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Testing the Validity of the Theoretical Model for TQM CSFs in hospitality Industry

and their impact on Customer Loyalty,

Walid Youssef Montasser - Prof Dr. Abd Alhakim Al Manhawy

Abstract: Total quality management (TQM) is a management philosophy which focuses on the work process and people, with the major concern for satisfying customers and improving the organizational performance. It involves the proper coordination of work process which allows for continuous improvement in all business units with the aim of meeting or surpassing customer’s expectations. It emphasizes on totality of quality in all facets of an organization with the aim of reducing waste and rework to reduce cost and increase efficiency in production and service. Total quality management (TQM) has become popular in the hospitality industry. It proposes to elicit the cooperation and loyalty of employees for the sake of corporate goals via an educational, motivating and positively rewarding relationship entered into by managers with their subordinates. The aim of the study is to test and validate the introduced theoretical model in the first part of the research, the validity of such a model can provide guidance for managers, decision makers and quality practitioners aiming to implement TQM in 5-stars hotels business to achieve their quality objectives, a comprehensive review of literature on Leadership, human resource management, customer focus, supplier relationship management, process management, training and education, teamwork, organizational culture, benchmarking and communication were carried out to accomplish the objectives of this part of the research, a group of five 5- stars Egyptian hotels was used as a case study for primary data collection, the statistical package for social science (SPSS) approach was used for hypotheses testing, Furthermore, a future scope of this study is also presented at the end of the research.

Index Terms- Leadership, human resource management, customer focus, supplier relationship management, process management, training and education, teamwork, organizational culture, benchmarking, communication.

1-INTRODUCTION

- - - - - - - ¡ - - - - - - -

otal quality management (TQM) is an integrated management approach that aim to continuously improve the performance of products, processes, and services to achieve and surpass customer's expectations. To accomplish this objective, some key factors that contribute to the success of TQM efforts are to be identified. These key
factors are often termed as critical success factors (CSFs).
In the first part of this study a pilot study was conducted
in five well known quality – oriented 5 – stars Egyptians
hotels, the aim of this study was to try to benefit from the
quality management experience possessed by these hotels
managers particularly in the field of TQM practices and
applications to help in identifying the TQM critical success
factors with the greater direct and positive effect on 5-stars
hotels performance using service quality as a performance
indicator in order to establish a long term relationship
between the hotels and their customers based on loyalty, so
as to achieve this purpose, the pilot study was proceeded
through 3 steps, where each step is based on the previous
one,

A- Step number 1:

Interviews were conducted with the top managers of
these hotels in order to find answers for 2 main questions.
The first question was about the most common internal
and external customer complaints exist in the 5- star hotels
business that indicates to a shortage in a hotel
performance?
The second question was about the hotels managers’
point of view of the right mix of TQM critical success
factors among those 22 factors affecting service industries,
which helped in minimizing the above stated problems
through enhancing the service quality as a main indicator
to the level of hotel performance?

B- Step number 2:

A constructed questionnaire was disseminated over 10
middle level and front line managers in each of the five
hotels (50 questionnaires) to detect their awareness of the
relative importance of the implemented TQM critical
success factors that was used to handle internal and
external customer’s complaints through enhancing service
quality offered by the hotels.

C- Step number 3:

A 25 structured performance appraisal forms were
introduced to each of the 5 hotel top managers with a total
of 125 appraisal forms, to measure the impact of each of the
implemented TQM CSFs on the staff performance, as to
ensure the effectiveness of those TQM CSFs identified by
hotels managers in step no (1&2) on quality of service as an
indicator for hotels performance.

Results:

As for step number 1:

The interviews that were conducted with the top
managers revealed a considerable number of the most
common internal and external customer complaints in 5-
stars hotel business that should be effectively encounter
through quality of service to achieve customers satisfaction,
a great portion of these complaints are shown in the first
part of the study (see IJSER magazine volume 4, issue 2,
February edition)
The interviews that were conducted with the top
managers of the five Egyptian Hotels also revealed a
number of 15 critical success factors among those 22 factors
effecting service industries with a greater relative
importance to 5-stars hotels business performance. (Where
their means were above 3 according to 5 likert scale), as
shown in table (1).

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Table 1: the means are arranged in a descending order

As for step number 2:

Due to the findings of the first step, the researcher
designed a questionnaire composed of 15 constructs
expressing the TQM CSFs with the highest means.
The internal reliability of each construct of the gathered
50 questionnaire forms with its different number of
statements was measured; Cranach’s alpha is calculated for
each construct. In this model 15 constructs were focused on,
The table below shows that only 10 constructs among the
15 chosen ones have Cronbach’s alphas larger than 0.7 (a
level considered “acceptable” in most social science
research) as shown in table (2).

Table 2: The internal reliability of all constructs

After checking the reliability of the items, it was needed to take the averaged scores of items for each of the 15 constructs stated in table (1) as the final score upon which we conducted further analysis. Table (3) shows the 10 TQM CSFs of the highest means.

Table 3: The means and standard deviations arranged in a descending order

It was clear from the previous results that there exists a relative importance for critical success factors when applying in 5-stars hotel business.

As for step number 3:

To study the impact of critical success factors on
performance appraisal, the researcher used the gathered
125 performance appraisal forms to develop a multiple
regression model, where performance appraisal is
considered the dependent variable and the selected 15
critical success factors are considered the independent
variables, the results obtained from the analysis shows that:
From analysis of variance, it is clear that the model is
significant since (P-value=0.000, which is less than 0.05),
this result is confirmed by (F calculated=11.507) which is
greater than (F tabulated= 1.759)
From the coefficients of the model the researcher found
that:
10 of the identified critical success factors which are
leadership, customer focus ,benchmarking, process
management ,supplier relationship management,
organizational culture, HRM practices, training and
education , teamwork and communication have a (P-value
which ranges between 0.0002-0.0005) that are less than 0.05
which means that they have a direct and positive impact on
performance appraisal.
From the analysis it was found that the rest 5 critical
success factors which are quality improvement, employee
involvement, continues improvement, information
gathering & analysis , employee empowerment have a (P-
value ranges between 0.123-0.567) that are more than 0.05
which means that they have no significant impact on
performance appraisal.

Research model and hypotheses

Based on the above results, a conceptual framework was
developed and a research model had been proposed to
examine the extent to which the 10 TQM CSFs are
implemented in 5-stars hotels business and to explore the
relationships between identified TQM practices and
company’s performance by measuring the ‘service quality’
as a performance indicator. The proposed TQM research
framework is depicted in Figure 1. This research model
suggested that the greater the extent to which these TQM
practices are present, the service quality of 5-stars hotels

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business will be higher which will lead to a higher customer’s satisfaction and loyalty. In this theoretical research framework, the independent variables are TQM practices and the dependent variables are service quality, customer satisfaction and customer loyalty respectively.
The main objective of the study was to establish the
TQM implementation and evaluation model for 5-stars
hotels business. The four research question of this study

was articulated as follows:

1- What are the most important TQM CSFs effecting the

5-stars hotels business?

2- Is there a relationship between the identified CSFs and

service quality?

3- Is there an impact in applying the identified CSFs on

customer satisfaction?

4- Is there an impact in applying the identified CSFs on

customer loyalty?

Though, there exist a number of TQM practices but the
identified 10 practices were selected as the study result and
were nominated for better quality oriented results. That led
to the following hypotheses:

• H1: There should not be any significant difference in the 10 TQM CSFs implemented by 5-stars hotels

• H11: Leadership practices in 5-stars hotels are

significantly implemented.

• H12: Customer focus in 5-stars hotels is significantly

implemented.

• H13: Teamwork in 5-stars hotels is significantly

implemented.

• H14: Organizational culture in 5-stars hotels is

significantly implemented.

• H15: Training and education in 5-stars hotels is

significantly implemented.

• H16: HRM practices in 5-stars hotels are significantly

implemented.

• H17: Communication in 5-stars hotels is significantly

implemented.

• H18: Supplier relationship management in 5-stars

hotels is significantly implemented.

• H19: Process management in 5-stars hotels is

significantly implemented.

• H110: Benchmarking in 5-stars hotels is significantly

implemented.

• H2: There is a significant positive relationship between identified TQM practices with Service quality of 5- stars hotels.

• H21: Leadership practices are positively correlated with

Service quality.

• H22: Customer focus practices are positively correlated

with Service quality.

• H23: Teamwork practices are positively correlated with

Service quality.

• H24: Organization culture practices are positively

correlated with Service quality.

• H25: Training and education practices are positively

correlated with Service quality.

• H26: HRM practices are positively correlated with

Service quality.

• H27: Communication practices are positively correlated

with Service quality.

• H28: Supplier relationship management practices are

positively correlated with Service quality.

• H29: Process management practices are positively

correlated with Service quality.

• H210: Benchmarking practices are positively correlated

with Service quality.

• H3: There is a direct correlation between service quality and customer satisfaction

• H4: There is a direct correlation between customer satisfaction and customer loyalty.

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The framework for the hypotheses as presented in figure 1:

TQM Implementation Model

TQM Practices

TQM Evaluation Model

H11
H12
H13
H14
H15
H16

LS

CF TW OC

TE

HRM

H21
H22
H23
H24
H25
H26

TQM

H1 H2

SERVICE H3

QUALITY

CUSTOMER H4

SATISFACTION

CUSTOMER LOYALTY

H17

COM

H27
H18
H19
H110
H28

SM

H29

PM

H210

BM

- Leadership (LS)
- Customer focus (CF)
- Teamwork (TW).
- Organizational culture (OC).
- Training and education (TE).
- HRM practices (HRM).
- Communication (COM).
- Supplier relationship management (SRM).
- Process management (PM).
- Benchmarking (BM).

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2- Literature review

2-1-Leadership:

There are various definitions of leader or leadership and
some of them are as follows:
“Leader is someone who can take a group of people to a
place they don’t think they can go. Leadership is we, not
me; mission, not my show; vision, not division; and
community, not domicile.” Bon Eaton, CEO Daimler
Chrysler.
(Kotter, 1996) describes leadership as “a process for
influence, without forcing, one or several groups of people
in one direction”.
(Wiberg, 1992) discusses the difference between
management and leadership. Management, according to(
Wiberg,1992), is to orientate an operation in the
surrounding world. Leadership is personal and deliberate
influence on co-workers to perform a work result.
Modern management concepts, such as TQM, are built
to a great extent on co-worker involvement. One role of the
management is to create conditions for facilitating
involvement from all members of the organization in, for
instance, decision-making processes, empowered work
teams or through delegated authority.
For TQM to be introduced successfully there has to be
top management commitment and this is to be
demonstrated through active involvement, setting clear
goals and a vision for the organization and integrating
TQM into the strategic quality planning process.
Everything starts with a committed and passionate leader
of the business organization, a leader who is really
committed to making fundamental changes (Steven Stanton
in Watts, 1996; Thiagarajan & Zairi, 1997). Senior managers
are actively involved in promoting the importance of
quality and customer satisfaction and they devote a
substantial part of their time to quality-related issues.
Each manager, including the president, must establish a
personal vision for the TQM effort. Managers should be
expected to work hard at defining what their vision is, both
as individuals and as the collective management team. The
management team, especially upper management, will be
viewed as being those who are ultimately accountable for
the success or failure of the TQM program, and they are
responsible! These managers need to be empowered to
create their visions, openly discuss them, and link their
actions and behaviors to the TQM effort (Anjard, 1998).
Researchers have stressed the importance of
organizational leadership as being fundamental to the
success of firms, even more so for industries that is global
and dynamic. The hospitality industry is complex,
dynamic, and global; as a result it becomes challenging for
the firms of the industry to sustain their competitiveness on
a continuous basis. The key to being a leader lies in the
firm’s ability to manage change as suggested by (Olsen,
West and Tse, 1998). Given the forces of change that have
impact on businesses within the hospitality industry, it is
essential to identify firms leadership characteristics that
help in sustaining competitive advantage in a dynamic
global/ local environment.

2-2-Training:

“Training is the process that provides employees with
the knowledge and the skills required to operate within the
systems and standards set by management.” (Sommerville ,
2007).
“Training, in the most simplistic definition, is an activity
that changes people’s behavior.” (Mccleland , 2002).
Training is a technology that transforms the individual
into a useful subject by making him/her visible and
controllable in order to reduce the gap between the current
and the expected state (Kelemen, 2003).
The main objective of any training programs is to
transfer work-related skills, knowledge, or information to
staff in order to improve their performance (Janes, 2003).
Training is also beneficial for both staff and managers.
Some organizations find that organizational change,
organizational culture, competition, guest demands to
improve quality, product expansion, or problems, staff
suggestion and technological changes stimulates the need
for training. However, there are some barriers to training.
They are lack of time, high staff turnover, high business
demands, cost, and a lack of training resources (Janes,
2003).
Staff training is a significant part as well as the key
function of Human Resource Management and
Development; it is the crucial path of motivating employees
and increasing productivity in the business. (Mcclelland ,
2002)
The role of training in TQM implementation is crucial to
any change effort according to the literature (Taylor &
Wilson 1996). Introducing new systems such as TQM when
people do not have the fundamental skills to work in the
new system is a prescription for disaster (Thiagarajan &
Zairi , 1997). There should be no doubt that for TQM to
succeed, the entire workforce must acquire new knowledge,
skills and abilities. Training and education based on total
quality must be planned and provided if this is to be
realized (Thiagarajan & Zairi , 1997). Top management of
best organizations, recognizing the link between education
and successful TQM, also focus their implementation
process around it (Thiagarajan & Zairi , 1997).
In modern hotel business, it is all about competence in
people, and especially the employees' qualities. The level of
service quality depends on the qualities of employees. The
qualities are about knowledge, skills and thoughts which
lead to a hotel's survival and development. Therefore, staff
training is essential in many ways; it increases productivity
while employees are armed with professional knowledge,
experienced skills and valid thoughts; staff training also
motivates and inspires workers by providing employees all
needed information in work as well as help them to
recognize how important their jobs are. (Yafang Wang,
2008.)
While most organizations train their employees in
functional and managerial skills, TQM hotels focus their
training efforts on quality.

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2-3-Customer Focus:

For organizations to be successful in today’s
marketplace, they need to be customer-focused. This can be
achieved by delivering superior value to their target
customers (Kotler et al., 1999). Organizations are created to
achieve objectives, missions, or visions but they will only
do so if they satisfy the needs, requirements and
expectations of their stakeholders. Their customers,
probably their most important stakeholder, will be satisfied
only if they provide products/services that meet their
needs, requirements, and expectations. Customer focus
means directing organizational resources into satisfying
customers and understanding that profitability or
avoidance of loss comes from satisfying customers. The
approach means that everyone in the organization needs to
be customer focused, not simply the top management
(Hoyle, 2007).
Effective customer focus demands organization-wide
commitment, appropriate managerial and employee
behavioral performance, and the implementation of
effective strategies, within the marketplace (Strong, 2006).
Even when management fully understands customer
expectations, service quality problems may occur. This is
because management may believe that they know better
about community requirements and that it is impossible or
impractical to meet all of the expectations. The organization
did not set its service specifications according to customer
needs; instead, it allowed the service to suffer because of an
assumption about who knows best (Rawlings, 2008). Since
the possibility of having organizations in search for a
customer focus strategy is present (Liang and Tanniru,
2007).
The primary purpose for introducing TQM is to achieve
complete customer satisfaction. This will in turn impact on
business organizations’ level of competitiveness and
prosperity.
Satisfying customers’ requirements better than the
competition can is widely recognized today as a key to
success in the marketplace (Peters, 1989).( Peters and
Waterman ,1982) emphasize that best organizations align
their corporate strategies to their customers’ requirements
(Thiagarajan & Zairi , 1997). An external customer service
program should include providing customers with timely
information and quick responsiveness to complaints, and
maintaining a corporate goal to reduce the quantity of
questions or complaints while recognizing all successful
efforts by employees in providing outstanding service
(Kasul and Motwani, 1995; Motwani 2001).
The power now enjoyed by customers has raised
expectations, and these expectations often determine
whether customers will stay at a particular hotel, according
to (Cooper et al., 1996). Customers are travelling more
widely, returning with new ideas and new standards
regarding accommodation provision. This means that hotel
customers are becoming much more discerning and
demanding. Competition has thus increased in the hotel
industry around the globe, and this has forced hotels to
offer better amenities, superior service, and loyalty
programs at a price that reflects value (Chaisawat, 1998; Presbury et al., 2005).

2-4-Human resource management:

As Gary Dessler described "HRM is the policies and
practices involved in carry out the 'people' or human
resource aspects of a management position, including
recruiting, screening, training, rewarding and appraising."
These practices and policies include conducting job
analysis, selecting suitable and required candidates,
orienting new employees, plans and implementation of
training and developing, managing salaries, providing
employees' benefits and awards etc. (Dessler, 2006).
A number of commentators suggesting that only the
integration of HRM and TQM managed organization will
be able to survive in the future (Redman and Mathews,
1998). The HR professionals played a central role in
creating and communicating the TQM vision of the
company (Palo and Padhi, 2005)
Therefore, the human resource function must take the
lead in activities such as job design and teams that promote
cooperation empower employees to provide information,
participation and autonomy, select employees that can
adapt to the organizational culture, foster programs of
training and development with quality goals and define
appraisal and compensation policies which support quality
targets. A fruitful cooperation between HRM and TQM can
produce better organizational results. The alignment of HR
and quality policies, such as creating and communicating
the TQM vision, preparing the organization and employees
for TQM implementation and generating quality awareness
among the employees across all levels, functions, and
departments, should contribute to an increase company
performance (Palo and Padhi, 2005).
The role of the HRM department is therefore central to
the success of total quality. TQM and HRM are in pursuit of
the same goals - productivity, profitability, a customer-
oriented company and a motivated workforce (Herbig,
1994).
Human resources play four important roles in TQM
hotels: strategic partner, quality manager, change agent,
and employee advocate (Partlow, 1996).
The hotel industry is undoubtedly a labor-intensive
industry. Its success depends “on the social and technical
skills of its personnel, their ingenuity and hard work, their
commitment and attitude” (Gabriel, 1988; Anastassova and
Purcell, 1995; Mohinder & Katou 2007).
It is also true that in a labor-intensive industry, the
effective utilization of human resources can give an
organization its competitive edge (Schneider and Bowen,
1993; Mohinder, 2004). “By effectively linking HRM with
organizational objectives and needs, human resources can
be recruited, developed, motivated and retained towards
gaining a competitive advantage” (Cheng and Brown, 1998;
Mohinder & Katou ,2007).
Thus, the success of the hotel industry depends on the
quality of its employees and their effective management in
order to assist the organization to achieve its objectives
(Berger and Ghei, 1995).

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2-5-Teamwork:

Teamwork typically involves groups of interdependent
employees who work cooperatively to achieve group
outcomes (Parker and Wall, 1998). Effective team
implementation can enhance the motivational properties of
work and increase job satisfaction. However, the job
satisfaction of team members is determined by multiple
factors such as the composition of the team, group
processes within the team, and the nature of the work itself
(Campion e tal., 1993; Gladstein, 1984). Because these
factors operate in combination, there is no simple process
through which teamwork influences job satisfaction.
Teamwork is a critical element if TQM is to succeed
(Crosby 1989) Teamwork promotes a bottom-up thrust for
quality improvement and delivers synergistic enhancement
of quality efforts (Thiagarajan & Zairi , , 1997). Successful
organizations are run with teams – for solving problems,
for improving quality, for introducing new processes and
products (Hoevemeyer, 1993).
Compared to employees who work individually,
effective teams tend to have higher morale and
productivity, and take pride in the job and the company.
Employees who involve themselves in quality group
activities are also better convinced of the benefits of the
quality process (Thiagarajan & Zairi, 1997).
Quality teams are often interdepartmental, and a quality
assurance system makes it difficult for divisions to see
themselves as independent operations (Partlow, 1993).
“The company has learned that not everyone wants the
responsibility of being on a strategic-planning team and
that some managers are better suited to a team approach--
particularly as facilitator or coach--than others (Partlow,
1993).
"We use screening methods in hiring to determine who
shares in our values, and we use predictive instruments to
tell if people are well suited to teamwork. That's a
breakthrough," he said. "We also spent more time building
the relationship of the team. We took for granted that if you
were already a good Ritz-Carlton employee, you already
understood our concept of lateral service. So when we put a
group of cross-functional people together in a team, we
figured they would just naturally work together as a team
and go forward. But what we found was that we had to
spend more time to allow the team members to get to know
each other and learn how to build and maintain support
before they could really get the kind of improvement we
wanted (Partlow, 1993).
According to ( Breiter et al., 1995), Bergstrom’s team
workshop focuses on recognizing individual strengths, the
principles of building a successful team, day-to-day team
techniques, and how to put those techniques into action.
The problem-solving session teaches participants how to
solve problems, whether personal or professional,
effectively and a five-step method, beginning with analysis
and ending with implementation, provides the framework
for the workshop (Breiter et al., 1995).

2-6-Communication:

Earlier studies indicated that communication is an
essential element in the practice of internal communication
within an organization. (Woodruffe , 1995) defines internal
communication as treating employees with an immense
value through the practices of programs to attain
organizational objectives. Internal communication should
not hinder the understanding of the overall organizational
functions but establish clear communication linkages and
internal relations to strengthen the organization. At one
time, internal communication was considered a backwater
in the communication world.( Michael, 1995) states that in
the past, top management seldom revealed its plans to
employees because they did not have to know necessarily
but in a today's changing business environment, an
employee communication function needs to be compelling,
thus, organizations can take a look at communicating with
employees. Several structures and policies need to be
followed to ensure the effectiveness of internal
communication such as employers ensuring that employees
receive copies of strategies, plans, missions, and goals to be
reached, besides that (Howard, 2000) states that, employers
need to make face-to-face communications with the internal
publics to maintain their effective internal communication.
It is in fact that the backbone of their internal
communications programs. Moreover, it could help
managers to develop a positive working relationship with
their employees, as it offers for an enhanced two-way
communication.
The more communication is integrated organization-
wide, the better it would be for the culture of TQM inside
the organization as people’s attitudes and behaviors are
clearly influenced by communication levels (Oakland,
2003). The key feature of communication is that it helps
managers and staff achieves organizational objectives by
facilitating information-sharing between them both
(Johnston et al., 2007).
For sharing information to be successful, management
should target the right audience with the right message in
the right way at the right time Failure to communicate
effectively creates unnecessary problems, resulting in
confusion, loss of interest and eventually in declining
quality through apparent lack of guidance and stimulus
(Oakland, 2003). If an organization aims to introduce a
TQM culture in its operations, appropriate levels of
communication would be required for managers to explain
to their staff the need to focus on processes and improving
their performance. Managers also need to share information
about the new culture with their staff to reduce their
resistance to its adoption (Oakland, 2003).
Generally, a development in a hotel industry is likely to
affect communication needs and patterns. The rapid
developments in the hotel industry can be concluded as the
crowing of effective communication. Employees in a hotel
industry are duty bound to communicate effectively to their
customers (Proctor and Doukakis, 2003).
Hotel staff should have the opportunity to share
information with their managers (bottom-to-top). This
information can be in the form of ideas, suggestions and

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comments that staff quotes on how to improve the quality of service in the hotel they work in.

2-7-Organizational culture:

The term corporate culture is one of the most frequently
used cliché’s, with precise definitions varying within the
normative literature. (Johnson and Scholes, 1984) define
corporate culture as being ‘the deeper level of basic values,
assumptions and beliefs that are shared by members of an
organization’. These values, assumptions, attitudes and
beliefs are reflected within an organizational culture. In
fact, they are manifested in many ways such as the rites,
rituals and routines that take place within an organization,
the language used the stories, legends and myths that are
told and re-told, the symbols, logos and artifacts that are
found throughout the company. Therefore, an
organizational culture is considered to be a set of collective
norms that govern the behavior of people within the
company. An organizational culture is characterized by
members’ shared ability to understand specific concepts
within the organization (Karathanos, 1998).
The key feature is that culture is taught to new members
as the correct way to behave, thus perpetuating
organizational survival and growth (Maull et al., 2001).
A strong organizational culture enables the smooth flow
of information and nurtures harmony among its members
(Karathanos, 1998). Improvements in work culture and
internal communication thus improve customer (internal
and external) satisfaction, which is essential for market
growth and profitability in the long term (Lakhe and
Mohanty, 1994).
According to (Miconnet, 2001), a new common set of
core values based on mutual agreement must be formulated
to establish the quality culture proposed in TQM.
According to (Hill, 1991), it is the task of the top
management to design a structure and establish a culture
that will maximize the effective participation of all
employees in the pursuit of quality (Dygert, 2000) claims
that the development of a quality culture in an organization
most often requires a dramatic change in the way people in
the organization see the world and their roles in it.
While TQM has separate origins from the culture
movement, the two fields have recently converged with the
idea that to achieve “excellence” and “quality”, it is
necessary either to change or work with the culture of an
organization (Lewis, 1996). Implementation of TQM
requires changes to the shared assumptions, frames of
reference, and understanding that most organizations have
developed through interaction with their environment.
These changes will impact basic beliefs and values that
employees hold about work. (Ngowi, 2000) This is why
many companies are now attempting to identify their
organizational culture prior to implementing their TQM
programs (Maull et al., 2001).
The implementation of TQM is not an easy task, as it
requires a total change in organizational culture, shifting of
responsibility to management, and continuous participation
of all in the quality improvement process (Lakhe and
Mohanty, 1994).

2-8-Process Management

A process is a series of interconnected activities that
takes input, adds value to it and produces output. It's how
organizations do their day-to-day routines. Your
organization's processes define how it operates.
Much of the work within an organization can be looked
upon as a process, which means a repetitive sequence of
activities (Bergman & Klefsjo, 2003). The goal of the process
is to produce products or services, which should satisfy the
customer. The corollary of focusing on processes is that the
focus is not on results. Instead the result is the dependent
variable. The result comes from whatever process is
followed; process drives result (Shiba et al., 1993). The
process generates data that indicates how well the process
is satisfying its customers. This means that we should not
look upon every single piece of data, for instance a
customer complaint, as something unique but instead as a
part of the statistics, which can give information about how
well the process is working and how it can be improved
(Bergman & Klefsjo, 2003). The process orientation and
focus has become even more focused on in the currently
dominating improvement program Six Sigma.
Processes define how organizations function and
projects are the means by practices have been described as
perhaps the most important management idea of the last 20
years (Cole and Scott, 2000). The notion of process
management can be traced back to the evolving quality
movement and its advocated shift in focus from product
characteristics (i.e. the output) to process characteristics (i.e.
how value is actually created in organizations) (Shewhart,
1931). This shift was emphasized further by the next
generation of scholars in the quality movement, suggesting
that the whole organization should be viewed as a system
of processes (Ishikawa, 1985; Deming, 1988; Juran, 1989).
With this view as a basis, process management involves
concerted efforts to define and map processes; identify
bottlenecks and improve; and designate process owners
(POs), thus creating a management structure for the value
flow that crosses between departments (Benner and
Tushman, 2003).
It is not enough for an organization to do better than it
did previously. The external demands an organization faces
are continuously increasing. Consequently, an organization
needs to continually try to improve the quality of its
product and processes (Imai, 1997; Bergman & Klefsjo,
2003). The continuous improvement of the process leads to
customer satisfaction, which results in an external quality
improvement. The continuous improvement of the process
also leads to fewer defects, which results in an internal
quality improvement (Dahlgaard et al., 1994).
If employee involvement is a key to the attainment of
customer satisfaction, managing by process is a key to
engaging an organization’s employees to take responsibility
for what they are doing in relation to satisfying the
customers (Oakland and Beardmore, 1995; Juran, 1993;
Thiagarajan & Zairi 1997).

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2-9-Supplier relationship management

Most organizations today are faced with increasing
competitive challenges and opportunities. To become or
remain competitive, organizations have had to learn to
adapt and improve performance in numerous ways,
including rapid product development (faster to-market),
reducing delivered costs, and providing higher product
and service quality. As the discipline of supply chain
management continues to evolve, there is an increasing
awareness of how customers can effectively work through
suppliers to achieve the needed performance and business
results (Stephen K. Hacker, 1999).
In the evolution of the customer-supplier dynamic, we
have seen a significant change in the nature of relationships
between customers and suppliers. In the past, customers
commonly relied upon their power to award business or to
take it away in supplier relationships, often setting up win-
lose conditions. As a result, adversarial climates frequently
developed (Jeff T. Israel, 1999).
Today, more and more buyers and sellers come together
for mutually beneficial reasons based less on the customer's
power and more on a symbiotic relationship based on value
exchange. When the buyer-seller relationship becomes
strategic in nature, we can describe the customer and
supplier as "business partners". At this point, trust becomes
a central component to customer-supplier relationships. A
significant level of mutual intention is required for
organizations to proceed in trust building initiatives. Trust
can be very fragile. Once business partners start down the
trust-building road, direct and implied promises must be
kept. Failure to stay the course can lead to a deterioration
rather than improvement of trust (Laurent Couturier, 1999).
In any alliance between two organizations, trust is an
essential ingredient to the success of the joint endeavor (Cyr
1999; Norausky 1998). When a high level of trust exists,
each party is convinced the other is committed to mutual
success. This feeling is strengthened by the fact that their
successes are often interdependent. A customer with a high
level of trust is a customer that tends to increase purchases.
A supplier that does well has the resources and
commitment to produce a quality product of value for the
customer. Both companies win when they create and
sustain a climate for cooperation and trust.
Developing a positive trust attitude encourages your
counterpart to reciprocate trust toward you (De Furia,
1996).When customers and suppliers trust each other, the
degree of complexity of their negotiations decreases
(Buttler, 1999). This allows them to discuss important
matters for mutual success rather than a host of little details
(which may relate to concerns of how to control the other's
behavior). Thus in the presence of trust, negotiations
consume less time and resources.
A major task in improving supplier performance was to
change these unsatisfactory relationships (Langfield- Smith
and Greenwood, 1998). With trust, sensitive and
proprietary information is offered freely with little fear of
abuse of sensitive technical information. The customer
receives higher value and higher quality products.
No total quality process is complete if it does not address the issues related to the process of managing suppliers (Elshennawy et al., 1991). This notion stems from the quality management philosophy of “prevention rather than detection”. TQ organizations aim for “design and purchase” quality, rather than “inspecting” quality to produce services and products that meet customer requirements (Thiagarajan & Zairi, 1997).

2-10-Benchmarking

Benchmarking is an integral part of a total quality
process (Bank, 1992; Beadle and Searstone, 1995; Bendell et
al., 1993; Kleiner, 1994; Mitchell, 1995). But what is
benchmarking? A continuous, systematic, process of
evaluating companies recognized as industry leaders, to
determine business and work processes that represent best
practices, establish rational performance goals (Zairi, 1994).
The primary objective of benchmarking is performance
improvement. Identifying opportunities for performance
improvement by comparing one organization’s
performance with that of another is a reflex of TQM (Bank,
1992).( Zairi, 1994) draws the link between TQM and
benchmarking: TQM is the wheel of improvement for doing
an internal value-adding activity for the end customer.
Benchmarking ... is the external activity for identifying
opportunities and ensuring that the wheel of improvement
is turning in the right direction and is making the necessary
effort towards the end destination, i.e. achieving high
standards of competitiveness.
Many best organizations are using benchmarking as a
tool for obtaining the information to be used in the
continuous improvement process, and to gain competitive
edge (Booth, 1995; McNair and Leibfried, 1992). They are
attracted to it because it stimulates and challenges the
improvement process (Smith, 1994).
According to American productivity and quality
center (APQC), “benchmarking is the process of
identifying, understanding and adapting outstanding
practices and processes from organization anywhere in the
world by a firm to improve its performance” (APQC, 1993).
In other words, best practices are the benchmarks that
should be adopted by a firm as the standards to exercise
operational control. The performance of an organization
can be evaluated continually till it reaches the best practice
level by using benchmarking. However, benchmarking
offers firms a tangible method to evaluate performance
(Kazmi, 2007).

3-Research Methodology:

To fulfill the requirements of the study, four main points
were taken in consideration and should be clarified before
proceeding into the steps of the research as follows:

• Fifty employees from each of the 5 hotels (a total of 250

employees) were selected with at least 15 years
experience in the 5- stars hotels business, those
employees whom may be considered as an experts in the
field of concern should have spent at least 3 years of
their career working at a well known quality- oriented 5-
stars hotels, for this reason the total number of

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employees in the selected five hotels was as big and convergent as possible see table (4).

Table 4: the numbers of rooms and employees in 5 hotels

• The distribution of the selected employees (experts) over the managerial structure of each of the five hotels whether vertically (top management, middle managers, front line managers, etc….) or horizontally (head of divisions, head of departments, head of sections, captains and heads of chiefs ,etc….) was considered

• The geographic distribution in selecting the 5 hotels was

taking in consideration to benefit from the diverse in
age, gender, education and cultural background of the
external customers in evaluating the quality of different
packages of services offered by the 5 selected hotels as
shown in table below.

Table 5: the geographic distribution of the 5 hotels

• Furthermore two crucial values were to be determined , the first was the expected value of quality of service

between 87 – 100% or between 4.35 – 5 on Likert scale, therefore the researcher selected the value 4.25 for quality of service and 4.35 for TQM CSFs degree of implementation to be used for the purposes of the research.

Finally the research was preceded through 3 steps as follows.

Step 1

In order to test the main hypothesis H1 and its 10 sub-
hypotheses H11 to H110, a questionnaire composed of 10
constructs representing the chosen 10 CSF was
disseminated over the selected hotels experts (250
questionnaires), as to determine to what degree the 10 TQM
CSFs were implemented in the 5 hotels.

Step 2:

In order to test the main hypothesis H2 and its 10 sub-
hypotheses H21 to H210 it was important to evaluate the
quality of service offered by the hotels from the
professionals point of view, so the researcher
communicated the Egyptian ministry of tourism to obtain
this necessary information as appraised by auditing
companies hired especially for that matter.

Step 3:

In order to test the two main hypotheses H3 and H4, a
questionnaire composed of 4 parts was disseminated over a
calculated sample size of (380) of hotels customers as will
be shown below.
-The first part of the questionnaire was used to describe
the demographic characteristic of the customers.
-The second part composed of 22 questions to measure
the 5 dimensions of quality of service identified by
(Parssuraman, 1980) as perceived by the hotels customers.
(These 5 dimensions are reliability, assurance, tangibles,
empathy and responsiveness).
-The third part composed of 5 questions to measure the
degree of customer satisfaction.
-The fourth part composed of another 5 question to
measure the degree of customer loyalty.

4-Results:

As for step 1:

To measure internal reliability of each construct of the
gathered 250 questionnaire forms with its different number
of statements, Cranach’s alpha was calculated for each
construct. In this model, 10 constructs were focused upon;
the Cronbach’s alphas were calculated according to
equation number (1).

k ⎡ ∑ S 2 ⎤

accepted in 5-stars hotels, and through investigating
references and institutions concerned of that matter such
as the European consumer centre network(ECCN) and

Where:

α = ⎢1 − 2 ⎥

k − 1 ⎣ t ⎦

the national tourist board for England(NTBE), it was found that it ranges between 85 - 100% or between 4.25 –
5 on Likert scale, the second was the expected acceptable value of the degree of implementation of the selected 10
TQM CSFs in order to achieve the desired quality of service for 5-stars hotels , and through a series of interviews with seven of quality experts especially in the field of concern , it was estimated in average as a range
K is the number of Constructs test.
Si2 is variance responses to each Constructs of the test
St2 is variance of the total answers of Constructs of the test.
The table below shows that the 10 constructs for this
model have Cronbach’s alphas larger than 0.7 (a level
considered “acceptable” in most social science research).

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Table 6: The internal reliability of all constructs

- Testing the first main hypothesis H1

The means and standard deviations of the employee’s
answers extracted from the gathered 250 questionnaires are
shown in table below:

Table7: means and standard deviations of the 5 hotels.

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The results in table (7) showed that the perceived mean value of the implemented 10 TQM CSFs is equal to (3.81) which is a moderate value, and that the standard deviation is equal to (0.92), this calculated mean is less than the expected mean value which was estimated before by (4.35) according to Likert scale, so it is clear that there is a gap existence between them.
To confirm this result the researcher developed a one sample T-test that revealed a significant difference between the perceived value of the implemeted10 TQM critical success factors and of the expected value through calculating (P value=0.00) which is less than (0.05) which mean that the null hypothesis is rejected and the alternative hypothesis is accepted, also by measuring the value of (T calculated= -9.28) it is less than the value of (T tabulated= -
1.970).
These results were ensured by measuring the value of
(confidence intervals = 3.695; 3.92) which did not include
the value of (zero).

• From the above results it is clear that the first

main hypothesis H1 is rejected.

-Testing the 10 sub-hypotheses H11 to H110

The researcher developed 10 one sample T tests, and the
results are shown in table (8).

Table 8: one sample T test

It is clear from the table that for all tests (P value= 0.00) which is less than (0.05), also all the values of (T calculated) which ranges between (-14.82 & - 3.86) are less than (T tabulated=-1.970), these results are ensured by the values of (C.I) that ranges between (3.33& 4.11) which did not include the value of (zero).

• From the above results it is clear that the 10 sub-

hypotheses H11 to H110 are rejected.

As for step 2

The feedback from the Egyptian ministry of tourism
revealed that the 5 selected hotels were audited through the
last two months of year 2012, and the service quality
offered was evaluated for each hotel, The results in table (9)
below shows that the perceived mean value of service
quality is equal to (3.43) which is a moderate value, and is
less than the expected mean value of service quality which
was estimated before by (4.25), so it is clear that there is a gap existence between them.

Table 9: the mean values of service quality for 5 hotels

(Source: Egyptian ministry of tourism)

- Testing the second main hypothesis H2

The researcher developed Pearson correlation matrix
between the mean value of 10 TQM critical success factors
and the mean value of service quality, the results revealed a
direct and strongly positive relationship between them,
their values ranges between (0.738 & 0.856) and significance
with (P value = 0.00), and indicate that as the mean value of
the implemented TQM CSFs increases the quality of service
increases.
Also, a multiple regressions model was developed
between the 10 TQM critical success factors as independent
variables and service quality as dependent variable, and the
results revealed that the model is significant through a (P
value= 0.00) which is less than (0.05), and confirmed by (F
calculated = 6.678 ) which is greater than (F tabulated =
1.870 ), also the effect of the 10 TQM CSFs on the service
quality was proved through the P values for the coefficients
of the multiple regression which ranges between (0.000 &
0.003) that is less than (0.05), so it is clear that all of the 10
TQM critical success factors have a positive impact on
service quality, to ensure the previous results the coefficient
of determination was calculated and its value was (r2=
82.35%) and that confirm all of the 10 TQM critical success
factors have a strongly positive impact on service quality,

• From the above results it clear that the second

main hypothesis H2 is accepted.

- Testing the 10 sub-hypotheses H21 to H210

The researcher developed a 10 simple regression models
between the quality of service as dependent variable and
each of the 10 TQM CSFs as independent variable, and the
results showed that all models proved to be significant
through (P value) that ranges between (0.003 & 0.008)
which is less than (0.05), and confirmed by (F calculated)
which ranges between (7.358 & 9.256) that are greater than
(F tabulated = 3.879), also the coefficients of determination
r2 were calculated and it ranges between (33% & 55%), these
results mean that each of the 10 TQM CSFs positively affect
the service quality.

• So it is clear that the 10 sub- hypotheses H21 to

H210 are accepted.

As for step 3:

To measure internal reliability of each construct of the
questionnaire form with its different number of statements,
Cranach’s alpha was calculated for each construct. In this

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model, 7 constructs are focused on, the Cronbach’s alpha are calculated according to equation number (1).
The table below shows that all the constructs for this model have Cronbach’s alphas larger than 0.7 (a level considered “acceptable” in most social science research).

Table 10: internal reliability for all constructs.

questionnaire forms were distributed over the customers, the number of questionnaires that was distributed to each of the 5 hotels customers are shown in table (11).

Table 11: number of questionnaires introduced for each hotel.

The researcher determined the Sample Size for customers through the following.
First: without taking into account the research
Pie chart in figure (2) shows the number and percentage of questionnaires distribution over the customers of the 5 hotels.

Figure 2

Category

Hotel 1

population using equation number (2):

t 2 p(1 − p)

Hotel 5

73; 19.2%

Hotel 1

77; 20.3%

Hotel 2

Hotel 3

Hotel 4

n =

d 2

Where:

Hotel 5

n: is the sample size required
t: is the number of standard units, ± 1.96 for the 95 %
confidence level.
p: is the proportion of vocabulary having the
characteristics in question that are 50%.
d: is the limit of error of 5% to 95% confidence level.

2

Hotel 4

66; 17.4%

Hotel 3

88; 23.2%

Hotel 2

76; 20.0%

n = 1.96

x 0.5(1 − 0.5) = 384.16 ≅ 385

0.052

The researcher found the required sample size n = 385. Second: the size of the sample was determined taking
into consideration the size of the community using equation number (3).

Descriptive analysis of the sample

The analysis includes the demographic variables for
personnel of the study sample:

• Gender

• Age

Where:

n1 =

n

1 + n / N

• Qualification

Gender:

n1: sample size modified with size of research community.
n : sample size without taking into account research community
N: size of research community existing in the chosen population and due to the statistics presented by the managers of the selected 5 hotels, the researcher found that (11800) customers had stayed in the hotels between
15/12/2012 – 15/1/2013.
It is the distribution of personnel on the sample
according to the variable gender.
Table (12) shows the number and percentage of males
and females who had replied the questionnaires over the 5
hotels
Par chart in figure (3) shows the distribution of the
respondent’s males and females over the 5 hotels. .

Table 12: Sample Distribution of Members According to

Gender

n1 =

385

1 + 385 /11800

≅ 373

From the above result the researcher chosen a sample size of 380 customers representing the five hotels, and a 380

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Figure 3

50

46

48 48

The percentage of personnel with low qualification is less than (20%).
Table (14) and Figure (5) represent data.

40

40

31

30 28

20

10

0

Gender

36 37

34

32

Table 14 Sample Distribution According to Qualification

Figure 5

Age:

It is the distribution of personnel on the sample
according to the variable age
More than 85% of respondents were over 30 years, which
is an evidence for the presence of personnel with
experience
The percentage of young personnel is less than (15%)

50

50

46 45

43

40

40

30

22

20 18 18

Table (13) and figure (4) represents data.

Table 13: Sample Distribution of Members According to Age

15 16

13

10

0

Education

16 16

12

10

Figure 4

- Testing the third main hypothesis H3.

The means and standard deviation of the customer’s
answers from the gathered 380 questionnaires are shown in
table (15) below.

40

40

34 35 35

32

30 29

20

13

11 12

10

0

Age

33

30 30

27

9 10

Qualification:

It is the distribution of personnel on the sample
according to the variable qualification
More than 80% of respondents were highly qualified,
which is evidence for the presence of qualified personnel in
the sample.

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Table 15: means and standard deviations of the 5 hotels.

The researcher developed Pearson correlation matrix between the mean value of the 5 dimensions of service quality and the mean value of customer satisfaction, the results revealed a direct and strongly positive relationship between them, their values ranges between (0.812 & 0.941) and significance with (P value = 0.00), and indicate that as the mean value of the quality of service dimensions increase the value of customer satisfaction increases.
Also, a multiple regressions model was developed between the 5 dimensions of service quality as independent variables and customer’s satisfaction as dependent variable, and the results revealed that the model is significant through a (P value = 0.000) which is less than (0.05), and confirmed by (F calculated = 8.567 ) which is greater than (F tabulated = 2.238), also the effect of the 5 dimensions of quality of service on customer’s satisfaction was proved through the P values for the coefficients of the multiple regression which ranges between (0.000 & 0.004) that is less than (0.05), so it is clear that all these dimensions have a positive impact on customer’s satisfaction, to ensure the previous results the coefficient of determination was calculated and its value was (r2= 85.43%) and that confirm all of the 5 dimensions of quality of service have a strongly positive impact on customer’s satisfaction ,
The researcher developed a 5 simple regression models between the customer satisfaction as dependent variable and each of the 5 dimensions of service quality as independent variable, and the results showed that all models proved to be significant through (P value) that ranges between (0.003 & 0.005) which is less than (0.05), and confirmed by (F calculated) which ranges between (8.235 &
9.654) that are greater than (F tabulated = 3.866), also the coefficients of determination r2 were calculated and it ranges between (30% & 45%), these results mean that each of the dimensions of service quality positively affect customer’s satisfaction.

• From the above results it clear that the third main

hypothesis H3 is accepted.

- Testing the fourth main hypothesis H4

The researcher calculated Pearson correlation between
the mean value of the customer’s loyalty and the mean
value of customer’s satisfaction , the result revealed a direct
and strongly positive relationship between them, their
value equal (0.88) and significance with (P value = 0.00),
and indicate that as the mean value of customer satisfaction
increases the value of customer loyalty increases.
Also, a simple regression model was developed
between customer’s loyalty as dependent variable and
customer satisfaction as independent variable, the results
revealed that the model is significant through a (P value =
0.000) which is less than (0.05), and confirmed by (F
calculated = 7.123) which is greater than (F tabulated =
3.866), so it is clear that customer’s satisfaction has a
positive impact on customer’s loyalty, to ensure the
previous result the coefficient of determination was
calculated and its value was (r2= 88.67%) and it confirm
that customer’s satisfaction has a strongly positive impact
on customer’s loyalty.

• From the above results it clear that the fourth

main hypothesis H4 is accepted.

5-Conclusion:

Retaining customers in hospitality industry has become
a major objective for quality experts and practitioners. TQM
CSFs are considered to be essential for gaining customers
satisfaction in order to achieve mutual benefits of all
parties. This research was conducted to empirically
examine the impact of implementing TQM CSFs on 5-stars
hotels performance using service quality as an indicator as
to achieve customer loyalty.

The findings of this part of the research can be summarized as below:

• According to the analysis of the gathered data, it is

obviously clear that the 10 TQM CSFs are not effectively

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implemented in these hotels, as their calculated mean values are less than the expected mean value.

• The evaluation of service quality offered by the selected

5 hotels, whether through professional’s appraisal or
through investigating the hotel customers point of views
showed that the perceived mean values of the offered
service quality is less than the expected mean value.

• It was also proved that there is a strongly positive

relationship between the implemented 10 TQM CSFs
and the service quality offered by the selected hotels, so
as the degree of implementation of the 10 critical success
factors increases the value of service quality offered
increases and vice versa.

• Data analysis also revealed that the levels of both

customer’s satisfaction and customer’s loyalty are less
than the expected ones.

• Furthermore a strongly positive relationship exists

between both service quality and customers satisfaction
and between customer’s satisfaction and customer’s
loyalty, so as the level of service quality increases the
levels of both customer’s satisfaction and loyalty
increase.
The above results can be briefly explained, that the low
degree of implementation of the 10 selected TQM CSFs
caused a low level of perceived service quality, which in
return led to a low levels in both customers satisfaction and
loyalty, and this prove that the proposed theoretical model
is valid to be used.
However despite the overall findings produced in this
study, there are still open opportunities for further studies
to ensure the validity of the theoretical model, so as a future
work the researcher will investigate the causes that led to
the shortage in implementation of the selected 10 TQM
CSFs, an improvement plan will be carried out in
coordination with the top managers of two of the
previously selected 5 hotels (hotels 3&5), then after the
completion of the improvement process, the validity of the
proposed theoretical model will be re-tested, and once
more the statistical package for social science (SPSS)
approach will be used for hypothesis testing.

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