It has been proved, in both theoretical and practical frames that employees are one of the most vital aspects of an organization and therefore a good human resources management policy can become a competitive advantage (Czepiel, Solomon, Surprenant & Gutman, 1985).
This is especially true in the case of service organizations as they depend heavily on their frontline staff to provide high-quality services to their customers (Palmer, 2001). Therefore, there is a need for managers to satisfy their employees as they, in turn, satisfy the most important external stakeholder – the customer.
Within the service sector, the customer judges the quality of the service provided by the employees by assessing their behavioral actions. Wilson, Zeithaml, Bitner, and Gremler (2008) state that customer –contact service employees are the service, the organization, the brand and the marketers in the eyes of customers. Satisfied employees will embrace enhanced behavior that will lead to the provision of higher quality services thus raising the customers’ satisfaction (Bitner, 1992).
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Therefore, managers must be in a position to understand and provide for the needs of their employees. Therefore an increase in job satisfaction will more than likely be the main factor employees will consider when contemplating whether to stay in their jobs or move elsewhere (Robbins, 2005).
Over the last two decades, the global hotel industry has grown considerably making it an intensively competitive industry (Kandampully & Suhartanto, 2000). Hotel owners can boost their competitiveness in several ways. Two of the most beneficial ways that a hotel owner can boost the competitiveness of their hotel is upgrading service quality and improving reputations. As indicated by a number of studies, customers will more likely be satisfied if employees are satisfied (Heskett, Jones, Loveman, Sasser, & Schlesinger, 1994). Due to this competitiveness, service firms are continuously in search of finding better ways to satisfy their customers. One of these ways is the creation of a suitable working atmosphere and environment which will satisfy the employees.
As previously mentioned, most managers and scholars emphasize that an organization’s most important tool for gaining a competitive advantage is its people and; in order for the firm to attain success those people have to be involved and active (Lawler, 1996). In recent years, two concepts have gained considerable attention which closely links an organization´s people to gain a competitive advantage. Those two concepts being employee empowerment and contextual performance.
Although a much more thorough explanation of each concept will be given later in our research; one can understand the basic elements of each concept as follows: Employee empowerment in its basic form is a term used to describe
how staff can make autonomous decisions without consulting upper management. An example is giving employees the discretion to solve work-related problems “on the spot” rather than consulting their immediate supervisors or upper management. Contextual performance is a term used to describe activities that employees partake in that are not part of their formal job duties. An example being voluntarily helping colleagues, putting in extra effort to complete tasks and working extra hours to complete tasks.