CHAPTER 1

The Problem and Its Background

Introducti on
Today s food i ndustry i s growi ng at a fast rate. Customers
nowadays are not onl y after the restaurant s best sel l ers or
speci al ty yet they l ong for a sati sfacti on on the servi ce provi ded
by the restaurant. They l ong for a product and an experi ence
worth payi ng the pri ce. Let us fi rst defi ne the term customer
sati sfacti on.
Customer sati sfacti on i s a term frequentl y used i n
mareti ng. !t i s a measure of how products and servi ces suppl i ed
by a company meet or surpass customer expectati on. Customer
sati sfacti on i s defi ned as "the number of customers# or percentage
of total customers# whose reported experi ence wi th a fi rm# i ts
products# or i ts servi ces $rati ngs% exceeds speci fi ed sati sfacti on
goal s. $http&''en.wi i pedi a.org # (i i pedi a%
)everthel ess# sati sfyi ng our customers i s one of the mai n
i ngredi ent to a successful busi ness i n our i ndustry. !t can then
l ead to customer l oyal t y and repeti ti on. *nd of course mareti ng
wi th the use of (ord of mouth can be a great step on becomi ng
one of the famous establ i shments. +ati sfacti on of customers on

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both food and servi ce wi l l eventual l y l ead to a growth on profi t
due to customer l oyal t y# trust and repeti ti on. (i th thi s statement
i n mi nd# we wi l l be di ggi ng i nto the rel ati onshi p of the vari abl es of
both organi ,ati onal commi tment and customer percei ved val ue.
*nd accordi ng to -. /actors That *ffect Customer +ati sfacti on by
)ati onal 0usi ness 1esearch !nsti tute# There are many entry
poi nts when exami ni ng customer sati sfacti on 2 -. of whi ch are
di scussed i n thi s arti cl e. 0ut the 3 umpi ng off poi nt for customer
sati sfacti on doesn t start wi th the customer at al l . !t actual l y starts
i n4house# wi th the empl oyee. The si ngl e most i mportant factor
that affects customer sati sfacti on i s empl oyee sati sfacti on# says
5oward 6. 1oss# presi dent of a 7aryl and4based consul ti ng fi rm.
8mpl oyees who feel sati sfi ed and happy at thei r 3 obs natural l y
tend to be more hel pful and consi derate toward customers. !t s
si mpl e l ogi c. !f ! l i e my 3 ob and the company ! wor for# ! m goi ng
to communi cate to customers that we have a good product. $9en
(est# :h.;# <..=%
!n thi s study# we wi l l focus on the di scovery of how the
management can i ncrease customer sati sfacti on# l oyal t y and trust
through empl oyee s wori ng envi ronment#
teamwor'communi cati on# competence# and servi ce abi l i t y and

COLLEGE OF TOURISM, HOSPITALITY & TRANSPORTATION MANAGEMENT
empl oyee sati sfacti on. (e wi l l focus on how the sai d di mensi ons
of organi ,ati onal commi tment can greatl y affect the di mensi ons of
customer s percei ved val ue. Thi s study i s ai mi ng to see the best
di mensi on the management can further i mprove to sati sfy
empl oyees# to be a more producti ve team whi ch wi l l then l ead to
customer percei ved val ue.
Statement of the Problem
Thi s study i s tased to determi ne the rel ati onshi p of the
organi ,ati onal commi tment of the empl oyees and managers and
the percei ved val ue of the customers of sel ected restaurants i n
7ari i na Ci ty.
Sub problems
-. 5ow wi l l the empl oyees and managers assess the
organi ,ati onal commi tment i n terms of&
-.- (ori ng envi ronment
-.< Teamwor'communi cati on
-.> Competence
-.? +ervi ce abi l i t y
-.@ 8mpl oyee sati sfacti on
<. !s there a si gni fi cant di fference bet ween the assessment of
empl oyees and managersA
>. 5ow wi l l the customers assess the percei ved val ue as to&
>.- +ati sfacti on
>.< Trust
>.> Loyal t y

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?. !s there a si gni fi cant rel ati onshi p bet ween organi ,ati onal
commi tment and percei ved val ueA
Theoretical rame!ork
The study wi l l be focusi ng on how the restaurants can
i ncrease thei r customer s sati sfacti on# customer trust and l oyal t y
through thei r empl oyees wori ng envi ronment#
teamwor'communi cati on# servi ce abi l i ty and sati sfacti on. The
sai d vari abl es of the organi ,ati onal commi tment wi l l focus on how
the di mensi on of customer s percei ved val ue.
The researchers wi l l be usi ng the +ervi ce :rofi t Chai n 7odel
created by 6ames 5esett on -==? to l egi bl y show the l i ns
between the i nternal servi ce qual i ty and customer percei ved val ue
thus mani festi ng the ob3 ecti ve of thi s study whi ch i s to prove that
i nternal servi ce qual i t y i s i n correl ati on to the customer percei ved
val ue. The servi ce4profi t chai n establ i shes rel ati onshi ps between
profi tabi l i ty# customer l oyal t y# and empl oyee sati sfacti on# l oyal t y#
and producti vi t y. The l i ns i n the chai n $whi ch shoul d be regarded
as proposi ti ons% are as fol l ows& :rofi t and growth are sti mul ated
pri mari l y by customer l oyal t y. Loyal t y i s a di rect resul t of customer
sati sfacti on. +ati sfacti on i s l argel y i nfl uenced by the val ue of

COLLEGE OF TOURISM, HOSPITALITY & TRANSPORTATION MANAGEMENT
servi ces provi ded to customers. Bal ue i s created by sati sfi ed#
l oyal # and producti ve empl oyees. 8mpl oyee sati sfacti on# i n turn#
resul ts pri mari l y from hi gh4qual i ty support servi ces and pol i ci es
that enabl e empl oyees to del i ver best resul ts to customers.
/i gure -. The +ervi ce :rofi t Chai n 7odel C 6ames
5esett# et al -==?

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Organizational commitment is highly correlated to perceived value.
Conceptual rame!ork
!nput :rocess Dutput
Dutput
Feedback
/i gure -.- Conceptual :aradi gm of the +tudy
The researchers present a conceptual framewor to mae the
study vi vi d# and at the same ti me# to exempl i fy the model that
serves as the foundati on of the study conducted i n the restaurants
i n 7ari i na Ci t y.

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Gathering of
information,
perceptions of the
employees towards
management
through
questionnaires
answered by the
employees
Gathering of
information,
perceptions of the
guests toward the
services provided by
the restaurant
through
questionnaires
answered by the
guests

Organizational commitment
Working
environment
eamwork!"ommuni
cation
"ompetence
#ervice ability
$mployee
satisfaction
%erceived &alue
"ustomer
satisfaction
"ustomer loyalty
"ustomer trust
"orrelation
between
organizational
commitment and
perceived value.

The vari abl es under the organi ,ati onal commi tment and
percei ved val ue of the customers are consi dered as the i nput of
the study to be abl e to come up wi th an output of fi ndi ng the
si gni fi cance of the rel ati onshi p between the organi ,ati onal
commi tment and percei ved val ue.
H"pothesis
There i s a si gni fi cant rel ati onshi p bet ween organi ,ati onal
commi tment and customer percei ved val ue based on the gi ven
vari abl es.
Scope and #imitations of the Stud"
The research was conducted i n sel ected restaurants i n
7ari i na Ci ty regardl ess of the type of ownershi p# food and
servi ces offered# number of empl oyees and seati ng capaci ty for
the researches to be abl e to fi nd out the si gni fi cant rel ati onshi p of
the di mensi on of organi ,ati onal commi tment and customer s
percei ved val ue. 7ari i na Ci t y was chosen by the researchers
because of the ti me and fi nanci al constrai nts. Thi s ci ty has a
scal e not too bi g for the researchers to venture i n a gi ven l i mi ted
ti me. The sai d l ocati on was consi dered because i t i s the ci ty
nearest to the metropol i s# bei ng a hi ghl y urbani ,ed and fi rst cl ass
ci t y# havi ng a number of restaurants needed for the study.

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The study wi l l be conducted dependi ng upon the managers
and researchers agreement on what day and ti me wi l l they al l ow
the researchers to conduct the sai d study. The respondents are
the guests of the parti ci pati ng restaurants# shoul d they be regul ar
or new guests# as wel l as the restaurant staff'empl oyees#
regardl ess of thei r age# gender and sal ary. The researchers chose
to adopt and use a conveni ent questi onnai re to gather an
unbi ased response. The di ffi cul ti es that has been encountered
by the researchers are fi ndi ng restaurants that wi l l parti ci pate and
al l ow the researchers to conduct the study i nsi de thei r premi ses
because thi s study requi res a deep i nvesti gati on i n the empl oyee
organi ,ati onal behavi ors as wel l as the management. The
researchers al so encountered such l ac of rel i abl e avai l abl e
resources due to the l i mi ted number of studi es conducted wi th
regards to the probl em. Dnl y a few number of boos# 3 ournal s and
other readi ng materi al s offered such topi c. 7ost of the rel ated
studi es of the topi c were i nternati onal l y based. Thi s correl ati onal
study has i ssues wi th regards to the predi cti on of the behavi or of
one vari abl e to another vari abl e# as fi ndi ngs wi l l al so di ffer to
other si tuati on gi ven and other respondents. * speci al emphasi s

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has to be gi ven on val ue del i very# where customer and empl oyee
are i n i nteracti on.
Significance of the Stud"
Conducti ng such study comes wi th di ffi cul ti es that al l
researchers have to face to be abl e come up wi th fi ndi ngs that wi l l
be useful not onl y to some# but al l the peopl e and organi ,ati ons i n
the 5ospi tal i ty !ndustry. Thi s part of the study di scusses about the
i mportance of the study to di fferent i ndi vi dual s such as the&
1estaurant Dwners
Dne of the purpose of thi s study i s to l et the restaurant
owners benefi t i n terms of both fi nanci al and empl oyee human
rel ati on. *s such that profi t wi l l i ncrease when the best i nternal
servi ce qual i ty on i ts empl oyees i s i mpl emented# therefore
provi di ng an excepti onal servi ce that wi l l l ead to customer
sati sfacti on and repeti ti on. ;ue to a good management# hi gh
empl oyee turn4over rate wi l l be prevented. Thi s study i s
si gni fi cant because i t wi l l provi de the i ndi spensabl e facts about

COLLEGE OF TOURISM, HOSPITALITY & TRANSPORTATION MANAGEMENT
the behavi ours of restaurant empl oyee whi ch wi l l then affect the
restaurant s over4al l performance. 5i gher producti vi t y rate wi l l
al so tae pl ace whi ch wi l l then l ead to a hi gher revenue.
1estaurant 8mpl oyees
8nhanced wori ng envi ronment# teamwor or
communi cati on# competence# and servi ce abi l i t y wi l l be provi ded
to the empl oyees resul ti ng to sati sfacti on causi ng the empl oyees
to devote themsel ves to thei r wor. 7anagement wi l l devel op
effecti ve strategi es to boost empl oyee commi tment and l evel s of
empl oyee support that wi l l al so i ncrease empl oyee engagement
and empl oyee wel l 4bei ng by creati ng a harmoni ous and successful
team of empl oyees.
Customers'Euests
+i nce the empl oyees are commi tted to provi di ng the
best servi ce qual i ty# the fact that more demandi ng the guests or
customers get# even the sl i ghtest attenti on gi ven to them wi l l
mean a l ot. Euest expectati ons wi l l be met and hi gher sati sfacti on
on both food and servi ces wi l l be achi eved such that they wi l l be
getti ng more than what they pai d for.
/uture 1esearchers

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/i ndi ngs of thi s research can be used as reference i n
the future studi es that wi l l be conducted by the researchers
dedi cated to further i mprove and devel op the fast growi ng
5ospi tal i ty !ndustry.
$efinition of Terms
Beha%ior & the way i n whi ch one acts or conducts onesel f#
esp. toward others.
Competence & the abi l i ty to do somethi ng successful l y or
effi ci entl y.
Customer ' the reci pi ent of a good# servi ce# product# or
i dea# obtai ned from a sel l er# vendor or a suppl i er for a
monetary or other val uabl e consi derati on.
Customer(s percei %ed %alue 2 the val ue of a servi ce to a
customer'guest.

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Emplo"ee satisfaction 2 i s the extent to whi ch the
empl oyees are happy or content wi th thei r 3 obs and wor
envi ronment
)uest 2 the one who pays for meal s or accommodati ons at a
restaurant# hotel # or other establ i shmentsC a di sti ngui shed
vi si tor to whom hospi tal i t y of an i nsti tuti on i s extended.
Hospitalit" industr" 2 an i ndustry that not onl y i ncl udes
hotel s and restaurants but al so refers to other i nsti tuti ons
that offer shel ter# food or both to peopl e away from thei r
homes.
*rgani+ational commitment 2 the i ndi vi dual s
psychol ogi cal attachment to the organi ,ati on
Ser%ice abilit" 4 the qual i t y of bei ng abl e to provi de good
servi ce
Turn&o%er rate 4 5ow fast tabl es empt y and fi l l duri ng a
shi ft.

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