Servant Leadership and Authentic Leadership on Hotel Front Liner Service Recovery Performance

Abstract

This study inspects the effect of organizational characteristics on a service firm's capacity to restore unsatisfied customers' satisfaction over service recovery. That is to say, it studies the likely effect of frontline employees' service recovery performance on the organization's overall performance. To see the impact on the job outcome, the management’s commitment to service quality will be measured. Two main theories will be tested together with Psychological Capital and Appraisal to support future results. The theories involved are Servant Leadership (SL) and Authentic Leadership (AL) theory. Since Servant and Authentic leadership have several characteristic comparisons, both are meritorious and lead to positive leadership styles. Servant and authentic are both believed in empowering the employees they serve since the leadership styles possess a high standard of values, and displays compassion and passion for integrity to their followers. It is anticipated that the results would demonstrate that organizational commitment through SL and AL has a significant positive impact on the service recovery performance of frontline workers, as do job satisfaction and recognizing service quality.

Keywords: Service leadership, authentic leadership, service recovery performance, hotel front liners, tourism industry

Background

Malaysia is chosen by international tourists to be among the top most visited countries in Asia (Musa & Thirumoorthi, 2016) and to be the most promising industry in Malaysian economy growth. With this ranking, it has proven that tourism industry in Malaysia is nailing the country economy success. Notably, the tourist business in Malaysia has contributed significantly to the country's Gross Domestic Product, which has contributed positively to the country's economic progress (Mohammed & Rashid, 2018). Therefore, an issuance of special budget from Malaysian government has contributed to the development of Malaysia tourism industry as it is now become a vital support towards Malaysia’s long- standing economic expansion 2020 (Bhuiyan et al., 2013).

To date, Malaysia has seen a stable development on the accurate data and physical evidences in its hotel industry that has steadily increased over the years (Mohammed & Rashid, 2018). The number of visitors visiting Malaysia climbed from 22.05 million in 2008 to 25.70 million in 2015, bringing the total receipts to RM69.1 billion (Tourism Malaysia, 2016). Hence, the contribution revenue earned from every sector under tourism industry has become a central to Malaysia economic growth. The sectors are listed as accommodation, transportation, entertainment, food & beverages and related industries. Hotel sector has become the main component to the tourism industry as it provides the most basic element to run the tourism industry in satisfying the customers. Thus, it is important to explore possible strategies that can turn every service provided by the hotel management to customer satisfaction and ultimately proceed to the intention to revisit (Poon & Low, 2005). In order to secure competitiveness in leading the tourism industry, every hotel service provider need to ensure that customer satisfaction is their priority to every aspect in their service delivery. As to mention, in tourism industry, customer satisfaction is measured to be a factor to a success story, and meeting their hotel guests' expectations is a must to remain competitive (Forozia et al., 2013).

Today, the hotel industry is tremendously boosting up in contributing income to Malaysia economy. This situation is expected due to the potential development and contribution success of tourism industry in Malaysia (Abdullah et al., 2018; Adisa et al., 2016; Boon et al., 2018; Jaafar et al., 2011). The tourism industry value chain is very large and is important to be understood. This value chain is elastic and flexible depending upon the situation itself. One of them is hotel industry. Hotel business is one of the vital roles in complementing tourism industry as it offers accommodation services to the travellers (Boon et al., 2018; Makhsun et al., 2018). Therefore, the struggle amongst the hotel service providers is growing and becoming competitive to survive in Malaysia as the quantity number of established hotels has grown massively since 2015 (Shamsudin et al., 2019). This has shown a significant change on the strategies applied by every hotel service provider in Malaysia in gaining competitive advantage in every service that they are offering to the customers. This situation will lead them to become a market leader in satisfying their customers in a better way.

Employees working in service sectors, especially the front liners encounter intangible challenges. This includes on how customers are treated by service staff which leads to questions of quality (Hewagama et al., 2019). Front liners perform a vital role in service delivery and building good customer relationships (Choi et al., 2014). Customers' perceptions of service quality and satisfaction are determined by the attitudes and behaviours of front-line employees, which ultimately affect organizational success.

Hotel industry involved highly in a quality set of manpower for its sustainability. High contact typed of interaction exist almost at all of their service process (Datta & Singh, 2017; Kusluvan, 2003; Tajeddini & Trueman, 2012). To date, most of the recent hotel employees are more up to date with certain skills and behaviours. They have attitudes to be the one, they bring new good values and perspectives comparatively with the seniors who have some kind of outdated version (Choi et al., 2013; Farrell & Hurt, 2014; Josiam et al., 2010; Pendergast, 2010). According to the current trend in the era of technology savy, they are well accepted by the hotel industry since the industry is now fully operated with a system and technology rather than manpower solely. Their ability to work together and be competent with the technology has now become an advantage (Eisner, 2005; Gursoy et al., 2008; Twenge et al., 2010). Among the disadvantages of the young workforces are that they become intolerant and have slightest organizational commitment to the firm. This has become a big problem to the firm in getting assurance to a job commitment and loyalty. The important element that needs to be mended and transform the employee to become attached with the firm is merely towards the working practise of the firm, i.e. organizational climate (Barron et al., 2007; Cairncross & Buultjens, 2007; Farrell & Hurt, 2014; Gursoy et al., 2008; Karatepe & Karatepe, 2010; Maxwell et al., 2010).

Problem Statement

Generally, organizations are having immense challenges in their effort to compete in the business market with increased financial scrutiny, expectation of work performance, adaptation to new technologies and young generation work values (Burke et al., 2013). Customers' complaints are very challenging, even more the demand sometimes can be overwhelmed when dealing with customers in different cultures, as in the hotel business (Costers et al., 2019).

Studies show that customers from diverse cultures pose challenges to service recovery performance among frontline employees (Costers et al., 2019). This is particularly concerning within the hotel industry where customers coming in hotels come from different cultures, either international or local. Different cultures warrant different service recovery, including compensation, acquire apology or seek for explanation from management (Sengupta et al., 2018).

Hotel front liners face great problems apart from facing customers. These include heavy workload, monotonous jobs, low pay, stress and irregular working hours (Burke et al., 2013). Hence, front liners in the hotel industry requires support from leaders (Ling et al., 2017). Among the famous world-known chain of hotels being the likes of Starwood, Ritz-Carlton and White Swan have successfully adopted servant or authentic leadership style within their corporate management (Ling et al., 2016).

Customers would be satisfied when employees dealing with complaints are able to resolve problems successfully within a short time, listen to needs and provide considerable compensation to their complaints (Costers et al., 2019). Front liners suffer emotional exhaustion in the form of emotional fatigue and lack of energy contributed by psychological demands may impact job performance in the hospitality industry (Choi et al., 2014).

As employees are generally dependent on organizational effort towards producing their service performance, adapting reformulation of attitude theory (RAT) would enable this study to understand the underlying concern on employees’ emotional response and behavior (Kim & Oh, 2012).

Role of leadership in prompting service recovery is still in scarcity (Luu, 2020). In the hotel business, servant leadership (SL) and authentic leadership (AL) are widely recognized as the most effective leadership styles for boosting staff enthusiasm (Kaya & Karatepe, 2020; Qiu et al., 2019). It is with great questions, which of the two leadership, SL and AL to be more appropriate in the hospitality industry, with respect to hotel, as both styles would bring more positivity in gaining employees job performance (Ling et al., 2017). Furthermore, it is intriguing to unveil the relationship of leadership in relation to the reformulation of attitude theory that correspond to customer appraisal and hence toward emotional response and behavior.

Research Questions

Critical issues which bother on the relationship between leadership styles, work engagement, work satisfaction to service recovery performance have been raised. In order to address the issues highlighted, the following research question are developed for this study:

What are the impact of servant leadership on management appraisal and psychological capital of hotel front liner?

What are the impact of authentic leadership on management appraisal and psychological capital of hotel front liner?

What are the impact of appraisal on work engagement, work satisfaction and service recovery performance of frontline employee?

What are the impact psychological capital on work engagement, work satisfaction and recovery performance of frontline employee?

Research Objectives

The objective of this study is to determine and recognize the service recovery performance outcome practiced by the hotel front line employees. It also examines the affective outcome of leadership style (Servant Leadership and Authentic Leadership) towards work satisfaction. This clear view of framework is justified individually as below:

To determine the impact of servant leadership on management appraisal and psychological capital of hotel front liner.

To determine impact of authentic leadership on management appraisal and psychological capital of hotel front liner.

To identify the impact of appraisal and psychological capital on work engagement of frontline employee.

Research Framework

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Scope of the Study

This research as shown in Figure 1 emphases on the impact of leadership style of service recovery performance on the relationship between work engagement and work satisfaction of hotel industry in Malaysia. Hence, the assessment of the hotel is limited to the following tested elements: customer training, empowerment, teamwork, role ambiguity, reward (Appraisal) and self-efficacy, hope, resilience, optimism (Psychological Capital).

This research covers the perspective of Malaysia’s hotel industry. This is because hotel business is one of the best platform in services business that practically highly involved with human interaction and responses. Hotel industry is also believed as amongst the most organized industry with a good system applied. Precisely by hotel industry, given their sizes, areas of locations, number of staffs and customer base, are expected to be more market-oriented, and strategically positioned as a good platform to become a research unit analysis.

The key respondents are the front liners of the selected 3 to 5 Star-rated hotels around Malaysia. Selected front liners are based on their job scope that is defined as a front liner or those who are currently serving the customers directly. The respondents are categorized based on the organizational level of hierarchy; lower level management, middle-level management top-level management. This categorization is useful for generalization purposes. Furthermore, this study focused more on the organizational capabilities that which covers every potential staffs in the whole organization. This study also aimed to measure service recovery performance of the organization and for the execution of strategy, not only to the top management who formulated it. Therefore, collecting feedback from the three category of organizational level hierarchy would well support the focus of this study.

Geographically, this research will cover selected hotels around Malaysia from Peninsular to Sabah and Sarawak (East Malaysia) including federal territories; Kuala Lumpur, Putrajaya and Labuan.

Significance of the Study

Two main bodies gained benefits from this research are the body of knowledge and the practitioners. From the perspective of knowledge, the results from this research are expected to contribute significantly to the service recovery theory as empirical studies that supports the theories to be reliable and valid. This additional contribution to the theory will strengthen the concept in the theory and help the past studies to be applicable in current state. It is also expected to become a bridge to a new theory that will be developed by the future researchers from the results gained through this research. This Reformulation of Attitude Theories (RAT) in service recovery will add into more additional values either through concepts and theories that related to management commitment to service quality, affective outcome, job outcome, servant leadership, authentic leadership, company appraisal, psychological capital, work engagement, work satisfaction and service recovery performance as a whole.

There is no doubt in the research framework that it donates to a body of knowledge in the area of business management. This study endeavours in investigating the gaps within hospitality context based on front liners perspective. It donates to the body of knowledge threefold. First, this study contributed to the theoretical perspective of reformulation of attitude theory concerning the management commitment to service quality to frontline employees. The service quality includes factors of training, empowerment, teamwork, role ambiguity and organizational commitment. Second, supplementary to the service quality, the four domains of psychological capital (PsyCap) will be tested in exploring internal motivation of frontline employees. PsyCap resides within individual domain resources which have received little attention especially among frontline service jobs (Karatepe & Talebzadeh, 2016). As rementioned studies focused on flight attendants, hotel front liner perspective is yet to be fully understood. Third, the role of leadership impact on appraisal domain and employee resource denoted with PsyCap, which in turn lead to work engagement and work satisfaction. These relationships are exploratory in nature which demand insightful understanding on the magnitude of these variables as exogenous to employee service recovery performance.

The second beneficiary of this research would be the practitioners in hotel industry. Hotel industries in other countries as well as other service related industries would equally benefit. Future researchers who would be interested in carrying out research on service recovery performance and its antecedents would find this research as a valuable reference material. The findings of this study, no doubt, would be practically significant to the hotels and hotel front liners. Hotels and hotel front liners would learn from the findings of this study that the performance of hotel is based on the competency of their employees particularly the front liners in recovering a failure situation greatly based on leadership style in practiced.

Hotel managers would learn from this study the need for them to take serious action on the accomplishment and development of company appraisal and psychological capital in ensuring the competency of each of the front liner that is highly involved in customer service delivery. In addition, hotel managers would be a great leader in practiced by applying a comprehensive leadership style in their daily routine tasks and become example to the followers especially to the future leaders. Furthermore, the findings of this study would bring to the realization of the hotel managers and front liners the need for their hotels to be strategically positioned. They need to position themselves as an excellent service provider and become productive and efficient in servicing the customers.

Sampling

The sample will be all hotel employees who are considered as front liners in the hospitality field. A quota sampling will be applied to the population of hotel front liners in the 5 regions in Malaysia (Northern, Central, East Coast, Southern and East Malaysia). The hotel employees will be taken from at least 3-Star rated hotels in ensuring that the sample is from a reputable hotel that can contribute to the reliability and validity of the study results.

Tool

A partial least square structural equation modeling (PLS-SEM) will be applied in testing the path analysis of the proposed variables. A two stage model of the PLS-SEM consists of a measurement model and structural model. Measurement model consists of a test of indicator loadings, internal consistency, convergent validity and discriminant validity test (Hair et al., 2017). Structural model will assess the path coefficient, explained variance of R2, effect size and significance level denoted by t-value. Assessment of structural model will enable us to deduce the acceptance or rejection of the hypotheses proposed in this study.

Expected Outcome

This study is expected to provide several benefits in threefold:

First this study would provide insight towards stakeholders in hospitality and tourism in Malaysia. Especially after the COVID-19 pandemic, on how the front liner in this area responded to declining customers in pursuing holidays and travelling.

In terms of leadership style, the outcome would be a substantial impact to the body of knowledge on how leadership plays a significant role towards appraising employees in the hospitality industry, especially the front liner of the hotel industry. The two leadership styles of servant leadership and authentic leadership

Are the two leadership that are supportive to frontline employees in the hospitality industry (Ashill et al., 2008; Kaya & Karatepe, 2020).

Based on reformulation attitude theory, this study would provide a deeper knowledge based on the factors that appraise employees and its affective outcome, measured by work satisfaction. This affective outcome is crucial in determining service recovery performance of frontline workers.

Acknowledgments

This concept paper is produced by the generosity of BOLD Grant 2021 granted by iRMC, UNITEN to the corresponding author.

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