Shanghai Hotels’ Employee Motivation

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Executive Summary

Organisations that operate in the hotel sector encounter difficulties when it comes to retaining workers since they do not have sufficient information on the factors that contribute to employee loyalty, satisfaction, and hence their motivation. This situation is challenging for luxury hotels in China since the industry is rapidly expanding. The $47.7 billion industry now employs over 2.3 million people.

Considering that the industry is also becoming highly competitive, it is important for any hotel operating in the industry to build strong brands while at the same time maintaining a competitive advantage around product quality, service excellence, and customer satisfaction. The paper hypothesises that it is impossible to achieve this goal without effective programmes for ensuring employee motivation, work satisfaction, and long-term organisational loyalty. These concerns lead to the proposition of research to investigate the interaction of the three variables in the Chinese luxury hotel sector.

The study is designed as the primary research that collects data through direct interviews on employees who are sampled from URBN, The Yangtze, Les Suites Orient, and The PuLi and Spa Hotels in Shanghai, China. The sample size is selected in a manner that the research is conducted within a confidence level of 0.95. Care is taken to guarantee the anonymity of the research subjects as one of the most important ethical requirements for research. It is expected that after completing the research, hotels that operate in the Luxury hotels sector will establish approaches to upgrading their employee motivational programmes to guarantee high levels of job satisfaction and organisational loyalty.

High-end hotel management departments require their employees to operate within some limits of acceptable decorum. Although data collection through the direct interview is costly, the researcher anticipates completing the research within strict budgetary constraints.


The hospitality industry is a highly competitive line of business that requires employees to demonstrate attitudes and behaviours that are consistent with customers’ expected service quality levels to ensure long-term success (Denvir & McMahon 2002). Hence, any organisation’s employees must maintain positive emotional states, consistent work motivation, and strong loyalty to the objectives, purpose, and values of their respective organisations.

This requirement is vital for any organisation, including luxury hotels in which service quality is an important aspect of brand positioning. However, despite this realisation, the hotel industry faces challenges such as high turnover, low professionalism, and labour intensiveness, which are significant contributors to low motivation, poor job satisfaction, and low organisational loyalty (Kumar & Ravindranath 2012).

Hotels operate in the hospitality industry where low motivation contributes to high labour turnover. For example, from 2001 to 2006, the hospitality and leisure industry in the United States had a high rate of turnover, 74.6 per cent. Kumar and Ravindranath (2012) observe that the fact that leisure and hospitality business demands less specialised tactics compared to the industrial segment makes it experience a higher rate of workers who quit their jobs.

Substitution, joblessness, and the cost of quitting are also lower in such an industry. The industry does a swift substitution of workers who decide to abandon their position. However, this situation does not shield organisations in the hospitality industry from disadvantages that are associated with poor work motivation, satisfaction, and loyalty, especially in terms of the degree of quality of service delivery.

Over the last decade, the Chinese luxury hotel industry has experienced rapid growth that averages to about 9.3% each year (Xu, Choi, & Lv 2014). The growth has led to $ 47.7 billion industry in terms of revenue generation (Xu, Choi, & Lv 2014). It has employed about 2.3 million people. Sustaining this growth requires a team of dedicated employees.

Consequently, there is a need for studying employee motivation, satisfaction, and loyalty. This article proposes research on these three issues that are critical when it comes to maintaining successful organisation in four Chinese hotels, namely, URBN, The Yangtze, Les Suites Orient, and The PuLi and Spa. These hotels are located in Shanghai, China.

Literature Review/Background of the Research

Hotel organisations deliver services to their customers via employees. For customers to have satisfaction with the services offered, employee motivation is incredibly important since it influences the fulfilment (or lack thereof) of a firm’s goals, aims, and objectives. Organisations that seek to improve employee motivation focus on satisfying their workers by fulfilling their needs.

Motivation is a driving force that ensures that people within an organisation perform a given activity to certain levels. Through such performance, various psychological factors and physiological needs of people are achieved. The satisfaction of these needs depends on an assortment of internal and external factors in an organisation. These factors include job satisfaction, accomplishment, recognition, satisfaction with salary and wages, working conditions, and workers’ degree of association with an organisation’s success among others (Wright & Gardner 2005).

Job contentment is important in all service sector organisations, including luxury hotels since satisfied employees are likely to offer services that meet the expectations of the consumers. A luxury hotel refers to ‘an upscale public house that typically costs more than the average accommodation’ (Qi 2011, p.217). Customers willingly pay for the extra costs above the average charge because they anticipate receiving superior services and experience. However, lowly motivated employees are not likely to provide such optimal experience.

Huang and Hsu (2008) reveal how employee motivation in the hotel industry is influenced negatively by factors such as inadequate wage, limited training opportunities, high level of job security, non-emergence of new opportunities, and the deprivation of promotional opportunities by managers. The authors also state that job transfers influence employee motivation in a negative manner (Huang & Hsu 2008).

Job displeasure is among the aspects that have attracted immense interest in the organisational management hypothesis. Several elements contribute to it. For instance, individual disappointment arises from reimbursement cases, work safety, job independence, and affairs with administrators among other reasons (Jones 2006).

Considering that these factors have also been found to influence employee motivation, it implies that job satisfaction is a wider paradigm that comprises various factors that influence employee motivation. Therefore, job satisfaction is an important predictor of employee work impetus. However, an important inquiry is whether work contentment may help to envisage worker enthusiasm in the Chinese luxury hotel industry.

The issue of work contentment within organisations has conventionally been approached from the hypothetical paradigm that job approval and workers’ performance are related. Hence, in the case of staff members are content with their working circumstances, they portray higher levels of competence and efficacy. In this context, Glisson and Durick (2003, p. 65) inform, ‘over the years, many employers and employees alike have held to this belief, and placed a great deal of emphasis on making sure employees are satisfied with their jobs to trigger the desired outcome’.

The projected results rely on the goals and agenda of a company. In the service sector business, for instance, the case of luxury hotels, the required results may include service rate and excellence. In organisations that deal with manufacturing, the projected results encompass output level increments that accumulate from the enhanced value of commodities and production power.

Chaudhry and Sabir (2010) suggest that poorly motivated employees are not satisfied with their jobs. Such employees are more likely to consider leaving their jobs in search of greener pastures. Consequently, the actual turnover or turnover intentions in the luxury hotel industry in China may help in predicting job contentment once the study is completed on whether such turnover intentions or actual turnover results from factors that predict employee job displeasure.

Research on job contentment identifies several elements, which augment loyalty among staff members. They include the compensation capacity, the degree of allotment of the task, and organisational customs among other aspects (Chaudhry & Sabir 2010). This observation underlines the implication of incorporating workers in the administrative practices in an organisation when compensation ceases to be a motivational aspect and hence a feature of job contentment.

This situation happens when workers become concerned about self-actualisation and appreciation. Indeed, incorporating them in administrative practices makes them develop insights that they are part of the owners of a particular company. This technique has the impact of stirring up loyalty in a company. Consequently, they attempt to carry out their tasks in a way that the organisation does not fall short of its operations. Otherwise, workers are lowlily contented with their jobs. They may consider quitting for other occupations.

Job quitting in many companies is deployed as a gauge of performance (Beecroft 2008). It determines workers’ choice to remain dedicated to the work of an organisation. Quitting among members of staff is categorised into two: purposeful and spontaneous quitting. Purposeful quitting occurs when workers decide to give up from employment out of their will to involve themselves in other agendas such as self-employment, but not because they are not pleased with the work. In the case of impulsive quitting, staff members are forced by circumstances to suspend their services in a company. Such circumstances include meagre compensation, the perception of mistreatment, and job-personal life differences (AbuKhalifeh & Som 2013).

Although labour turnover is controllable, it is inevitable (AbuKhalifeh & Som 2013). In the service provider business, quitting comprises one of the leading challenges that influence the respective companies’ day-to-day operations. Denvir and McMahon (2002) agree with this assertion by further claiming that the elevated rate of quitting in the service provider companies results in an augmented cost of hiring and training fresh workers to occupy the gaps left by the outgoing workforce.

Several studies that have been done to find out the impact of quitting on the service sector businesses regard the act of giving up of jobs as one of the issues that demand to be addressed urgently, especially by companies that seek to exploit cost competitiveness as a success policy (Khilji & Wang 2007). Scott and Snell (2005) amplify this argument by adding that in case a small number of people remain employed within a company for at most five years, labour charges increase tremendously through the elevated rate of substituting people who leave their job positions.

Many of the studies in the service sector companies address the root and the implication of quitting in the workplace. For example, Hussain (2012) concludes that workers who consider leaving their jobs due to displeasure also have an insignificant degree of organisational loyalty. Therefore, loyalty and job satisfaction are important predictors of motivation, which can be demonstrated by research that investigates factors that lead to poor job satisfaction and consequently issues that trigger employees to consider quitting their jobs.

Loyalty is a measure of employees’ decision to remain working for an organisation for a long time. Hussain (2015) argues that different industries develop and implement diversity training programmes. Besides developing performance assessment systems and improvising working policies, they also set different reward systems with the objective of inducing and maintaining employee loyalty.

Indeed, the primary reason for designing and implementing programmes of increasing employee loyalty is to guarantee long-term tenure with the anticipation that when employees spend longer times working in specific organisations, they will add value to the organisation. Ross (2005) reveals how some companies are cognizant of the need to induce work satisfaction. However, they are a little concerned about the need to maintain long-term relationships with them. To this extent, the organisations risk inheriting the advantages associated with employee loyalty since it is an important factor that determines the decision to work for a long time.

Hussain (2015) asserts that customer satisfaction with the products or services of an organisation depends on the nature of the commodities. In turn, this nature depends on employee loyalty that they have developed towards an organisation to the extent that they are keen to maintain consistency in terms of products and service quality (Hussain 2015). Such products are likely to induce stronger customer loyalty for an organisation to increase its profitability through repeated purchase and clients’ stay at a luxury hotel. Indeed, Jusoff et al. (2009) find a significant relationship between employee satisfaction and loyalty.

Research Aims and Objectives

The current research aims to determine the effect of motivation on employee job satisfaction in the luxury hotel sector in Shanghai by interviewing employees in four leading luxury hotels. This study has three objectives. It seeks to:

  1. Establish factors that enhance employee loyalty in the Chinese luxury hotel industry
  2. Test whether the reasons identified for loyalty relate to job satisfaction in the Chinese luxury hotels’ industry
  3. Establish the effect of employee satisfaction and loyalty on motivation in the Chinese luxury hotels’ industry

Research Methodology and Sampling

Research can be planned to take the secondary or primary approach. The current study assumes the primary approach. Therefore, it relies on the facts acquired through the target interviewees. Well-structured questions are used as the primary technique of data gathering. Questionnaires are also administered based on a four-point rating scale in collecting data that relates to employee satisfaction and loyalty. Hence, the research is quantitative in its design. The questions provide the benefit of swapping information and sharing work experiences with the respondents.

Hence, the gathered information is also broad. Opposed to any other methodology of primary data collection, interviews provide an opportunity to garner data on subjects, regardless of their emotional status. They increase the likelihood of truth of the facts collected in comparison with other techniques. However, the methodology presents some disadvantages. It is lengthy and cost demanding, especially when large samples are involved. The challenge is dealt with by deploying only a recommendable sample that comprises 40 employees. Hence, no attempt is made to study the population due to monetary and time constraints.

Variables captured in the interviews include the role and influence that loyalty has on motivation, as well as the role and influence of employee satisfaction on motivation. Weight is placed on the implication of these elements in determining workers’ pronouncement to change their work positions shortly. Another important variable is the decision to consider turnover concerning various factors that justify such a decision. This aspect acts as a control variable. It helps in establishing whether inadequate motivation in the Chinese luxury hotel industry can be explained by other factors, instead of satisfaction and loyalty.

The plan to quit can be gauged using the Likert scale that captures five aspects as used by Nadiri and Tanova (2009) and Seston and Ferguson (2009). However, in this research, the four-element rating tool is deployed. The points include ‘not significant’, ‘less significant’, ‘significant’, and ‘extremely significant’.

Measuring turnover is significant since employees with high organisational loyalty are less likely to consider leaving their jobs shortly. Employees who are dissatisfied due to poor play or lack of job enrichment are also likely to think about leaving their jobs. Therefore, interview questions that are designed to capture the reasons for turnover consideration can help to unveil useful information on employee issues concerning job displeasure.

The interview will be conducted on 40 randomly selected employees in the four organisations (10 in each organisation). Simple sampling is used as the method of the sample generation. However, many questionnaires can be completed cheaply and successfully. Therefore, data collected through them should ensure that the research achieves a certain confidence level to enhance the reliability and dependability of the findings. Nevertheless, it is vital to establish the required sample to which the opinion poll will be distributed.

While establishing the sample magnitude, four aspects need to be captured. The elements include the population dimension, confidence gap or the extent of the fault, confidence intensity, and the standard deviation (SD). Although human resource units for each hotel have the data for the entire population of workers, the researcher does not currently have these facts. Nevertheless, this situation should not hamper the study from being carried out. In most experimental researches, the population magnitude is not given (Saunders, Lewis, & Thornhill 2012).

Sample magnitudes are always defective. Therefore, it is crucial to establish confines of any inaccuracy. In the current study, the confidence interval is set at 95 per cent. The SD value is set as 0.5 while the confidence gap is set as +/-5 per cent. The SD reveals the anticipated discrepancy in the answers given by the interviewees. The selection of 0.5 as the SD is informed by the fact that the research is yet to be carried out and that a secure and the most intolerant figure must be determined.

Various confidence levels have diverse Z-score figures. For the chosen confidence level of 95 per cent, the corresponding Z-score is 1.96. Deploying these numbers, the sample is determined from the formula: (Z-score) 2– SD (1-SD)/ (margin of error) 2. The figures yield 385 as the requisite sample magnitude. Direct interviews cannot be administered feasibly to such a large sample size. Therefore, only 385 questionnaires will be completed while only 40 employees will be interviewed.

Accessibility, Ethical Issues, Significance, and Deliverables


When collecting the data, the researcher needs to access the recruited research subjects. Consequently, in the current research, the examiner first sought permission from human resource managers of the four hotels for advice on the date to book interviews. This permission has already been granted. Clear communication is made promising that the research data relating to the operational model or any other special information of any hotel will not be accessed by competitors, but will only be used in the current research.

Ethical Issues

Ethical issues that relate to anonymity are observed. When completing the research, the investigator uses pseudonyms to maintain the anonymity of the study subjects. Any word or expression that describes a given gender is avoided where interviews relate to one subject who it would be obvious to know his or her identity. As part of ethical considerations, data is limited to what is acquired from the research subjects. Care is taken to ensure that the researcher does not manipulate or influence data collected through preconceived ideas.


Luxury hotels offer top-line quest services coupled with facilities that help in reinforcing their opulent lifestyles. Operating the hotels presents immense risks to developers and owners due to their complexities and the need to meet the unique demands of each guest who may have a wide variety of choices. Tsang and Hsu (2011, p.886) amplify this argument by noting, ‘luxury hotels in China are among the most volatile in the industry, enjoying strong performance in good times and often suffering significantly in times of economic downturn’.

The dynamics of the luxury hotel underline the significance of this research. Without understanding the sources of employee motivation, satisfaction, and loyalty, it becomes problematic for luxury hotels in China to guarantee the best service and experience to first-line customers who are mainly concerned with service satisfaction. Indeed, motivated, satisfied, and loyal employees are more likely to deliver optimal service and hotel experience compared to de-motivated, poorly satisfied, and unreliable employees.


The proposed research provides a theoretical understanding of the root of worker impetus, contentment, and allegiance in the Chinese luxury hotel industry. This deliverable implies helping the management of the hotels to develop appropriate policy frameworks seeking to enhance and/or maintain employee inspiration, work contentment, and loyalty as the basis for increasing service quality and experience of high-end customers.

Required Resources/Implementation (Gant chart)

Time Resources

Gantt Chart

Monetary Resources

Conducting direct interviews is not only time-consuming but also an expensive activity. In the preparation and administration of the interviews, monetary resources are required. The researcher will require monetary resources to cater for transportation costs, administration of questionnaires, refreshment of interviewees, and in the data processing.


Based on the expositions made in the paper, it is clear that the luxury hotel industry is highly competitive and that organisations that operate in this line of business with the view of seeking to enjoy competitive benefit must establish strategies for boosting their workers’ happiness and loyalty. One of such strategies encompasses the optimal deployment of the available human resources through the establishment of various compensation and rewarding structures to augment staff members’ contentment with their jobs.

Such an approach is considered pivotal in the organisational and human resource administration hypothesis. Better-rewarded workers have been thought of being better stimulated and more pleased with their work. However, there is the need to establish the link between loyalty, satisfaction, and motivation for luxury hotels in China to design and implement employee retention schemes that uphold these three important aspects, which justify employees’ decision to renounce their positions.


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