Effects of Rewards System on Employee Performance in Hospitality Industry: A Study on Hilton

To determine the effects of rewards
system on employee performance in
the context of hospitality industry:
A study on Hilton
1

ABSTRACT
The main motive for conducting this research is to know about the effect of reward
system on the performance of employees within hospitality industry. The objectives and aim are
also made by considering the motive of the research. For achieving the objectives of research
secondary information is gathered from different sources like books, articles, journals and
publications. These information is used to complete the part of literature review for completing
the research. Different type of methodologies is used to gather and analyse information in a
systematic manner. Some kind of methodologies are research approach, research philosophy,
data collection and research strategy. Data analysis is also done with the help of primary source
and for that questionnaire is selected where respondents are chosen from organisation because
they are the people who are have direct knowledge regarding the organisation. The gathered data
is presented with the assistance of graphs which is effective in understanding easily. And then
different ways are suggested to improve the setting up of reward system.
2

ACKNOWLEDGEMENT
While preparing for my research, I had taken guidance and assistance from respected
people, who deserve my highest gratitude. During completing my research, it gave me pleasure, I
want to show gratitude towards my instructor for providing me great guidance and guidelines for
completing project with various consultations. I also want to thanks my family and relatives who
have helped me directly and indirectly in guiding me doing research. And I also want to thanks
my professor who have introduced me with the different research methodologies.
My classmates have also made valuable suggestions to improve the quality of my
research with using limited resources and saving maximum time.
3

Table of Contents
ABSTRACT.....................................................................................................................................2
ACKNOWLEDGEMENT...............................................................................................................3
INTRODUCTION...........................................................................................................................5
Overview of the topic.............................................................................................................5
Background of an organisation...............................................................................................5
Research Aim and Objectives................................................................................................6
Rationale of the research........................................................................................................6
Overview of other chapters....................................................................................................7
LITERATURE REVIEW................................................................................................................8
Concept of reward system......................................................................................................8
Different types of reward system and their impact on employee performance in hospitality
industry.................................................................................................................................10
Barriers and challenges arise at the time of setting up reward system in Hilton..................13
RESEARCH METHODOLOGY...................................................................................................17
DATA PRESENTATION AND ANALYSIS...............................................................................23
RECOMMENDATION.................................................................................................................40
CONCLUSION..............................................................................................................................40
REFERENCES..............................................................................................................................42
APPENDICES...............................................................................................................................44
4

INTRODUCTION
Overview of the topic
Reward system is defined as the attainment of benefits by personnel, employees or
workforce for their performance in a firm. Workforce of an organisation joins with some
expectations and these expectations are financial gains, rewards, perks and benefits. There are
also people in an organisation who want hike in salary, wages, accommodation facility, health as
rewards. They are divided into two benefits: economic and non-economic. Thus, these benefits
given by organisations to workforce for doing their job roles effectively and efficiently without
their expectations are called reward (Osborne and Hammoud, 2017). Companies make provision
of rewards in advance and it is also communicated with employees in initial stages only.
Rewards are given on the basis of performance in role assigned is known as reward management.
For the efficient system of reward management, a firm has to make proper system for rewards.
So, reward management can be described as giving rewards to workforce on the basis of how
well an employee is performing in its job roles. These rewards are also used to motivate
employees so that can get better in their performance and attain the goals of an organisation.
Hospitality industry is one of the best service industry (Sakdiyakorn, Golubovskaya and
Solnet, 2021). It provides high class service to their customers. Mainly it satisfies needs of
customers and catering services to guests. For more clarity and to avoid confusion it is divided
into five sectors: food and beverage, lodging, transportation, tourism and events. In simpler
words industry of hospitality is concerned with products and services to individuals to support
and help the well-being of these individuals (Wright, Hassan and Christensen, 2017).
Background of an organisation
Hilton is a multinational hospitality company which provides, manages, organises and
franchises resorts and hotels. It is founded in May, 1919 by Conard Hilton and headquarters is
situated in Virginia, US. It has total properties of 6215 and they have total rooms of 983465
across the world more than 118 countries and territories. Hilton also has 18 brands in various
market segments and works with more than 1,69,000 employees. Hilton has achieved great
success because of its luxurious services providing in different locations and countries. 98% of
the Hilton rooms are managed by the franchise that are solo operators or firms. Franchising is
very famous in hospitality industry because hotels and resorts are mostly given in franchise
5

because parent firm does not require to pay cost of maintenance and other overheads.
Franchisees should follow strict protocols and rules for the maintenance of license agreement
within Hilton. Hilton's many properties, resorts, airports are managed by different corporates.
Hilton involves in activities, sessions and programmes which helps in motivating workforce of
their company and to achieve their pre-defined objectives and goals (Khan and Nawaz, 2016).
Research Aim and Objectives
Research Aim
The main aim of study is to understand the role of reward system in enhancing employee
performance. A case study on Hilton
Research Objectives
 To evaluate the concept of reward system
 To understand different type of reward system and its impact on employee performance
of Hilton within hospitality industry.
 To analysis potential barrier which generally arises at the time of setting up or reward
system in Hilton.
Research Questions
 What is the concept of reward system?
 What are the different types of reward system and their impact on employee performance
of Hilton within hospitality industry?
 What are the barriers or challenges arising at the time of setting up reward system in
Hilton?
Rationale of the research
The main concern to conduct this study is to determine the role of reward system in
enhancing performance of employees in firms. As reward system plays an important role in
Hilton to motivate their employees so they can fulfil their responsibilities. Hilton is a chosen
hotel that faced issue of reward system. This decreased employee’s performance that turn to
impact on organisational growth and performance. This research has also focused on identifying
barriers and challenges that are faced by Hilton at the time of setting up reward system by human
resources. These challenges are high employee turnover, reduced business performance etc. The
study is taken to determine the various types of reward systems that are necessary in hospitality
industry because they have a great impact on workforce off Hilton. These different systems of
6

reward provide efficiency in operations and activities of organisations. Generally, rewards have
positive impact on enhancing performance of employees because employees feel that their
performance is rewarded and recognised. This rewarding system assists Hilton to build trust with
workforce and in return workforce gets encouraged to work hard more (Inuwa, 2016). This
report also shows that there are many barriers that are faced by hospitality industry while
planning and implementing reward system because understanding needs of every employee
becomes hectic. Selection of reward systems from the different alternatives also one of the
barriers faced by the same industry. It is analysed that it becomes difficult to manage and execute
reward systems. But reward systems are very important to motivate personnel continuously in
hospitality industry as it holds a significant place in organisations and necessary to take out
activities effectively.
Overview of other chapters
There are many chapters that are important for undertaking current research because all
these chapters helped investigator to take their research in an efficient and effective manner.
Involving these chapters help in answering all the questions that are made for conducting
research. The first chapter introduction which clearly defines the basic meaning of reward system
and its importance in an organisation, it also gives a brief about the selected organisation that is
Hilton, which comes under the hospitality industry (Fan, Wei and Ko, 2021). Then the next
chapter for this research is literature review which explains each objective in a very clear way,
the impact of reward system on the performance of employees. After this the next chapter is
research methodology where all the research methods are explained used for collecting data
through different sources. Questionnaire is used in which different questions are mentioned
asked from employees of Hilton and their views are showed with the help of bar graphs with
proper interpretation. After this conclusion and recommendation chapter comes, in conclusion
part it concludes the whole research in a paragraph. In recommendation the researcher defines all
the possible way to overcome the issue and challenges faced by Hilton while planning and
executing the reward system.
7

LITERATURE REVIEW
Literature review is defined as identifying and evaluating the literature in the particular
field of a topic. It provides the information that is already published connected to the study. By
the help of literature reader gets to know information and ideas of specific study. It clearly
explains the strengths and weakness of the study related to the research topic. Literature review
provides information collected through secondary sources like books, journal articles, magazines
and publications.
Concept of reward system
Alam and Raut-Roy (2019) states that reward system is about the implementation,
development, communication and evaluation of reward process. There are benefits and perks
received by personnel for doing their job effectively and efficiently in an organisation are called
reward system. Candidates work for organisation as they have some particular expectations of
reward. Some employees expect good salary and remuneration that is financial rewards whereas
some employees have expectations of better accommodation facilities, conveyance facilities,
health and safety facilities and so on. Economic and non-economic benefits given by companies
to their workforce for performing their jobs effectively and efficiently without expecting by
employees are called rewards. Employees have informed about rewards at the initial stage of
joining. Providing rewards according to the performance of each work assigned in companies are
known as reward management. For the effective reward management, a company has to form a
right reward system. Attractive reward system has the power to motivate the responsible and
dedicated employees. Management of reward also help in planning the financial management for
a long term.
According to the PAAIS and PATTIRUHU (2020), reward system is a practice used by
organisations to motivate their employees so that their personal objectives can be achieved with
objectives of organisation. For effective rewards system organisation set predefined aims and
rules for their workforce so that they can work accordingly and attain already set goals. In
simpler words rewards are given to employees in exchange of their hard work and smart work
for achieving predetermined goals and objectives. When employees are provided with right
rewards they feel motivated for their job and start working more according to the requirement of
job. Workforce get more energized and productive for organisations they are working for.
Companies require systems that continuously increase the motivation level of employees.
8