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How will empowered and customer-oriented employees respond to customers’ special requests under different relationship contexts in the hotel industry in China BY ZHAI YANG 09051643 Marketing Concentration An Honours Degree Project Submitted to the School of Business in Partial Fulfilment of the Graduation Requirement for the Degree of Bachelor of Business Administration (Honours) Hong Kong Baptist University Hong Kong April 2013

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How will empowered and customer-oriented employees

respond to customers’ special requests

under different relationship contexts

in the hotel industry in China

BY

ZHAI YANG

09051643

Marketing Concentration

An Honours Degree Project Submitted to

the School of Business in Partial Fulfilment

of the Graduation Requirement for the Degree of

Bachelor of Business Administration (Honours)

Hong Kong Baptist University

Hong Kong

April 2013

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Acknowledgement

First and foremost, I want to say that, I can hardly express my hearty gratitude

and sincere appreciation to my supervisor, Dr. Henry Fock, for his edification,

inspiration and invaluable advices. With his expertise in marketing, Henry inspired

me to strive for the best in this study and generously gave me assistance throughout the

whole research process.

Also, I would like to express my thankfulness to all the staffs in Hong Kong

Baptist University who taught me a lot. Together with these experienced teachers, I

have enjoyed an unforgettable university life here.

In addition, I would also like to thank my respondents who contributed a lot in

my data collection process. Without their cooperation, I would not be able to complete

this study smoothly.

Last but not least, I must sincerely thank my dearest parents who support and

encourage me all the time!

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Executive Summary

Although it is explained by the western literature that empowerment practices

and customer-orientation tend to positively influence employee’s intention to satisfy

customers’ special requests, the issue of how these two factors will influence Chinese

service employees under different business and personal relationship contexts still

remains under-researched.

This study probes into the joint effects of relationship nature, perception of

customer profit potential, employee empowerment and customer-orientation, on

service employees’ intention to comply with special requests from customers.

To achieve my research objective, a field study was conducted with participation

of 151 frontline employees from three Chinese hotels. Findings indicate that

empowerment has positive effect on employees’ intention to comply with special

requests from customers with high profit potential. Conversely, when frontline

employees are handling special requests from customers with low profit potential, the

relationship nature between the employee and customer qualifies the effect of

customer-orientation on the compliance intention. Specifically, the effect of

customer-orientation on employees’ compliance intention is significant when they are

in personal relationship.

Moreover, the results show that when the customer only has low profit potential,

empowerment practices could make employees to stand on company’s best interests

even when the customer has a personal relationship with the employee. Thus,

managers of Chinese employees should pay more attention to the use of

empowerment practices.

Last, empowerment practices and customer-orientation attitude cannot generate

significant effect on employee’s intention to accommodate special requests from

customers of low profit potential in business relationship.

After discussing the findings, managerial implications and advices for future

research are offered.

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Tables of Contents:

Executive Summary .................................................................................................. i

List of Tables ........................................................................................................... iii

List of Figures ......................................................................................................... iv

1. Introduction .......................................................................................................... 1

1.1 Importance of Services Industry .................................................................... 1

1.2 Empowerment as a Solution to the Difficulty of Service Employees ........... 1

1.3 Customer-orientation of Service Employees ................................................. 2

1.4 Profit Potential of Customers ......................................................................... 4

1.5 Relationship Nature Between Customers and Employees ............................. 4

1.6 Toward a Research Agenda ........................................................................... 5

2. Literature Review ................................................................................................. 6

2.1 Empowerment ................................................................................................ 6

2.2 Customer-orientation ..................................................................................... 7

2.3 Profit Potential of Customer .......................................................................... 9

2.4 Relationship Nature ..................................................................................... 11

3. Methodology ...................................................................................................... 16

3.1 Design .......................................................................................................... 16

3.2 Scenarios ...................................................................................................... 17

3.3 Manipulation Checks ................................................................................... 19

3.4 Dependent Measurement ............................................................................. 19

3.5 Other Measurements .................................................................................... 20

3.6 Reliability and Validity ................................................................................ 20

4. Results and Discussion ....................................................................................... 26

4.1 Results of Repeated Measures ANOVA ...................................................... 26

4.2 Nested Structural Equation Models ............................................................. 30

5. Discussion and Implications ............................................................................... 41

5.1 Discussion of Path Analysis Results of Individual Scenario ....................... 41

5.2 Discussion of Analysis Results of Nested Structural Equation Models ...... 45

5.3 General Discussion and Theoretical Contribution ....................................... 48

5.4 Managerial Implications .............................................................................. 49

6. Limitations and Future Research ........................................................................ 51

References .............................................................................................................. 54

Appendix 1: Questionnaires ................................................................................... 59

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List of Tables:

Table 1.1 Confirmatory Factor Analysis for Scenario 1 ................................................. 21

Table 1.2 Confirmatory Factor Analysis for Scenario 2 ................................................. 22

Table 1.3 Confirmatory Factor Analysis for Scenario 3 ................................................. 23

Table 1.4 Confirmatory Factor Analysis for Scenario 4 ................................................. 24

Table 2.1 Results of Analysis of Variance for H1........................................................... 26

Table 2.2 Results of Analysis of Variance for H2 and H3 .............................................. 28

Table 2.3 Experiment Cell Means: Compliance Intention ............................................. 29

Table 3 Fit Statistics of Baseline Models ..................................................................... 36

Table 4.1 Chi-square Difference Test for H1 .................................................................. 38

Table 4.2 Chi-square Difference Test for H2 .................................................................. 39

Table 4.3 Chi-square Difference Test for H3 .................................................................. 40

Table 4.4 Chi-square Difference Test for the Interaction Term ...................................... 48

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List of Figures:

Figure 1.1 The Theoretical Framework for Hypothesis 1………………….... 11

Figure 1.1 The Theoretical Framework for Hypothesis 2 & 3………………. 15

Figure 2.1 Path Analysis of Scenario 1:

Personal Relationship, High Customer Profit Potential…………..

32

Figure 2.2 Path Analysis of Scenario 2:

Business Relationship, High Customer Profit Potential………….

33

Figure 2.2 Path Analysis of Scenario 3:

Personal Relationship, Low Customer Profit Potential…………..

34

Figure 2.2 Path Analysis of Scenario 4:

Business Relationship, Low Customer Profit Potential…………..

35

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1. Introduction

1.1 Importance of Services Industry

Service industry drives the sustainable economic growth (Donovan, 1963).

Currently, there has been a lively interest in the development of service industry in

China as well.

Pertaining to the service industry, it is widely held that customer’s satisfaction

and service organization’s profitability have a strong correlation with the quality of

service provided by frontline employees (Crosby, Evans, & Cowles, 1990; Heskett,

Jones, Loveman, Sasser, & Schlesinger, 1994). Thus, accurately identifying the

driving forces of enhancing service quality and properly managing these driving

forces are of paramount importance.

1.2 Empowerment as a Solution to the Difficulty of Service Employees

Usually, rules and regulations are utilized by the management to maintain and

improve operational efficiency of employee services while unique and customized

services are emphasized by more demanding customers nowadays. As

boundary-spanners, service employees not only have to abide by those rules and

regulations, but also need to be customer-oriented and fulfill various customers’

needs. In order to ease the tensions of boundary spanning employees who are torn

between organizational rules and customer requests, empowerment becomes a

popular management intervention (Fock, Chiang, Au, & Hui, 2011).

Empowerment, defined as providing employees with discretion and autonomy in

connection with their work, has drawn increasingly more attention from researchers

and practitioners (Kanter, 1979; Neilsen, 1986; Hui, Au, & Fock, 2004a).

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Empowerment has been widely accepted as an effective mean by which service

managers can improve the job performance and satisfaction of their frontline staff.

It is generally thought that empowerment plays a pivotal role in improving

organizational effectiveness, and enhancing service performance (Kanter 1979;

Bennis & Nanus, 1985; Hartline & Ferrell, 1996).

1.3 Customer-orientation of Service Employees

In addition to empowerment practices, past studies have found that

customer-orientation of frontline employees could influence the quality of service

provided and the fulfillment of customers’ needs as well. Customer-orientation is

defined as a continuous, proactive disposition of meeting customer exigencies and

focusing on customer satisfaction (Han, Kim, & Srivastrava, 1998). It was found that

frontline employees who are highly customer-oriented have higher concern for others.

Yet, employees with low customer-orientation show low concern for others but high

concern for themselves (Dubinsky & Staples, 1981; Saxe & Weitz, 1982). Evidence

abounds to suggest that customer-orientation positively influences employees’

performance and customers’ satisfaction (Goff, James, Danny, & Carrie, 1997;

Keillor, Parker, & Pettijohn, 1999; Sharma, Nikolaos, Michael, & Panagiotis, 1999;

Brown, John, Todd, & Jane, 2002).

Thus, it has been held that empowerment and customer-orientation are

positively correlated with frontline employees’ service performance. Empowered and

customer-oriented staffs tend to better cater to and better fulfill various customers’

needs in different encounters.

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However, to a large extent, these widely held viewpoints do not always work in

reality, especially in China. A few studies have found that high empowerment does

not necessarily mean that the empowered employees would exercise their power (Hui

et al., 2004a). In nations with high power distance and unequal power distribution,

frontline employees may feel nervous and ambiguous in accepting and exercising

discretionary power to satisfy customers’ unique needs (Robert, Probst, Martocchio,

Drasgow, & Lawler, 2000; Fock, Hui, Au, & Bond, 2013).

Whereas prior research in the western societies show that empowered

employees tend to be more customer-oriented and more likely to engage in

pro-customer behaviors (Peccei & Rosenthal, 2001), recent research evidence reveal

that in China, even in some industries which highly emphasize customer-orientation,

such as hotel and catering industries, the Chinese frontline employees are not always

willing to accommodate customers’ special requests (Hui, Au, & Fock, 2004b). They

tend to be reluctant to offer help to customers in need in some conditions. Hence,

some other factors may also influence the effects of customer-orientation and

empowerment on employees’ behavior in service encounters. This phenomenon

implies a knowledge gap which cannot be explained by current literatures.

Now and then, some viewpoints raised by western literatures, even some classic

ones, have shown a few of problems in explaining some phenomenon in Chinese

culture context (Smith & Bond, 1999). Some of those literatures also found the

unique effect of Chinese culture on Chinese employees working behaviors (Hofstede,

1980; Trompennars & Hampden-Turner, 1997).

In view of the above knowledge gap and the uniqueness of Chinese cultures, I

argue that the viewpoints held by previous studies would not necessarily work in

China. In this research, I propose two boundary conditions, namely profit potential of

customer and the nature of relationship between the employee and the customer, in

explaining the effect of customer-orientation and empowerment on Chinese

employees’ intention to comply with customers’ special requests.

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1.4 Profit Potential of Customers

Pertaining to the profit potential of customers, to obtain the maximum profit

potential of every customer relationship is supposed to be the primary goal of every

firm. One of the ways to earn the full profit is to extend the business relationship life

of every customer; to keep those desired customer behaviors for a longer period of

time. Firms identify customers that have the highest potential of profit-improvement.

Then, firms tend to orient every function to keep these customers and maximize the

profitability from them. Value exchange, namely the relationship between the

investments a business devotes into a particular customer relationships and the

pay-back generated by the customer tends to be cared and optimized by businesses

(Grant & Schlesinger, 1995; MacMillan & McGrath, 1996).

1.5 Relationship Nature Between Customers and Employees

Previous studies have found that employees may vary their responses to

customer’s special requests basing on the identity of the customer. It is generally

believed that people will take care of in-group members’ welfare ahead of others

(Cialdini, Wosinska, Barrett, Butner, & Gornik-Durose, 1999; Bove & Johnson, 2001;

Verbeke & Bagozzi, 2001). This behavior is regarded as social norms and obligations

to in-group members. To a large extent, it is natural that employees have to face more

pressure to fulfill the needs of customers with whom they have a closer relationship

(Hui et al., 2004b).

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1.6 Toward a Research Agenda

Take above all into consideration, this paper attempts to clarify on what

empowered and customer-oriented frontline employees would do when dealing with

special requests raised from customers under different customer relationships and

different perceptions of customers’ profit potential in China, to fill in the knowledge

gap which could not be explained by current literatures.

Moreover, findings of this study could make contributions to the real-life service

practices as well. With the research findings, service managers could obtain insights

on how to effectively identify and manage the causes of Chinese employees’ different

responses in dealing with customers’ special requests. Thus my study could facilitate

the enhancement of service quality and fulfillment of customer’s needs, which would

be beneficial for increasing customers’ satisfaction and firm’s profitability (Crosby et

al., 1990; Heskett et al., 1994).

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2. Literature Review

2.1 Empowerment

Now and then, employees, especially service employees who serve in boundary

spanning situation are required to accommodate customers’ various unique requests

(Bitner, Booms, & Tetreault, 1990; Mittal & Lassar, 1996). Therefore, a more flexible

system could be advantageous in service provision. Yet, Companies tend to utilize

rules and regulation to standardize employees’ behaviors and ensure smooth

coordination of operations (Mintzberg, 1979). This could pose restrictions on

employees’ autonomy and service flexibility, could bring about more rigidity to the

system.

However, to solely rely on rules and regulations cannot be effective to deliver

premium service to customers in this era of demanding customers (Kelley,

Longfellow, & Malehorn, 1996). Empowerment, which is providing service

employees with autonomy and discretion, can enhance service performance while

facilitate the fulfillment of customers’ unique needs (Bowen & Lawler, 1992).Thus,

higher customer satisfaction can be achieved.

Yet, even though empowerment provide employees with more autonomy and

discretion, whether the employees would utilize their discretionary power to satisfy

customers’ special requests depends on employees’ willingness to accept and exercise

their power and their motivation to satisfy customers’ needs in the service encounters

(Hui et al., 2004b). Prior studies have found that empowerment may barely or even

negatively affect employees’ job behaviors as well (Robert et al., 2000).

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In addition, for example, Hui et al. (2004a) have suggested that in nations with

high power distance, like Mainland China and Malaysia, the practice of discretionary

empowerment should be adopted cautiously. Since this practice may be inconsistent

or even contradictory with the culture of institutional hierarchy in these high

power-distance countries, frontline employees there may feel uncomfortable and

reluctant to accept and exercise discretionary power in satisfying customers’ needs

which are actually not beneficial to the firm (e.g., more discounts, extra breakfast).

2.2 Customer-orientation

The positive effect of frontline employees’ customer-orientation exerted on the

quality of service provided and the fulfillment of customers’ needs has been found by

past studies. Customer-orientation refers to a disposition to continuously deliver

superior value to customers, to proactively and attentively fulfill customers’ needs,

meet customer exigencies (Slater & Narver, 1994; Han et al., 1998).

Practitioners and researchers commonly agree that the quality of service

provided tends to rely on frontline employees’ customer-oriented job behaviors

(Zeithaml, Berry, & Parasuraman, 1988; Rucci, Kirn, & Quinn, 1998). Prior

researchers have found that customer-oriented frontline employees and salespeople

tend to pay attention to identify and cater to the needs and problems of customers

(Han et al., 1998). These boundary-spanners tend to refrain from taking actions that

would just increase the short-term profitability at the expense of sacrificing

customers’ benefits (Dubinksy & Staples, 1981; Saxe & Weitz, 1982). Several studies

also found that customer-orientation can positively influences employees’

performance (Keilor, Parker, & Pettijohn, 2000; Boles, Babin, Brashear, & Brooks,

2001; Brown et al., 2002). Moreover, frontline employees’ customer-oriented attitude

and behaviors positively influences customers’ overall satisfaction in the service

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encounters, which in return influences customers’ satisfaction with the service or

product provided (Humphreys & Williams, 1996; Goff et al., 1997; Sharma et al.,

1999).

In addition, previous study has found that customer-oriented frontline employees

generally show high concern for others. Conversely, frontline employees with low

customer-orientation normally have low concern for other people but higher concern

for themselves (Saxe & Weitz, 1982). More importantly, past literatures have found

that positive relationships exist between frontline employees’ customer-oriented

behaviors and these employees’ perceptions of their relationship with customers as

well as their intention to help customers (Saxe & Weitz, 1982; Schwepker Jr, 2003).

Yet, some cases in Chinese service industry cannot be clearly explained by the

findings of current western literatures. In a few of services industries which highly

emphasized customer-orientation, like hospitality industry, frontline service

employees are not willing to help customers with their special requests (e.g., Magnini

& Ford, 2004; Du, Fan, & Feng, 2010).

Since customer-orientation and empowerment cannot necessarily exert the same

effects on Chinese frontline employees’ job behaviors in meeting customers’ special

requests as explained by prior researchers, I postulate two boundary conditions,

customers’ profit potential and nature of customer relationship, which could impact

the effects of customer-orientation and empowerment suggested by current western

literatures. Next part, literatures reviews about the two boundary conditions

mentioned above are presented.

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2.3 Profit Potential of Customer

One of the fundamental goals of every business is to gain profit as much as

possible from each customer relationship. In addition to acquiring new customers,

one of the ways to earn the full profit potential is to extend the life of every customer

relationship; to keep those enhanced customer behaviors for a longer time.

Businesses, like Federal Express Corporation, Bank of America have categorized its

customers into different groups based on their profitability. Then service providers

devote different extent of efforts into different groups classified on their own.

Current businesses have found that not all customers deserve equally good

service. Offering different service to customers according to their profitability is

actually effective and profitable. To serve all customers with premium service and to

satisfy customers various needs are not only unprofitable but also impractical

(Zeithaml, Rust, & Lemon, 2001).

Value exchange, namely the relationship between the investments a business

makes in particular customer relationships and the pay-back generated by the

customer tends to be emphasized and optimized by businesses. Then, firms are

attempting to identify the customers that have the highest potential of

profit-improvement. After that, businesses devote more efforts into these profitable

customers, integrate and orient every function to maximize the profit earned from

these groups.

Thus, to adjust service in accordance with customers’ levels of profitability is

advantageous for the firm to be clear about the linkage between service quality and

profitability, thereby enabling the firm to optimally allocate scarce resources (Grant

& Schlesinger, 1995; MacMillan & McGrath, 1996).

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As mentioned in the above literature review, to successfully implement

empowerment practice, frontline employees have to accept and exercise their

discretionary power and should be motivated to accommodate customers’ needs when

facing customers’ special requests (Hui et al., 2004a). Therefore, in my research, I

propose that frontline employees will have motivation to make use their discretionary

power to meet special requests raised by customers whose profit potential is high.

The rationale is, to preferentially treat special requests of high profit potential

customers is beneficial for retention of this type of customers (Grant & Schlesinger,

1995; Cannon & Homburg, 2001; Wulf, Odekerken-Schroder, & Iacobucci, 2001), is

congruent with the long-term benefits of the firm, which gives a legitimate

motivation for the empowered frontline employee to exercise their discretionary

power. Furthermore, both acquiring a new customer with high profit potential and

retaining a patron with high profit potential are beneficial not only to the firm but

also to the employees’ individual interests (e.g., achievement of better performance

and higher bonus), which gives the empowered employee more incentives to use

power to satisfy customers’ needs.

Conversely, to devote more into customers with low profit potential is normally

not consistent with the interests of the firm and not beneficial to both the firm and the

employees themselves. Lack of motivation normally would prevent frontline

employees from meeting customers’ extra requests.

I therefore hypothesize that:

H1: The effect of empowerment exerted on employees’ compliance

intention will be more pronounced when the customer’s profit potential is high

than when it is low.

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Employee’s

Compliance

Intention

Employee

Perceived

Empowerment

Customer

Profit

Potential

H1

Figure 1.1 The Theoretical Framework for Hypothesis 1

2.4 Relationship Nature

2.4.1 Relational Norms

Researchers have found that employees may have different responses toward

customer’s special requests basing on the identity of the customer. It is generally

found that people tend to prioritize in-group members’ interests (Cialdini et al., 1999;

Bove & Johnson, 2001; Verbeke & Bagozzi, 2001). It is inevitable that service

employees have to face more pressure to accommodate the needs of customers with

whom they have a closer relationship (Hui et al., 2004b). This type of preferential

treatment is actually regarded as requirement of norms and obligations to in-group

members.

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Norms serve as guiding principles; they help people to decide which one is the

right way to go in a specific situation. People adhere to norms. They consider norms

when determining the value of an object instead of just focusing on the maximization

of economic utility (Johar, 2005).

Norms associated with relationships would be activated, so that relational

frames could affect value. Exchanges could be affected by those relational norms,

due to the social identities people tend to convey (Kahneman & Miller, 1986). The

different perception of a relationship would inevitably exert different effects on an

individual’s corresponding responses toward this relationship.

For example, imagine that you were a front desk staff in a hotel. One day a

customer with whom you have a certain kind of relationship comes to you, and he

asks you for more discounts, which is doable for you, yet with possibility of violating

organizational rules. At this moment, the nature of this relationship would

undoubtedly affect your responses toward this special request.

2.4.2 Communal and Exchange Relationships

Previous research has used behavior norms to identify two different

relationships; they are exchange relationships and communal relationships (Clark &

Mills, 1979, 1993). In exchange relationships, the purpose of interacting with other

people is to get benefits from exchange with others, people care a lot about what they

can receive for what they give (Clark & Mills, 1993, c.f. Aggarwal & Zhang, 2006).

Benefits are given “with the expectation of receiving a comparable benefit in return

or as repayment for a benefit received previously” (Clark & Mills, 1993, p.684).

Strangers and business partners are the best examples of this kind of relationship

(Aggarwal & Zhang, 2006).

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Yet, in communal relationships, “the norm is to give benefits in response to

needs, or to demonstrate a general concern for the other person…the receipt of a

benefit does not change the recipient’s obligation to respond to the other’s needs”

(Clark & Mills, 1993, p.684). People involved in this relationship genuinely concern

others’ well-being. Most close relationships, especially family relationships are the

typical examples of this sort of relationship (Aggarwal & Zhang, 2006).

Hence, these two kinds of relationships are characterized by norms that exert

effects on people’s expectation for others’ behavior and their corresponding reactions

to the actual behavior of others (Wan, Hui, & Wyer, 2011). According to Aggarwal &

Zhang (2006), salient relationship norms “serve as a lens through which people view

the world and guide their subsequent behavior.

More importantly, there is a second difference between these two kinds of

relationships, which is one of the focal points of my study as well. For an exchange

relationship, norms that govern transactions tend to be established. The expectations

and obligations in this kind of relationship are clearly held by both parties. However,

in a communal relationship, the expectations and obligations perceived by both

parties are depending. The perspective from which individuals think of this

relationship could make a huge difference (Wan et al., 2011). On one hand, an

individual may expect their counterparts to be sensitive to his own needs and

difficulties. On the other hand, he may view the relationship from counterparts’ angle,

so that to understand and cater to counterparts’ difficulties and needs (Aggarwal &

Zhang, 2006). Normally, people tend to feel obliged to care people in difficulty and

need. This phenomenon of human nature is usual in reality. In addition, according to

Wan, Hui, & Wyer (2011), the above situation would be complicated due to the

reason that attention to an individual’s own needs in a communal relationship would

make the other party’s obligation to take care of these needs salient at the same time.

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In a service encounter, it is conceivable that this kind of situation can occur.

Given that there may be a communal relationship between the service employee and

the customer (e.g. may be employee’s close friends, comrade-in-arms), whether this

service employee pays more attention to their own (self-obligation) or this customer’s

obligation (other-obligation), whether he view this relationship from the angle of his

own needs (other-obligation) or from customer’s angle (self-obligation) could

generate largely different effects on this employee’s responses. Wan, Hui, & Wyer’s

(2011) study has found that these two different perspectives could largely influence a

customer’s response toward a service failure which is made by his “communal”

service provider.

In this study, I postulate that the activation of service employees’ perspective of

self-obligation and other-obligation will be largely influenced by the customer’s

financial situation, because people tend to care people in need and difficulty.

Considering the literatures about customer-orientation, customer-oriented

frontline employees normally show high concern for others. Conversely, frontline

employees with low customer-orientation normally have low concern for other

people but higher concern for themselves. Accordingly, positive correlations are

expected between frontline employees’ customer-oriented behaviors and these

employees’ perceptions of their relationship with customers as well as their intention

to help customers (Dubinsky & Staples, 1981; Saxe & Weitz, 1982).

Hence, my second and third hypotheses are formulated as follows:

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H2: The effect of customer-orientation exerted on employees’ compliance

intention will be more pronounced when employees perceived the relationship

with the customers as a personal relationship than when they perceive the

relationship as a business one.

H3: The effect of customer-orientation exerted on employees’ compliance

intention will be the most pronounced when employees perceived the

relationship with the customers as a personal relationship and the customer is in

need and difficult.

Employee’s

Compliance

Intention

Customer-

orientation

Customer

Profit

Potential

Relationship

Nature

H3

H2

Figure 1.2 The Theoretical Framework for Hypothesis 2 & 3

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3. Methodology

3.1 Design

To manipulate business contexts with customers of different profit potentials and

relationship natures, quasi-experimental design was adopted in my study.

Qusai-experimental design has high control on confounding influences as well as

advantages of realism. The quasi-experiment is a 2 (customer profit potential: high vs.

low) × 2 (relationship nature: personal vs. business) within–subject factorial design.

The antecedents of levels of perceived empowerment and customer-orientation are

measured. One hundred and fifty one employees from three different hotels of a hotel

group took part in this experiment. All respondents were required to read the four

experiment scenarios and responded to the respective dependent measures (two

scenarios in one time slot within a two-week period). The choice of practicing

frontline employees in real-life market place as my research respondents was to

enhance realism.

These scenarios were included in three sets of questionnaires which were

distributed to the employees in three different time slots. I introduced a time lag of

four days between the distribution of each set of questionnaires to achieve the effect

of temporal separation, so that my study could overcome the problem of common

method as much as possible (Johnson, Rosen, & Djurdjevic, 2011). Moreover, all

respondents were asked to fill in their answers and put the completed questionnaires

in a sealed envelope to ensure confidentiality and avoid social desirability bias.

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Measurement items in all three sets of my questionnaires were originally

composed in English. A back-translation procedure was adopted to assure language

equivalence between the Chinese and English versions. I translated the English

version into Chinese and was then back translated by a doctoral student in Hong

Kong (Brislin, 1980). Discrepancies between the original version and back-translated

version were edited and improved. The syntax and grammar in the Chinese version

were reviewed as well, to make sure the wording was in the local dialect of

respondents.

3.2 Scenarios

I used scenario experiments in my study. In terms of researches on service

encounters, scenario experiments tend to be applied, and this kind of experiment do

have some inherent benefits (Bateson & Hui, 1992; Smith, Bolton, & Wagner, 1999;

Baker, Parasuraman, Grewal, & Voss, 2002).

In the four scenarios, customer’s profit potential was operationalized as whether

the customer’s financial situation was perceived by the frontline employee as good or

bad. Good financial situation or operating situation indicated high profit potential;

conversely, bad financial situation or operating situation indicated low profit potential.

Relationship nature was operationalized as whether the customer was an old

classmate of the employee or a regular client. The relationship with an old classmate

was regarded as a personal relationship, and the relationship with a regular client was

regarded as a business relationship. The following contents are two scenarios for the

conditions when the profit potential is high. The first one is for the condition when

the relationship is perceived as a personal one, and the second one is for the business

relationship. (Explanations in brackets are for the manipulation of the low profit

potential conditions):

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In Star Hotel (a fictitious name), every staff is required by the management

to try hard to fulfill customers’ various needs and earn more profits for the firm.

You are one of the front desk staffs.

One of the front desk staff’s responsibilities is handling room reservation.

Every front desk staff is empowered by the management to offer appropriate

discounts to prospects for attracting more customers.

Scenario for condition of Personal Relationship:

One day, you are on your shift at the front desk. Chen Ming, your old

classmate (for manipulation of personal relationship), comes to you. Chen Ming

owns a couple of companies which are running very well and leads an affluent

life. (In condition of low profit potential: Chen Ming now is working at a very

small company. You heard from other classmates that Chen’s company is not

running very well recently, and Chen’s life is difficult.)

After a small chat, Chen Ming tells you that he wants to book two rooms,

and asks you for some more discounts.

Scenario for condition of Business Relationship:

One day, you are on your shift at the front desk. A customer comes to you.

He tells you that he is the representative of Excellence Company (for

manipulation of business relationship). Star Hotel used to do business with

Excellence Company, and Excellence Company usually makes room

reservations in Star Hotel. During the past 3 years, you are the one who handles

Excellence Company’s room-booking. It has been very nice to do business with

Excellence Company and your experience of dealing with Excellence Company

is pleasant.

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As you know, Excellence Company is running very well all the time. (In

condition of low profit potential: As you know, Excellence Company is running

very badly recently.)

This time this representative of Excellence Company wants to book 5

rooms and he asks you for more discounts, considering that Excellence

Company is a patron.

3.3 Manipulation Checks

After reading each of the four scenarios, the respondents were asked to answer

several questions which included two measures to check the effectiveness of the

manipulations: (1) whether employees perceived that the customer was in good

financial or operating condition; and (2) whether the employee’s relationship with the

customer was a personal relationship or a business relationship (see Appendix 1 for

details). Manipulation of these two measures indicated that both the profit potential

and the relationship nature manipulation were very effective (100% of 151

employees chose the right answers accord with the corresponding scenario). Thus,

the experiment design was considered as an effective one.

3.4 Dependent Measurement

After 2 measures of manipulation check, every scenario also consisted of a set

of dependent measures. There were 4 measures of service employee’s intention to

comply with customer’s special request (to offer more discounts). Two of them were

direct measures of employee’s compliance intention while the other two were

projective measure of employee’s compliance intention (please refer to Appendix 1).

All four measures of compliance intention were adopted from Hui et al. (2004b). The

items used six-point semantic-differential items.

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3.5 Other Measurements

Measures of the two antecedents, namely employee perceived empowerment

and customer-orientation, were tapped in the third questionnaires. I gauged the

antecedents in a separate questionnaire after all other measures to ensure that the

respondents would not be able to answer the dependent measures with reference to

the antecedent measures. This design helps further reduce the possibility of common

method variance (Johnson et al. 2011). Employee’s perceived empowerment was

assessed with three items adopted from the self-determination scale in Spreitzer’s

(1995) study. Employee’s perception of customer-orientation was measured by five

items adopted from Han et al. (1998). For each item, the respondents indicated their

agreement on a 6-point Likert-type scales ranging from 1 (Stongly Disagree) to 6

(Strongly Agree). In addition, demographic variables include gender, education and

working experience in current hotel were included as control variables in the analysis

to control for possible confounding effects. (for the details of these measurement

items, please refer to Appendix 1)

3.6 Reliability and Validity

I examined the psychometric properties of the three measures by putting all the

12 measurement items into a confirmatory factor analysis with LISREL 8.4 before

fitting the data into subsequent analyses. The CFA results indicated an acceptable fit

of the 3-factor measurement model for all four scenarios (Scenario 1: χ² = 116.75, d.f.

= 51, p < .001; CFI = .94; NNFI = .92; RMSEA = .093; Scenario 2: χ² = 88.3, d.f. =

51, p < .001; CFI = .96; NNFI = .95; RMSEA = .070; Scenario 3: χ² = 88.33, d.f. =

51, p < .001; CFI = .96; NNFI = .94; RMSEA = .070; Scenario 4: χ² = 80.75, d.f. =

51, p < .01; CFI = .96; NNFI = .95; RMSEA = .062). The convergent validity of

customer-orientation is demonstrated (please refer to Table 1).

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Table 1.1 Confirmatory Factor Analysis

(Scenario 1: Personal Relationship, High Profit Potential; N=151)

Item Description Standardized

Loading T-Value CR AVE

Employee’s Compliance Intention (CI) 0.96 0.84

Are you inclined to offer more discounts to Chen Ming 0.88 15.34

Are your real-life colleagues inclined to offer more discounts

in similar situations (offer more discounts to rich old

classmates)?

0.88 15.20

Will you offer more discounts to Chen Ming at last 0.77 13.70

Will your real-life colleagues offer more discounts in similar

situations at last (offer more discounts to rich old

classmates)?

0.81 14.02

Perceived Empowerment (EM) 0.79 0.56

I have significant autonomy in determining how I do my job. 0.48 8.56

I can decide on my own how to go about doing my work. 0.67 10.32

I have considerable opportunity for independence and freedom

in how I do my job. 0.53 9.20

Customer-orientation (CO) 0.70 0.31

Our business objectives are driven by customer satisfaction. 0.35 6.43

We closely monitor and assess our level of commitment in

serving customers’ needs. 0.28 5.72

Our competitive advantage is based on understanding

customers’ needs. 0.25 5.39

Business strategies are driven by the goal of increasing

customer value. 0.29 5.85

We pay close attention to after-sale service. 0.40 6.92

χ² 116.75 (d.f. = 51, p < .001)

RMSEA .093

CFI .94

NNFI .92

Mean, Standard Deviation, and PHI Correlation Matrix

Mean SD CI EM CO

CI 3.87 1.09 1.00

EM 3.82 0.97 0.34* 1.00

CO 4.90 0.54 -0.01 0.23 1.00

Note. CR = Composite Reliability; AVE = Average Variance Extracted

*p < .05; **p < .01

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Table 1.2 Confirmatory Factor Analysis

(Scenario 2: Business Relationship, High Profit Potential; N=151)

Item Description Standardized

Loading T-Value CR AVE

Employee’s Compliance Intention (CI) 0.94 0.80

Are you inclined to offer more discounts to Excellence

Company? 0.74 13.12

Are your real-life colleagues inclined to offer more discounts

in similar situations (offer more discounts to regular clients

who are doing well)?

0.79 13.80

Will you offer more discounts to Excellence Company at

last? 0.81 14.17

Will your real-life colleagues offer more discounts in similar

situations at last (offer more discounts to regular clients

who are doing well)?

0.83 14.45

Perceived Empowerment (EM) 0.79 0.56

I have significant autonomy in determining how I do my job. 0.46 8.46

I can decide on my own how to go about doing my work. 0.69 10.33

I have considerable opportunity for independence and

freedom in how I do my job. 0.53 9.01

Customer-orientation (CO) 0.70 0.31

Our business objectives are driven by customer satisfaction. 0.35 6.41

We closely monitor and assess our level of commitment in

serving customers’ needs. 0.29 5.87

Our competitive advantage is based on understanding

customers’ needs. 0.25 5.36

Business strategies are driven by the goal of increasing

customer value. 0.28 5.77

We pay close attention to after-sale service. 0.40 6.94

χ² 88.3 (d.f. = 51, p < .001)

RMSEA .07

CFI .96

NNFI .95

Mean, Standard Deviation, and PHI Correlation Matrix

Mean SD CI EM CO

CI 4.19 0.92 1.00

EM 3.82 0.97 0.19 1.00

CO 4.90 0.54 -0.11 0.23* 1.00

Note. CR = Composite Reliability; AVE = Average Variance Extracted

*p < .05; **p < .01

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Table 1.3 Confirmatory Factor Analysis

(Scenario 3: Personal Relationship, Low Profit Potential; N=151)

Item Description Standardized

Loading T-Value CR AVE

Employee’s Compliance Intention (CI) 0.91 0.72

Are you inclined to offer more discounts to Chen Ming? 0.71 12.44

Are your real-life colleagues inclined to offer more discounts

in similar situations (offer more discounts to old classmates

in difficulty)?

0.69 12.17

Will you offer more discounts to Chen Ming at last? 0.76 13.18

Will your real-life colleagues offer more discounts in similar

situations at last (offer more discounts to old classmates in

difficulty)?

0.71 12.37

Perceived Empowerment (EM) 0.79 0.56

I have significant autonomy in determining how I do my job. 0.46 8.42

I can decide on my own how to go about doing my work. 0.71 10.36

I have considerable opportunity for independence and

freedom in how I do my job. 0.52 8.83

Customer-orientation (CO) 0.70 0.31

Our business objectives are driven by customer satisfaction. 0.44 7.42

We closely monitor and assess our level of commitment in

serving customers’ needs. 0.28 5.87

Our competitive advantage is based on understanding

customers’ needs. 0.24 5.42

Business strategies are driven by the goal of increasing

customer value. 0.25 5.49

We pay close attention to after-sale service. 0.34 6.45

χ² 88.33(d.f = 51, p < .001)

RMSEA .07

CFI .96

NNFI .94

Mean, Standard Deviation, and PHI Correlation Matrix

Mean SD CI EM CO

CI 4.35 0.79 1.00

EM 3.82 0.97 -0.001 1.00

CO 4.90 0.54 0.41** 0.22 1.00

Note. CR = Composite Reliability; AVE = Average Variance Extracted

*p < .05; **p < .01

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Table 1.4 Confirmatory Factor Analysis

(Scenario 4: Business Relationship, Low Profit Potential; N=151)

Item Description Standardized

Loading T-Value CR AVE

Employee’s Compliance Intention (CI) 0.91 0.73

Are you inclined to offer more discounts to Excellence

Company? 0.62 11.34

Are your real-life colleagues inclined to offer more discounts

in similar situations (offer more discounts to regular clients

who are doing badly)?

0.72 12.56

Will you offer more discounts to Excellence Company at

last? 0.76 13.18

Will your real-life colleagues offer more discounts in similar

situations at last (offer more discounts to regular clients

who are doing badly)?

0.79 13.68

Perceived Empowerment (EM) 0.79 0.56

I have significant autonomy in determining how I do my job. 0.48 8.50

I can decide on my own how to go about doing my work. 0.69 10.25

I have considerable opportunity for independence and

freedom in how I do my job. 0.52 8.92

Customer-orientation (CO) 0.70 0.31

Our business objectives are driven by customer satisfaction. 0.36 6.53

We closely monitor and assess our level of commitment in

serving customers’ needs. 0.28 5.78

Our competitive advantage is based on understanding

customers’ needs. 0.25 5.40

Business strategies are driven by the goal of increasing

customer value. 0.28 5.80

We pay close attention to after-sale service. 0.38 6.84

χ² 80.75 (d.f. = 51, p < .01)

RMSEA .062

CFI .96

NNFI .95

Mean, Standard Deviation, and PHI Correlation Matrix

Mean SD CI EM CO

CI 3.85 0.77 1.00

EM 3.82 0.97 0.04 1.00

CO 4.90 0.54 -0.14 0.23* 1.00

Note. CR = Composite Reliability; AVE = Average Variance Extracted

*p < .05; **p < .01

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Moreover, the composite reliabilities (CR) for empowerment,

customer-orientation and compliance intention were all above 0.70 in all scenarios. In

addition, the variance extracted (AVE) was adequate for the constructs of

empowerment and compliance intention in 4 scenarios, customer-orientation’s

variance extracted (AVE) was just marginally acceptable (AVE=0.31 in four

scenarios). Yet, the squared correlations between any pair of factors were still smaller

than the respective AVEs. Thus, discriminant validity was demonstrated.

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4. Results and Discussion

4.1 Results of Repeated Measures ANOVA

4.1.1 Empowerment Effects in Different Contexts

To test the hypothesis H1 and compare the effects of empowerment on the

compliance intention of employees across the four experimental conditions, a

repeated-measures ANOVA was conducted. A summary of results is given in Table

2.1.

Table 2.1 Results of Analysis of Variance for H1

Model/source

DV = Compliance Intention

F(1,150)

Main effects

Relationship Nature .33

Profit Potential 8.17**

Empowerment 11.29**

Two-way interaction

Relationship Nature * Profit Potential 13.80***

Relationship Nature * Empowerment .82

Profit Potential * Empowerment 7.39**

Three-way interaction

Relationship Nature * Profit Potential * Empowerment 4.24**

*p < .1

**p < .05

***p < .001

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Table 2.1 showed that the main effect of empowerment [F(1,150) = 11.29, p < .05]

on the compliance intention of employees as theorized. For the proposed contingency

factors, profit potential showed a significant effect [F(1,150) = 8.17, p < .05] while

relationship nature [F(1,150) = .33, ns] was non-significant. These outcomes reflected

that both empowerment and customer profit potential affected employee’s

compliance intention. Yet, relationship nature cannot significantly influence

employee’s compliance intention.

Our focus, however, falls on the interaction effects between empowerment and

the contingency factors. The ANOVA results further indicated a significant

interaction effect of empowerment and profit potential on employee’s compliance

intention [F(1,150) = 7.39, p < .05], as predicted by my hypothesis H1. This significant

interaction effect revealed that the effect of empowerment exerted on employee’s

compliance intention could be significantly influenced by customer’s profit potential.

However, we cannot identify in which situation of profit potential the effects of

empowerment could be stronger. Therefore I applied structural equation models after

the repeated measures ANOVA.

The three-way interaction of relationship nature, customer profit potential and

empowerment was significant [F(1,150) = 4.24, p < .05]. This finding reflected that the

effects of empowerment could be affected by different relationship nature and

different customer profit potential as well, even though this three-way interaction

effect was not hypothesized in this study.

4.1.2 Customer-orientation Effects in Different Contexts

To test my hypothesis H2 and hypothesis H3 and compare the effects of

customer-orientation on the compliance intention of employees across the four

experimental conditions, I conducted a repeated-measures ANOVA again. A summary

of results is given in Table 2.2.

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Table 2.2 Results of Analysis of Variance for H2 and H3

Model/source DV = Compliance Intention

F(1,150)

Main effects

Relationship Nature 8.21**

Profit Potential 1.57

Customer-orientation .21

Two-way interaction

Relationship Nature * Profit Potential 1.38

Relationship Nature * Customer-orientation 9.15**

Profit Potential * Customer-orientation 1.84

Three-way interaction

Relationship Nature * Profit Potential * Customer-orientation 3.78**

*p < .1

**p < .05

***p < .001

Table 2.2 showed that the main effect of customer-orientation [F(1,150) = .21, ns]

on the compliance intention of employees was non-significant. For the proposed

contingency factors, profit potential showed a non-significant effect [F(1,150) = 1.57,

ns]. Yet, relationship nature showed a significant effect [F(1,150) = 8.21, p < .01].

These outcomes reflected employees’ compliance intention could be affected by

relationship nature, however, could not be significantly influenced by both

customer-orientation and customer profit potential.

Similar to last section, interaction effects between customer-orientation and the

contingency factors are our focal points. The ANOVA results further indicated a

significant interaction effect of customer-orientation and relationship nature on

employee’s compliance intention [F(1,150) = 9.15, p < .05], as predicted by my

hypothesis H2. This significant interaction effect reflected that customer-orientation’s

effects on employee’s compliance intention could be significantly influenced by

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relationship nature. Yet, similarly, we cannot tell in which relationship

customer-orientation could generate stronger effects. Thus, more in-depth application

of structural equation models was introduced.

The three-way interaction of relationship nature, customer profit potential and

customer-orientation was significant [F(1,150) = 3.78, p < .05]. This finding reflected

that both relationship nature and customer profit potential could simultaneously affect

customer-orientation’s effect on employee’s compliance intention, as predicted by my

hypothesis H3. Due to the similar reason that it was difficult to tell in which one of

the four scenarios customer-orientation could generate stronger effects, structural

equation models were applied by me.

Moreover, since the two antecedent factors, namely empowerment and

customer-orientation, were measured, it would difficult to interpret the simple main

effects in each experimental condition with the distribution of means of the

dependent measure (Table 2.3) as well.

Thus, after the repeated measures ANOVA, I performed a follow-up study with

nested structural equation models to further illuminate the interaction effects of

empowerment and customer-orientation in different service contexts.

Table 2.3 Experiment Cell Means: Compliance Intention

Personal Relationship Business Relationship

High Customer Profit Potential 3.87 4.19

Low Customer Profit Potential 4.35 3.85

n = 151;

Compliance intention: 1 – 6 ratings; a higher score implies a greater intention to comply with

the customer request.

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4.2 Nested Structural Equation Models

Due to several advantages of the structural equation models, I applied this

approach in my study. The advantages of the structural equation approach are listed

below (Bagozzi & Yi, 1989).

1. This approach provides a natural way to correct for measurement error in

the measures of variables thus reduce the chances of making type II

errors.

2. This approach does not involve the restrictive assumption of

homogeneity in variances and covariances of the depend variables across

groups.

3. This approach allows for a complete modeling of theoretical relations.

The path analysis involved empowerment, customer-orientation, the interaction

term between empowerment and customer-orientation, and employee’s compliance

intention. Besides, demographic variables such as employee’s gender, education

background and employee’s working experience in current hotel were also included

as control variables to partial out their possible confounding effects.

Prior to the analysis, all measurement items of empowerment and

customer-orientation were mean-centered to eliminate the possible multi-collinearity

problem (Aiken & West, 1991). Since the two contingency factors are nominal data,

they were not mean-centered. The structural paths of the models for four scenarios

are shown in Figure 2.

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4.2.1 Findings of Path Analysis of Individual Service Scenario

Before the path models were nested together, an individual path analysis was

conducted for each scenario to assure that the path model fit and represented the data

of their respective service context. Findings of the four scenarios showed interesting

and distinctive patterns.

In the first scenario (Scenario 1: Personal Relationship, High Customer Profit

Potential; please refer to Figure 2.1), Empowerment was positively related to

employee’s compliance intention, as evidenced by a significant path ( = .39; t =

3.79). The effects of customer-orientation and its interaction term with empowerment

were both non-significant (p > .10). This result provided some support to my

hypothesis H1. These findings reflected that, when the relationship between the

employee and the customer was a personal relationship, empowerment practices were

effective in influencing employee’s intention to comply with special requests from

customers with high profit potential. Yet, the results also showed that, when customer

profit potential was high, customer-orientation could not affect employee’s

compliance intention in dealing with special requests from a customer with whom the

employee had a personal relationship. Thus, my hypothesis H2 cannot be supported.

Moreover, empowerment and customer-orientation could not generate interactive

effect on employee’s compliance intention when the customer’s profit potential was

high and the relationship nature was perceived as a personal one.

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Perceived

Empowerment

(PE)

The

interaction of

PE &CO

Customer-

orientation

(CO)

Employee’s

Compliance

Intention

(Scenario 1)

Other control variables

(Gender, Education

Attainment, and Working

experience at current hotel)

are all non-significant

Model Fit Statistics:

χ²= 155.95 (d.f. = 87, p < .001)

RMSEA = .073

NNFI = .91

CFI = .94

Figure 2.1 Scenario 1: Personal Relationship, High Customer Profit Potential

For the second scenario (Scenario 2: Business Relationship, High Customer

Profit Potential; please refer to Figure 2.2), similar to the first scenario,

empowerment was positively related to employee’s compliance intention, as

evidenced by a significant path ( = .22; t = 2.17). The effects of customer-orientation

and its interaction term with empowerment were both non-significant (p > .05). These

findings reflected that, when the relationship between the employee and the customer

was a business relationship, empowerment could influence employee’s intention to

accommodate special requests from customers with high profit potential. My

hypothesis H1 was supported by this result as well. However, employee’s compliance

intention cannot be influenced by customer-orientation and its joint effect with

empowerment practices in a business relationship and the customer comes with high

profit potential.

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Perceived

Empowerment

(PE)

The

interaction of

PE &CO

Customer-

orientation

(CO)

Employee’s

Compliance

Intention

(Scenario 2)

Model Fit Statistics:

χ²= 134.61 (d.f. = 87, p < .001)

RMSEA = .060

NNFI = .93

CFI = .95

Other control variables

(Gender, Education

Attainment, and Working

experience at current hotel)

are all non-significant

Figure 2.2 Scenario 2: Business Relationship, High Customer Profit Potential

Next, pertaining to the third and forth scenarios in which the customer was

perceived with low profit potential, let me elaborate on the forth scenario first

(Scenario 4: Business Relationship, Low Customer Profit Potential; please refer to

Figure 2.4). In the forth scenario, the effects of customer-orientation, empowerment

and the interaction term of customer-orientation and empowerment were all

non-significant (p > .10). The results reflected that, when the profit potential of a

customer was perceived by the employees as low, and the relationship between the

customer and the employee was business relationship, empowerment,

customer-orientation and the combined effect of these two factors could not make

any difference on the employee’s compliance intention.

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In the third scenario (Scenario 3: Personal Relationship, Low Customer Profit

Potential; please refer to Figure 2.3), customer-orientation was positively and

strongly related to employee’s compliance intention, as evidenced by a significant

path ( = .54; t = 4.26). The effect of empowerment was non-significant (p > .10). Yet,

more interestingly, the interaction term of empowerment and customer-orientation

was negatively and also strongly related to employee’s compliance intention, as

evidenced by a significant path ( = -.35; t = 3.99). These results showed that when

the customer and the employee were in a personal relationship, employees’ intention

to comply with special request from the customer could be positively affected by

customer-orientation, which supports my hypothesis H3. What’s more interesting is,

even though this intention cannot be influenced by empowerment, the significant and

negative joint effect of empowerment and customer-orientation shows that the effect

of customer-orientation on employee’s compliance intention can be weakened by

empowerment.

Perceived

Empowerment

(PE)

The

interaction of

PE &CO

Customer-

orientation

(CO)

Employee’s

Compliance

Intention

(Scenario 3)

Model Fit Statistics:

χ²= 125.75 (d.f. = 87, p < .01)

RMSEA = .054

NNFI = .94

CFI = .96

Other control variables

(Gender, Education

Attainment, and Working

experience at current hotel)

are all non-significant

Figure 2.3 Scenario 3: Personal Relationship, Low Customer Profit Potential

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Perceived

Empowerment

(PE)

The

interaction of

PE &CO

Customer-

orientation

(CO)

Employee’s

Compliance

Intention

(Scenario 4)

Model Fit Statistics:

χ²= 116.87 (d.f. = 87, p < .05)

RMSEA = .048

NNFI = .95

CFI = .96

Other control variables

(Gender, Education

Attainment, and Working

experience at current hotel)

are all non-significant

Figure 2.4 Scenario 4: Business Relationship, Low Customer Profit Potential

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4.2.2 Hypothesis Testing by Nested Structural Equation Models

To provide further evidence for testing the hypotheses in this study, individual

path models were nested in a pair to form baseline models for comparison of the

strength of hypothesized relations (γ1ijγijγijγij) between every pair of

models which represented different manipulated service contexts (please see fit

statistics in Table 3).

Table 3 Fit Statistics of Baseline Models

The nested model of

two scenarios χ2

RMSEA CFI NNFI

Scenario 1 & 2

(HP & HB)

299.23

(d.f. = 195, p < .001) .060 .95 .94

Scenario 1 & 3

(HP & LP)

305.67

(d.f. = 195, p < .001) .062 .95 .93

Scenario 1 & 4

(HP & LB)

290.62

(d.f. = 195, p < .001) .057 .95 .94

Scenario 2 & 3

(HB & LP)

278.38

(d.f. = 195, p < .001) .053 .96 .95

Scenario 2 & 4

(HB & LB)

256.87

(d.f. = 195, p < .005) .046 .97 .96

Scenario 3 & 4

(LP & LB)

256.88

(d.f. = 195, p < .005) .046 .97 .96

Notes: Scenario 1: Personal Relationship, High Profit Potential = HP

Scenario 2: Business Relationship, High Profit Potential = HB

Scenario 3: Personal Relationship, Low Profit Potential = LP

Scenario 4: Business Relationship, Low Profit Potential = LB

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My hypothesis H1 theorizes that the effect of empowerment exerted on

employees’ compliance intention will be more pronounced when the customer’s

profit potential is high than when it is low. To test this hypothesis, the paths between

empowerment and compliance intention were constrained to be equal among the

models of Scenario 1 (Personal Relationship, High Profit Potential) and 3 (Personal

Relationship, Low Profit Potential) (Constrained HP =

LP

), the models of

Scenario 2 (Business Relationship, High Profit Potential) and 4 (Business

Relationship, Low Profit Potential) (Constrained HB =

LB

), respectively.

Chi-square difference tests were applied to compare whether there were significant

differences between the baseline (unconstrained) models and the constrained models.

The results (please refer to Table 4.1) indicate that the effects of empowerment on

employee’s compliance intention showed significant difference between Scenario 1

and Scenario 3 (unconstrained model: χ² = 305.67. d.f. = 195; constrained model: χ² =

320.38, d.f. = 196; Δχ² = 14.71, Δd.f. = 1, p < 0.001), which provided evidence to

support my hypothesis H1. Yet, the relationship between empowerment and

employee’s compliance intention was not different between the Scenario 2 and 4

(unconstrained model: χ² = 256.87. d.f. = 195; constrained model: χ² = 257.78, d.f. =

196; Δχ² = .91, Δd.f. = 1, ns). This finding did not support my hypothesis H1. We

therefore got mixed findings. Because the repeated measures ANOVA results showed

that the two-way interaction of empowerment and relationship was not significant

[F(1,150) = .81, ns; please refer to Table 2.1], and my path analysis of individual

scenario also showed that the effects of empowerment on employee’s compliance

intention were just significant in models of Scenario 1 and 2, but not significant in

models of Scenario 3 and 4 (please refer to Figure 2). This finding of chi-square

difference tests indicates that relationship nature still may moderate the effects of

empowerment on employee’s compliance intention given that customer’s profit

potential is high.

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Table 4.1 Chi-square Difference Test for H1

Path Relations χ² d.f. Δχ² Δd.f. p-value

Baseline Model (Scenario 1 & 3) 305.67 195

Empowerment Employee’s Compliance Intention

(Constrained HP =

LP

) 320.38 196 14.71 1 0.001

Baseline Model (Scenario 2 & 4) 256.87 195

Empowerment Employee’s Compliance Intention

(Constrained HB =

LB

)

257.78 196 0.91 1 0.340

Notes: Scenario 1: Personal Relationship, High Profit Potential = HP

Scenario 2: Business Relationship, High Profit Potential = HB

Scenario 3: Personal Relationship, Low Profit Potential = LP

Scenario 4: Business Relationship, Low Profit Potential = LB

Next, my hypothesis H2 theorizes that the effect of customer-orientation exerted

on employees’ compliance intention will be more pronounced when employees

perceived the relationship with the customers as a personal relationship than when

they perceive the relationship as a business one. To test this hypothesis, firstly, the

paths between customer-orientation and compliance intention among the models of

Scenario 1 and Scenario 2 (Constrained HP =

HB

), and the models of Scenario 3

and 4 (Constrained LP =

LB

) were constrained to be equivalent. Chi-square

difference tests were applied to investigate whether there were significant differences

between personal relationship scenario and business relationship scenario across the

two scenarios which shared the same profit potential. The results (please refer to

Table 4.2) showed that the effects of customer-orientation on employee’s compliance

intention were significantly different between Scenario 3 and Scenario 4

(unconstrained model: χ²= 256.88. d.f.= 195; constrained model: χ²= 268.80, d.f.=

196; Δχ²= 11.92, Δd.f.= 1, p < 0.001). Yet, the relationship between

customer-orientation and employee’s compliance intention was not different between

Scenario 1 and 2 (unconstrained model: χ²= 299.23. d.f.= 195; constrained model: χ²=

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299.49, d.f.= 196; Δχ²= .26, Δd.f.= 1, ns). Thus, customer-orientation’s effects were

not significantly different between personal relationship scenario and business

relationship scenario given that customer’s profit potential is high. Thus, my

hypothesis H2 cannot be supported.

Table 4.2 Chi-square Difference Test for H2

Path Relations χ² d.f. Δχ² Δd.f. p-value

Baseline Model (Scenario 1 & 2) 299.23 195

Customer-orientation Employee’s Compliance Intention

(Constrained HP =

HB

) 299.49 196 0.26 1 .0610

Baseline Model (Scenario 3 & 4) 256.88 195

Customer-orientation Employee’s Compliance Intention

(Constrained LP =

LB

)

268.80 196 11.92 1 0.001

Notes: Scenario 1: Personal Relationship, High Profit Potential = HP

Scenario 2: Business Relationship, High Profit Potential = HB

Scenario 3: Personal Relationship, Low Profit Potential = LP

Scenario 4: Business Relationship, Low Profit Potential = LB

Furthermore, in my hypothesis H3, I propose that the effect of

customer-orientation exerted on employees’ compliance intention will be the most

pronounced when employees perceived the relationship with the customers as a

personal relationship and the customer is in need and difficult. To test this hypothesis

H3, the paths between customer-orientation and compliance intention among the

models of Scenario 1 and Scenario 3, the models of Scenario 2 and 3, the models of

Scenario 3 and 4 were constrained to be equal. Similarly, chi-square difference tests

were applied.

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The results (Please refer to Table 4.3) revealed that the effects of

customer-orientation on employee’s compliance intention in Scenario 3 were

significantly different from Scenario 1 (unconstrained model: χ²= 305.67. d.f.= 195;

constrained model: χ²= 317.09, d.f.= 196; Δχ²= 11.42, Δd.f.= 1, p < 0.001), Scenario 2

(unconstrained model: χ²= 278.38, d.f.= 195; constrained model: χ²= 294.99, d.f.=

196; Δχ²= 16.61, Δd.f.= 1, p < 0.001) and Scenario 4 ((unconstrained model: χ²=

256.88. d.f.= 195; constrained model: χ²= 268.80, d.f.= 196; Δχ²= 11.92, Δd.f.= 1, p <

0.001), respectively.

Thus, my hypothesis H3 is supported.

Table 4.3 Chi-square Difference Test for H3

Path Relations χ² d.f. Δχ² Δd.f. p-value

Baseline Model (Scenario 1 & 3) 305.67 195

Customer-orientation Employee’s Compliance Intention

(Constrained HP =

LP

) 317.09 196 11.42 1 0.001

Baseline Model (Scenario 2 & 3) 278.38 195

Customer-orientation Employee’s Compliance Intention

(Constrained HB =

LP

) 294.99 196 16.61 1 0.001

Baseline Model (Scenario 3 & 4) 256.88 195

Customer-orientation Employee’s Compliance Intention

(Constrained LP =

LB

)

268.80 196 11.92 1 0.001

Notes: Scenario 1: Personal Relationship, High Profit Potential = HP

Scenario 2: Business Relationship, High Profit Potential = HB

Scenario 3: Personal Relationship, Low Profit Potential = LP

Scenario 4: Business Relationship, Low Profit Potential = LB

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5. Discussion and Implications

This study provides new insights related to the roles of customer relationship

nature and customer profit potential in moderating the effects of empowerment and

customer-orientation on service employees’ intention of complying with customers’

special requests. I aimed to investigate under what kind of situation empowerment

and customer-orientation could affect employees’ compliance intention in Chinese

hotel industry.

5.1 Discussion of Path Analysis Results of Individual Scenario

Few prior researches have ever probed into why western literatures about

empowerment and customer-orientation could not explain special phenomena in

Chinese service industry and why empowerment practices and customer-orientation

cultivation cannot always make employees to accommodate customer’s special

requests. It was stimulating and inspiring to find that different combinations of

customer profit potential and customer relationship nature did affect the effects of

empowerment and customer-orientation on compliance intention of employees. Next,

findings got from the path analysis of the four combinations in my study are

presented.

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5.1.1 Two Scenarios of High Customer Profit Potential (Scenario 1 & 2)

In the path analysis of individual scenario for Scenario 1 (Personal Relationship,

High Profit Potential) and Scenario 2 (Business Relationship, High Profit Potential),

just the effects of empowerment were significant on compliance intention, which was

consistent with my hypotheses H1.

The reasons are clear. Since to comply with special requests from customers

with high profit potential is consistent with the interests of both the employee and the

firm, frontline employees tend to be willing and motivated to accommodate these

customers’ special needs.

The reasons why customer-orientation cannot take significant effect in these 2

scenarios can be, for a customer with high profit potential, his financial situation

tends to be ideal. Thus, he can be perceived by employees as actually not in great

need or exigencies of more discounts. Customer-orientation which primarily means

proactively fulfilling customers’ needs and meeting customers’ exigencies thus

cannot generate effect here. Employees comply with profitable customers’ special

and extra requests can simply due to their perception and expectation of high profit

potential possessed by the customer.

5.1.2 Business Relationship and Low Customer Profit Potential (Scenario 4)

In Scenario 4 (Business Relationship, Low Profit Potential), both empowerment

and customer-orientation could not generate significant effects on compliance

intention, which was reasonable as well.

To sacrifice the benefits of the hotel for retaining a customer with low profit

potential is definitely not a wise move for an employee. Following reasons can

explain this rationale clearly.

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First of all, business relationships tend to be exchange relationships in which

people care about what they can get back for what they give (Aggarwal & Zhang,

2006). No extra benefits, no extra devotion. Employees tend to process everything

according to established rules and regulations, or just follow the conventional

practices. In addition, employees will not feel obliged to accommodate the special

needs of customers in this relationship. Whether the customers are in need or not will

not affect the employees’ judge and according responses.

Moreover, to satisfy the special requests from a customer with low profit

potential in the expense of the firm’s benefits is inconsistent with the interests of both

the firm and the employee. Employees would not be willing as well as motivated to

comply with these special requests by utilizing the power at hand.

Taking in the above two aspects into consideration, the employees tend to be

inattentive to whether their customers are in need or even in difficulty, thus

customer-orientation attitude which basically means a disposition to take care of

customers’ needs can simply not take effect in this Scenario 4. In addition, lack of

both willingness and motivation to use the discretionary power at hand to help the

customers encountered will make the effects of empowerment practices dormant.

Thus, in this situation, both empowerment and customer-orientation cannot impact

employee’s compliance intention.

5.1.3 Personal Relationship and Low Customer Profit Potential (Scenario 3)

In Scenario 3 (Personal Relationship, Low Profit Potential), I found significant

effect of customer-orientation on employee’s compliance intention. Yet,

empowerment’s effect was non-significant.

Compared with the business customer with low profit potential, the nature of

personal relationship could differently impacts employee’s compliance intention.

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Friends tend to regard a personal relationship as a communal relationship in

which people are willing to give benefits in response to friends’ needs regardless of

their possible pay-back. In this kind of relationship, the return of benefits will not

change the giver’s perspective of obligation to accommodate the others’ needs (Clark

& Mills, 1993). Thus, service employees tend to feel obliged to comply with the

special requests from the friend customers.

Generally customer-oriented employees tend to show high concern for others’

needs and meet customers’ needs and exigencies (Saxe and Weitz, 1982, Han et al.,

1998). In the scenarios of low customer profit potential, though the profit potential of

the customer encountered is low, that means this customer is in greater need of this

special request (e.g., more discounts).

Employees tend to feel obliged to help their communal customers, thus tend to

be aware of and be attentive to the exigencies of the customers. Hence, the effect of

customer-orientation on employee’s intention to meet the special requests thus can be

significant.

More interestingly, in this scenario (Personal Relationship, Low Profit Potential),

the significant but negative interaction between empowerment and

customer-orientation on compliance intention shows that the effect of empowerment

would be attenuated by the strength of customer-orientation. This finding does not

necessarily reflect that empowerment effect will be reversed by customer-orientation

but the two effects may offset each other in affecting the employees’ compliance

intention. In other words, customer-orientation serves as a “ceiling effect” on the

empowerment effect.

The reasons can be: prior researchers have found that empowerment is

beneficial for enhancing employees’ satisfaction and promoting employees’ sense of

belonging to the firm (Bowen & Lawler, 1992; Liao, Toya, Lepak, & Hong, 2009).

Yet, since to comply with the special requests from customers with low profit

potential is actually not consistent with the firm’s interests, employees who are highly

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empowered and have a sense of belonging to the firm tend to prioritize firms’

interests over their originally perceived obligation in a communal relationship.

Employees who bear in mind firm’s interests may not feel so obliged to attentive to

exigencies of communal customers. Therefore customer-orientation’s effect would be

attenuated. Thus, the more empowered employees feel, the less they would comply

with special requests from friend customers with low profit potential. This

unexpectedly significant and negative interaction effect actually may deserve more

attention of future research.

5.2 Discussion of Analysis Results of Nested Structural Equation Models

5.2.1 The Mixed Findings of Testing Hypothesis H1

In testing hypothesis H1, we got mixed findings. The repeated measures

ANOVA results showed us that the two-way interaction of empowerment and

relationship was not significant [F(1,150) = .81, ns; please refer to Table 2.1].

Simultaneously, my path analysis of individual scenario also showed that the effects

of empowerment on employee’s compliance intention were just significant in

Scenario 1 (Personal Relationship, High Profit Potential) and 2 (Business

Relationship, High Profit Potential), but not significant in Scenario 3 (Personal

Relationship, Low Profit Potential) and 4 (Business Relationship, Low Profit

Potential) (please refer to Figure 2). However, the chi-square difference tests showed

that the relationship between empowerment and employee’s compliance intention

was significantly different between Scenario 1 and 3, but was not different between

Scenario 2 and 4, indicating that relationship nature still may moderate the effects of

empowerment on employee’s compliance intention given that customer’s profit

potential was high.

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Actually the results of chi-square difference tests are not inconceivable as well,

because people still tend to prioritize in-group members’ interests as suggested by

previous literatures (Cialdini et al., 1999; Bove & Johnson, 2001; Verbeke & Bagozzi,

2001). Personal relationship may motivate the employee and further strengthen the

effects of empowerment on top of the motivation driven by the perceived profit

potential. In contrast, a business relationship does not possess a similar motivation

power which drives frontline employees to use their discretionary power on hand to

satisfy special needs of customers.

5.2.2 The Findings of Testing Hypothesis H2 and Hypothesis H3

In testing hypothesis H2, the chi-square difference tests showed us that the

relationship between customer-orientation and employee’s compliance intention was

significantly different between Scenario 3 (Personal Relationship, Low Profit

Potential) and 4 (Business Relationship, Low Profit Potential), but was not

significantly different between Scenario 1 (Personal Relationship, High Profit

Potential) and 2 (Business Relationship, High Profit Potential), indicating that the

strength of customer-orientation could not be affected by relationship nature when the

customer’s profit potential was high. In testing hypothesis H3, the chi-square

difference tests showed that the relationship between customer-orientation and

employee’s compliance intention in Scenario 3 was significantly different from the

effects of customer-orientation in other three scenarios, which implied the effects of

customer-orientation are the most significant in Scenario 3 (Personal Relationship,

Low Profit Potential).

These two sets of tests did provide us consistent evidence with the path analysis

of individual scenarios, in which we also found similar results, because the effects of

customer-orientation on employee’s compliance intention were just significant in

Scenario 3 (Personal Relationship, Low Profit Potential), not significant in other

three scenarios.

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5.2.3 Chi-square Difference Tests for the Significant Interaction Effect of

Customer-orientation and Empowerment in Scenario3

In the path analysis of individual scenario for Scenario 3 (Personal Relationship,

Low Profit Potential), we unexpectedly found that, the interaction term of

empowerment and customer-orientation was negatively and significantly related to

employee’s compliance intention. This significant and negative joint effect of

empowerment and customer-orientation showed that the effect of

customer-orientation on the compliance intention of employees could be weakened

by empowerment. Even though we did not hypothesize this interaction effect, we also

applied chi-square difference tests to investigate whether the relationship between the

interaction term and compliance intention in Scenario 3 (Personal Relationship, Low

Profit Potential) was significantly different from that in other three scenarios. The

results (please refer to Table 4.4) showed that the relationship between the interaction

term and employee’s compliance intention in Scenario 3 was not significantly

different from that in Scenario 1 (Personal Relationship, High Profit Potential) and 4

(Business Relationship, Low Profit Potential). Thus, the interesting finding we found

in the path analysis of individual scenario was not very distinctive because there were

similar phenomena in Scenario 1 and 4 as well. This extra finding may deserve future

research.

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Table 4.4 Chi-square Difference Test for the Interaction Term of Empowerment and

Customer-orientation

Path Relations χ² d.f. Δχ² Δd.f. p-value

Baseline Model (Scenario 1 & 3) 305.67 195

EMP x CO Employee’s Compliance Intention

(Constrained HP =

LP

) 305.34 196 0.33 1 0.566

Baseline Model (Scenario 2 & 3) 278.38 195

EMP x CO Employee’s Compliance Intention

(Constrained HB =

LP

) 283.95 196 5.57 1 0.018

Baseline Model (Scenario 3 & 4) 256.88 195

EMP x CO Employee’s Compliance Intention

(Constrained LP =

LB

)

258.54 196 1.66 1 0.198

Notes: Scenario 1: Personal Relationship, High Profit Potential = HP

Scenario 2: Business Relationship, High Profit Potential = HB

Scenario 3: Personal Relationship, Low Profit Potential = LP

Scenario 4: Business Relationship, Low Profit Potential = LB

5.3 General Discussion and Theoretical Contribution

In conclusion, this study found out the different effects of empowerment and

customer-orientation on employee’s intention to comply with customers’ special

requests under different influences from relationship nature and perception of

customer profit potential in Chinese hotel industry.

My results revealed that the effect of empowerment was especially significant

when service employees were handling customers with high profit potential and high

value of retention, though the mixed findings of nested structural models showed that

relationship nature might moderate empowerment’s effects on employee’s

compliance intention even when employees were dealing with customers with high

profit potential.

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Moreover, this study demonstrated that service employees tended to treat

business relationships as exchange relationships in which staff would care more

about the balance between giving and receiving.

It was stimulating to find that the effect of customer-orientation could be very

significant when employees were dealing with special requests from customers in

need given that the employees and the customers were in a personal relationship.

Employees tended to be attentive to the needs and exigencies of people with whom

employees have a personal relationship.

More interestingly, this study found that empowerment practices might inspire

the employees to put firm’s interests at first. To empower the frontline employees

which could improve employee’s satisfaction and cultivate their sense of belonging to

the firm may make employees be inclined to prioritize firm’s benefits over their

originally perceived obligations in communal relationships. Though we finally found

that this interaction of empowerment and customer-orientation was not distinctive in

just Scenario 3 (Personal Relationship, Low Profit Potential), but the finding that

similar phenomena might exist in other scenarios did provide a potential direction for

future studies.

5.4 Managerial Implications

To put my findings into practice, this study provides more evidence to

recommend empowerment practices to Chinese managers.

First of all, empowerment practices tend to encourage the frontline employees to

acquire or retain profitable clients with less hesitation, which is very beneficial for

the firm’s long-term benefits.

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Second, Chinese employees apparently treat customers differently according to

employees’ own perception of customers’ profit potential. Thus, managers should

figure out how to link employee’s natural inclination with firm’s interests by utilizing

empowerment practices. For instance, service managers may devise a guideline

which could help frontline employees identify profitable customers in a subtle way

and give employees a direction on how to deal with customers with different profit

potential by utilizing power at hand.

Moreover, empowerment practices may enhance employee’s sense of belonging

to the firm which in turn, inspire the employees to prioritize firm’s benefits over own

interests. With empowerment practices, frontline employees are inclined to perceive

the enhancement of firm’s benefits as beneficial for the enhancement of their own

interests. A good employer-employee relationship is advantageous to the firm. Thus,

managers should pay more attention to the utilization of empowerment practices. To

decisively empower the frontline employees and trust the empowered subordinates

actually can motivate staffs to care about the company’s interests and work hard for

company’s benefits.

Pertaining to customer-orientation, my findings show that to purely pursue

cultivation of customer-orientation does not necessarily generate positive and

beneficial results for the firm. Thus, how to strike a balance between

profit-orientation and customer-orientation could be decided by service practitioners

more cautiously.

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6. Limitations and Future Research

6.1 Limitations

The context chosen by me is a hotel group. This choice may pose some biases

which are detrimental to the generalizability of my results. Moreover, this hotel is

running in the inland area of China. It is generally thought that the businesses in the

coastal area are very different from the businesses in the inland area, in terms of

degree of modernization, management practices, and concepts in doing business. The

culture and perspectives regarding to relationship nature and personal tie can be very

different between these two areas mentioned above as well. Thus, we cannot directly

generalize these findings to the whole hotel industry in China.

Given the resources base of doing this study, I just collected data from three

hotels from a hotel group which actually just can be defined as a medium-sized firm.

If my study can be backed up by more resources, like time, and connections, I would

try to collect data from some large-scale hotels or collect data from hotels in various

scales so that the representativeness of my study could be improved.

6.2 Future research

Future study may pay more attention to other fields in service industry instead of

just focusing on hospitality industry.

Moreover, as I mentioned in section 5.1.3 and section 5.2.3, in this study, I just

tried to explain why the interaction term of empowerment and customer-orientation

could negatively affected employee’s compliance intention. We have not elaborated

this finding with solid evidences and analyses. Moreover, we also found that the

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significant and negative interaction effects of empowerment and customer-orientation

which was found by us unexpectedly in Scenario 3 (Personal Relationship, Low

Profit Potential) may exist in Scenario 1 (Personal Relationship, High Profit Potential)

and 4 (Business Relationship, Low Profit Potential) as well. Future research may try

to investigate whether there are actually other factors influencing the interaction

effects of customer-orientation and empowerment on employee’s compliance

intention.

Last but not least, future studies could keep an eye on the cultivation of a

balanced combination of customer-orientation and profit-orientation to the service

employees. Whether a balanced orientation can bring about more beneficial results to

the service providers or not deserves the attention of future studies.

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Appendix 1: Questionnaires

Series 1

Part One: Please read the following scenarios, imagine that you were this staff in these

scenarios, and pick the corresponding answers according to the scenarios.

In Star Hotel, every staff is required by the management to try hard to fulfill customers’

various needs and earn more profits for the firm. You are one of the front desk staffs.

One of the front desk staff’s responsibilities is handling room reservation. Every front desk

staff is empowered by the management to offer appropriate discounts to prospects for attracting

more customers.

Basing on 2 different situations below (A, B), what will you do accordingly?

Situation A:

One day, you are on your shift at the front desk. Chen Ming, your old classmate, comes to you.

Chen Ming owns a couple of companies which are running very well and leads an affluent life.

After a small chat, Chen Ming tells you that he wants to book two rooms, and asks you for

some more discounts.

1. Chen Ming is your___?

2. Chen Ming’s financial situation is ___?

A. Bad B. Good

3. How will you think of your relationship with Chen Ming?

A. Old classmate B. Old boss

C. Distant relative D. Subordinate

A. Personal relationship B. Business relationship

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To what extent do you agree or disagree with the following viewpoints?

Please Circle the answers which are most consistent with your own viewpoints in following

questions.

6. Are you inclined to offer more discounts to Chen Ming?

Definitely

Unlikely Definitely

Likely

1 2 3 4 5 6

7. Are your real-life colleagues inclined to offer more discounts in similar situations (offer

more discounts to rich old classmates)?

Definitely

Unlikely Definitely

Likely

1 2 3 4 5 6

8. Will you offer more discounts to Chen Ming at last?

Definitely

No Definitely

Yes

1 2 3 4 5 6

9. Will your real-life colleagues offer more discounts in similar situations at last (offer more

discounts to rich old classmates)?

Definitely

No Definitely

Yes

1 2 3 4 5 6

Totally

Disagree

Totally

Agree

4 I think it is my duty to offer

more discounts to Chen Ming. 1 2 3 4 5 6

5

I think it is Chen Ming’s duty

to understand my difficulties

and support my work. 1 2 3 4 5 6

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Situation B:

One day, you are on your shift at the front desk. A customer comes to you. He tells you that he

is the representative of Excellence Company.

Star Hotel used to do business with Excellence Company, and Excellence Company usually

makes room reservations in Star Hotel. During the past 3 years, you are the one who handles

Excellence Company’s room-booking. It has been very nice to do business with Excellence

Company and your experience of dealing with Excellence Company is pleasant.

As you know, Excellence Company is running very well.

This time this representative of Excellence Company wants to book 5 rooms, and he asks you

for more discounts, considering that Excellence Company is a patron.

10. Excellence Company is your____?

A. Regular client B. Old classmate

C. Surbodinate D. Relative

11. The operating situation of Excellence Company is___?

A. Good B. Bad

12. How will you think of your relationship with Excellence Company?

A. Personal relationship B. Business relationship

To what extent do you agree or disagree with the following viewpoints?

Totally

Disagree

Totally

Agree

13

I think it is my duty to offer

more discounts to Excellence

Company. 1 2 3 4 5 6

14

I think it is Excellence

Company’s duty to understand

my difficulties and support my

work.

1 2 3 4 5 6

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Please Circle the answers which are most consistent with your own viewpoints in following

questions.

15. Are you inclined to offer more discounts to Excellence Company?

Definitely

Unlikely Definitely

Likely

1 2 3 4 5 6

16. Are your real-life colleagues inclined to offer more discounts in similar situations (offer

more discounts to regular clients who are doing well)?

Definitely

Unlikely Definitely

Likely

1 2 3 4 5 6

17. Will you offer more discounts to Excellence Company at last?

Definitely

No Definitely

Yes

1 2 3 4 5 6

18. Will your real-life colleagues offer more discounts in similar situations at last (offer more

discounts to regular clients who are doing well)?

Definitely

No Definitely

Yes

1 2 3 4 5 6

The End of Series One

Please put this questionnaire in a sealed envelope for confidentiality.

Thanks for your cooperation.

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Series 2

Part One: Please read the following scenarios, imagine that you were this staff in these

scenarios, and pick the corresponding answers according to the scenarios.

In Star Hotel, every staff is required by the management to try hard to fulfill customers’

various needs and earn more profits for the firm. You are one of the front desk staffs.

One of the front desk staff’s responsibilities is handling room reservation. Every front desk

staff is empowered by the management to offer appropriate discounts to prospects for attracting

more customers.

Basing on 2 different situations below (A, B), what will you do accordingly?

Situation A:

One day, you are on your shift at the front desk. Chen Ming, your old classmate, comes to you.

Chen Ming now is working at a very small company. You heard from other classmates that Chen’s

company is not running very well recently, and Chen’s life is difficult.

After a small chat, Chen Ming tells you that he wants to book two rooms, and asks you for

some more discounts.

1. Chen Ming is your___?

2. Chen Ming’s financial situation is ___?

A. Bad B. Good

3. How will you think of your relationship with Chen Ming?

To what extent do you agree or disagree with the following viewpoints?

A. Old classmate B. Old boss

C. Distant relative D. Subordinate

A. Personal relationship B. Business relationship

Totally

Disagree

Totally

Agree

4 I think it is my duty to offer

more discounts to Chen Ming. 1 2 3 4 5 6

5

I think it is Chen Ming’s duty

to understand my difficulties

and support my work. 1 2 3 4 5 6

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Please Circle the answers which are most consistent with your own viewpoints in following

questions.

6. Are you inclined to offer more discounts to Chen Ming?

Definitely

Unlikely Definitely

Likely

1 2 3 4 5 6

7. Are your real-life colleagues inclined to offer more discounts in similar situations (offer

more discounts to old classmates in difficulty)?

Definitely

Unlikely Definitely

Likely

1 2 3 4 5 6

8. Will you offer more discounts to Chen Ming at last?

Definitely

No Definitely

Yes

1 2 3 4 5 6

9. Will your real-life colleagues offer more discounts in similar situations at last (offer more

discounts to old classmates in difficulty)?

Definitely

No Definitely

Yes

1 2 3 4 5 6

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Situation B:

One day, you are on your shift at the front desk. A customer comes to you. He tells you that he

is the representative of Excellence Company.

Star Hotel used to do business with Excellence Company, and Excellence Company usually

makes room reservations in Star Hotel. During the past 3 years, you are the one who handles

Excellence Company’s room-booking. It has been very nice to do business with Excellence

Company and your experience of dealing with Excellence Company is pleasant.

As you know, Excellence Company is running very badly.

This time this representative of Excellence Company wants to book 5 rooms, and he asks you

for more discounts, considering that Excellence Company is a patron.

10. Excellence Company is your____?

A. Regular client B. Old classmate

C. Surbodinate D. Relative

11. The operating situation of Excellence Company is___?

A. Good B. Bad

12. How will you think of your relationship with Excellence Company?

A. Personal relationship B. Business relationship

To what extent do you agree or disagree with the following viewpoints?

Totally

Disagree

Totally

Agree

13

I think it is my duty to offer

more discounts to Excellence

Company. 1 2 3 4 5 6

14

I think it is Excellence

Company’s duty to understand

my difficulties and support my

work.

1 2 3 4 5 6

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Please Circle the answers which are most consistent with your own viewpoints in following

questions.

15. Are you inclined to offer more discounts to Excellence Company?

Definitely

Unlikely Definitely

Likely

1 2 3 4 5 6

16. Are your real-life colleagues inclined to offer more discounts in similar situations (offer

more discounts to regular clients who are in difficulty)?

Definitely

Unlikely Definitely

Likely

1 2 3 4 5 6

17. Will you offer more discounts to Excellence Company at last?

Definitely

No Definitely

Yes

1 2 3 4 5 6

18. Will your real-life colleagues offer more discounts in similar situations at last (offer more

discounts to regular clients who are in difficulty)?

Definitely

No Definitely

Yes

1 2 3 4 5 6

The End of Series Two.

Please put this questionnaire in a sealed envelope for confidentiality.

Thanks for your cooperation

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Series 3

Part 1:

1. Please Circle the answers which are most consistent with

your own viewpoints in following questions. Strongly Disagree Strongly Agree

Our business objectives are driven by customer satisfaction. 1 2 3 4 5 6

We closely monitor and assess our level of commitment in serving

customers’ needs. 1 2 3 4 5 6

Our competitive advantage is based on understanding

customers’needs. 1 2 3 4 5 6

Business strategies are driven by the goal of increasing customer

value. 1 2 3 4 5 6

We pay close attention to after-sale service. 1 2 3 4 5 6

2. To what extent do you agree or disagree with the following

viewpoints? Strongly Disagree Strongly Agree

I have significant autonomy in determining how I do my job. 1 2 3 4 5 6

I can decide on my own how to go about doing my work. 1 2 3 4 5 6

I have considerable opportunity for independence and freedom in

how I do my job. 1 2 3 4 5 6

Part 2: About Your Personal Information

1. Your Gender: Male / Female (Please circle the appropriate answer)

2. Your Education Background: (Please circle the appropriate answer)

a. Primary

School

b. Junior

Middle School

c. Senior

Middle School

d. Vocational

School

e. Bachelor

or above

3. How many years have you worked in current firm: _________Years _________Months

This is the end of all 3 series of surveys.

Thanks so much for your time and cooperation!

Please put this questionnaire in a sealed envelope for confidentiality!