Performance Management and Performance Measurement in the Hotel Sector
Info: 21998 words (88 pages) Dissertation
Published: 24th Aug 2021
Tagged: Hospitality
Table of Contents
Chapter 1 (Introduction) 1
Introduction
1.2 Background on Residence Inn Austin South
1.3 Structure of the Research Study
1.4 Summary
Chapter 2 (Literature Review) 6
2.1 Introduction
2.2 Defining Performance
2.3 Performance Measurement and Concept
2.4 Performance Management and Concept
2.4.1 Performance Management Process
2.5 Difference in Performance Management and Performance Measurement
2.6 Performance Management in the Hospitality Sector
2.7 The balanced scorecard approach
2.7.1 Critique of the Balanced Scorecard
2.8 Utilising the Balanced scorecard in Performance Management
2.9 The application of the balanced scorecard in the hospitality sector
2.10 Summary
Chapter 3 (Research Methods) 22
3.1 Research Philosophy
3.2 Research Approach
3.3 Methodological Choice
3.4 Research Strategy
3.5 Time Horizon
3.6 Data Collection Methods
3.7 Sampling Plan
3.8 Triangulation
3.9 Ethical Issues
3.10 Summary 36
Chapter 4 (Research Findings and Literature Refection)
4.1 The difference between Performance measurement and management
4.1.2 Performance Management Process
4.1.3 Reflecting against literature
4.2 Effectiveness of performance management in the industry
4.2.1 Challenging aspect in performance management
4.2.2 Role of motivation in performance management
4.2.3 Reflecting against literature
4.3 Utilising the balanced scorecard with performance management
4.3.1 Reflecting against literature
Chapter 5 (Conclusion ) 55
5.1 Revisiting the research aim and objectives
5.1.2 To investigate the difference in performance measurement and performance management
5.1.3 To established the effectiveness of performance management within the hotel industry
5.1.4 To understand the balanced scorecard approach with effective performance management
5.2 Limitations
5.3 Recommendations
5.4 Summary
References 60
Appendices 66
Chapter 1 - Introduction
The purpose of this research is to study the difference between performance management and performance measurement and to further investigate the impact of them within the hotel sector in the hospitality industry. Performance management is suggested as “the ongoing monitoring and reporting of organisational accomplishments, particularly accomplishments towards pre-established goals” (Andersen, Henriksen and Aarseth, 2006, p.63). The author completed a placement year within the hotel sector from June 2015 to June 2016 and has identified that performance measurement is a component that contributed towards performance management hence the focus on why the hotel sector should move towards management as it proves to be more effective.
From this issue that has been highlighted, the aim of the research study is:
- Should performance management takeover performance measurement within the hotel sector with the help of the balanced scorecard.
The aim has emerge a set of research objectives:
- To investigate the difference in performance measurement and performance management
- To established the effectiveness of performance management within the hotel industry
- To understand the balanced scorecard approach with effective performance management
1.2 Background on Residence Inn Austin South
The author completed a placement year with Residence Inn Austin South and observed the issue that the hotel has faced, hence decided to further investigate the issue. Residence inn was created to accommodate long term stay guest. According to Marriott Development (2016), approximately one third of all business travel nights are part of an extended stay.
Residence inn Austin south is one of the smallest hotel within cluster of hotel in the south. The hotel has 66 rooms, 3 Managers, 3 permanent front desk employees, 2 night audit staff, 2 breakfast attendants and 5 permanent housekeeping staff. The author observed that the increase in staff turnover in various departments has an immediate impact towards the performance of the hotel. With the increase in staff turnover and decrease in performance the hotel has been using the performance measurement approach alongside the balanced scorecard to help resolve the issues. Drawing from the issues, the author will conduct a research on performance management within the hotel sector.
1.3 Structure of the Research Study
The research study is structured into 5 chapters as illustrated in Figure 1
Figure 1. Structure of the Research Study
(Selvaraj, 2017)
Following the first introduction chapter, Chapter two reviews the current literature on performance management and measurement and follows with an analysis on the concept within the hotel sector. In particular, this chapter explores the difference between management and measurement and analyses the process of performance management. The chapter concludes by examining the balanced scorecard and the approach with performance management. The chapter also reviews the literature on integrating and implementing the balanced scorecard in the hotel sector.
Chapter three discusses the practical work through selecting and describing the research methods and approach. The author uses the ‘research onion’ by Saunders et al (2016) to outline the structure, as each method section is presented with a detail justification on the reasons behind each data collection, data analysis and ethical consideration.
Chapter four reports on the finding and analysis that has been gathered from the 4 questionnaires and the authors’ observation whilst working for the organisation. From the research questions, the author presents the findings and how it stands upon the existing literature on performance management and measurement.
Chapter five concludes the study with a conclusion to this research and describes the key limitations of the work. This opens up a discussion for the future research that could be conducted. It concludes by suggesting scopes of improvements that extends for the future.
1.4 Summary
This chapter has demonstrated the full context of this research which lead to the research problem and development of an overall purpose of this research. The overview of the research methods approach has given the author an outline of this research study. The researcher had a particular interest in the performance field while undergoing a placement with the hotel sector which inspired the research to be conducted. The aim and the objectives as stated earlier in the introduction has provided the basis for taking these issues forward. The next chapter examines and analyses the current knowledge within the key areas of literature that has been drawn upon for this study.
Chapter 2 - Literature Review
2.1 Introduction
The previous chapter gave a brief outline of the research and described the context in it. This chapter purpose is to examine and evaluate the literature of performance management and measurement in the hospitality industry. The chapter begins with understanding the term ‘performance’ as it is the fundamentals of the two concepts in management and measurement. Then, it will define the two concepts and analysing the key of it becoming efficient. Performance management is a major theme in this literature review as this research has a focus on using it with the balanced scorecard approach. The following sections discuss the balanced scorecard approach and the usage with performance management. The literature review also outlines the concept of performance management and the balanced scorecard within the hospitality sector. The chapter concludes on how the existing literature has helped the researcher understand more of the context. Findings from the literature will then be used to provide a platform for the next chapter of this research.
2.2 Defining Performance
This section defines and analyse the term performance in the literature context. There has been plenty of definition in the context on how performance management is used in organisations today. It is vitality important to understand the word performance, to gain a better understanding on performance management and measurement. The dictionary gave a few definitions on what performance is:
- An act of presenting a play, concert or other form of entertainment
- The action or process of performing a task or function (Oxford English Dictionary, 2017)
Performance in organisations is more than just achieving the goals that has been set, as in addition to that it is also how the work is done. (Brumbrach 1998, citied in Armstrong, 2002) defined performance as ‘both behaviours and results’. From the definition, it is alluded that performance is all about attainment to reach the highest standard that has been targeted.
2.3 Performance Measurement and Concept
The purpose of this literature is to help differentiate the contrast between measurement and management in the topic of performance. This section of the literature defines and analyses the concept of the performance measurement system.
Neely (1999) defined performance measurement ‘as a process of quantifying the efficiency and effectiveness of an action’, this definition was define in a basis review of a performance measurement literature. (Moullin, 2007) stated that Neely’s (1999) definition is the most presented definition on measurement. There has been limited perspective on the context on defining performance measurement. Various authors have emphasised that performance measurement main characteristics is to create organisational alignment (Hanson et al, 2011), and to convert strategy into action (Micheli and Manzoni, 2010). The definition from various authors presents measurement as an objective, however the behaviour of the humans involved in using a measurement suggest that subjectivity is involved in it (Johnson and Kaplan, 1987 p253-262).
Farbey et al (1993 p75-94) described how a measurement procedure maps and preserves the difference in a set of symbols and the difference in attributes of a collection of entities. Farbey’s opinion on performance measurement expresses the same occurrences as Neely et al (1999), although recent literature has shown that it is not only becoming broader, but more diverse and specialised. The literature has been a prominent part of the performance literature, which has allowed the discussion of measurement as part of the themes in the development of this literature.
Additionally to the definition that has been mentioned, Bititci et al (1997) identified performance measurement as ‘the information system that is the heart of the performance management process, and integrates all the relevant information from all the other performance management system’. Although there has been research conducted on the issues of measurement, the right definition on measurement is still yet to be defined (Wu, 2009).
The research so far has given a depth of performance measurement across various industries and for the past three decade. According to Sainaghi et al (2013) there is an increasingly scholarly interest in the tourism performance measurement although the concept of it is not fully articulated. The research has discovered that firm performance has remained the most popular concepts in the research field. Despite it, there is still some approach towards performance measurement in the industry as Philips and Louvieris (2005) has provided support for carefully designing a holistic performance measurement system for hospitality, tourism and leisure industries. Based on the analysation on the existing literature on performance measurement, another uncovered theme in the literature review will be analysed in the next section.
2.4 Performance Management and Concept
Based on the existing research on performance measurement, the term ‘performance management’ was widely discovered. This section aims to define management and how current literature has been discussing the term. Radnor and McGuire (2004) stated that the term performance management is conceptually loose and has often not distinguished from performance measurement.
CIPD (2017) explained performance management as a holistic process that ensures employees performance contributes to the organisation vision and mission. Bitici et al (1997) define performance management as a process that allows an organisation to handle its performance in line with strategy and objectives. Further to Bitici (1997), Lawler (1994) emphasis that performance management ‘has been one of the most praised, criticised and debated management practices.
Most of literature regarding performance management agreed and suggested that the term performance management is taken into a different approach, for example, performance measurement is but an element in performance management and how the terms are still being use incorrectly (Stewart, Belcourt, Bohlander, Snell and Sherman 2003). Bititci et al (1997) states the objectives of performance management as providing backs up the previous discussion:
“… A proactive closed loop control system where the corporate and functional strategies are deployed to all business processes, activities, tasks and personnel, and feedback is obtained through the performance measurement system to enable appropriate management decisions.”
Performance management that has been implemented and maintained wrongly will become a huge burden rather than a developing and learning tool for employees to progress within the organisations (Glendinning 2002; Hazard 2004). Going further, there seemed to be limited research on performance management in the hospitality industry.
The lack of research on performance management made it hard to give a perspective from the hospitality point of view. Radnor and Lovell (2003) refer to performance management system, using the combined system that involve both performance measurement and management. This proposes that most of the published literature has an overlap between the two theoretically unclear terms. The overlap of the term has influenced the following section on the differences between performance management and performance measurement.
2.4.1 Performance Management Process
The performance management literature has defined the widely misinterpret term as the term has been frequently used in the context, but to date there is no consensus on the definition of performance management. While a variety of authors has suggested the definition of performance management, this research will use CIPD (2017) definition, as it is more contemporary for the current situation. This definition stresses performance management as a process that the target ensures individual employees to reach the goals that has been set by the organisation.
For performance management to function in an organisation, having strategic aims will help achieve competitive advantage by imposing it within the organisational structure (Hartle, 1997). Organisations need to be aware that performance management is a constant evolving process of identifying, measuring and developing the performance of organisation members and aligning the performance with the strategic goals of the organisation (Aguinis, 2009). Developing and implementing the performance management system, always require adjustments in management activities and practices.
Armstrong (2003, p.476) suggested the performance management cycle compromises of five stages; see figure 1 which could help define and asses performance. Armstrong’s (2003) performance cycle compliments the literature components on the process of performance management. Performance management system consist on elements such as “performance measures, performance indicators, performance appraisal and review, value for money and more recently quality assurance” (Boland and Flower, 2000, p. 417). The majority of management literature regarding performance management generally consists of five elements which Armstrong (2003) has suggested in the performance management cycle.
Figure 1: The Performance Management Cycle
Plan
Review
Act
Monitor
Source: Armstrong (2003, p.476)
Pace (2011), stated that the most critical implementation of performance management is, lack and poor executive engagement and execution. Furthermore, organisation also needs a well-developed management system that fits the culture of the workplace. Although, without a commitment from the management team, employees would not take the management system seriously which would not allow an effective system to take place.
Organisations can have a performance management system how not having the right knowledge and skills on it only weakened the system. Watkins and Leigh (2012) argues that weakness in the performance management system arise primarily because it is poorly designed or lack of training on the system that has not transferred into the organisations strategies and goals to support its implementation. There should not be a one off communication as Davis and Rogers (2005), argue that is critical for an organisation to develop a pre-launch, launch and post launch communication plan to ensure that there is an understanding and commitment by continually explaining the benefits of using the system to employees, management and organisation.
It is suggested by Latham and Mann (2006) that employees believes are taken into account as, many of them consider performance management being implemented for the wrong reasons by the management and how by using this process it allows them to hold account and a much easier way to discipline them. The impact of the performance management depends upon the employees’ perceptions and evaluation, encouraging organisations to recognise and incorporate them into the analysis and construction of performance management (Guest, 1999).
2.5 Difference in Performance Management and Performance Measurement
There has been limited research on the existing work that differentiates performance measurement and performance management. Lebas (1995) states that the first involves various types of performance measures, while the latter involves processes and characteristics such as training, teamwork and incentives. Lebas (1995) details on the difference in management and measurement is been shown in Table 2
Table 2 Processes and preoccupations of Performance Measurement and Performance Management (Lebas 1995)
| Performance Measurement | Performance Management |
|
|
(Selvaraj, 2017)
From the descriptions in table, Lebas (1995) has praised a rare attempt to distinguish performance measurement and performance management. In addition to the descriptions, Lebas (1995) suggests that performance management precedes performance measurement that the two are complementary, yet cannot be separated which is shown in figure 2.
Figure 2: Relationship between management and measurement
(Source: Lebas, 1995)
This has suggested that the performance management processes are broader than the performance measurement processes (Lebas 1995, Bititci et al. 1997) although some current literature has suggested that a difference can be spotted between the both theories on how they influence performance in an organisation.
2.6 Performance Management in the hospitality sector
There is a limited literature focusing mainly on performance management in the hospitality sector. There has been two American studies (Huckestein and Dubodd, 1999; Denton and White, 2000) on the experience of the Hilton and Marriott hotels implementing a balanced scorecard approach to performance management. Yilmaz and Bititci (2006) suggest that there are a limited number of studies on performance management and measurement in the tourism industry when compared to studies done in the manufacturing sector.
From the literature research that has been conducted, it is appeared that most of the research is on the measurement aspect of the hospitality industry. In addition to the limited literature in the hospitality industry, the literature that can be used to define performance management is also restricted, which makes it one of the reason for this research to be carried out.
2.7 The Balanced scorecard approach
The purpose of this section is to examine the balanced scorecard approach within performance management. The literature in management and measurement field has develop an occurring theme regarding the balanced scorecard as a performance tool. The success of the balanced scorecard according to Bull (2007) is in terms of efficiency, effectiveness and efficacy. The balanced scorecard created by Kaplan and Norton (1992) was designed to deliver such approach that was stated by Bull (2007).
The aim of the balanced scorecard was to overcome the shortages of the traditional financial- based that has been developed in the research of the literature in performance. The idea of the balanced scorecard is ‘if you cannot measure it, you cannot understand it’ (Kaplan, 2010 p.3). The balanced scorecard was originally used as a performance management tool to measure performance and focus on the four metrics – financial, customer, internal process and learning and growth metrics (Kaplan and Norton, 2010). Most of the current literature has supported the approach of the balanced scorecard as a performance measurement approach.
According to Kaplan and Norton (1992), the balanced scorecard is a strategic management technique for communicating and evaluating the achievement of the mission and vison of the organisation. Kellen (2003) has supported the argument and suggested that a balance of measurement can provide the organisation with a wide coherency. Drury (2008) also argued that the balanced scorecard philosophy helps to create a strategic focus by translating organisations visions and strategies into an operational objectives and performance measures for the discernible perspectives.
The balanced scorecard model utilises an appropriate combination of leading and lagging performance indicators to measure performance across four interrelated perspectives. These performance measures are determined by answering the following fundamental questions about each of the four perspectives within the model (Giannopoulos et al., 2013).
The four perspective of the balanced scorecard has been analysed and discussed as stated in table 1.0 below.
Table 2.1 Perspective of The balanced scorecard
| Customer Perspective
‘How do customers see us?’ |
The ability of the organisation to provide quality goods, services, delivering overall customer service, and satisfaction. Each sector has different focus and responsibility towards the customer perspective. |
| Financial Perspective
‘How do we look to shareholders?’ |
A performance measurement will eventually define the long-run objectives of the organisation (Kaplan & Norton, 1992). A structured and well-designed financial control system can actually enhance an organisation management system by improving cost structure and increasing assets utilization. The financial perspective helps by emphasizing cost efficiency, which would able to deliver the maximum value to the customer at minimum cost and sustained stakeholder value (Gekonge, 2005) |
| Internal Process Perspective
‘What must we excel at?’ |
The internal processes perspective focuses on the internal business results that lead to financial success and satisfied customers. Organisations need to identify the key business process on what and which they would need to excel (Gekonge, 2005). |
| Learning and Growth
‘Can we continue to improve and create value?’ |
Helps organisation to focus on the capabilities and skills, which the company needs to excel to ensure superior internal business processes, which would create a value. For learning and growth to achieve successfully, skill and motivating employees that was supplied with accurate and correct information with superior leadership (Gekonge, 2005) |
(Selvaraj, 2017)
2.7.1 Critique of the Balanced Scorecard
Although there have been many protagonists of the Balanced Scorecard, the framework however is not free from criticism. The time dimension in the framework that is not included in it somehow makes the tool problematic. The aim of the balanced scorecard should be helping the organisations to develop and improve the four perspective in the same time period, and ensuring the effects appearing at different times. The fact that there isn’t a time frame in the scorecard, it would be problematic and impractical to measure the immediate effect of a new and complex action. Norreklit states that in addition to that, it is also considered to be hard and not promising for the organisation to find performance measures for the actions that are new and inexperienced (Norreklit, 2000). It has been argued that it was difficult to measure the effects in business, where innovation play a vital part to an organisation as they will have to regularly settle in to new situation (Giannopoulos et al., 2013).
Moreover, to that the balanced scorecard ignores the competition and technological developments which in today’s business environment are some of the most important factors. The balanced scorecard has risks which are too rigid as it only measures what the strategy requires to be it and does not ask about how or what may block or will cause problems to strategy. This could result in a failure which would be hard to identify problems to the strategy hence it will create a gap among the strategic plan and the main aim of the strategy that is adopted (Norreklit,2000).
2.8 Utilising the Balanced Scorecard in Performance Management
ACAS states that managing the performance of employees is a continuous process (ACAS, 2016). Performance in the workplace ensures that employee performance contributes towards the goals and objective that is set. Managing performance creates a relationship bond between the managers and employees as this could lead to a key element of good communication and nurture trust and personal development (ACAS, 2016).
One of the way organisations can manage performance management is using the balanced scorecard. The balanced scorecard is one of the most common used frameworks in today’s workplace as it enables managers to translate strategy into action. The balanced scorecard highlights that financial and non-financial measures should be integrated for all employees at any level in the organisation. The four perspective in the balanced scorecard enable organisations to gain a holistic view of performance management (Kaplan and Norton, 1996b). Figure 3 shows the traditional model on how performance was assessed on four stakeholder perspective (Kaplan and Norton, 2010).
Figure 3: Traditional Model of Balanced Scorecard
Source: (Kaplan and Norton, 2010).
In todays’ competitive environment for an organisation to achieve and sustained competitive advantage requires explicit links between strategy and performance measures. Performance measurement framework need to move beyond the mere collection of financial and non-financial measure and try to incorporate the links among measures, strategies and outcomes (Sainaghi, Phillips and Corti, 2013). Using the balanced scorecard, the organisation monitors both its current performance and the efforts to improve processes, motivate, learn and improve. Many successful organisations agree on the need for a proper structured methodology for helping them achieving their goals and objectives.
Measurement should not be the end in itself, but organisation should use that as a tool for more effective management. Implementing a transition from measurement to management ensure an effective result for the organisation. The balanced scorecard, provides a structured framework for performance management to take place in an organisation. The measurement process is a start-up process that helps organisation’s to identify their areas of strength and weaknesses. With the data that the organisation has it is the next step on how they are going to manage the performance of each employee.
Employees today tend to focus more on personal goals rather than the organisation’s objectives and goals. The disharmony between employee and organisation strategies and the existance of the reward structure which focuses on the individuals’ achievements rather than the achievement of the organisation goals (Kerr, 1975). The balanced scorecard comes helpful in this situation as it ensures organisations to engage in few beneficial activities (Frigo and Krumwiede,2000). This will allow employees to understand the organisations strategy and focus on the right things that will reach personal and the organisation targets.
2.9 The application of the balanced scorecard in the hospitality sector
There has been a range of publications on the application of the balanced scorecard in various industries. Donselaar et al (1998) and Gunasekaran et al (2001) has reported that the usage of balanced scorecard within the hospitality industry has hardly existed in theory. Huckestein and Duboff (1999) reported on the experiences of the Hilton franchise White Lodging services in implementing the balanced scorecard. The balanced scorecard tool was discovered as a generally useful tool, as it has brought the organisation together by measuring and improving the performance of the hotel. Moreover, the research discussed how the implementation of the balanced scorecard has been successful in reinforcing a strategic business environment, which is stated in the balanced scorecard literature as vital for an organisation to be successful.
Denton and White (2000) has also conducted research on the hospitality industry in conjunction with White lodging services. The brand that was being analysed comprises of the Marriott brands on how the usage of the balanced scorecard was developed in 1997 to help monitor performance at the property and ensuring the organisational long-term objective, were met. The research has recorded that during the first two years, white lodging services had recorded improvements in several areas within the properties.
From this research, it is clear that the volume of research on the balanced scorecard within the hospitality industry is very limited. Although, it can be concluded that several hospitality industries have been using the balanced scorecard to measure performance and there have been improvements made within the organisation. The usage of the balanced scorecard in the hospitality industry has allowed managers to create a working culture that permits the organisation to achieve the long term goals and objectives that has been targeted (Denton & White,2000
2.10 Summary
The research has shown lack of clarity on recognising the difference between performance measurement and performance management, as both terms has been widely and inaccurately used in the literature that made the research broader. In addition, the info on the term performance is a loose concept, which allowed the research to draw various literature. The research has described the concept on measurement and management, which has been the key for the literature. The current publications on suggested that performance management could be differentiated from performance measurement as the two concepts as different influences towards the performance of an organisation.
The discussion on the literature towards the hospitality industry has also been limited and apparent. It has been analysed, that several hospitality industries have been operating with the balanced scorecard and how it has been successful as there are improvement within the organisations. Throughout the research that has been, questions raised about the implementation of management using the balanced scorecard in the hospitality industry by reviewing the existing literature which allowed the research to move into the next chapter. This has helped the research by developing questions and how the basis of this literature review has been the theory of this research.
Chapter 3 - Research Methods
3.0 Introduction
This chapter will discuss research philosophy and methods in general, and the author will outline the research approach used for this particular study and the reason behind the use. According to Saunders et al (2016) the research design is the general plan on how will the author go about answering the researching questions.
Figure 3: Research Onion
(Source: Saunders et al, 2016)
The ‘research onion’ shown in figure 3.0 will be used to help plan a layout on how the data will be collected and also how the author proposes to collect and analyse other issues in this research. The research design is a start to help understand what is the objective and purpose of this study and how is it being intended to do so. The research onion starts up with the philosophical stances that is associated with the philosophies of the research. The research onion is a methodology that was created by Saunders et al (2016) which is shown in the appendices. The onion consists of various layers starting from the philosophy, research approaches, methodological choice, strategies, time horizon and the final layer is techniques and procedure.
3.1 Research Philosophy
Table 3.1 Types of Research Philosophies (Saunders, Lewis and Thornhill, 2016)
| Positivism | Positivism relates to the philosophical stance of the natural scientist and entails working with an observable social reality to produce law-like generalisations |
| Critical Realism | Critical realism focuses on explaining what the author sees is what the author get: what the author experience through their senses portrays the world accurately. |
| Interpretivism | Interpretivism emphasises that humans are different from physical phenomena because they create meanings |
| Pragmatism | Pragmatism asserts that concepts are only relevant where they support action .The research usually starts with a problem and aims to contribute practical solutions that inform future practice. |
(Selvaraj, 2017)
The following research intends to follow the Interpretivism philosophy as Denzin and Lincoln (2003) stated interpretivists as them believing in multiple realities. The author believes that conducting a research on performance management has the attributes of a qualitative by its very nature as the questionnaire is to question managers about employee’s attributes and their perception in relations to the performance management system. The research is design for to analyse people’s understanding, and what they think about, their ideas and their importance of either using performance measurement or performance management. The author hopes to ‘get close’ and attempts to ascertain a relationship about the hotel’s knowledge framework in performance and how the behaviour resulting from the performance framework.
3.2 Research Approach
Table 3.2 Deductive and Inductive Research (Saunders, Lewis and Thornhill, 2016)
| Deduction | Induction |
|
|
(Selvaraj, 2017)
There are two general approaches to reasoning which will result in the hopeful of a new knowledge and better understanding about the research which are inductive and deductive reasoning.
The deductive approach starts with a statement or a question and the approach involves testing the theory out. The deductive approach is mostly applied to research arears in which the theory has been pre-defined.
On the other hand, the inductive research is all about creating a theory. The process of inductive moves in the opposite direction taking the focus from the working title of the researcher not the existing theory. One of the most basic assumption that has been made about the inductive research that if the research were repeated with other samples from the same population, the findings would be consistent.
Based on the discussion, the author will approach this research using the deductive approach, as it is testing a process that originates with an establish theory and seeks to see if the theory applies to specific instances (Hyde, 2000). The deductive approach for this research is suitable as data collection is less time consuming and work on a ‘one take’ basis which would be beneficial for the participant in the questionnaire.
The author, will obtain a confirmation from the research that is being conducted to see if the hypothesis is accepted in the research as there is no intention for generalizability of results and there are predefined questions to be answered.
3.3 Methodological Choice
Table 3.3 Types of Methodological Choice (Saunders, Lewis and Thornhill, 2016)
| Quantitative | The quantitative method involves numbers. It is usually concerned with quantity and measurement |
| Qualitative | The qualitative method is concerned with rich data such as personal accounts, opinions and description. |
(Selvaraj, 2017)
Saunders et al (2016) stated that the research methods are in accord with the methods and used for data collection and analysis. Qualitative research according to Denzin and Lincoln (2011) is mostly associated with an interpretive philosophy which is suitable for this research, as it studies about the meanings and the relationships of the participants by using a variety of data collection techniques and analytical procedures which helps creating a conceptual framework and theoretical contribution (Saunders, Lewis and Thornhill, 2016). In this research questionnaires, which would be a single data collection technique would be use in this research process which the author believes that it is naturalistic and interactive. Bansal and Corley (2011) states that qualitative research is characterised by methodological variations, it still remains as a vital irrespective of the method used to demonstrate methodological rigour and theoretical contribution (Saunders, Lewis and Thornhill, 2007)
3.4 The Research Strategy
The research strategy is the next step in this research to help the author define the method of data collection based on the research questions, objectives, the already knowledge in the field of research and as well as other resources and the author’s philosophical underpinning (Saunders, Lewis and Thornhill, 2016). There are seven strategies according to Saunders et al, however it is noted that no research strategy is considered superior to another and all of the strategies can be used for exploratory, descriptive and explanatory types of research (Yin, 2003)
Table 3.4 Research Strategy Approach (Saunders, Lewis and Thornhill, 2016)
| Research Strategy | Definition |
| Case Study | Extensive study of one or more individuals or cases in a real life context. |
| Ethnography | Study of others from a detached point of view. Ethnography requires researcher to be part of a situation that they are researching. This can be time consuming to achieve full integration into a social scene to experience long term changes in actions and opinions. |
(Selvaraj, 2017)
3.4.1 Ethnography
Having being a participant observer in the organisation, the author’s approach towards this study is ethnography. The researcher will remain the arbiter of how this study goes and what to include. Using the ethnography method for this study was relevant towards the organisation that is being researched on as it is a modern organisation and furthermore having worked in the organisation the author has become familiar with the context and complexity of the organisation and would be able to gain access to undertake an ethnographic study for this research.
3.4.2 Case Study
The case study approach as stated by Yin (2014) states that the case study is an in-depth inquiry into a topic or phenomenon within its real-life setting, and it has also been defined by (Eisenhardt 1989; Eisenhardt and Graebner 2007) that case study research sets out to understand the dynamics of the topic being studied within its setting or even context. Yin’s second dimension, the holistic versus embedded will be used in this research as it refers to the unit of analysis. The organisation that will be use in this case study is Residence Inn Austin South, as the author has been employed by this organisation. The research will be studying only Residence Inn Austin South, however this study will examine a number of different sub units in the hotel such as housekeeping, front desk, back office and even the breakfast department.
3.5 Time Horizon
Table 3.5 Type of Time Horizon (Saunders, Lewis and Thornhill, 2016)
| Cross-sectional | Cross sectional studies often employ the survey strategy. Author’s that uses this approach may be seeking to describe the incidence of a phenomenon. |
| Longitudinal | Longitudinal studies is its capacity to study change and development. This approach helps author’s by providing them with a measure of control over some of the variable that is being studied. |
(Selvaraj, 2017)
Most research study takes a duration period of time. The author will be using the longitudinal approach, as it is a study about change and development that was taken during a period of time. Pettigrew (1990) has emphasised the important of longitudinal study in understanding an organisation as a way of providing data on the mechanisms and processes through which changes are created. The longitudinal questionnaire combines both extensive and intensive approaches (Davies and Dale, 1994). The research is about studying and understanding the difference between performance measurement and performance management, as this study has been taken during a period of time to study the relationship between the organisation and the performance of the employees.
3.6 Data Collection methods
There are different ways to collect data for the findings to ensure the researcher has reached the research objectives and aims. There are few ways to collect data which is between observation, interview and questionnaires that would be based on either primary or secondary data resources.
Table 3.6 Type of Data Collection methods (Saunders, Lewis and Thornhill, 2016)
| Data Collection Method | Definition |
| Observation | Observation involves the systematic viewing, recording, description, analysis and interpretation of people’s behaviour. |
| Interview | A purposeful conversation between two or more people that requires the researcher to establish rapport and ask concise and unambiguous questions to which the participants are willing to respond. |
| Questionnaires | A general term to include all methods of data collection in which each participant has been asked to answer the same set of question in a predetermined order. |
(Selvaraj, 2017)
3.6.1 Observation
There are four methodologies of observation that could be used for a research, and for this research the author’s approach would involve participant observation as the research is a qualitative study. In addition to the four approaches of observation, there are four types of participant observation that are distinguished by two separate dimensions see table 3.6.1.
The study will be using participant-as-observer as the author has taken part and reveal the purpose of this research at this start of this study. By being immerse in the culture of the organisation the author was able to understand the organisation even more. It allow the author to understand the symbolic world of the informants and their perceptions about their social situation which allows the author to create a deep and nuanced understanding of the meanings of interactions (Saunders, Lewis and Thornhill, 2016).
Table 3.6.1 Types of Participant Observation (Saunders, Lewis and Thornhill, 2016)
| Type of Participant Observation | Definition |
| Complete participant | The researcher attempts to become a member of the group in which the researcher is researching. |
| Participant as observer | The researcher would usually take part in both and reveal the purpose of the research. |
| Observer as participant | The researcher will primarily involve in observing, however the purpose will be known to those whom is in the research. |
| Complete observer | The researcher would not take part in the activities of the group. |
(Selvaraj, 2017)
However, using the participant observer show the potential lack of objectivity, as the research is not an independent observer but a participant and the issue that is being observed is the subject of research.
3.6.2 Questionnaire
Based on the literature and company review focused, the author of this research has designed questionnaire based on the literature review to explore the depth of what and how performance management can help the hospitality industry with staff turnover and other issues that the organisation might face with the help of the balanced scorecard. The author was hoping for similar trends and mention that has been stated by the participants. Moreover, Saunders et al (2016) stated that questionnaire is one of the most widely used data collection methods within the survey experiment and case study strategy
3.6.3 Type of Questionnaire
This approach as stated earlier will be used in this research to gather more understanding about the two types of performance discussed earlier in the hospitality industry. A self-completed questionnaire will be designed for the respondents to complete. The questionnaire will be distributed via the internet as the organisation that is being studied about is currently in Austin, Texas.
Table 3.6.2 Type of Questionnaire (Saunders, Lewis and Thornhill, 2016)
| Type of questionnaire | Attributes |
| Self-Completed (Web ) |
|
(Selvaraj, 2017)
3.6.4 Designing the questions
Each questions that is designed for this questionnaire, will be determined by the data that will be collected. The questions that will be asked in this questionnaire will be open questions, as according to Fink (2013) open questions allows respondents to give answers in their open way, as the main research is to analyse and comprehend if the hospitality industry understands the difference between the performance measurement and performance management. The open question as describe by Saunders et al (2016) states that the researcher would want to find out what is uppermost in the participants’ mind as some questions could be lead to an effective approach for the respondents to take.
3.6.5 Limitation of Questionnaires
There are few limitations using the questionnaire to gather more information about the difference between performance measurement and performance management. Using questionnaires can be inadequate to understand as participants may undergo changes in emotions, behaviour and feelings towards the questions. This can affect the data that is gathered from the questionnaire. The respondents might likely not tell the truth in the questionnaire to protect the performance tool that the hotel uses. Using an open question to gather more data, respondents might not put too much thought towards this questionnaire as some of the respondents might have a busy schedule and answering the questionnaire.
The internet questionnaire seems like the most suitable approach to reach out to the respondent, however with different time zones and schedule that the respondents have it is likely to get all respondents to be involve in the questionnaire. There should be another method, if the questionnaires fail, as open questionnaires can be tedious to answer. All the emails, that the researcher will use was obtained during the employment period in the organisation. There can also be chances that some of participants, might not even be working in the same organisation, and it will be hard for the researcher to get in contact will all of them.
As stated this research will use a qualitative case study method to study an effective approach towards performance. Guba and Lincoln (1981) refers case study research as “unusual problems of ethics” as it has been backed up by A Hamel (1993, p23) that using the cases study approach “has basically been faulted for its lack of representativeness and the lack of rigor in the collection, construction and analysis of the materials that give rise to this study”. This tends to lead to bias judgements towards this research as the researcher could have a personal connection towards the organisation that is being studied about.
3.7 Sampling Plan
Table 3.7 Types of Sampling Techniques (Saunders, Lewis and Thornhill, 2016)
| Sampling Techniques | Definitions |
| Probability | The participants that has been chosen in the population has a known chance of being selected. This allow the research to get the answers to the question and to achieve the objectives that is required to estimate statistically the characteristics of the target. |
| Non-probability | The participants would be chosen in a way that each participant that has been selected is not known and it is impossible to answer the research questions that requires the researcher to make statistical inferences about the characteristics of the population. |
(Selvaraj, 2017)
Once the research problem has been defined and there a method of data collection has been set out, the researcher need to clearly select the targeted population from which the sample will be taken. The research sample would be small and it is possible to gather data from all the participants. All of the participants that has taken part in the research has been approached and selected according to the suitability that has been perceived by the researcher. The author will use probability sampling method for data collection, since the researcher has identified a suitable sampling which would be the managers based on the research question. Table 3.7.1 shows the outline of participants that will be used in the research.
Table 3.7.1 Participants
| Manager A | Started her first job with White Lodging as a front desk manager. After working up the ranks, got promoted as a general manager of Residence Inn and has been with the organisation for more than 10 years. |
| Manager B | Cluster Sales Manager of Residence inn, Courtyard, Springhill and Fairfield Austin South. 3 years’ experience with White Lodging and started off as a housekeeping supervisor and worked up the ranks. |
| Manger C | First experience with white lodging. Got the job through the graduate programme. Currently the front desk manager of Springhill Austin south. |
| Manager D | Operations manager of Residence Inn Austin South. Has been with the organisation for more than 4 years. Started off as a front desk associate with the organisation. |
(Selvaraj, 2017)
3.8 Triangulation
Saunders et al (2016) defined triangulation as the process of using more than one source of data and method of collection to confirm the validity, credibility and authenticity of research data and analysis of the research question. The author’s has stated that the philosophy approach that will be taken in this research would be interpretivism. The author believes that by using triangulation alongside with interpretivism it helps to add depth, breath, complexity and richness towards this research (Saunders, Lewis and Thornhill, 2016).
3.9 Ethical Issues
Ethics referred by Saunders et al (2016) is the standards of behaviour that guides the researcher to conduct in relation to the rights of those who become the subject of the researchers work or even how it could affect it. Conducting the research will be guided and help by the guidance of the university’s assigned tutor and the university’s code of ethics which will highlight what is and what is not considered ethical for this research study Saunders, Lewis and Thornhill, 2016). Bell and Bryman (2015) states that such codes are tend to be written in abstract terms and are designed to prevent misconduct thus the principles of this research will be interpreted by the author and furthermore the standards will be contained in the code of ethics with care and finally it will be applied to the context of this research that is being studied about.
The method that will be used in this research would be an internet based questionnaire there are still number of issues that still will raise a question towards the participants. The biggest issue that the participants take in this questionnaire would be about their confidentiality and anonymity of them taking it. There won’t be any harm to any participants that are willing to take part in this questionnaire. The identity and records of individuals and the organisations will be maintained confidential. Since this is a qualitative research, Bell and Bryman (2015) states that great care is needed to be taken with regard to the possible identification of person and organisation.
3.10 Summary
This chapter has helped the author to focus on the research design which will be use in this study. The approach that the researcher has taken will help to analyse the data that will be reviewed in chapter 4.
Chapter 4 - Research Findings & Literature Reflection
4.0 Research Findings
This chapter provides an evaluation and analysis of data followed by a discussion of the research findings that was collected from various managers that work in the hospitality industry. The findings in this research have been related to the research questions that have allowed the guidance for this study. The data that has been gathered from this research were analysed to identify, describe and explore the understanding on why should performance management take over performance measurement in the hospitality industry.
The data were obtained from a self-administered completed by 4 managers that have been working in the hospitality industry. Every manager has been cooperative and has no reason for refusal to participate in this questionnaire.
Study Findings
Three themes emerged from the data:
- The difference between performance measurement and management.
- Effectiveness of performance management in the industry.
- Utilising the balanced scorecard with performance management.
While conducting the research study, the participants that took part in the questionnaire contributed differing amounts of information to the three themes that were discovered during chapter 2. All participants’ voices and views are represented in this study. Furthermore, while these themes are reported as being discrete, there is a considerable overlap among them. The full transcripts of the questionnaires are in the appendices.
4.1 The difference between performance measurement & management
To start of the findings, the author wanted to analyse the perceptions of participants on the difference between measurement and management. Table 4.1 presents the comments that has been made by the participants that has taken part in the questionnaire.
Table 4.1 Performance Measurement and Performance Management in Practice
| Participants | Performance Measurement | Performance Management |
| Manager A | “Measuring how an associate is performing at a set moment in time” | “Making the best skillset your employees have and ensuring they get right support from management to perform to their best capabilities” |
| Manager B | “Tracking tool that helps see where the goals are” | “Consist of different variables that manages employers to achieve their target” |
| Manager C | “Collecting data that will help measure employees performance” | “Identifying employee performance and using the management and measurement to bring out the best within the employees” |
| Manager D | “Measuring and focusing on the results that has been gathered through charts or grids” | “How we are going to take action on the measurement we have gotten” |
(Selvaraj, 2017)
From the questionnaires, it has been noted that the participants had various understanding on the difference between performance measurement and performance management. Majority of the participants had a better understanding on the concept of measurement rather than management. The author observed that most participants did not have a full knowledge on performance management for instance Manager B mentioned management as “consist of different variables that manages employers to achieve their target” which seemingly is true but there is more than just managing employers to achieve targets with the management concept as.
As a complete participant observer in the research, the author observed that the organisation has been operating with the ‘measurement theory’ to improve performance within the workplace. While working, the author witnessed the increase in staff turnover in various departments and how it has affected the performance in the workplace. The usage of measurement with the increase of staff turnover and decrease in performance was not helpful for the organisation as managers were findings way to resolve the issue.
As part of the discussion to understand participants knowledge on the dissimilarity between management and measurement, the participants were asked to indicate the performance system that is been used in their respective organisation. The author earlier mentioned that majority of the participants had a better understanding on measurement and it has been clarified as all of the participants discussed ‘measuring’ their organisation performance with the balanced scorecard which quoted from Manager A that “their prominent performance system is the balanced scorecard and using colour coding associates performance was measure with it”. Table 4.2 shows the type of performance system used in the participant’s organisation.
Table 4.1.2 Type of performance System used in the practice
| Participants | Performance System |
| Manager A | Balanced Scorecard |
| Manager B | Balanced Scorecard |
| Manager C | Balanced Scorecard |
| Manager D | Balanced Scorecard and Feedback Approach |
(Selvaraj, 2017)
4.1.2 Performance Management Process
As performance management is the main research in this study, the participants were asked to comment on what the management system consists of. The uncertainty on performance management has allowed the researcher to question the participants on the management theory. It is interesting to note here that the participants had a very different knowledge on the performance management theory. The issue on why performance management is yet to be implemented in the hotel sector is the lack of understanding on the management term, for instance Manager B perceived management as a “measurement tool” whereas Manager A discussed management as “a long term perspective that is consistent on improving the employees performance”.
From the findings, the author has analysed the participants answers and figure 4 displays what performance management consist of.
Figure 4: Performance Management
Source: (Selvaraj, 2017)
4.2.3 Reflecting against the literature
The literature has suggested the limitation on the distinctions between the terms performance measurement and performance management. This section will discuss on the theoretical distinctions between the terms in the light of the findings from primary research. Firstly it looks at the difference in definition between measurement and management, then it goes into the literature theory of the performance management process.
Table 4.1.3 Reflecting against the literature
| Theme | Findings from Primary Research | View of Current Literature |
| The difference between performance measurement and management. |
|
|
(Selvaraj, 2017)
The existing literature proposed performance measurement as a sub-system of performance management (Halachmi, 2005), a term that Lebas (1995) developed into a model. Neely (1999) defined measurement as: ‘the process quantifying the efficiency and effectiveness of an action’ which makes performance management a broader process that the quantification that has been mentioned earlier. CIPD (2017) on the other hand, gives a contemporary definition on performance management as: ‘holistic set of process that ensure employees contribute to business objectives’. Manager C responds on defining management compliments the current literature as it states management being strategic by identifying and planning what is needed for the employees.
Furthermore, it has also been mentioned by the findings, literature and the author that performance management compromises of a few elements, which includes learning and development, measurement of performance and feedback. Bititci et al (1997) backs up the author’s analysis on what performance management is consist of by stating management as a ‘business processes, activities, tasks and personnel, and feedback is obtained through the performance measurement system to enable management decisions’. Manager B description on performance management “Consist of different variables that manages employees to achieve their target” underlines perfectly with the theory and the author’s views.
The overall understanding on the term measurement and management has been justified by the author through comparison of the findings and the current literature. From the findings and research that has been conducted, it shows most organisations reported measurement as a system being operated, nonetheless there was no mentioned on performance management system. With limited research on management within the hotel sector and most current published literature has been overlapping both term as Radnor and Lovell (2003) stated ‘performance management as a combined system that consists of both management and measurement’.
4.2 Effectiveness of performance management in the industry
In this section participants were asked to comment on their opinions on performance management being effective for organisations. The question also queried participants if performance management could reduce staff turnover and increase the performance in the organisation. Table 4.3 presents the thoughts from the participants.
Table 4.2 Effectiveness of Performance Management
| Participants | Effectiveness of Performance Management |
| Manager A | “If it is conducted the right way it can be affective. Understanding why people are underperforming and addressing the issue can increase retention of employees” |
| Manager B | “Keep employees accountable and believe that it can reduce staff turnover as employees will have the knowledge on what is needed from them” |
| Manager C | “Effective method as it helps employers to measure the expectations that employees should be performing and the management system helps to identify what is needed for the employees to develop them” |
| Manager D | “Performance management is a very effective system, if it is implemented and applied the right way. With it being implemented effectively, this can help organisations understand their employees better by giving them the right training for them to grow within the organisation” |
(Selvaraj, 2017)
Maximizing performance has been a priority for many organisations today and by utilising performance management in the workplace this could be the perfect link between the organisational strategy and results. The participants have all agreed that the management system is an effective approach that can help reduce staff turnover and improve performance.
Manager A addressed on it being effective “if it conducted the right way” as well as Manager D “if it is implemented and applied the right way”. Employers need to execute the management system to ensure the process is going on smoothly. The findings earlier has allowed the author to understand the management process in more depth and believes that management method is a continuous and ongoing process which can help organisations to reduce staff turnover and increase the performance.
As being an observer in the research, the organisation that the author undergone a placement has been using performance measurement to measure performance. This has raised a question for the participants if performance management would be considered in their respective organisation.
All of the participants would considered performance management for their organisation quoted from Manager C “as this would give awareness to allow my employees to meet the expectations that has been set for their role”. Manager A mentioned “this could help catch an employee who is underperforming which could impact damaging the organisation results”, as performance management is developed to help organisation reach their set of goals and objectives with the usage of their best employees.
Manager D believes that “implementing a new approach can be challenging for the organisation” and the author supports the comment that has been mentioned. A new change within the organisation can be time consuming and requires cooperation from all of the department to ensure an effective performance management to take place. The author has witnessed that a good management system can have an impact for organisations to achieve their targets and goals. From the findings, the author has identified four benefits from the effectiveness of performance management which aligns with the literature that will be discussed section 4.2.3.
Table 4.2.1 Benefits from the effectiveness of Performance Management
| Helped employees to understand their importance of their contributions to the organisational goals and objectives. |
| Allows employees to understand what is expected from their job skills and the support that is required to fulfil the expectations |
| Guaranteeing the right aligning and linking of objectives and ensuring proper communication throughout the organisation |
| Effective performance management helps cordial and create a balanced work life environment between the employee and the employer based on trust and respect. |
(Selvaraj, 2017)
4.2.1 Challenging aspect in Performance Management
For organisations to achieve the process of performance management, the system and tolls that is needed must fit the needs of the organisation. Duplicating a performance management and trying to adopt it in the organisation would not be a success. Manager A stated:
“That the challenging aspect in performance management would be managing underperforming employees as this could be time consuming and if no action is taken it may be time consuming to solve the issue”
Furthermore, for some cases managing the best employees can be a difficult task and by using performance management employers tend to push away employees which could lead to putting them under pressure. Manager B believes “That ineffective leadership support in the organisation is a challenging aspect in performance management”. The concept of management allows organisation to reach their objectives and get the best out of their employees, however if the employers are not motivated to get towards their target, the utilisation of performance management is pointless in the organisation.
Manager C mentioned a few challenges that could be a challenging aspect for performance management. It was not a disbelief to see that Manager C said that “failure of communication within the stakeholder and employees play a huge impact on why it could be hard for performance management to succeed in the organisation”. Performance management mentioned by the author, is an ongoing process which continually requires communication from all of the department to ensure that the process is going smoothly. Everyone in the organisation needs to be on the same page when it comes to measuring performance and adapting to changes to ensure that the goals and objective of the organisation is met.
Failure in communication which was mentioned is one of the challenging aspect for performance management to succeed in an organisation. The management needs to ensure that there is a smooth communication line that run throughout the whole organisation to ensure performance management can be beneficial for the organisation. Besides establishing a strong communication within the organisation, not having leadership support could be non-beneficial for performance management to be successful.
Performance management in the organisation needs to be driven by the strategy and the senior management of the organisation or else the performance management in the organisation could be a failure. Having a strong leadership support would be effective for performance management as not only it would open up the communication within the organisation, it would allow the performance management system to be an effective change within the organisational culture. Ineffective leadership was mentioned by participant as this could be the challenging prospect towards performance management, as from the findings the author believes that all the factors that has been mentioned by the participants have a domino effect towards performance management being successful within the organisation.
4.2.2 Role of motivation in Performance Management
While conducting the research on the effectiveness of performance management, motivation has been discovered as an emerging sub theme towards the research, which led the author question the participants on what motivates employees to perform their fullest. Table 4.5 shows the factors of motivation that was mentioned by the participants.
Table 4.2.2 Factors that motivate employee
| Participants | Motivation Key |
| Manager A | “Constant growth and room for progression and job satisfaction” |
| Manager B | “Recognition” |
| Manager C | “Recognition” |
| Manager D | “Recognition” |
(Selvaraj, 2017)
For performance management to be effective, employees need to corporate with employers to ensure smooth process. Having the right motivation helps employees to perform better for their organisation. During the placement, the author noticed how motivation has an impact towards the performance of the employee and the staff turnover. There was a period, where lack of leadership from the management has brought the performance level of the organisation down. As mentioned by Manager B that “ineffective leadership” is a challenging aspect for performance management to succeed, the author also believes that this is also a factor of motivation in management.
All of the participants commented “recognition” as a key motivation for performance management to succeed as employees feel their needs to be acknowledged and compensated equally for their contributions and achievements toward the organisation. Quoted from Manager C:
“Recognition is one of the factor that motivates employees in their organisation as it is believed that providing recognition for the employees’ efforts and performance helps to increase their chances of performing even better”
From the findings a few participants have mentioned a clear path of progression is one of the factor that motivates employees to perform better for their organisation. Especially in the hospitality industry many employees would want to know their clear path of progression as it is one of the industries with the highest staff turnover. Having a clear path of progression within the organisation shows that the employer cares about the employee’s future and with the help of performance management employers can still retain all their best employees.
4.3.1 Reflecting against the literature
The second theme investigates performance management in the sector and questions participants if they would consider using the management approach for their organisations. The overall research aim was to see if management could takeover measurement, as much work so far has focused on performance measurement in the sector.
Table 4.2.3 Reflecting against the literature
| Theme | Findings from Primary Research | View of Current Literature |
| Effectiveness of Performance Management | Most organisations have been using the measurement system, hence there was a clarity on the term measurement however when it came to differentiating the term measurement and management there was a lack of understanding within the concepts. |
|
(Selvaraj, 2017)
As stated in the literature, publications have highlighted the use of the terms measurement and management is conceptually loose and that they are often used interchangeably (Radnor and Mcguire, 2004). Based on theme 1 findings, the author’s suggested that performance management includes a broader process than measurement, and from the findings and revised definitions given by the participants, there is a clearer conceptualisation with respect to another in the existing literature.
Ineffective leadership was mentioned in the findings for the management process to be challenging in an organisation. The finding has been supported by Pace (2011) as it was mentioned lack and poor executive engagement and execution can be the most critical part in implementing performance management. The literature also mentioned how a poorly designed management system can be the weakness for it to be successful (Watkins and Leigh, 2012). This goes along with the author’s believe in how having the right understanding on what performance management is can be effective or an organisation.
An emerging sub-theme was discovered while conducting this research. The participants and author’s observation found motivation was a key driving force for performance to succeed. This has allowed the researcher to analyse the current literature in the context. Bartol and Martin (1998) stated motivation as a powerful tool that reinforces behaviour and triggers the tendency to continue. From the findings, the author believes that motivated employees have the self-belief to align their goals towards the direction of the organisation. Kamalian and Moloudi (2010) suggested, motivated employees has their goals aligned with those of the organisation and directs theirs in that direction. Having employees with the right motivation has ensured organisations to reach their targeted goals.
4.3 Utilising the balanced scorecard with performance management
The reason why the usage of balanced scorecard was question in this research was the author’s observation while undergoing a work placement in the hospitality industry. From the findings and the author’s observation the balanced scorecard is the most popular tool that is used in the hotel sector. The usage of balanced scorecard with performance management helps employers to look in the financial and non-financial measures in the organisation. With it being one of the most utilise performance tool in the hospitality industry, all of the participants were committed to the implementation of the balanced scorecard in their organisation.
Earlier in this findings, the author has analyse the performance system that is used to understand participants understanding on the difference between management and measurement. All of the participants brought up the balanced scorecard approach, which was not a surprise for the author, as it was observed whilst working for the organisation. The researcher’s organisation utilise the balanced scorecard approach to measure operation, although there was still an increase in the staff turnover and decrease in performance. The management had the tool to improve the issues, however having the measurement system did not benefit the organisation as it created a dysfunctional environment. Table 4.7 shows the comments made by the participants regarding the usage of the balanced scorecard.
Table 4.3 Usage of the balanced scorecard
| Participants | Usage of the balanced scorecard |
| Manager A | “Helped monitor how well their employees have been doing and allowing them to focus more on the weak performers to bring out their input towards the organisation” |
| Manager B | “Useful performance tool as it has helped the organisation to improve their performance by visually being able to track their performance. Moreover, it also helps their organisation to set goals for themselves and the departments” |
| Manager C | “The balanced scorecard has been greatly beneficial for measuring how a certain role or department in the organisation should be performing.” |
| Manager D | “Connect the dots across all departments to work together collectively to achieve the targets and goals” |
(Selvaraj, 2017)
The balanced scorecard has not only helped to identify potential barriers and employees that are not performing well as others but also helped the organisation understand what they need to do to create value to go further and stand out from their competitors. While conducting this study there was a strong perception on the balanced scorecard on how it helps the management provide a full comprehensive understanding on the organisations operations.
All of the participants responded that the usage of balanced scorecard in the hospitality industry definitely helps the organisation to improve their performance in all the departments. The balanced scorecard provides a structured framework for organisations to allow performance management to take place as it has an overall positive effect on the performance of an organisation. Most of the participants have used the balanced scorecard tool to measure performance in their organisation and have gotten results that have improved their organisation.
Cooperating the balanced scorecard with the management system could be an effective way to deal with staff turnover and performance issues in the organisation. The observation that has been made while undergoing placement in the organisation was utilising the measurement with the balanced scorecard did not get the results that the organisation was looking for. With performance management, the author believes it will help organisation to link measurement, strategies and outcome to improve processes, motivation and development (Sainaghi et al, 2013).
The aim of this research was to analyse if management could take over measurement in the sector, and from the findings there is a positive result. The participants and the author believes the management concept with the balanced scorecard approach could help organisation reach their goals and objectives, however Manager D mentioned “implementing a new change can be time consuming and challenging”.
4.3.1 Reflecting against the literature
There was a range of literature on the balanced scorecard approach but a restricted publication within the hospitality industry (Donselarr et al, 1998 and Gunasekaran et al, 2001). The literature will concentrate on performance management and the implementation of the balanced scorecard.
Table 4.3.1 Reflecting against the literature
| Theme | Findings from Primary Research | View of Current Literature |
| Utilising the balanced scorecard with performance management | The authors’ observations and findings has stated that the balanced scorecard is the most used tool in the hotel sector. This helps measure the non-financial and financial performance in the organisation. |
|
(Selvaraj, 2017)
The hospitality industry strives on customer satisfaction and utilising the balanced scorecard tool to measure the performance seems to be the right approach. To analyse this theme, it draws on the previous two themes literature review and findings. The initial literature of Kaplan and Norton (1996) discusses how the balanced scorecard can be used a cornerstone in a strategic management system. From the findings, the participants have given a positive outlook towards the balanced scorecard as a performance tool and how it refers to measure that drive within an organisation (Kaplan and Norton, 1996).
Hume and Wright, (2006) stated that to deliver performance, there should be an improvement on the management system, not only the performance monitoring and measurement system. The author’s observation with the organisation utilising the measurement did not resolve the main issue such as high staff turnover. Form the data has been collected, it showed that management did not have a greater impact towards the hotel sector compared to the measurement system.
Throughout this findings, the data collected and observation made by the research, it has been suggested that measurement alone cannot alter performance, as utilising management could help resolve performance issues within the organisation. This is backed up by Bourne et al (2005) who has emphasised that differences in performance occur according to how performance is managed with the measures.
Summary
The discussion has involved the researcher returning to the literature to underpin the research. The research in the field was found to draw a fractional on the variety of sources, with limited guidance on the overall structure. The discussion of the findings in the context have been reflected in three theme in the existing research alongside with the reflection against the current literature.
The discussion of the findings from the first theme laid a foundation for differentiating the terms of performance measurement and management, which then helps the researcher to analyse theme 2. Participants did not have a clear understanding on the terms as it has given a clarity to the author on why management is not being used in the hotel sector.
The findings, literature and the author’s observation assessed the implication of the balanced scorecard in the hotel sector. The findings highlighted the importance of the balanced scorecard to measure and keep track of the organisations performance. However, the author suggests utilising the management system with the scorecard and from the suggestion of the literature, that using performance measurement alone does not have an influence on performance but performance management does.
The findings, supported by current literature have helped the researcher reach a conclusion of the study. The final chapter discusses the contributions and the limitations of the study. Moreover the author reflects on the research and looks to the future implications
Chapter 5 - Conclusion
The overall conclusion of this research study is described in this chapter. Following the research aim and the objectives that was highlighted in the introduction are being referred back in this chapter.
5.1 Revisiting the Research Aim and Objectives
The research was set to see if performance management can overtake measurement in the hotel sector with the usage of the balanced scorecard. There has not been any literature inaugurated in this research interest. The beginning of the literature has discussed concepts of measurement and the increase shift focus on performance management with a better understanding difference drawn between the two (Radnor and McGuire, 2004). The research then turns towards the approach of the balanced scorecard and how using the management concept can be effective for the organisation. From this issues that was raised by the author the overall research aim was:
Should performance management takeover performance measurement within the hotel sector with the help of the balanced scorecard.
The research aim has been addressed throughout the literature review, a methodology framework and the questionnaires with an observed case study by the author. The findings that was gathered was analysed and broken down into a sub themes to help get a structural understanding on the research. From the analysis and discussion of the findings, performance measurement and management have been differentiated and clarifying on how the two concepts are not clearly notable in the literature review. This was proven by researching each system and the effectiveness towards the performance and how current the literature has shown as increase interest in performance that is worth measuring and managing. Before understanding the both term, the author analysed the term performance as it was the key towards this research.
The research aim emerged three objectives, which will be addressed and described in the next section. The author has ensured that the research findings has been examined with the respect to key contemporary literature which has led to the objectives for this study.
5.1.2 To investigate the difference in performance measurement and performance management
From the literature review and findings that have been analyse, the author has gain a better understanding on both of the terms before investigating the effectiveness within the industry. Performance measurement is the most utilise system in most industries, as traditionally measurement was designed to focus on the financial measures only (Striteska and Spickova, 2012). Neely’s definition on performance measurement according to (Moullin, 2007) is the most presented definition on measurement. Neely stresses out “effectiveness and efficiency” which is fundamental for the measurement system. From the literature, performance measurement has been mentioned by (Plant, 2006) as one element of a general management system that comprises many other components to form a performance management system.
As the research focuses mainly on performance management, most of the literature that has been gathered for this research has widely and conceptually loose the term of management and has often distinguished it as a measurement system (Radnor and McGuire, 2004). The author observed during the placement that there was a lack of understanding on the term which lead the organisation to an increase in staff turnover and a decrease in performance. The research findings that was conducted was aimed to seek participants understanding in the both terms, and it shows that there is a lack of understanding on the term which is one of the reason why performance management is not yet to be implemented in the hotel sector.
5.1.3 To established the effectiveness of performance management within the hotel industry
The research is trying to establish whether performance management is the right system to reduce various issues such as staff turnover. Gathered from the previous findings, performance management is a continuous process as it involves a never ending process of setting targets and goals, observing performance and an ongoing giving and receiving feedback (Aguinis, 2005). From the literature, findings and author’s observation implementing an effective performance management can make an impact towards the organisation.
Implementing a new system can be challenging, as the author observed it while working for the organisation. Participants has even mentioned how effective communication and a strong leadership from the management is vital to ensure effectiveness of the management system. Despite the challenging outcomes, participants in the research agreed that the management system is an effective approach to reduce staff turnover and increase performance in an organisation.
Research on effectiveness of performance management has brought up motivation, which the author found it as an interesting sub theme. The author has even questioned the participants on what motivates employee to perform their fullest to ensure motivation is a key factor towards effective performance management. This gave the author a new literature to investigate and proof that motivation is one of a key factor for an effective performance management.
5.1.4 To understand the balanced scorecard approach with effective performance management
The balanced scorecard was observed by the author as a measuring tool that the organisation uses to measure performance. The findings brought an attention to the author on how most organisations focuses on measurement systems. The research aim on whether management should takeover measurement has been clarified by the findings and how with the usage of the balanced scorecard can help the hotel sector look into the four strategic perspectives. The balanced scorecard with performance management can help organisation to fulfil the three most basic function: the measurement, the system of strategic management and communication (Striteska and Spickova, 2012).
5.2 Limitations
During the time frame of this research, they were some major limitations has discovered. The limitations are shown in Table 5.2 and the author believes despite other limitations which has been outlined, the challenging factor was not having enough time with the participants.
| The research methods has only used questionnaires and participant observation, but it was difficult for the author to access more perspectives in this research topic. |
| There was a potential bias in the research, as the author had a closed relationship with all the participants. However, the author believes that the analysis of the findings has been transparent and the answers that was given by the participants were honest. |
| As this was a case study, the research based was only on the organisation that the author has conducted a placement with. Moreover, the literature context was limited as the sector and organisation was based in the United Sates. |
| Despite knowing the participants, there was still a time factor that made the research challenging. The author wished to be present with the participants in the organisation to brief them more on the research. |
(Selvaraj, 2017)
5.3 Recommendations
There be some changes that the author would make if the research was to be conducted again. Table 5.3 shows some of the recommendations that would be taken into consideration in the future.
Recommendation |
| A longer period of time to conduct this research is needed to capture the changes and results that is taken place in the organisation. To prove the aim of the research is accomplished, a period of time is needed for this to achieve. |
| The author’s approach research methods towards this study would be different. Besides using observations and questionnaire to collect data, the author would recommend using interviews to give a better perspective on this research to the participants. |
| The context of literature was limited since the sector and country has been specified. The topic is growing bigger in various industry and countries, and the author would hope to analyse the impact of the topic in it. |
(Selvaraj, 2017)
5.4 Summary
Performance management should be a priority if they wish to established consistent performance and reduce staff turnover in the hotel sectors. By implementing it correctly, this can create an effective performance at a drastic rate. As stated in the literature review, many of context has been focusing on performance measurement and with this research it has contributed towards a new research with the help of the current literature. The author has re-examined the aims and objectives of this research to ensure the research has been answered and met the purposed. From the literature, findings and the author’s observation, it can be established that performance management can takeover measurement with the usage of the balanced scorecard. By implementing it correctly and achieving effective management, there would be an immediate impact on the staff turnover and performance in the organisation.
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Appendices
Participant A
- How does the performance system in your organisation operate?
We measure our employee using a number of tools. Firstly and most prominently we use a balanced scorecard. We measure associates via a colour coding system which is Platinum, Gold, Green, Yellow and Red. It is essential our employees are in green and above otherwise our performance in GSS is significantly lower than necessary.
- How do you identify associates with significant scope for improvement?
The associates who are showing up in the balanced scorecard as yellow are the ones we as managers know need significant improvement. In a customer service focused environment having employees who aren’t performing to our high standards can reflect badly on us all, therefore it is important to spot when performance levels are low in order to act quickly and accordingly and do what is necessary to improve them.
- What do you think motivates employees to perform their fullest in an organisation?
I think it can be a number of different things. Firstly I believe constant growth and room for progression is a key motivating factor. Employees who know there are opportunities for promotion will be motivated to work hard to achieve that. Secondly, satisfaction in a job is important. Those who enjoy their job and work well with the associates around them tend to be the ones who perform the best.
- What is your understanding about the difference between performance measurement and performance management?
Performance measurement is all about measuring how an associate is performing at a set moment in time, whereas performance management is making the best of the skillset your employees have and ensuring they get the right support from management to perform to their best capabilities.
- How has using the balanced scorecard for the organisation help to improve the performance of the employees?
It has allowed us to continually monitor how our employees are doing, allowing us to focus on those who need more input from management, additionally it means we can analyse our greatest performers and ensure they keep to these levels, as well as highlighting their successes.
- In your view, what does performance management consist of?
This is all about having a long-term perspective. It is about regularly looking to organise, monitor and appraise performance to make sure you are getting the best of your workforce every day. If you are actively involved in improving your employees then the satisfaction guests are likely to have will increase.
- Would you consider using performance management in your organisation to manage performance?
Yes, it is essential to a healthy organisation. If you fail to catch an employee who is underperforming it could result it bad results.
- What would be the most challenging aspect of performance management?
I would say it would be managing those who are underperforming but who are also our best employees. It can be the case that even our best employees can be at times not performing to their own high standards. Managing this is difficult as you have to make sure that you deal with this situation in a positive manner, as you don’t want push your employees away through putting them under serious pressure when their performance level drops.
- To what extent do you think performance management is effective or is there an alternative way to improve performance and reduce staff turnover?
I believe it can be affective if conducted in the right way. Unfortunately for those who are underperforming significantly it is difficult to improve them therefore they are pushed out of the organisation. That said, understanding why people are underperforming and addressing the issue can increase retention of employees.
Participant B
- How does the performance system in your organisation operate?
We are tracked based on the number of groups that we book per month and by our performance versus the competition hotels in our area.
- How do you identify associates with significant scope for improvement?
Within our department, multitasking and attention to detail are key, which results in us being able to identify when something is lacking and someone is not responding well to their assigned tasks.
- What do you think motivates employees to perform their fullest in an organisation?
-Recognition might be the biggest one as it makes one feel motivated and accomplished. Within our department, we have quarterly bonuses which are up to 15% of our salary and that is a big motivator to keep booking more groups and paying attention to our daily rates and availability to outgrow our competitive set.
- What is your understanding about the difference between performance measurement and performance management?
When I think of performance measurement I think of a tracking tool. it helps us see what our goals are and where we are versus our goals. Performance management has many different variables that go into it such as time management, ability to multitask, ability to concentrate, and attention to detail.
- How has using the balanced scorecard for the organisation help to improve the performance of the employees?
The balance scorecard helps improve the performance of employees by being able to visually track our performance. This helps us see where we are and where we want to be, as well as what we need to be there. It helps us set goals for ourselves and our department.
- In your view, what does performance management consist of?
As I mentioned before, many different variables go into it. Mostly it is keeping track of yourself and ensuring that you stay on task to accomplish your goals.
- Would you consider using performance management in your organisation to manage performance?
Yes, I would.
- What would be the most challenging aspect of performance management?
Keeping others accountable would be the most challenging aspect of performance management. If someone is not motivated to reach their goals, you cannot make them feel motivated.
- To what extent do you think performance management is effective or is there an alternative way to improve performance and reduce staff turnover?
I believe performance management is the most effective way to keep employees accountable and believe that it does reduce staff turnover because employees will feel more knowledgeable about what they need to do and what their supervisors expect them to do.
Participant C
- How does the performance system in your organisation operate?
We used the balanced scorecard to measure and track our performance. The balanced scorecard has been useful and has shown with the increase of performance within the front desk associates.
- How do you identify associates with significant scope for improvement?
We would use a PDP/appraisal to help identify if an employee needs development or we would look at the overall department or team within the hotel and how they are performing; doing this helps identity if there is a need for further training or if we need to look at their objectives or their targets.
- What do you think motivates employees to perform their fullest in an organisation?
What motivates the employees is recognition we provide in the hotel; the management team believe that providing recognition for the employee’s efforts and performance increases their chance of doing it again or motivation to perform better. An example if there were good comments provided about housekeeping or about reception; this would be fed to management and then to the employee with an reward, by doing this we show that we are thankful for their work and it helps with employee retention and motivation.
- What is your understanding about the difference between performance measurement and performance management?
Performance management – this would involve identifying employee’s performance, to achieve their target
Performance measurement – this would involve collecting data that would help measure the employees performance or a departments performance, collecting this data will help measure and to compare the level of performance that department or person should be performing.
- How has using the balanced scorecard for the organisation help to improve the performance of the employees?
It has been greatly beneficial for measuring how a certain role or department should be performing and how it has made an impact on the organisation. It has helped myself and the hotel to understand how our customers view our service and what expectations we should be meeting in order to create new customers and to develop repeated customers.
In relation to employee performance; it has created a motivational step for them as it helps them to meet their objectives in regards to their PDP or their department goals; most importantly it helps us identify potential barriers and who is not performing as well as the others.
Following on, the balance scorecard has helped our hotel understand what we need to do to create value and how we must innovate to develop our value further; creating a difference from our competitors; basically, how can we excel.
The balance scorecard takes a look into the financial aspect of our hotel; in relation to employee performance the balance scorecard helps us to identify which employee is creating a financial value and their quality of work. We are able to set targets for our employees in relation to their performance in order to help them excel and to develop themselves further.
- In your view, what does performance management consist of?
Performance management is about being strategic as well as operational, as its aim is to ensure that employees contribute positively to the business objectives; as management I must ensure that all employees are performing to the best of their ability; as we aim to provide excellent customer service and performance management ensure we do this.
As a manager I would plan, monitor and review an employee’s performance; this is to ensure they are complying with their role duties and they are meeting expectations.
- Would you consider using performance management in your organisation to manage performance?
Yes, as a manager I would use this as a method of gaining awareness if my employees are meeting the expectations that are set for their role. It helps us identity if there is further development needed or what we would need to do to help that employee excel further in their role.
- What would be the most challenging aspect of performance management?
What I would consider a challenge for implementing performance management is the following:
- Failing to communicate with the stakeholders and the employees that there is a performance management strategy
- Not identifying the impact, it will make; such as not providing the employees the resources to be able to fulfil the requirements.
- Not adapting to the performance management requirements therefore not making the changes that are necessary.
- To what extent do you think performance management is effective or is there an alternative way to improve performance and reduce staff turnover?
I do believe that is an effective method of measuring employee performance because it helps measure the expectations that employees should be following for their role and what could be done to develop that employee further. I do think it helps to decrease turnover, as we are identifying what we can do to keep our employees such as providing them with further development to help with their awareness of their role or to help them meet their targets or objectives in the PDP.
Participant D
- How does the performance system in your organisation operate?
The performance system that the hotel uses is more towards managing the performance. The hotel uses the balanced scorecard and the feedback approach to help the organisation meet the targets that has been set by the cooperation. The balanced scorecard has helped to measure the weakness within the organisation in various departments.
- How do you identify associates with significant scope for improvement?
With the usage of the balanced scorecard and the feedback approach, managers can keep track of their weakest employees and find the right training and development session to help the employees out. The organisation aim is all about maintaining high standard performance and having associate that are not performing can affect the performance of the organisation.
- What do you think motivates employees to perform their fullest in an organisation?
There are few factors that motivates employees to perform for their organisation, to me and from what I have personally experience, recognition from the employers is the biggest key that motivates employees. The satisfaction of knowing that your employer knows you have been contributing towards the success of the organisation show you are recognise and have been a value for them.
- What is your understanding about the difference between performance measurement and performance management?
Performance measurement is all about measuring and focusing on the results that has been gathered through charts or grids.
Performance management on the other hand is all about how we are going to take action on the measurement that we have gotten. The right performance management system consist of various process that allows managers to find new solution to meet their targets and goals.
- How has using the balanced scorecard for the organisation help to improve the performance of the employees?
As stated in the first question, the balanced scorecard is one of the performance tool that is used in our organisation. The balanced scorecard has helped the managers to connect dots from various departments to work together collective to achieve the targets and goals. By allowing managers to focus on the employees and ensuring their job role within the organisation has been effective.
- In your view, what does performance management consist of?
Performance management consist of various process. From the start of this system it sets a strategic plan that is linked up with the organisational goals. The system continues to track the weakness of the employers and employees to ensure it does not affect the goals that has been set. Performance management system has a flexibly within the organisation as the system will allow managers to mend and try different solutions to ensure the goals and targets have been met.
- Would you consider using performance management in your organisation to manage performance?
Yes, definitely as performance management seems to be the right process to help organisation reach their targeted goals. However implementing a new approach when the organisation has been using the balanced scorecard and the feedback approach can be a challenging process.
- What would be the most challenging aspect of performance management?
Creating a design that doesn’t fit the organisational culture would be a challenging aspect of performance management.
- To what extent do you think performance management is effective or is there an alternative way to improve performance and reduce staff turnover?
Performance management is a very effective system, if it is implemented and applied the right way. With it being implemented effectively, this can help organisations understand their employees better by giving them the right training for them to grow within the organisation.
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