The impact of management structure on guest satisfaction in chain-affiliated hotels and the moderating influence of chain scale

Abstract

While extensive research focuses on the relationship between chain-affiliation and hotel operating performance, these results are inconclusive. We suggest this is because previous studies have largely ignored whether affiliated hotels are operated by the owner, the chain or an independent third-party operator. This is a critical aspect of hotels’ operating performance given that the disparate resources and potential agency problems across these management structures can affect the service provided by hotels, and ultimately guest satisfaction. Building on 79,000 guest satisfaction scores from 499 US chain-affiliated hotels between 2015 and 2019, our findings suggest that management matters. We found that chain-operated hotels deliver the greatest level of guest satisfaction while owner-operated hotels deliver the least. While this holds up for upscale and upper-upscale hotels, owner-operated hotels deliver the highest level of guest satisfaction in economy and midscale hotels.