Comprehensive Model Of Customer Satisfaction Essay

Question:

Discuss about the Comprehensive Model of Customer Satisfaction.

Answer:

Introduction:

This paper provides a dissection of existing literatures on the uses of technology to achieve customer satisfaction. The literature review provides a comprehensive assessment on each variable separately and then establishing the relationship between them. The literature review classifies technology as independent variable and customer satisfaction as dependent variable. The first segment of the paper identifies the scope of the problem followed by the study of independent variable then dependent variable. The subsequent section provides critical analysis on the link between technology and customer satisfaction. The paper affords different scholarly articles, texts and other relevant sources to build on the existing literature. The paper acknowledges that the proliferation of technology on the hospitality industry, and hotels in particular is a moot topic.

The fundamental aim of the hotel industry is to enhance customer satisfaction by delivering quality services, which in turn engenders customer loyalty and profitability (Kadieva, 2016). The rapid change in technology has had substantial impact on the hotel industry in terms of operations, efficiency, brand loyalty, and customer satisfaction (Bhagat, 2012). There is growing need to improve service quality by using modern technological systems. Hotel operators have been under pressure from their competitors and customers to adopt new service delivery systems. Hotel booking services, food-ordering services, and transaction services are fast becoming automated. This literature review explores how technology affects the hospitality industry.

A number of research on the hospitality discourses focus on the customer satisfaction and customer loyalty. While there are already studies on the relationship between technology and service delivery, most of the findings focus on the efficiency and branding, and a few little on performance management. Different factors ranging from the hotel management system, pricing, availability of substitutes, employee satisfaction, to the mode of service delivery affects the customer’s satisfaction. However, the main problem is whether the use of technology in the hospitality industry improves customer satisfaction.

Literature Review

The new technology has become the integral part of hospitality industry from 2970s and is continuing to evolve. The general principle surrounding the hospitality industry is that the larger and advanced a hospitality firm is— in terms of food, beverage, spa treatments, recreational facilities, interior designs, beautiful architecture, landscaping, and overnight accommodation— the more it relies on the new technology. A number of theories support adoption of technology to improve the productivity and customer satisfaction. Lai (2017) developed Task-technology Fit theory, which focuses on the impact of technology on the individual impact. Individual impact in this context refers to effectiveness, efficiency, and desirable quality. Task-technology fit theory emphasizes on the significance of adopting appropriate technology address emerging issues of global trend and market dynamics. Technological Acceptance Model emphasizes on the organizational goals versus outcomes of performing job tasks (Lai, 2017). The model is entrenched on assessing usefulness of a system by understanding the behaviour from the external environment. Besides achieving efficiency and effectiveness, most companies adopt new technologies to improve customer satisfaction and gain competitive advantage over their rivals.

M?kinen (2016) observes that information communication technology (ICT) presents new opportunities to firms, particularly in hospitality industry. The use of modern technology has enabled businesses to alter their models in pursuit of increasing interactions between clients and organizations. In his study about “self-service technology in hotel reception” M?kinen (2016) finds that the technology system has improved efficiency and customer loyalty in the hospitality industry by enabling customers, particularly in hotels and traveling industry, to check in without necessarily interacting with employees. Self-service technology (SST) refers to “a service method where customers deliver the service by themselves with the help of technology and without interacting with an employee” (M?kinen, 2016, p.19). Kasavana (2016) compartmentalizes SST technology into four distinctive categories: “telephone-based technologies and interactive voice response systems, internet based interfaces, interactive kiosks, and video technologies” (Kasavana, 2016)). SST can also help to mitigate existential challenges that hoteliers face. Some of these challenges include labour shortage and pressure from the customers to improve the service. However, Kotler et al. (2016) contend that SST reduces human-to-human interaction, which can culminate to customer failure, and sluggish “service recovery strategies.” Reduced interaction can also weaken strong bonds with customers, which results to declining volume of sales and consequently reduce the firm’s profit margin

In another nuanced study, Johnston et al. (2012) acknowledge that technology facilitates communication in multiple channels of the hospitality industry. Hotels can now use the information technology systems to select the appropriate human capital and other facilities that enhance customer satisfaction, perform transaction tasks, and reduce labour cost. The use of technology enables hospitality firms to multitask and automate routine tasks. According to Bloom (2015), the success of a service firm is underpinned on its acceptance to the new technology because customers always prefer the new technology particularly if it is beneficial. However, Kotler et al (2016) assert that hotels should not be fast to adopt new technologies because customer’s willingness to switch to the new technology is not implicit. Therefore, hotels and airline industries should assess the efficaciousness of different systems before implementing them to determine how it changes the consumer’s behaviour. According to M?kinen (2016), the concept of the new technology in the hospitality industry is intertwined with the need to improve customer experience. Kayes (2016) finds that the in the modern context, most service industries have narrowed their research on how to adopt and implement effectively the new systems to meet consumer expectations. Besides implanting customer loyalty, new technological systems help the management with energy management, in-room vending, in-room entertainment, and interface application. M?kinen (2016) conducts further analysis by via Technology Research Index (TRI) to determine customer technology preference based on demographic distinctions and concludes that the young, the affluent, and the highly educated mostly prefer hotels with complex facilities.


Bloom (2015) holds that the intention of the technology systems is not to replace human capital; rather, it meant to support it. The author states “technology should be a servant and not a master. Devices like food timers enable chefs to prepare French fries by maintaining consistent quality. IT systems also help with information distribution within the organization, data collection, data analysis, data storage, problem solving, decision making among hostage of other benefits. Fast-food companies, like McDonald, employs the use of IT systems to enhance employee empowerment and flatten management hierarchy. By incorporating IT in operational and management system, hospitality companies aim at improving productivity, improving service delivery, and customer loyalty. In his study about proliferation of the new technology in the hospitality industry, Cobanoglu et al. (2011) find that most hotels have incorporated innovation systems that facilitate their property management system (PMS), global distribution systems (GDS), and central reservation system (CRS). PMS is commonly used in managing reservations, housekeeping, connectivity, and cashiers while GDS and CRS enable the management to improve connectivity and reservation tasks. Kayes (2016) observes that hotel operators have invested heavily on in in-room technology for the past three years more than any other period. Recent studies show that hotels are under constant pressure to adopt new technologies due to rapid change in technology. Ford et al. (2012) attests that high-definition TV, high-speed internet, and digital entertainment are some of the trending facilities in in the hospitality industry. Upscale and luxury hotels are competing in service provision based on the technological systems. Bloom (2015) finds that some technological amenities like in-room fitness systems and internet on TV are low priorities to most guests while devices like Guest-Device Connectivity, in-room temperature control, connectivity panels, and Free-To-Guest TV are high priority to customers.

Chen (2011) uses SWOT analysis to explore the impacts of SST systems. The author finds the strength of the system to be improved speed in service delivery, location flexibility, time flexibility, personal service avoidance, cost effectiveness, advertising opportunity, and one-stop shopping. On weaknesses, Chen (2011) argues that SST system is associated with high sunken cost. In addition, service quality is tied to the design of the technology. Technology failure and process failure may jeopardize customer satisfaction by introducing confusing systems. Some of the opportunities that HOTEL10 identifies include 3D holograms, radio frequency and identification chips (RFID), biometric technologies, and smartphones to be the main opportunity (Chen, 2011). Holography refers to “a technique that reproduces a 3-D image of an object through memorizing the light reflection from the original object” (Chen, 2011). The system enables customers to make sound purchase decisions. RFID, Biometric, and smartphone technology enable employees or machine operators to identify clients and provide the required service. The major threats identified in the analysis include technology anxiety, service recovery capability, and dynamism of SST. Developing, acquiring, and maintaining SST is a major challenge (Chen, 2011).

Dependent Variable

Mill (2011) defines satisfaction refers to “the buyer’s cognitive state of being adequately or inadequately rewarded for the sacrifice he has undergone.” According to the Festinger’s theory of assimilation, consumers tend to develop “cognitive comparison” between what they expect from the product and their perception on the product’s performance (Isac and Rusu, 2014). When consumers detect a difference between the two, chances are that dissonance may not appear. Wang (2014) observes that consumers underscore avoidance of dissonance by changing their perceptions about a product in pursuit of edging it closer to their anticipations. Additionally, consumers may decide to distort expectations— by raising “the level of satisfaction through minimizing the relative importance of experimental disconfirmation” — in pursuit of reducing the tension that emanates from the discrepancy between the product or service performance (Isac and Rusu, 2014). Assumption of the theory is that consumer can be influenced to reconsider their expectations about a product or service performance. According to the theory, if consumers reconsider their expectations concerning product performance, then discontentment does not ensue from post-usage process. Vallen and Vallen (2017) attest that controlling the real product performance has the efficacy to engender healthy relationship between satisfaction and expectations. Ideally, the theory postulates that it is difficult to have dissatisfaction, only if customer started assessment of the product with negative expectations (Al Ababneh, 2017). If the assimilation theory is effective, then hotel managers should work towards raising expectations above product or service performance by increasing quality to gain higher ratings during evaluation. Critics of this theory of dissonance argue that theory presents a vague relationship between expectations and satisfaction. Scholars have also criticized the underlying assumption in that it is possible to motivate and influence customer’s expectations about a product or serviced (Mill, 2011).

Luo and Qu (2016) argue that by raising quality and satisfaction standards, hotels implicitly raise the customers’ expectation. Keeping in touch with a returning guest is ostensibly significant because in the long run, it reduces service cost. This emanates from the fact that a returning guest is cognizant of the about the hotel hence requires less information, buys more services, and can recommend the hotel to others. In his study, Luo and Qu (2016) identify four criterion that are commonly used to determine the service satisfaction: price, product quality, location, and service quality. According to Abukhalifeh, and Mat Som (2012), service quality or “the people factor” remains the most fundamental in assessing the overall consumer satisfaction in the hospitality industries. Yet, Bilgihan et al. (2016) posit that service or product satisfaction is the salient determinant of firm’s profitability as well as the brand loyalty. Luo and Qu (2016) find that there is a linear relationship between company’s profitability and loyalty. According to Bhagat (2012), service industry operators are more concerned with improving customer loyalty, and as such, most hotel managements have redesigned their strategy to improve quality service and customer’s experience. Bilgihan et al (2016) observe that loyal customers do not easily switch to other operators for prices reasons. Loyal customers are “fantastic marketing force” since they usually recommend the products or services to their relatives and colleagues.

Loyalty occurs when a consumer repeatedly buys a product or service and harbours a positive attitude towards it. Fort et al (2011) categorized customer loyalty into three distinct forms: composite, behavioural, and attitudinal. In behavioural loyalty, consistency and repetitive purchasing habit are used to determine customer’s loyalty. However, Bilgihan et al. (2016) criticised behavioural loyalty approach, citing that it provides insufficient understanding on repetitive purchasing habits. In addition, repeat purchasing does not emanates from psychological commitment on a given product or service. When a new hotel is established in town, customers tend to switch because they perceive that the new hotel offers better services than the incumbent hotel. Besides, travellers may check into a hotel due to location convenience. Attitudinal measurements employ the use of attitudinal data to assess the emotional attachment to brand, in terms of allegiance, engagement, and sense of loyalty. When the customers hold a positive attitude towards the hotel, they are likely to recommend it to others. On the other hand, composite measurement blends attitudinal and behavioural aspects to determine consumer’s loyalty. According to Isac and Rusu (2014), most scholars recognize composite approach for its efficacy to predict accurately and understand loyalty in different fields.

Wang (2014) attests that competition in the global market place keeps soaring and hotels have been compelled to improve their quality service and product design. According to Bilgihan et al (2016), customer satisfaction remains the most significant product of marketing tasks in all market-oriented firms. Typically, the main reason for improving customer’s satisfaction is to expand market share, generate more revenue, increase referral business, and maintain repeat. Vallen and Vallen (2017) insist that satisfied client tend to purchase frequently and buy more whenever they visit. In contrary, beleaguered customers tend to shift loyalty and may advise their friends, family, and colleagues not to visit the hotel. Hence, focusing on customer’s satisfaction is tantamount to concentrating on business profitability. Abukhalifeh and Mat Som (2012) study also support the notion that consumer loyalty and product satisfaction are intertwined. However, Bilgihan et al (2016) argue that satisfied customers may repurchase a product or service with intentions of minimizing risks that are concomitant with buying unknown product. Wang (2014) opines that service quality in essence is identifying and understanding what customer’s expectations as well as being knowledgeable about the industry. Vallen and Vallen (2017) contend that service quality is all about magnificence. A discrepancy between consumer expectations and experience is what defines magnificence. Scholars continue to establish conceptual interrelationship between service quality and customer satisfaction. Still, there is no universal agreement on the relationship between the two variables. Usually, service quality and customer satisfaction are used interchangeably. According to In Gaol et al (2017), customer satisfaction hinges towards future behaviour compared to service quality. Another study links service quality to five distinctive features: responsiveness, assurance, tangibles, reliability, and empathy. However, Wang (2014) holds that customer satisfaction depends on the employees’ attitude and therefore the hospitality firms should take a deliberate step to improve employees’ welfare to underscore service quality. In Gaol et al (2017) link customer satisfaction to an individual’s service encounter or consumption experience. Scholars have integrated repurchase intent with customer satisfaction.

Correlation between the two variables

Recent study shows that the usages of hotel facilities like wellness centre, spa services, restaurant, guestroom, and bar have become the integral part of customer’s lifestyle. According to Kasavana (2016), the demand of hotel services for the past two decades has shifted beyond traditional services. Technology has become a salient ingredient that hospitality firms incorporate into their systems to improve service quality, and eventually enhance customer satisfaction. Advanced technological systems like SSTs improve customer’s experience and company loyalty. Evidence from the empirical research shows that majority of the customers are pleased to serve themselves using SST since they can save time due to reduced waiting. Studies show that customers using SST systems are happy to use customized and efficient services.

Most hospitality operators acknowledge that proliferation of technology into the industry has enabled them to improve service quality and customer satisfaction by responding faster to customer’s queries and addressing their complaints. SSTs provide springboard for organizations to improve customer loyalty and deliver quality customer experience. LAWI finds that most managers and business travellers prefer checking into hotels that have technological systems— like multiple telephone lines, voice-mail, and video conferencing— that enhance that enhance their communication to the head office. Luo and Qu (2016) accentuate technology, performance, and satisfaction: the author notes that technology-based facilities in the guestroom have a substantial influence on the customer’s satisfaction, which determines the customer’s attitude towards the hotel. Research also shows that —ceteris paribus— most people assess technological amenities of a hotel before checking in. This shows how important technology is in delivering customer satisfaction (Kotler et al., 2016).

However, critics of SSTs argue that the systems may experience technological failure and reduce interaction with customers, which is detrimental to the performance of the company. Technological failure is inimical to the company’s reputation and overall performance because it breeds discontentment among customers. Nevertheless, studies have shown that technological benefits in the hotel industry overweigh the limitations.

Conclusion

This chapter has investigated how technology and customer satisfaction in the hospitality industry are related by providing analysis on the existing literatures about the two variables. Indeed, the operational and service delivery in the hospitality industry has been experiencing rapid change coupled with escalating competition and proliferation of technology systems. Besides enhancing efficiency, technological systems enable the organization to improve service quality and maximize customer loyalty. Customer satisfaction depends on the types of the quality of services consumers receive compared to their expectation. Technology devices improves customer interaction, promotes a company’s brand, enables customer to book hotels more quickly, minimizes delays, and improves customer’s experience. The aforementioned merits of technology improve customer’s satisfaction. Customers’ satisfaction is evident on their repurchasing habit and recommendation of the hospitality facility to friends, family, and colleagues. The paper also identifies some weaknesses and threats of technological systems in the hotel industry that may be inimical to the company’s performance by reducing customer’s satisfaction. Some of the technological issues that might reduce customer satisfaction include technological failure and reduced interaction with customers.

To improve performance in the hotel industry, firms must strategize on how to use the new technology to improve service quality, customer loyalty, and eventually customer satisfaction. The hospitality firms should maximise technological systems to determine customer needs and expectations. This includes using data mining technology in research about the market. The management should also ensure that systems in place foster interaction with customers, since it is only through adequate communication that the organization can identify customer’s needs. Another way of utilizing technology to meet customer’s expectation is by using it to set quality standards. To ensure that technological systems operate effectively, the management should motivate employees by taking into consideration their welfare. This will help to improve customer satisfaction. Similarly, the management should work closely with external IT gurus to be updated on the trending technological developments that are relevant to hotel industry.

References

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