THE ROLE OF SERVICE QUALITY AND EMPLOYEE ENGAGEMENT IN ENHANCING CUSTOMER SATISFACTION AMONG HOSPITALITY AND TOURISM ENTERPRISES
Keywords:
Employee Engagement, Service Quality, Customer Satisfaction, SERVQUAL, Job Demands-Resources, Dyadic Analysis, PhilippinesAbstract
The hospitality and tourism sector in the Philippines is undergoing a critical transition from post-pandemic recovery to sustainable structural reinvention, with direct gross value added in tourism reaching PHP 2.27 trillion in 2025. To sustain this economic momentum and meet the national hotel room demand projected to exceed 456,000 keys by 2028, enterprises must address persistent issues of inconsistent service standards and high employee turnover. Grounded in Job Demands-Resources theory, Social Exchange Theory, and Expectancy Disconfirmation Theory, this study investigated the mediating role of service quality in the relationship between frontline employee engagement and customer satisfaction among Department of Tourism-accredited hotels in Central Luzon (Region III), Philippines. Utilizing a quantitative, descriptive-correlational, and mediational research design, empirical data were gathered from a matched, dyadic sample of 180 frontline employee-guest pairs ( dyads; 360 respondents) across selected three-star and four-star hotels in Region III. Frontline employee engagement was assessed using the 9-item Utrecht Work Engagement Scale (UWES-9), while guests evaluated service quality via an adapted 15-item SERVQUAL instrument and customer satisfaction using an adapted performance scale. Structural path and multiple linear regression analyses revealed that employee engagement significantly predicts perceived service quality (), which in turn exerts a powerful direct impact on customer satisfaction (). Employee engagement also demonstrates a significant direct effect on customer satisfaction (). Mediation testing via the Sobel -test () and bootstrapping with 5,000 resamples confirmed that perceived service quality partially mediates the engagement-satisfaction link, carrying 47.4% of the total effect (indirect effect = 0.2674, total effect = 0.5646, ). These findings indicate that while highly engaged employees inherently project positive service behaviors, the translation of their psychological motivation into overall customer satisfaction is highly maximized when channeled through structured service quality dimensions, particularly assurance and responsiveness. The practical implications of this research highlight the strategic value of institutionalizing standardized capacity-building initiatives, such as the national Filipino Brand of Service Excellence training, to bridge internal psychological work states with external guest satisfaction and long-term brand equity.References
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