CHAPTER TWO
LITERATURE REVIEW
2.0 Introduction
This chapter reviewed appropriate literature from referenced books, journals, magazine newspapers, reports, dissertations and other publications. This chapter was arranged under the sub heading from the objectives.
2.2 Employee rewards and recognition practices
One common form of reward in hotels is monetary compensation, which includes base salary, bonuses, and commissions (Bethapudi, 2015). Monetary rewards serve as tangible incentives that recognize employees’ efforts and contributions to the hotel’s success. Bonuses are often tied to individual or team performance, encouraging employees to strive for excellence (Paryani, Masoudi, & Cudney, 2015). Commissions, typically offered to sales and marketing teams, provide additional financial incentives for generating business and increasing revenue (Assaf & Barros, 2016).
In addition to monetary rewards, hotels also utilize non-monetary rewards to recognize and motivate employees. These rewards focus on intrinsic motivation and include various forms of recognition and appreciation. For example, employee-of-the-month programs acknowledge outstanding performance and provide public recognition (Claver-Cortés & Molina-Azorín, 2016). Certificates, plaques, or trophies can also be awarded to employees who have achieved significant milestones or contributed significantly to the hotel’s success (Sigala, 2014).
Professional development and career advancement opportunities are another important aspect of reward practices in hotels. These opportunities include training programs, skill-building workshops, and educational sponsorships (Paryani & Cudney, 2015). By investing in employees’ growth and development, hotels demonstrate their commitment to supporting longterm career progression and fostering employee loyalty (Yousaf, 2015).
Employee benefits and perks are additional forms of rewards provided by hotels. These may include health insurance, retirement plans, discounted or complimentary stays at affiliated hotels, and meal allowances (Ham & Jeong, 2015). Such benefits enhance employees’ overall well-being and work-life balance, contributing to job satisfaction and loyalty (Ivanov, 2014). It is important to note that reward practices in hotels may vary depending on the organizational culture, budget constraints, and specific hotel policies. Furthermore, reward practices should be aligned with performance appraisal systems to ensure fairness and transparency (PalaciosMarques, Ribeiro-Soriano, & Gil-Pechuan, 2021).
Human resource managers use intrinsic rewarding mechanisms to incite self-satisfaction and enrichment of their employees. This leads to attraction and retention of suitable employees as well as ensuring adequate facilitation to improve their job performance through motivation in bid to comply with the set rules, regulations and legislation (Cerasoli et al, 2024). Intrinsic reward structures facilitate the organization strategic goals based on the collective individual employees. Given the dynamic and competitive environment, needs change from time to time which also calls for more flexible means of rewarding employees.
Reward management has played a significant role in ensuring that organizations attract and retain proficient employees. Intrinsic reward mechanisms influence self-actions and this has a tremendous effect on employee performance (Ali & Ahmad, 2019). This encourages employees to take positive actions leading to reward. Reward programs should be properly designed in the organization so as to reinforce positive behavior which leads to performance.
Intrinsic rewards were found to be key players in-built in one’s job jurisdiction upon successful completion of tasks and achievement of goals set. Specific to intrinsic, such rewards are intangible or psychological such as positive/caring attitude, appreciation, job rotation upon achievement, and meeting the new challenges. Intrinsically, one is motivated to creatively execute tasks in a conducive environment (Ali & Ahmad, 2019).
In set, intrinsic factors relate to self in terms of achievement, actualization, determination, fulfilment, competence that an employee experiences in a job context. As such, intrinsic rewards are more personalized targeted for personal development and responsibility as also common in the workplace. Rewards are catalysts of employee performance. In view therefore, Farooqui & Nagendra (2014) asserted that a good manager should consider recognizing people by way of acknowledging their effort and accomplishments in either tangible or intangible ways. Rewarding employees intrinsically is a basic behavioral motivator of employees towards their assigned tasks.
2.2 Strategies for satisfying employees in hotels
An employee’s job satisfaction is a reflection of how they feel about their work environment and the company they work for.
Job satisfaction is considered as one of the main factors that affect efficiency and effectiveness of business organizations. Now days’ organizations and managements are concentrating on employees’ wellbeing and focusing on understanding their wants, needs, personal goals and desires (Spector, 2017). Spector (2017) stated that Job satisfaction facets include: reward such as pay or fringe benefits, coworkers or supervisors, nature of work itself and the organization itself. While Aziri (2021) mentioned that job satisfaction is under the influence of many factors such as: The nature of work, salary, advancement opportunities, management, work groups and work conditions.
Employees will demonstrate a high level of satisfaction if they perceive that top management show satisfaction by providing adequate resources. According to Kumar & Kumar (2017) employee empowerment is a motivational strategy that promotes employees’ sense of satisfaction towards their job and organisation.
Training will motivate employees to participate more actively by improving their confidence level. Arguably, employees training should focus on total quality, decision making, customer care, and employee relations. Employee training has been associated with a couple of benefits such as lower costs, reduced turnover and absenteeism, increased revenues, employee satisfaction and flexibility empowerment. They add that satisfied employees are happy with the training they received, self-development programmes, employee meetings, their participation in the various activities and consideration of their ideas and opinion create a direct influence to employee performance (Meyerson, 2019).
Top management must communicate the company mission and objective to employees so that they will know what value to add to the organisation. Indeed, communication supports the firm culture, foster coordination and facilitate decision making consistent with the strategic objectives of the organisation (Hunjra, 2018). UlHaq, (2011) submit that employee empowerment promotes achievement, productivity and business growth. As such, management should communicate the strategic direction of the firm to all employees to monitor its business performance (Yousaf, 2018).
A strong reward system is important to empower employees and motivate them to put in their best. Rewarding employees is an additional important ingredient in employees’ empowerment. Except employees feel that their good performance is esteemed, they will have no incentive to make familiar performance (Ward, 2019). Individual incentives augment empowerment by: (a) recognizing and reinforcing personal competencies and (b) Individuals are given incentives for participating and involving decision making process at work. In the same context, Lawler (2016) states that employees will be motivated to perform well when three conditions exist there off (a) Rewards are perceived to be attached to performance (b) The rewards that are tied to performance are esteemed. (c) Effective performance is perceived to be attainable.
Employees are satisfied and motivated when their organisations set clear and challenging goals. Managers should create an environment that supports employees to do everything they want desirously and intentionally. Managerial strategies such as having clearly defined goals can promote employee empowerment. Yousaf (2018) submit that employee empowerment promotes achievement, productivity and business growth. As such, management should communicate the strategic direction of the firm to all employees to monitor its business performance
Delegation of authority can enable an organisation to nurture hidden talents and competencies to meet the business need. Formation of bipartite committees will promote healthy employee relations climate and superior organisational performance. Hanayshahe (2016) reports that employee empowerment is connected to organisational satisfaction. They concluded that a higher employee’s empowerment trait will lead to superior organisational performance. Empowering leadership involves sharing power and motivating employees to superior performance. Broadly speaking, empowering leadership, connotes improving the meaningfulness of work, encouraging employees participation in decision making, showing confidence in high performance, and promoting autonomy from bureaucratic barriers (Zhang & Bartol, 2020).
Sense of trusteeship can motivate employees to achieve both organisational goals and individual desires and needs. Hao, He & Long (2017) find that empowering leadership has a positive indirect relationship with employee task performance and creative performance through harmonious passion, and a negative indirect association with employee task performance through obsessive passion. Even though empirical studies suggest that empowering leadership has a positive impact on employee work performance, some scholars have reported negative or non-significant relationships (Cheong et al., 2016; Humborstad & Kuvaas, 2013).
Interaction with top executives is the right platform for employees to raise several issues, offering their views, and suggestions for the survival and sustainability of the organisation. Extant literature suggests that when leaders’ empowerment expectations are more than employees’ empowerment expectations, employees may experience low intrinsic motivation and high role stress (Humborstad et al., 2014; Humborstad & Kuvaas, 2013). Similarly, leaders’ high empowering behaviours may lead to work-induced tension for employees (Cheong et al., 2016) and work resistance (Maynard, Mathieu, Marsh & Ruddy, 2007). Nonetheless, employee empowerment is crucial for firms that want to achieve superior performance.
2.3 Relationship between employee rewards and recognition practices and job satisfaction in hotels
Ibrahim and Brobbey (2015) carried out a study to instigate whether the financial sector in Ghana’s performance of employees could be affected by rewards. The results of the research indicated that granting leadership opportunities, employee recognition, meeting up their expectations and interacting with employees actually motivated employees. Lack of incentives, comfort levels, poor management, a good work environment, technological advancement, evaluation of employees, managerial standards and rewards were also seen as factors that could actually influence the performance of employees. The findings further indicated that Rewards in an organization enhances efficiency and also helped employees meet their personal needs as well as attaining the goals of the organization and enabling them have a good relationship with themselves in the organization (Ibrahim & Brobbey, 2015).
Waiyaki (2017) sought the relationship between rewards and staff performance in a study carried out at Pam Golding Properties. The study revealed that the management of Pam Golding Properties partially used reward goal-setting as a motivator to their employees. They also allowed the employees to be involved when setting their goals, although they did not find them challenging or difficult at all, despite them being specific. The study also showed that there was a lack of regular training and development for the employees to improve their key skills and knowledge and this is an area that should be addressed. Additionally, there was no mentorship program for employees either during on-boarding or to achieve their goals and this would be greatly beneficial to them. The study concluded that the employees at Pam Golding Properties were highly dissatisfied with the monetary packages that were offered by the company. The employees saw these incentives as not competitive compared to other organizations in the same field. In conclusion, the study agreed to the fact that money was a great motivator and the organization should actually look into satisfying its employees accordingly by it. Indeed, a positive relationship between Rewards and performance can be deduced from this study (Waiyaki, 2017).
Nadeem et al. (2014) put various companies in Multan city, Pakistan under scrutiny to determine whether rewards affected the performance in these organizations. In the study, an analysis of different aspects of rewards more specifically in private organizations were made and found out that most of them were not motivated. The findings of the study indicated that Rewards is necessary for each and every firm for it surely affects the overall performance of the employees and helps them achieve their overall goals. A firm that takes proper care of their employees progresses. From the above studies, we can actually conclude that rewards is a very important factor on job satisfaction.
Koo et al. (2020) examined the relationships among emotional and material rewards, job satisfaction, burnout, affective commitment, job performance, and turnover intention in the hotel industry. Their findings indicate that both emotional rewards (such as recognition and praise) and material rewards (such as bonuses and benefits) significantly enhance job satisfaction. Emotional rewards help employees feel valued and appreciated, fostering a positive work environment, while material rewards provide tangible incentives that meet employees’ financial needs. The study also noted that increased job satisfaction due to effective rewards and recognition practices reduces burnout and turnover intention, thus promoting a stable and committed workforce.s
Alsafadi and Altahat (2021) investigated the role of human resource management practices, including rewards and recognition, on employee performance, with job satisfaction as a mediating factor. Their research demonstrated that job satisfaction plays a crucial role in linking rewards and recognition to employee performance. Effective reward systems enhance job satisfaction, which in turn boosts employee performance. This underscores the importance of designing reward and recognition programs that not only motivate employees but also align with their expectations and needs, thereby enhancing their job satisfaction and performance.
Waltz et al. (2020) explored job satisfaction and workplace engagement among millennial nurses, providing insights that can be applied to the hotel industry. The study found that millennial employees place high value on recognition and opportunities for career advancement. In the context of hotels, this means that recognition programs should be designed to meet the specific needs and preferences of younger employees, who may prioritize career development and frequent feedback. By catering to these preferences, hotels can improve job satisfaction and engagement among their millennial workforce.
Thant and Chang (2021) used Herzberg’s two-factor theory to analyze the determinants of public employee job satisfaction in Myanmar. Their study identified recognition and reward as key motivators that significantly contribute to job satisfaction. Applying these findings to the hotel industry, it is evident that both intrinsic factors (such as recognition and appreciation) and extrinsic factors (such as pay and benefits) are essential for fostering job satisfaction. Hotels should therefore implement comprehensive reward systems that address both intrinsic and extrinsic needs of employees to ensure high levels of job satisfaction and motivation.
