Examining the Interrelationships Among Reward Systems, Organizational Climate, and Cultural Changes in the Hospitality Industry

Abstract

This article aims to explore the impact of a hotel's reward system on strengthening: positive relationships and communication among employees; the creation of a change-friendly organizational climate and cultural change barriers, within the context of a cultural change process in a hotel. Quantitative data were collected from a proportionally stratified, representative sample of 207 Greek five-star hotels' senior executives and analyzed with the principal component method of extraction and structural equation modeling. This led to the creation and validation of three prototype second-order latent variable models, which highlight and depict the impact of individual variables and their importance for a reward system creating an organizational climate for or against cultural change in hotels. The originality of the article lays on both theoretical and practical levels. On a theoretical level, the article's findings manage to fill a knowledge gap through a novel modeling of a reward system on a hotel's organizational climate in times of cultural change. On a practical level, the article findings enable hotels' executives to focus on specific variables of a reward system that can enhance and/or prevent a cultural change initiative.