Impact of Performance Appraisal on Employee Motivation in Hospitality

This report investigates the impact of performance appraisal on employee motivation within the hospitality industry, focusing on a case study of the Holiday Inn hotel chain. The research aims to assess the influence of performance appraisals on employee motivation, identify common tools and motivators, and evaluate potential barriers in the performance management process. The report includes a literature review that examines performance appraisal as a tool for control or encouragement, the importance of employee engagement, the reasons why performance appraisal meetings may fail, and the effects of performance appraisal on employee motivation. The research methodology involves questionnaires and interviews to gather both qualitative and quantitative data to determine the relationship between performance appraisals and employee motivation within the hospitality sector. The report also discusses various methods of appraisal such as 360-degree appraisal, evaluation through KPIs, and benchmarking. The findings of this report will help organizations bridge the gap between standard and actual performance and improve employee motivation.

Impact of Performance
Appraisal on Employees
Motivation in the Hospitality
Industry

Table of Contents
CHAPTER 1: INTRODUCTION....................................................................................................2
CHAPTER 2: LITERATURE REVIEW.........................................................................................4
CHAPTER 3: RESEARCH METHOD AND METHODOLOGY.................................................8
CHAPTER 4: ................................................................................................................................11
CHAPTER 5: RECOMMENDATIONS........................................................................................17
CONCLUSION .............................................................................................................................18
REFERENCES..............................................................................................................................19
.........................................................................................................................................................1

CHAPTER 1: INTRODUCTION
Introduction to the topic:
`The major aim of this project is to analyse and examine the impact of performance
appraisal in providing the motivation to the employees. Performance apprisal is the method
which is used by the organisation to motivate the employee for performing good in their task or
work by evaluating the performance of employees. These appraisal work as a driver for the
motivation. This reserach will be performed upon a hotel, Holiday Inn. The hotel is the American
Brand hotel. The company has the highest hotel chain in this world. The degree towrads which
the organisation applies the performance appraisal is analysed and examined through this
research. Every employee needs some or the other type of motivation through which the he can
put more pf his efforts in the work (Ao and Martek, 2020 ). The performance apprisal is a
method through which the actual performance of an employee has performed gets analysed and
then neccessary steps are taken afetr reviewing his performance. In the evaluation, it has been
found out that the employee's performance is not up to the mark then neccessary steps or
measures will be taken so that his performance can bring to the mark. These measures may
include coaching, mentoring, training and development programs, proper guidance and much
more. But it is found out that the performance of that employee is excellent then to motivate him
more there are more methods are used like increase in income, providing the promotion,
providing him with bonus and much more. Through these performance appraisal the growth of
that employee can easily get decided. This report is upon a research which will be conduct upon
the Holiday Inn Hotel. The major aim of this report is to assess the impact of performance
appraisal upon the motivation level of employees. It must also help the company in determining
the gap between the standard and the actual performance gap in the performance of employees.
Through the dteremination of same the organsiation can take the neccessary steps and actions so
that they can bridge the gap in between (Baakeel, 2018). There are various methods through
which the research can get performed, some of these methods inlclude 360 degree appraisal,
evaluation through the KPI's, benchmarking and so on. All these methods are very crucial in
analyses of performance appraisal. The data and the information which has been collected in this
report are all Qualitative In this the primary information and data has been gathered through
performing the questionnaires in the organisation in which the reviews about the employees has
been collected upon the topic. The qualitative data or information would get gathered through the

conduction of interview. The interview of the employees will get conducted and the opinion of
the company's employees gets into the consideration.
Reserach Aim
The aim of this research is to assess the impact of performance appraisal on employees
motivation in the hospitality industry (Brown, 2019).
The aim of this research is to examine the strategy of different types of businesses including
restaurants, coffee shops, hotels; and to identify the effectiveness of their performance
management strategy.
The aim of this research of to demonstrate the gaps in the performance management system and
to find the connection between the gaps and bad performance.
Research Objectives
To find out what are the most common tools used in dynamic environments like hospitality and
what are the frequency of performance appraisal by November 2020.
To identify and examine the main employee motivators in the hospitality industry and how to
meet with them in order to increase efficiency by November 2020.
To evaluate barriers that managers can face during the process of performance management and
to carry out the reasons that can lead to the failure of the process e.g. firing someone by
November 2020 (Cheptaek Chemiat and Kiptum Kimutai, 2018.).
Research questions
Performance appraisal: a tool for controlling or to encourage employees?
Why it is important to listen to employees and to engage with them: the impact of poor HR
strategies.
Why performance appraisal meetings go wrong?
How employees' motivation is affected by performance appraisal?
How to achieve the required performance?

CHAPTER 2: LITERATURE REVIEW
Literature Review is the type of methodological or theoretical review which presents the
knowledge about the topic. In these the articles, books, journals, and the academic related topics
get reviewed. The literature review is also known as narrative review. They are the sources from
where the information can get fetch. The author or the writer of that book, journal, article, blog
and of that academic source is the major proof which defines the area from where the
information was get fetch. It is a article summary in which the view points of what the author or
writer has to say upon the topic has been described (Chouhan and et al., 2016). The take of the
author gets presented in the summary. Literature review gives an opportunity to the researcher to
gain to much knowledge about the topic upon which the research has been presented.
Performance appraisal: A tool for controlling or to encourage employees.
According to Patro, (2019), Performance appraisal is a tool through which the
performances of an employees in an organisation has get analysed and examined. The
performance appraisal is very necessary to evaluate as the correct measures can be taken by the
organisation to minimise the gap between the standard and actual performance. The author has
his own take upon the benefits and disadvantages of performance appraisal. He believes that the
organisation controls the employees by evaluating their performance and if they find any
employee's performance low they tries of curb the activities of that employee through which his
performance get getting this low (Gohil, 2019). The actions of the employees can get curb or
control by shaping them or defining them in a particular form or direction. The performance
appraisal is a method which some where or the other gives the de motivated feeling to the
employees. As in the performance appraisal the gap is analysed between the standard and the
actual performance, the control measures are taken with respect to the activities of the
employees. The control or restrictions are put upon the activities and type of work of the
employees. The employees activities and work gets controlled accordingly so that the
organisation can attain their set goals and objectives.
But at some areas or points, the performance appraisal activity work as a methods for
encouraging the employees. The employees get encouraged when their work or performance gets
appreciated by their manager. Through that motivation they themselves feel so satisfied and
motivated that they performs their work with much more energy and willingness. The
performance provides the necessary rewards and appreciation to the employees. The financial

and non financial rewards and awards would help the employees in getting motivated and
generating the energy towards the direction which leads them in the attainment of objectives.
Therefore the performance appraisal works as a both a control and the motivation generator for
the employee (Gu and Nolan, 2017). For some it works as a motivator because it provides the
necessary motivator or opportunity to employees with respect to growth and it is provide as a
controller because it controls or curb the activities of the employees to some extent as the
organisation force the employees to follow a particular course of action in achieving the
organisation objective.
Why it is important to listen to employees and to engage with them: the impact of poor HR
strategies.
According to Baakeel, (2018), The human resource of an organisation is taken as an
important asset. In the modern organisation culture, the organisations practices the employees
engagement in which they evolve the opinions and decisions of them. By practising this the new
and innovative ideas get sprung which help them in attaining the competitive advantage in the
market. There are times when the suggestions and the advices coming from the employees does
help the organisation in performing the effective work and task in an organisation workplace.
When the organisation like, Holiday Inn hotel listens to the employees or the staff members their
motivational level get increased. They feel valued and satisfied in the organisation. Whereas in
the organisation where the employees do not get a chance to be heard there the level of
motivation is very low (Gupta, Beri and Behal, 2019). Listening and hearing proper to the
employees shows the good practices and exercises of human resource department. Here the
major importance is given to the human resource and their opinions and ideas. This shows that a
organisation respects the employees and consider them a important resource which helps the
company in attaining the success or their desired objectives. For increasing the employees
motivation this practice is necessary and proves to be much effective. The employees consider
themselves as a valuable person and they also consider them as an important source to
organisation. When they thinks that the organisation is giving them too much value their
productivity level in the work gets increase (Guruprasad, Sridhar and Balasubramanian, 2016).
They put more efforts in their work and helps to the fullest in attaining and fulfilling the
organisational goal. This shows the effect8ive HR strategies of any organisation. But whereas in
the organisation where all the decisions are made up by the top level management people and

there is no involvement of middle or lower level management of people in the decision making
process then it shows the poor HR strategy. There the employees are dull, not satisfied as they
believe that their full potential has not been achieved yet.
Why performance appraisal meetings go wrong?
Memon, (2019), There are times when the performance appraisal goes very wrong by the
managers. There are various reasons behind it and some of them may include, improper
presentation about the employee performance within the a short time period. The performance
appraisal generally take place for a time period of a year or semi year. Here a manager cannot
able to present a employee performance which he has performed for a year in a short meeting of
generally 20 to 30 minutes. Here the improper information about the employee can get the
employee into trouble (Kim, Oh and Park, 2018). Also there are times in a year when the
performance of employee is excellent for a particular period of time say in a quarter but as the
evaluation is done for a year the good work may got neglected by the manager in presenting the
performance appraisal. These two reasons can be prove of the major ones through which the
performance appraisal can went wrong.
How employees' motivation is affected by performance appraisal?
According to Farag, (2017), Performance appraisal is a methodology that revolves around
analysing the overall performance of an employee and use it as a tool to motivate them. Key
indicators are used to measure the growth in the efficiency of an employee's action. Active
monitoring practices are used to determine the operational values the employee works under
along with the growth that the employee have made. This is often done by the management of an
organisation. This helps in motivation of employees as every member of workforce is driven by a
motivation,. For some employees it might be higher level of pay and for others it might be
promotion or recognition. And therefore management of an organisation have to figure out these
motivation and grant them to employees that works efficiently. This motivates employees as they
feel that their efforts towards their organisation are being valued and they are getting return in
accordance to it (HoLandy, Zedeck and Cleveland, 2017). Along with it the employees who do
not get the incentives will be driven to improve their performance so that they get the incentives
next time. This creates an atmosphere of healthy competition within the organisation itself.
These incentives that are given to employees can be monitory as well as non-monitory depending

upon the driving motivation of employees. Healthy competition is beneficial for the overall
organisational goals as it increases employee efficiency and helps an organisation in achievement
of their overall objectives more efficiently. This methodology of performance appraisal is
beneficial in motivating the employees of the organisation as well. This helps in building the
feeling of belongingness in the employees for the organisation as well. This helps in employees
to work with more efficiency as they believe that they are a part of organisation itself. The
management have to effectively initiate performance appraisal practices in order to make sure
that it have better chances at motivating employees which will in turn result in efficient
achievement of organisational objectives (Lehtinen and Pälli, 2020).
How to achieve the required performance?
According to Landy, (2017), The required performance can get achieved through setting up
the goals and objectives in an effective manner. All the goals and objectives set clearly and
properly understood by the employees. This helps in getting a clarity in the minds of employees
about what they suppose of do and how they can achieve their goals. Setting up the clear
objectives can help the employees in reducing or eliminating the confusions, showing them the
clear path for actions, increase in their production activity and much more. A proper planning is
necessary before taking an important action (Levy and et al., 2018). The planning will help the
employees in eliminating all sorts of risks which they may face in the path also it helps in lying
the path which is will help them in attaining the success. Apart from this the continuous
examination and analyses of ones performance can also contributes to the achieve the required
performance. With the continuous analyses of the performance, the gap which present between
the actual and standard goal can get minimum through taking the appropriate controlling
measures.

CHAPTER 3: RESEARCH METHOD AND METHODOLOGY
Types of investigation
It is the systematic thorough and minute attempt in order to learn the facts about
something which is hidden and complex. There are mainly two types of investigation being used
in research which is- Qualitative research- It is that kind of research which is descriptive in nature and is
regarded as the phenomenon which may be observed but not be measured. It seeks to
answer the questions about how and why the people behave in a way. It provides the in
depth information regarding the human behaviour.
 Quantitative research- It involves collecting the data which is in numerical form which
can be analysed using the methods of mathematical based. It involves using more
respondents so that data can be collected in an easy manner (Loga and Chand, 2019).
In context to this research, qualitative research shall be used so that answers can be sort
of the questions which are helpful in achieving the successful research objectives.
Research approach
It is basically a procedure or a plan which consists of steps of the broad assumptions to
the detailed methods of the data collection, interpretation and the analysis. There are two types of
research approach which is discussed below- Inductive- It begins with an observation and the theories which are proposed towards the
end of research process as the result of the observations. It is aimed to develop the
theories. The process involves initially the gathering of information and then looking for
the pattern to analyse it so that theory can be developed (Marchegiani, Reggiani and
Rizzolli, 2016).
 Deductive- It is mainly the one that the people typically associate with the scientific
investigation. The researcher in this approach studies what others has done and read the
existing theories and then test the hypothesis which emerged from those theories.

In context to this research, deductive approach is being used so that research aims and
objectives can be attained.
Research philosophies
It is the belief about a way in which the data about the phenomenon must be gathered,
used and analysed. It is mainly of two types which is illustrated below- Positivism- It is claimed that a social world may be understood in the objective way. This
research is based and dependent upon what is the researcher's interest.
 Interpretivism- It involves the researcher to interpret the elements of a study and also
integrate the human interest in the study. This philosophy emphasizes on the qualitative
researcher rather than quantitative one (Memon and et al., 2019).
In context to this research study, interpretivism research philosophy shall be used which
will help in interpreting the qualitative data which is gathered to achieve the research objectives.
Research strategy
It is the overall plan in order to conduct the research study. The research strategy mainly
guides the researcher in planning, monitoring and executing the study. There are three kinds of
research strategy which is discussed below- Questionnaire- It is the main component for collecting and gathering the data. It is the set
of standardized questions which follow the fixed scheme so that individual data can be
collected about the specific topic. Interview- It mainly involves the open ended questions so that in depth data can be
collected from the respondent (Paramesh and et al., 2020). It helps in explaining and
better understanding the research subject's opinion.
 Survey- It is the collection of the information from the sample of the individuals through
the responses to their questions. It helps in describing the characteristics of the large
population as it provides broad capability.
In context to this research, interview shall be used as research strategy so that accurate
and relevant data can be collected from the respondents.
Sampling
It is a process which is used in the statistical analysis so that pre determined observations
can be brought from the larger population. It is referred to as the process which involves
selecting the units from the population of interest so that result can be generated fairly from the

population which have been chosen for collecting the data. For this research, the sample size is 3
respondents whose interview shall be conducted to collect the qualitative data for achieving the
aims and objectives of the research.
Data collection
It is referred to as the process which involves gathering and measuring the information on
the variables of the interest in the established systematic form. It involves collecting, measuring
and analysing the data and also involves the evaluation of hypothesis which is based on the
collected data (Levy and et al., 2018). There are mainly two types of data collection which is
illustrated below- Primary data collection- It is such a data which is collected as the first hand and original
research. It is collected directed from the population through the research method of
interview, survey or experiments.
 Secondary data collection- It is referred to as the data which is already collected by
someone else in the past. It means that the data is already available and analysed by
someone else. It includes books, journals, magazines and many other.
For this research, primary data collection tool is being used which will help in collecting
first hand information from the respondents through interview method (Loga and Chand, 2019).
Data analysis
Data analysis is the process of the systematically application of the statistical or the
logical techniques in order to describe, illustrate and evaluate the data. For this research,
Thematic analysis is being used so that research objectives can be achieved e4ffectively. It is the
method which is used to analyse the qualitative data. It is applied to the set of text like interview
transcripts. The research in this analysis, closely examine the data so that it can identify the
common theme which involves patterns in the data which are interesting and important
(Marchegiani, Reggiani and Rizzolli, 2016).

CHAPTER 4:
DATA ANALYSIS AND PRESENTATION OF DATA
Data analyses is a method through which the data get collected or gathered and then it get
interpreted to a meaningful information. These data or the information which got fetch from the
raw data helps in making the necessary decisions and strategies in the organisation. For this
particular research the qualitative research as been used. Qualitative research is the research
method in which the non numerical information get collected by the investigator. In the
qualitative research the thematic data has been used. Thematic data is an analytical tool to
interpret ate the data.
For this research purpose the data has been gathered by conducting the interviews. The
interview questions are:
Questions
Q1. In your perspective what role does performance appraisal plays in an organisation?
Q2. In your opinions what is the major drawback of performance appraisal?
Q3. Does this approach really helps in motivating the employees?
Q4. In your opinion which is the best method for performance appraisal?
Q5. Do you think performance appraisal method curbs the employee actions or activities?
Theme 1: Role does performance appraisal plays in an organisation
Q1. In your perspective what role does performance appraisal plays in an organisation?
Respondent 1: The performance appraisal is a method through which the productivity of an
employee can get increased. It shows the areas or the grounds at which the employees or the staff
member gets to know about the improvements levels and the areas where the employees
performance is the good.
Respondent 2: It is a method which can help in identifying the areas which are insufficient in
terms of their working. It gives them the opportunity to work more upon the unproductive or
insufficient areas so that they can attain their performance which set as a standard for the
employees.