excellent service. A key to excellent service is
the individual employee who delivers the service to the guest. Whether it is the restaurant
server or the hotel receptionist, the employee at the point of contact with the guest is the one
who likely makes the difference between an excellent and a bad guest service experience.
The problemfor managers is that this employee is typically the one who is the least identi?ed
with the long-term goals and objectives of the organization, who has the least seniority, least
experience, and lowest pay. In other words, one of the unique challenges in the hospitality
industry is to get the person who is the least involved and least committed to the organization
motivated and enthusiastic about delivering the guest experience in a way that makes the
guest not only happy with the organization, but so happy that he or she wants to come back
DOI 10.1108/17506180910940306 VOL. 3 NO. 1 2009, pp. 3-12, Q Emerald Group Publishing Limited, ISSN 1750-6182
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INTERNATIONAL JOURNAL OF CULTURE, TOURISM AND HOSPITALITY RESEARCH
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John C. Crotts is based at
the College of Charleston,
Charleston, South Carolina,
USA. Robert C. Ford is
based at the University of
Central Florida, Orlando,
Florida, USA.
Vincent C.S. Heung is
based at the School of Hotel
and Tourism Management,
The Hong Kong Polytechnic
University, Kowloon, Hong
Kong SAR, People’s
Republic of China.
E.W.T. Ngai is based at the
Department of
Management and
Marketing, The Hong Kong
Polytechnic University,
Kowloon, Hong Kong SAR,
People’s Republic of China.
Received February 2007
Revised June 2007
Accepted November 2007
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for more. Since, for many guests, the front line server is the organization, managers must
inspire that employee to deliver the experience in a way that so exceeds guests’
expectations that they will tell everyone they knowwhat a wonderful place the organization is
to visit and experience (Heskett et al., 1997; Heskett et al., 1994). This major challenge is
shared by all service organizations and increasingly recognized by all organizations as a key
determinant of success in competitive markets.
How do we enable and encourage these guest contact employees to perform their jobs in a
way that not only satis?es increasingly demanding guests but even exceeds their
expectations? How do we ensure a congruence or constancy of purpose between frontline
employees and the organization’s mission? We suggest that organizations that are
successful at this do not achieve it by accident, but instead apply a systematic process by
which this is accomplished. These collective processes build from ensuring that everything
that management says and does aligns systematically with a guest service emphasis in
corporate mission (Bart, 1998; Crotts et al., 2005; Powell, 1992). Benchmark guest service
organizations like Disney, Harrah’s, Ritz Carlton and Southwest Airlines are successful
based, in part, because of their abilities to successfully align their strategic activities, staf?ng
policies and system design and procedures to make sure that everything and every
employee are focused on guest service (Crotts et al., 2005; Ford and Heaton, 2000; Ford
et al., 2001).
This article has two objectives. First, the article reviews the concept of organizational
alignment, highlighting a wide range of factors that contribute to the performance of ?rms
widely accepted as benchmark organizations. Then, the article describes the application of
a method of organizational alignment audit proposed by Crotts et al. (2005), in which
employees of four similarly sized, rated and located hotels are surveyed in order to explore
the diagnostic tool’s relationship to employee turnover, satisfaction, and commitment to
service scores.
Background
Service-pro?t chain
Heskett and colleagues, in their pioneering 1994 work The Service-Pro?t Chain and it’s 1997
followup article ‘‘Putting the Service Pro?t Chain to Work’’ offer evidence that there is a direct
link between employee satisfaction, service quality, customer loyalty, and an organization’s
?nancial performance. It is interesting to note that two of these academic researchers have
since returned to the industry to continue putting these ideas into practice: Loveman is the
CEO of Harrah’s and Schlesinger is the vice chairman of The Limited. The Service-Pro?t
Chain at an organizational level adopts the following propositions:
B pro?t and growth are dependent primarily on customer loyalty;
B loyalty is a direct result of high customer satisfaction;
B satisfaction is largely in?uenced by the value of services provided to customers;
B value is created by satis?ed, loyal and productive employees; and
B employee satisfaction results from high-quality support services and policies that
empower employees to serve customers well.
The last two bullet points, where customer satisfaction and loyalty are directly affected by
employees, are especially key for managers. This supports Bill Marriott’s business
philosophy, that if you ‘‘Take good care of your employees they will take good care of your
customers and these customers will come back’’. In other words, employees treat customers
as they themselves are treated by their organization (Masterson, 2001, p. 594). The
Service-Pro?t Chain can be thought of as a model that highlights and justi?es the importance
of effective manageme nt of a ?rm’s human resources to achieve its organizational goals.
Given the interest in applying the service-pro?t chain model among managers, it is not
surprising that an increasing number of researchers have become interested in testing
linkages in the model. This is no easy task, since the linkages of Heskett et al. (1997) are
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conceptual in nature, and the accepted scales to measure all stages in the model do not
exist. In addition, collecting data for all the model’s stages in a single ?rm, while taking into
account the lag time between changes in human resource strategies and their effects on
organizational outcomes such as ?nancial performance, is dif?cult. As a result, researchers
seldomhave the resources to test the model in its entirety, and instead typically focus only on
one or more linkages of the model.
This has produced mixed results and seldom lends irrefutable support for the service-pro?t
chain model. To illustrate, Wiley’s (1991) study of a retail chain found a found a positive
correlation between employee satisfaction and customer satisfaction, but both these
measures were negatively correlated with ?nancial performance. In addition, Pritchard and
Silvestro’s (2005) study of a home improvement retail chain found signi?cant correlations
between employee satisfaction and loyalty to the company, but neither of these measures
correlated with labor turnover. In addition, service quality as measured was not signi?cantly
correlated with customer perception of value, satisfaction and loyalty measures. The list of
empirical research producing, at best, only limited support for the model includes work by
Fredericks et al. (2001), Loveman (1998), Reichheld (1996), and Vandermerwe (2000).
However, it can be argued that the hospitality industry has a number of contextual
differences that distinguish it from other retail sectors. Hotel managers are faced with unique
challenges that are not always borne by other retail sectors, such as intangibility,
inseparability, variability and perishability (Kotler et al., 1999). Hospitality managers are
routinely faced with contradictory challenges forcing them to make tradeoffs between guest
satisfaction, organizational ef?ciency, and ?nancial performance. Our experience has
shown that that latitude in making tradeoffs is higher for hospitality managers than for retail
managers, suggesting that the transfer of management principles from the retail sector to
the hospitality sector is not always advised. Hence this research is a test of this proposition in
regards to the service-pro?t chain.
Organizational alignment
Organizational alignment is a concept that relates to the service-pro?t chain model. The
organizational alignment concept adds value to the service-pro?t chain model by capturing
both macro and micro environmental conditions inherent in Heskett et al.’s (1997) model.
Alignment audits examine multiple aspects of an organization’s workplace environment that
can be later analyzed singularly or collectively, as to their effect on a ?rm’s strategic
outcomes.
Coined by organizational behaviorists as ?t, congruence, consistency or alignment, the
concept describes the relationship of a ?rm’s internal systems and strategies with its
organizational opportunities and possibilities (Bernhardt et al., 2000; Gelade and Young,
2005; Schneider et al., 2000). No matter what term is used, the concept is a belief that a ?rm
whose internal policies, procedures and systems are in alignment, both with each other and
with external contingencies, will perform better than those organizations that are not so
aligned. Firms that have set explicit goals to deliver service excellence, supported by
explicit systems, policies and procedures which reinforce the achieving of such goals, will
be more effective and pro?table than operations with low alignment. According to Schneider
et al. (2000), various systems, policies and procedures focused on the same goals will
reinforce one another, thereby reducing the possibility of wasted effort and resources in
exceeding customer expectations and gaining their loyalty.
The concept of alignment in relation to both a ?rm’s external opportunities and internal
policies and actions has been an important topic among researchers for some time. Tichy
(1983) noted that the strategic task of management is to keep the organization both internally
and externally aligned. Externally, strategic choices are shaped by the need to align
organizational resources with environmental opportunities and threats (Miles and Snow,
1978). An organization that is in close ?t or alignment with various contingency factors, (e.g.
size, environment, technology, resource availability) can signi?cantly improve its’
performance (Andrews, 1971; Lawrence and Lorch, 1967; Powell, 1992). Internally,
ensuring a consistent ?t between organizational mission and the actions, policies, and
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procedures of the organization and its leadership can also signi?cantly improve
organizational performance. Porter (1996) suggests that the best way for any organization
to achieve a sustainable competitive advantage is to reinforce its chosen strategy with a host
of ‘‘activities,’’ including functional policies, staf?ng decisions, and structure. Nadler and
Tushman (1997, p. 34) proposed ?ve key areas that an organization should seek to establish
and monitor where congruence or ?t is critical for organizational success. They state: ‘‘the
degree to which the strategy, work, people, structure, and culture are smoothly aligned will
determine the organization’s ability to compete and succeed’’.
Research investigating the importance of alignment or congruence has, not surprisingly,
found the concept to be important. Bart (1998) and Bart et al. (2001) trace the linkage
between organizational mission and ?nancial performance; these studies ?nd that the
degree to which an organization aligns its internal structure, policies, and procedures with its
mission relate positively with employee behavior, which, in turn, has the most direct
relationship with ?nancial performance. In the human resource management area, several
studies focus on the alignment of human resource polices and processes with the
organizational mission (Baird and Meshoulam, 1988; Gratton and Truss, 2003; Wright and
Snell, 1998). Researchers now accept the proposal that all human resource practices and
polices need to align with the overall organizations mission.
The importance of alignment in determining organization performance is well established in
the management literature and is even a part of most standard texts on strategy (e.g., Baird
and Meshoulam, 1988; Thompson and Strickland, 2003; Wright and Snell, 1998). In the
hospitality and tourism management literature, a related term often called ‘‘organizational
environment’’ or ‘‘workplace climate’’ has also been shown to in?uence customer
satisfaction and revenue (Davidson et al., 2001) as has employee burnout (Crotts et al.,
1998). The achievement of this alignment is more problematic.
Crotts et al. (2005) put forth a mission alignment audit/assessment tool based on factors
derived from the study of benchmark organizations in hospitality and service management
(e.g., Ford and Heaton, 2000; Gronroos, 2000; Lovelock, 2002). According to Crotts et al.,
dividing these factors into three categories is useful – strategy/tactical factors, staf?ng
policies and procedures factors, and system design factors. Strategic factors include the
mission alignment with departmental goals, environmental setting/physical design, annual
managerial performance goals, service mission stories, events that are celebrated and top
management actions. Staf?ng factors include the mission alignment with job
advertisements, interview process, on-boarding process, orientation programs,
performance appraisals, rewards, and annual training. Systems factors include the
mission alignment with feedback systems informing employees of service quality,
measurement systems of service quality, service recovery systems, and service delivery
systems.
These factors form the basis of a questionnaire for the current study for assessing the
degree to which implemented strategy, staf?ng, and system factors are present within the
?rm. Though the literature suggests that benchmark organizations have aligned
strategy/tactics, staf?ng policies and procedures, and systems, there is no evidence that
any one ?rm effectively incorporates all factors in a focused way. Alignment is therefore a
concept made up of the various prompts or cues that managers use to communicate to
employees what is important and what is not, what has value to the organization and what
does not, and what they should do for their guests and what they should not in order to
achieve guest-focused culture focused on service excellence. However, to date there is
limited evidence as to the relationship between the instrument’s derived measures and its
relationship to employee satisfaction and commitment (Dickson et al., 2006). Dickson and
colleagues employed derived factors from the original 42 item alignment scale to test their
relationship with employee satisfaction and organizational commitment among employees
of a large resort hotel. They found that factors derived from the organizational alignment
scale related to employee satisfaction and commitment measures in the directions
predicted. This study extends both the research methodology and its dependent variables
of the previous study in an effort to test the full organizational alignment construct. Moreover,
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it is designed to highlight to active industry professionals a fuller understanding of the
concept of organizational alignment and its relationship to stakeholder satisfaction and
pro?tability.
A conceptual model that describes the relationship of organizational alignment to the service
pro?t-chain (see Figure 1) informs this study. Though the current study does not test the full
model, it is our hope that our results will encourage additional research in a relatively
neglected area of hospitality management that has theoretical and managerial implications.
We suggest that there is a positive and signi?cant relationship between a ?rm’s alignment
measures and its employee and guest alignment measures, which in turn impacts pro?ts
and ultimately owner satisfaction. Though intuitively appealing, such a model is dif?cult to
test in one sample frame as evidenced by Heskett et al. (1994).
Method
The primary data were collected through a survey administered in winter of 2005. The target
respondents were 200 employees fromeach of four hotels, all of whomearned hourly wages.
A total of 800 employee surveys were administered by the Human Resource Of?ces of the
four hotels. These four hotels are in the four-star hotel category, of similar size and quality
ratings, and all are located in Hong Kong, PRC. A structured and self-administered
questionnaire consisting of two main parts was developed for the study. The ?rst part
comprised questions designed to collect the background information of the respondents
such as their position and department in the company, length of service and duty time. The
second part contained an organizational alignment audit, which contained 42 factors and
statements derived from the hospitality and service management literature focused on
benchmark organizations (Crotts et al., 2005; Dickson et al., 2006). The survey includes
questions measuring the employee’s overall satisfaction with the job and the organization,
and the likelihood that the employee would stay with the company. The scale used for the
alignment statements was a 5-point Likert scale with responses ranging from 1 (strongly
disagree) to 5 (strongly agree). The scores for the 42 items were summed to yield a total
alignment score. Thus a respondent’s evaluation of their ?rm’s degree of alignment could
range from a low of 42 to a high of 210. The employee satisfaction, organizational support,
and employee service commitment scales were multi-item measures drawn from the
organizational development literature (Fields, 2002). These scales are widely accepted and
deemed valid scales that are designed to measure an employee’s job satisfaction,
assessment of management’s support in providing the responding employee the tools and
support to perform their job duties, and the motivation of the employee to serve the
consumer (guest). Like the organizational alignment measure, a total score for each scale
was produced by summing the responses across all items. The employee turnover rate in
percentages was provided from the respective hotel human resource of?ce. Five hundred
Figure 1 Conceptual cause and effect model of organizational alignment
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and twenty ?ve completed questionnaires were returned, representing a response rate of 66
percent. After sorting out the incomplete and unusable questionnaires, 479 (59 percent)
were used for the ?nal analysis.
Results
Employee responses to the assessment instrument ranged, on average, froma high of 134.4
for hotel A to a lowof 106.7 for hotel Dalong a scale that could potentially range from a low of
42 to a high of 210. Though no single ?rm is expected to be perfectly aligned, it is interesting
to note that, on average, the employees of hotel A perceived their ?rm’s alignment at 63.8
percent of its potential, while hotel D employee’s assessed its alignment at 50.8 percent.
Employee turnover rates per year are a good place to start in assessing the alignment audit
since all four hotels were similar in size and quality ratings, but vary greatly in terms of
employee turnover rates. Hotel A had the lowest annual turnover rate of 23 percent, followed
by B at 24.10 percent, C at 37.4 percent and D at 50 percent (see Table I). No statistics were
necessary in this between-group comparison due to the census nature of the data.
Between-group comparisons of these hotels are statistically different at p , 0.001 on all four
measures. Post hoc comparisons employing Tukey and Scheffe tests revealed that
responding employees from hotel D (the hotel with the highest employee turnover rate) had,
on average, the lowest organizational alignment measures. Speci?cally, employees’ scores
of hotel D assessing their property’s organizational alignment scored it at a level that was
signi?cantly different (lower) when compared with properties with lower turnover rates.
Likewise, similar results surface when comparing employee responses to three other
standardized measures. Speci?cally, hotel D employees reported, on average, signi?cantly
lower employee satisfaction, employee commitment, and organizational support measures
when compared to all other groups in seven out of nine between-group comparisons.
Next, multiple regression was employed with the stepwise procedure to determine the ability
of the dependent measures, both individually and collectively, to predict employee turnover
rates (see Table II). The analysis yielded a three step model that, when combined, explained
30 percent (r ¼ 0:55, p , 0.001) of the variance among the hotel turnover rates. In order of
importance, organizational alignment accounted for most of the explained variance in terms
Table I Between-group mean differences of hotels on dependent measures
Hotel
n A B C D
Dependent measures 115 122 132 157 F p-value
Employee turnover 23.0 24.1 27.4 50.0
Organizational 134.4
a
* 128.8
b
133.4
c
106.7
a, b, c
42.01 0.000
Employee satisfaction 19.1
a, c, d
18.6
b,d
17.9
a, c
17.1
a, b
8.70 0.000
Employee commitment 35.7
a
33.0
b
32.8
c
31.9
a, b, c
13.10 0.000
Management support 15.5
a
14.6 14.8
b
14.2
a, b
8.80 0.000
Notes: Values with the same alphabetical superscript are statistically different at p , 0.05 employing
both Tukey and Scheffe post hoc test of between-group differences
Table II Relationship between hotel turnover rates with measures of organizational
alignment, employee satisfaction, employee service commitment, and
organizational support
Stand. Beta t R square p value cumulative
Organizational alignment 0.47 21.03 0.22 0.000
Management support 0.51 9.61 0.29 0.000
Employee satisfaction 0.52 9.77 0.30 0.000
Variable not retained in the model
Employee service commitment 0.10 1.18 0.23
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of hotel turnover rates, followed by organizational support, and employee satisfaction. Self
reported measures of employee service commitment did not contribute uniquely to the
analysis in a statistically signi?cant way.
Lastly, a series of independent t tests were performed where group membership was
assigned to each respondent in terms of their responses to the organizational alignment
measures and compared with their measures on organizational support, employee service
commitment, and employee satisfaction. Speci?cally, group membership in the high
category was assigned at the 50th, 75th and 90th percentile and contrasted with the
workplace environment measures. Though the repetitive use of t tests in this manner runs the
risk of generating Type I statistical error(s), it nevertheless affords a means to determine at
what level a ?rm needs to focus it’s efforts in order to become a benchmark organization in
terms of impacting employee workplace environment measures (see Table III).
Between-group differences in organizational alignment measures in all nine cases were
statistically signi?cant in the directions predicted. Speci?cally, in every analysis those
subjects assigned to the high organizational alignment groups, on average, reported
signi?cantly higher organizational support, employee service commitment and employee
satisfaction as comparedto loworganizational alignment groups. Increases in organizational
support, employee service commitment, and employee satisfaction increasedon average as
the standardfor inclusion in the organizational alignment groups also increasedfromthe 50th
percentiles to the 90th percentiles. Since the underlying structural equation model of t tests is
regression, these results in the simplest of terms reveal inter-correlations between the
organizational alignment measures and workplace environment measures. Among all these
sub-analyses, those employees of hotels A and C (the properties with the highest average
organizational alignment measures) were assigned primarily to the high groupings in
organizational support, commitment and satisfaction measures as well. This provides a
strong indication that workplace environment differences are indeed a concept that
employees are aware of, as re?ected in the above evaluation scores.
Discussion
Hospitality organizations, like all organizations selling intangible experiences, are ultimately
some of the most dif?cult ?rms to manage successfully. Meeting, let alone exceeding, the
ever- increasing expectations of guests must ultimately be achieved through front-line
employees who are often the least trained, least compensated and least committed staff
members. Add to this the high pro?t expectations of owners who, according to PKF
Consulting (2005) had achieved operating pro?t margins in 2005 of 27.3 percent (pro?ts
before contributions to capital reserves, debt service, rent, income taxes, depreciation, and
amortization), and one can appreciate the pressures facing today’s managers.
Table III Between-group mean differences between organizational alignment groupings
and workplace environment measures
Organizational alignment
Dependent variables High Low t p ,
Organizational support
50th percentile 15.2 14.5 22.65 0.008
75th percentile 16.0 14.5 25.71 0.000
90th percentile 16.4 14.7 24.56 0.000
Employee service commitment
50th percentile 34.4 32.8 22.68 0.008
75th percentile 36.2 32.7 25.19 0.000
90th percentile 37.1 33.2 24.36 0.000
Employee satisfaction
50th percentile 18.9 17.6 23.36 0.001
75th percentile 20.0 17.6 25.51 0.000
90th percentile 20.3 18.0 23.78 0.000
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The organizational alignment audit is a useful managerial tool in combination with the
Service-Pro?t Chain Model (Heskett et al., 1994) as it provides a framework for why
alignment is important and what an aligned organization should look like and feel like
through the eyes of its employees. Again, when the results are acted upon, assessing the
perspective of one’s employees as to howwell the staf?ng policies, procedures and systems
are aligned with the organization’s mission, strategies and tactics is a critical step. JW
Marriott once said you can’t make happy customers with unhappy employees. The
statement expands following the results of this study. You cannot make satis?ed and
committed employees unless policies, procedures and systems are aligned with the
mission. If what management says, writes, and does is not aligned with the mission, then the
employees’ attitudes and behaviors are not likely to be aligned either.
The organizational alignment audit is a detailed assessment of an organization’s alignment
with its mission. No organization is likely to achieve high evaluations on all 42 items. In this
study of employees of four similar hotels, the alignment assessments ranged from a high of
64 percent to a low of 51 percent. On a 100 point academic grading scale, these scores are
failing. Not surprisingly, measures of employee satisfaction, employee commitment,
employee turnover rates, and employee assessments of managerial support were all
relatively low, indicating strong inter-correlations between the factors. The hotel with the
lowest average organizational alignment measures also had the lowest average measures of
employee satisfaction, commitment, and management support in seven out of nine
between- group comparisons. In addition, this same hotel had the highest annual turnover
rate for the previous year at 50.0 percent, which was virtually twice as high as the other
hotels. Though the test’s statistics cannot prove cause and effect, it is interesting to note that
organizational alignment measures proved superior to employee satisfaction, employee
service commitment, and organizational support measures in explaining the organizations’
turnover rates. In addition, employees’ perceptions of their organization’s alignment had a
measurable and strong effect on their perceptions of their organization’s support, their
commitment to serving the guest as well as their overall satisfaction as an employee.
Therefore, this is strong evidence that administering the organizational alignment audit is a
good starting point for managers seeking to impact their employees, organizations, and
guests in positive ways.
Future research
This study is not without ?aws that future researchers need to avoid. First and foremost, a
?rm’s annual employee turnover rate is an inexact measure of managerial effectiveness.
Satis?ed and motivated employees leave their employment all the time for reasons beyond
the control of management. Arguably, a better measure would be an employee’s willingness
or intention to resign, but again these were inherent in the alternative measures employed. A
better and more objective measure of turnover would be to match employees’ organizational
alignment score with their employee status within the same ?rm a year later. However, such
an effort may bias the ability of gaining honest opinions from employees on the alignment
audit since con?dentiality cannot be assured.
Secondly, the reader should not construe that, within this database composed of employees
from four hotels, there exists a benchmark organization.. On the contrary, the organizational
alignment audit rated these properties between 50 to 63 percent on a 100 percentage point
scale suggesting that all four ?rms have room for improvement. Further replications of this
research would bene?t from a wider range of properties in terms of alignment measures.
However, researchers are encouraged to draw carefully matched samples from similarly
sized and rated properties so as not to add other in?uences that can impact measures on the
service-pro?t chain.
Nevertheless, the hope is that this study and its more extensive model will stimulate
additional research in this area. Applying the organizational alignment audit to multiple
properties and comparing these results with customer satisfaction measures as well as
annual report data not only is a more complete test of the service-pro?t chain model, but will
also add signi?cantly to our understanding of effective management practice.
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Corresponding author
John C. Crotts can be contacted at: [email protected]
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doc_806871276.pdf
Hospitality organizations, whether large or small, are complex entities requiring managers to
work through frontline employees to manage every guest’s moment of truth and meet their firms’ goals
and objectives. This study aims to test propositions that firms whose staffing policies and systems are
aligned with their strategic goals and objectives to outperform those firms with poorer organizational
alignment.
International Journal of Culture, Tourism and Hospitality Research
Organizational alignment and hospitality firm performance
J ohn C. Crotts Robert C. Ford Vincent C.S. Heung E.W.T. Ngai
Article information:
To cite this document:
J ohn C. Crotts Robert C. Ford Vincent C.S. Heung E.W.T. Ngai, (2009),"Organizational alignment and hospitality firm performance",
International J ournal of Culture, Tourism and Hospitality Research, Vol. 3 Iss 1 pp. 3 - 12
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Organizational alignment and hospitality
?rm performance
John C. Crotts, Robert C. Ford, Vincent C.S. Heung and E.W.T. Ngai
Abstract
Purpose – Hospitality organizations, whether large or small, are complex entities requiring managers to
work through frontline employees to manage every guest’s moment of truth and meet their ?rms’ goals
and objectives. This study aims to test propositions that ?rms whose staf?ng policies and systems are
aligned with their strategic goals and objectives to outperform those ?rms with poorer organizational
alignment.
Design/methodology/approach – Data were collected through a survey administered in winter of 2005
to 200 hourly wage employees from each of four matched hotels. Some 479 completed surveys were
returned yielding a 59 percent response rate.
Findings – Between-group differences in organizational alignment measures were statistically
signi?cant in the directions predicted. Speci?cally, subjects from the high organizational alignment
hotels, on average, reported signi?cantly higher organizational support, employee service commitment
and employee satisfaction as compared to low organizational alignment properties.
Research limitations/implications – The ?ndings of this study provide a strong indication that the
workplace environment is a concept that employees are aware of which in turn in?uences their
commitment and satisfaction.
Practical implications – This research provides managers with an assessment tool useful for ensuring
that a ?rm is being effectively managed.
Keywords Strategic alignment, Hospitality services, Pro?t
Paper type Research paper
M
ost new businesses start with some great advantages in the marketplace. Those
advantages may include bringing a product, known to work in other locations, to a
new market, a great price-value, a beautiful facility, and/or a great location. But can
the organization create a customer experience that keeps customers coming back? This
ultimately is what separates one’s ?rm from the competition. Building customer loyalty starts
with a commitment to deliver excellence at every moment of truth and must extend from
upper management to every frontline employee.
Many opinions are available on howto achieve excellent service. A key to excellent service is
the individual employee who delivers the service to the guest. Whether it is the restaurant
server or the hotel receptionist, the employee at the point of contact with the guest is the one
who likely makes the difference between an excellent and a bad guest service experience.
The problemfor managers is that this employee is typically the one who is the least identi?ed
with the long-term goals and objectives of the organization, who has the least seniority, least
experience, and lowest pay. In other words, one of the unique challenges in the hospitality
industry is to get the person who is the least involved and least committed to the organization
motivated and enthusiastic about delivering the guest experience in a way that makes the
guest not only happy with the organization, but so happy that he or she wants to come back
DOI 10.1108/17506180910940306 VOL. 3 NO. 1 2009, pp. 3-12, Q Emerald Group Publishing Limited, ISSN 1750-6182
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PAGE 3
John C. Crotts is based at
the College of Charleston,
Charleston, South Carolina,
USA. Robert C. Ford is
based at the University of
Central Florida, Orlando,
Florida, USA.
Vincent C.S. Heung is
based at the School of Hotel
and Tourism Management,
The Hong Kong Polytechnic
University, Kowloon, Hong
Kong SAR, People’s
Republic of China.
E.W.T. Ngai is based at the
Department of
Management and
Marketing, The Hong Kong
Polytechnic University,
Kowloon, Hong Kong SAR,
People’s Republic of China.
Received February 2007
Revised June 2007
Accepted November 2007
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for more. Since, for many guests, the front line server is the organization, managers must
inspire that employee to deliver the experience in a way that so exceeds guests’
expectations that they will tell everyone they knowwhat a wonderful place the organization is
to visit and experience (Heskett et al., 1997; Heskett et al., 1994). This major challenge is
shared by all service organizations and increasingly recognized by all organizations as a key
determinant of success in competitive markets.
How do we enable and encourage these guest contact employees to perform their jobs in a
way that not only satis?es increasingly demanding guests but even exceeds their
expectations? How do we ensure a congruence or constancy of purpose between frontline
employees and the organization’s mission? We suggest that organizations that are
successful at this do not achieve it by accident, but instead apply a systematic process by
which this is accomplished. These collective processes build from ensuring that everything
that management says and does aligns systematically with a guest service emphasis in
corporate mission (Bart, 1998; Crotts et al., 2005; Powell, 1992). Benchmark guest service
organizations like Disney, Harrah’s, Ritz Carlton and Southwest Airlines are successful
based, in part, because of their abilities to successfully align their strategic activities, staf?ng
policies and system design and procedures to make sure that everything and every
employee are focused on guest service (Crotts et al., 2005; Ford and Heaton, 2000; Ford
et al., 2001).
This article has two objectives. First, the article reviews the concept of organizational
alignment, highlighting a wide range of factors that contribute to the performance of ?rms
widely accepted as benchmark organizations. Then, the article describes the application of
a method of organizational alignment audit proposed by Crotts et al. (2005), in which
employees of four similarly sized, rated and located hotels are surveyed in order to explore
the diagnostic tool’s relationship to employee turnover, satisfaction, and commitment to
service scores.
Background
Service-pro?t chain
Heskett and colleagues, in their pioneering 1994 work The Service-Pro?t Chain and it’s 1997
followup article ‘‘Putting the Service Pro?t Chain to Work’’ offer evidence that there is a direct
link between employee satisfaction, service quality, customer loyalty, and an organization’s
?nancial performance. It is interesting to note that two of these academic researchers have
since returned to the industry to continue putting these ideas into practice: Loveman is the
CEO of Harrah’s and Schlesinger is the vice chairman of The Limited. The Service-Pro?t
Chain at an organizational level adopts the following propositions:
B pro?t and growth are dependent primarily on customer loyalty;
B loyalty is a direct result of high customer satisfaction;
B satisfaction is largely in?uenced by the value of services provided to customers;
B value is created by satis?ed, loyal and productive employees; and
B employee satisfaction results from high-quality support services and policies that
empower employees to serve customers well.
The last two bullet points, where customer satisfaction and loyalty are directly affected by
employees, are especially key for managers. This supports Bill Marriott’s business
philosophy, that if you ‘‘Take good care of your employees they will take good care of your
customers and these customers will come back’’. In other words, employees treat customers
as they themselves are treated by their organization (Masterson, 2001, p. 594). The
Service-Pro?t Chain can be thought of as a model that highlights and justi?es the importance
of effective manageme nt of a ?rm’s human resources to achieve its organizational goals.
Given the interest in applying the service-pro?t chain model among managers, it is not
surprising that an increasing number of researchers have become interested in testing
linkages in the model. This is no easy task, since the linkages of Heskett et al. (1997) are
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conceptual in nature, and the accepted scales to measure all stages in the model do not
exist. In addition, collecting data for all the model’s stages in a single ?rm, while taking into
account the lag time between changes in human resource strategies and their effects on
organizational outcomes such as ?nancial performance, is dif?cult. As a result, researchers
seldomhave the resources to test the model in its entirety, and instead typically focus only on
one or more linkages of the model.
This has produced mixed results and seldom lends irrefutable support for the service-pro?t
chain model. To illustrate, Wiley’s (1991) study of a retail chain found a found a positive
correlation between employee satisfaction and customer satisfaction, but both these
measures were negatively correlated with ?nancial performance. In addition, Pritchard and
Silvestro’s (2005) study of a home improvement retail chain found signi?cant correlations
between employee satisfaction and loyalty to the company, but neither of these measures
correlated with labor turnover. In addition, service quality as measured was not signi?cantly
correlated with customer perception of value, satisfaction and loyalty measures. The list of
empirical research producing, at best, only limited support for the model includes work by
Fredericks et al. (2001), Loveman (1998), Reichheld (1996), and Vandermerwe (2000).
However, it can be argued that the hospitality industry has a number of contextual
differences that distinguish it from other retail sectors. Hotel managers are faced with unique
challenges that are not always borne by other retail sectors, such as intangibility,
inseparability, variability and perishability (Kotler et al., 1999). Hospitality managers are
routinely faced with contradictory challenges forcing them to make tradeoffs between guest
satisfaction, organizational ef?ciency, and ?nancial performance. Our experience has
shown that that latitude in making tradeoffs is higher for hospitality managers than for retail
managers, suggesting that the transfer of management principles from the retail sector to
the hospitality sector is not always advised. Hence this research is a test of this proposition in
regards to the service-pro?t chain.
Organizational alignment
Organizational alignment is a concept that relates to the service-pro?t chain model. The
organizational alignment concept adds value to the service-pro?t chain model by capturing
both macro and micro environmental conditions inherent in Heskett et al.’s (1997) model.
Alignment audits examine multiple aspects of an organization’s workplace environment that
can be later analyzed singularly or collectively, as to their effect on a ?rm’s strategic
outcomes.
Coined by organizational behaviorists as ?t, congruence, consistency or alignment, the
concept describes the relationship of a ?rm’s internal systems and strategies with its
organizational opportunities and possibilities (Bernhardt et al., 2000; Gelade and Young,
2005; Schneider et al., 2000). No matter what term is used, the concept is a belief that a ?rm
whose internal policies, procedures and systems are in alignment, both with each other and
with external contingencies, will perform better than those organizations that are not so
aligned. Firms that have set explicit goals to deliver service excellence, supported by
explicit systems, policies and procedures which reinforce the achieving of such goals, will
be more effective and pro?table than operations with low alignment. According to Schneider
et al. (2000), various systems, policies and procedures focused on the same goals will
reinforce one another, thereby reducing the possibility of wasted effort and resources in
exceeding customer expectations and gaining their loyalty.
The concept of alignment in relation to both a ?rm’s external opportunities and internal
policies and actions has been an important topic among researchers for some time. Tichy
(1983) noted that the strategic task of management is to keep the organization both internally
and externally aligned. Externally, strategic choices are shaped by the need to align
organizational resources with environmental opportunities and threats (Miles and Snow,
1978). An organization that is in close ?t or alignment with various contingency factors, (e.g.
size, environment, technology, resource availability) can signi?cantly improve its’
performance (Andrews, 1971; Lawrence and Lorch, 1967; Powell, 1992). Internally,
ensuring a consistent ?t between organizational mission and the actions, policies, and
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procedures of the organization and its leadership can also signi?cantly improve
organizational performance. Porter (1996) suggests that the best way for any organization
to achieve a sustainable competitive advantage is to reinforce its chosen strategy with a host
of ‘‘activities,’’ including functional policies, staf?ng decisions, and structure. Nadler and
Tushman (1997, p. 34) proposed ?ve key areas that an organization should seek to establish
and monitor where congruence or ?t is critical for organizational success. They state: ‘‘the
degree to which the strategy, work, people, structure, and culture are smoothly aligned will
determine the organization’s ability to compete and succeed’’.
Research investigating the importance of alignment or congruence has, not surprisingly,
found the concept to be important. Bart (1998) and Bart et al. (2001) trace the linkage
between organizational mission and ?nancial performance; these studies ?nd that the
degree to which an organization aligns its internal structure, policies, and procedures with its
mission relate positively with employee behavior, which, in turn, has the most direct
relationship with ?nancial performance. In the human resource management area, several
studies focus on the alignment of human resource polices and processes with the
organizational mission (Baird and Meshoulam, 1988; Gratton and Truss, 2003; Wright and
Snell, 1998). Researchers now accept the proposal that all human resource practices and
polices need to align with the overall organizations mission.
The importance of alignment in determining organization performance is well established in
the management literature and is even a part of most standard texts on strategy (e.g., Baird
and Meshoulam, 1988; Thompson and Strickland, 2003; Wright and Snell, 1998). In the
hospitality and tourism management literature, a related term often called ‘‘organizational
environment’’ or ‘‘workplace climate’’ has also been shown to in?uence customer
satisfaction and revenue (Davidson et al., 2001) as has employee burnout (Crotts et al.,
1998). The achievement of this alignment is more problematic.
Crotts et al. (2005) put forth a mission alignment audit/assessment tool based on factors
derived from the study of benchmark organizations in hospitality and service management
(e.g., Ford and Heaton, 2000; Gronroos, 2000; Lovelock, 2002). According to Crotts et al.,
dividing these factors into three categories is useful – strategy/tactical factors, staf?ng
policies and procedures factors, and system design factors. Strategic factors include the
mission alignment with departmental goals, environmental setting/physical design, annual
managerial performance goals, service mission stories, events that are celebrated and top
management actions. Staf?ng factors include the mission alignment with job
advertisements, interview process, on-boarding process, orientation programs,
performance appraisals, rewards, and annual training. Systems factors include the
mission alignment with feedback systems informing employees of service quality,
measurement systems of service quality, service recovery systems, and service delivery
systems.
These factors form the basis of a questionnaire for the current study for assessing the
degree to which implemented strategy, staf?ng, and system factors are present within the
?rm. Though the literature suggests that benchmark organizations have aligned
strategy/tactics, staf?ng policies and procedures, and systems, there is no evidence that
any one ?rm effectively incorporates all factors in a focused way. Alignment is therefore a
concept made up of the various prompts or cues that managers use to communicate to
employees what is important and what is not, what has value to the organization and what
does not, and what they should do for their guests and what they should not in order to
achieve guest-focused culture focused on service excellence. However, to date there is
limited evidence as to the relationship between the instrument’s derived measures and its
relationship to employee satisfaction and commitment (Dickson et al., 2006). Dickson and
colleagues employed derived factors from the original 42 item alignment scale to test their
relationship with employee satisfaction and organizational commitment among employees
of a large resort hotel. They found that factors derived from the organizational alignment
scale related to employee satisfaction and commitment measures in the directions
predicted. This study extends both the research methodology and its dependent variables
of the previous study in an effort to test the full organizational alignment construct. Moreover,
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it is designed to highlight to active industry professionals a fuller understanding of the
concept of organizational alignment and its relationship to stakeholder satisfaction and
pro?tability.
A conceptual model that describes the relationship of organizational alignment to the service
pro?t-chain (see Figure 1) informs this study. Though the current study does not test the full
model, it is our hope that our results will encourage additional research in a relatively
neglected area of hospitality management that has theoretical and managerial implications.
We suggest that there is a positive and signi?cant relationship between a ?rm’s alignment
measures and its employee and guest alignment measures, which in turn impacts pro?ts
and ultimately owner satisfaction. Though intuitively appealing, such a model is dif?cult to
test in one sample frame as evidenced by Heskett et al. (1994).
Method
The primary data were collected through a survey administered in winter of 2005. The target
respondents were 200 employees fromeach of four hotels, all of whomearned hourly wages.
A total of 800 employee surveys were administered by the Human Resource Of?ces of the
four hotels. These four hotels are in the four-star hotel category, of similar size and quality
ratings, and all are located in Hong Kong, PRC. A structured and self-administered
questionnaire consisting of two main parts was developed for the study. The ?rst part
comprised questions designed to collect the background information of the respondents
such as their position and department in the company, length of service and duty time. The
second part contained an organizational alignment audit, which contained 42 factors and
statements derived from the hospitality and service management literature focused on
benchmark organizations (Crotts et al., 2005; Dickson et al., 2006). The survey includes
questions measuring the employee’s overall satisfaction with the job and the organization,
and the likelihood that the employee would stay with the company. The scale used for the
alignment statements was a 5-point Likert scale with responses ranging from 1 (strongly
disagree) to 5 (strongly agree). The scores for the 42 items were summed to yield a total
alignment score. Thus a respondent’s evaluation of their ?rm’s degree of alignment could
range from a low of 42 to a high of 210. The employee satisfaction, organizational support,
and employee service commitment scales were multi-item measures drawn from the
organizational development literature (Fields, 2002). These scales are widely accepted and
deemed valid scales that are designed to measure an employee’s job satisfaction,
assessment of management’s support in providing the responding employee the tools and
support to perform their job duties, and the motivation of the employee to serve the
consumer (guest). Like the organizational alignment measure, a total score for each scale
was produced by summing the responses across all items. The employee turnover rate in
percentages was provided from the respective hotel human resource of?ce. Five hundred
Figure 1 Conceptual cause and effect model of organizational alignment
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and twenty ?ve completed questionnaires were returned, representing a response rate of 66
percent. After sorting out the incomplete and unusable questionnaires, 479 (59 percent)
were used for the ?nal analysis.
Results
Employee responses to the assessment instrument ranged, on average, froma high of 134.4
for hotel A to a lowof 106.7 for hotel Dalong a scale that could potentially range from a low of
42 to a high of 210. Though no single ?rm is expected to be perfectly aligned, it is interesting
to note that, on average, the employees of hotel A perceived their ?rm’s alignment at 63.8
percent of its potential, while hotel D employee’s assessed its alignment at 50.8 percent.
Employee turnover rates per year are a good place to start in assessing the alignment audit
since all four hotels were similar in size and quality ratings, but vary greatly in terms of
employee turnover rates. Hotel A had the lowest annual turnover rate of 23 percent, followed
by B at 24.10 percent, C at 37.4 percent and D at 50 percent (see Table I). No statistics were
necessary in this between-group comparison due to the census nature of the data.
Between-group comparisons of these hotels are statistically different at p , 0.001 on all four
measures. Post hoc comparisons employing Tukey and Scheffe tests revealed that
responding employees from hotel D (the hotel with the highest employee turnover rate) had,
on average, the lowest organizational alignment measures. Speci?cally, employees’ scores
of hotel D assessing their property’s organizational alignment scored it at a level that was
signi?cantly different (lower) when compared with properties with lower turnover rates.
Likewise, similar results surface when comparing employee responses to three other
standardized measures. Speci?cally, hotel D employees reported, on average, signi?cantly
lower employee satisfaction, employee commitment, and organizational support measures
when compared to all other groups in seven out of nine between-group comparisons.
Next, multiple regression was employed with the stepwise procedure to determine the ability
of the dependent measures, both individually and collectively, to predict employee turnover
rates (see Table II). The analysis yielded a three step model that, when combined, explained
30 percent (r ¼ 0:55, p , 0.001) of the variance among the hotel turnover rates. In order of
importance, organizational alignment accounted for most of the explained variance in terms
Table I Between-group mean differences of hotels on dependent measures
Hotel
n A B C D
Dependent measures 115 122 132 157 F p-value
Employee turnover 23.0 24.1 27.4 50.0
Organizational 134.4
a
* 128.8
b
133.4
c
106.7
a, b, c
42.01 0.000
Employee satisfaction 19.1
a, c, d
18.6
b,d
17.9
a, c
17.1
a, b
8.70 0.000
Employee commitment 35.7
a
33.0
b
32.8
c
31.9
a, b, c
13.10 0.000
Management support 15.5
a
14.6 14.8
b
14.2
a, b
8.80 0.000
Notes: Values with the same alphabetical superscript are statistically different at p , 0.05 employing
both Tukey and Scheffe post hoc test of between-group differences
Table II Relationship between hotel turnover rates with measures of organizational
alignment, employee satisfaction, employee service commitment, and
organizational support
Stand. Beta t R square p value cumulative
Organizational alignment 0.47 21.03 0.22 0.000
Management support 0.51 9.61 0.29 0.000
Employee satisfaction 0.52 9.77 0.30 0.000
Variable not retained in the model
Employee service commitment 0.10 1.18 0.23
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of hotel turnover rates, followed by organizational support, and employee satisfaction. Self
reported measures of employee service commitment did not contribute uniquely to the
analysis in a statistically signi?cant way.
Lastly, a series of independent t tests were performed where group membership was
assigned to each respondent in terms of their responses to the organizational alignment
measures and compared with their measures on organizational support, employee service
commitment, and employee satisfaction. Speci?cally, group membership in the high
category was assigned at the 50th, 75th and 90th percentile and contrasted with the
workplace environment measures. Though the repetitive use of t tests in this manner runs the
risk of generating Type I statistical error(s), it nevertheless affords a means to determine at
what level a ?rm needs to focus it’s efforts in order to become a benchmark organization in
terms of impacting employee workplace environment measures (see Table III).
Between-group differences in organizational alignment measures in all nine cases were
statistically signi?cant in the directions predicted. Speci?cally, in every analysis those
subjects assigned to the high organizational alignment groups, on average, reported
signi?cantly higher organizational support, employee service commitment and employee
satisfaction as comparedto loworganizational alignment groups. Increases in organizational
support, employee service commitment, and employee satisfaction increasedon average as
the standardfor inclusion in the organizational alignment groups also increasedfromthe 50th
percentiles to the 90th percentiles. Since the underlying structural equation model of t tests is
regression, these results in the simplest of terms reveal inter-correlations between the
organizational alignment measures and workplace environment measures. Among all these
sub-analyses, those employees of hotels A and C (the properties with the highest average
organizational alignment measures) were assigned primarily to the high groupings in
organizational support, commitment and satisfaction measures as well. This provides a
strong indication that workplace environment differences are indeed a concept that
employees are aware of, as re?ected in the above evaluation scores.
Discussion
Hospitality organizations, like all organizations selling intangible experiences, are ultimately
some of the most dif?cult ?rms to manage successfully. Meeting, let alone exceeding, the
ever- increasing expectations of guests must ultimately be achieved through front-line
employees who are often the least trained, least compensated and least committed staff
members. Add to this the high pro?t expectations of owners who, according to PKF
Consulting (2005) had achieved operating pro?t margins in 2005 of 27.3 percent (pro?ts
before contributions to capital reserves, debt service, rent, income taxes, depreciation, and
amortization), and one can appreciate the pressures facing today’s managers.
Table III Between-group mean differences between organizational alignment groupings
and workplace environment measures
Organizational alignment
Dependent variables High Low t p ,
Organizational support
50th percentile 15.2 14.5 22.65 0.008
75th percentile 16.0 14.5 25.71 0.000
90th percentile 16.4 14.7 24.56 0.000
Employee service commitment
50th percentile 34.4 32.8 22.68 0.008
75th percentile 36.2 32.7 25.19 0.000
90th percentile 37.1 33.2 24.36 0.000
Employee satisfaction
50th percentile 18.9 17.6 23.36 0.001
75th percentile 20.0 17.6 25.51 0.000
90th percentile 20.3 18.0 23.78 0.000
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The organizational alignment audit is a useful managerial tool in combination with the
Service-Pro?t Chain Model (Heskett et al., 1994) as it provides a framework for why
alignment is important and what an aligned organization should look like and feel like
through the eyes of its employees. Again, when the results are acted upon, assessing the
perspective of one’s employees as to howwell the staf?ng policies, procedures and systems
are aligned with the organization’s mission, strategies and tactics is a critical step. JW
Marriott once said you can’t make happy customers with unhappy employees. The
statement expands following the results of this study. You cannot make satis?ed and
committed employees unless policies, procedures and systems are aligned with the
mission. If what management says, writes, and does is not aligned with the mission, then the
employees’ attitudes and behaviors are not likely to be aligned either.
The organizational alignment audit is a detailed assessment of an organization’s alignment
with its mission. No organization is likely to achieve high evaluations on all 42 items. In this
study of employees of four similar hotels, the alignment assessments ranged from a high of
64 percent to a low of 51 percent. On a 100 point academic grading scale, these scores are
failing. Not surprisingly, measures of employee satisfaction, employee commitment,
employee turnover rates, and employee assessments of managerial support were all
relatively low, indicating strong inter-correlations between the factors. The hotel with the
lowest average organizational alignment measures also had the lowest average measures of
employee satisfaction, commitment, and management support in seven out of nine
between- group comparisons. In addition, this same hotel had the highest annual turnover
rate for the previous year at 50.0 percent, which was virtually twice as high as the other
hotels. Though the test’s statistics cannot prove cause and effect, it is interesting to note that
organizational alignment measures proved superior to employee satisfaction, employee
service commitment, and organizational support measures in explaining the organizations’
turnover rates. In addition, employees’ perceptions of their organization’s alignment had a
measurable and strong effect on their perceptions of their organization’s support, their
commitment to serving the guest as well as their overall satisfaction as an employee.
Therefore, this is strong evidence that administering the organizational alignment audit is a
good starting point for managers seeking to impact their employees, organizations, and
guests in positive ways.
Future research
This study is not without ?aws that future researchers need to avoid. First and foremost, a
?rm’s annual employee turnover rate is an inexact measure of managerial effectiveness.
Satis?ed and motivated employees leave their employment all the time for reasons beyond
the control of management. Arguably, a better measure would be an employee’s willingness
or intention to resign, but again these were inherent in the alternative measures employed. A
better and more objective measure of turnover would be to match employees’ organizational
alignment score with their employee status within the same ?rm a year later. However, such
an effort may bias the ability of gaining honest opinions from employees on the alignment
audit since con?dentiality cannot be assured.
Secondly, the reader should not construe that, within this database composed of employees
from four hotels, there exists a benchmark organization.. On the contrary, the organizational
alignment audit rated these properties between 50 to 63 percent on a 100 percentage point
scale suggesting that all four ?rms have room for improvement. Further replications of this
research would bene?t from a wider range of properties in terms of alignment measures.
However, researchers are encouraged to draw carefully matched samples from similarly
sized and rated properties so as not to add other in?uences that can impact measures on the
service-pro?t chain.
Nevertheless, the hope is that this study and its more extensive model will stimulate
additional research in this area. Applying the organizational alignment audit to multiple
properties and comparing these results with customer satisfaction measures as well as
annual report data not only is a more complete test of the service-pro?t chain model, but will
also add signi?cantly to our understanding of effective management practice.
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Corresponding author
John C. Crotts can be contacted at: [email protected]
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This article has been cited by:
1. Fariborz Rahimnia, Samira Keyvanipoor, Mahdi Moghadasian. 2014. Analysis of BSC perspectives as related to the alignment of
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doc_806871276.pdf