Importance of Business Health Check - Assignment

Business Health Check

Table of Contents
INTRODUCTION...........................................................................................................................1
LO 1.................................................................................................................................................1
1.1 Analysing the objectives of a business.............................................................................1
1.2 Explaining the factors that affect the business.................................................................2
1.3 Determining the potential improvement of a business firm.............................................6
LO 2.................................................................................................................................................7
2.1 Reviewing the effectiveness of a business.......................................................................7
2.2 Developing a plan that helps to improve the business by justifying the value.................9
LO 3...............................................................................................................................................11
3.1 Evaluating the current skills of management and staff..................................................11
3.2 Developing a plan for development of a skill for management and staff......................13
CONCLUSION..............................................................................................................................15
RECOMMENDATIONS...............................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Business Health check is one of the essential key part of the process which mainly
highlights the weaknesses and strength of the company. Therefore, it is a current as well as
overall assessment of all the critical element of the business. Moreover, it is a full diagnostic on a
business that determines the overall result of the company. Further, the report main aim is to
describe the importance of business health check up and also understand the way that progress of
a business is involved in a hospitality industry. The chosen firm for this report is Premier Inn
which is the largest hotel in UK and currently the firm has more than 70000 rooms and more
than 750 hotels at international level. The firm is established by the Whitbread as a Travel Inn
and that is why it is run in hospitality industry.
The report will describe the objectives of a business and also explain the factor that
creates impact upon the business. Apart from this, the study will also determine the
improvements to a business organization and it further review the effectiveness of a business by
considering different areas. Then, report will also develop a plan that helps to improve the
business and also justifying its values. Further, report will critically evaluate the current skills of
management and staff and through professional development plan report will also justifies the
development of skills.
LO 1
1.1 Analysing the objectives of a business
Premier Inn is one of the British hotel chain and the UK's largest hotel brand. The firm
currently has more than 72000 rooms and more than 750 hotels. The quoted firm also operates
hotels in different variety of location which includes city centres, airports etc. The firm was
established by Whitbread in order to compete the Travelodge. In 2004, the Whitbread bough
Premier Inn and then merge it with Travel Inn and then establish the unit in UK. Now, the firm is
consider one of the top and leading brand in hospitality industry (Sullivan and Rosenberg, 2019).
The quoted firm mainly provides accommodation services to all kind of peoples with high
quality of products and services at reasonable rates.
Vision: To become as a unique n the industry by fulfilling the promises and demands
made by guest.
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Mission: to provide the best service and company preferred destination of choice by
offering professional, flexible hospitality and service to target people and market.
Business Objectives:
 To raise the sales of the company up to 20% in coming next 2 years.
 To provides the best products and services to their customers and converting the feedback
into positive one in next 1 years.
1.2 Explaining the factors that affect the business
There are many factors that affect the business of Premier Inn and even it creates positive
as well as negative impact upon the business performance. Therefore, by using PESTLE, Porter
five force and SWOT analysis, company can easily determine the factors which are as mention
below:
PESTLE Analysis: It is the strategic management tool that helps to determine those factions that
affect the external business environment. These contain some external factors which are as
follows:
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Illustration 1: PESTLE Analysis
(Source: PESTLE Analysis, 2018)

Political Factor: This factor generally deals with the political system of the country and
as per the governmental influences, corporation tax also decreases from last many years in order
to evaluate the rise in profit. Further, VAT also increases from up to 2.5% and this creates
negative impact upon the firm reputation. Therefore, it is essential for the firm to follow all the
rules or policy defined by the government in order to sustain the brand image (PESTLE Analysis
of Premier Inn, 2019).
Economic Factor: In 2008, as UK is suffered from the financial crisis which creates
negative impact upon the business financial performance. But at time, Premier Inn also make
different strategy in order to cope up with this situation and as a result, there is little decline in
the sales and its financial performance. Apart from this, by lowering down the rates of offered
products and service will also help to attract wide range of customers towards it.
Social Factor: The hotel is completely rely on tourism, seasonal holidays, bank holidays
and that is why company also increases the rates on the particular occasion because the target
customers are ready to spend money in these period (Goto and et.al., 2019). Therefore, this
shows that Premier Inn have strategy to attract the customers and when the target people change
their preference towards another then, it also affect the business in negative way.
Technological Factor: the factor is concern with the advance technology and and as a
result, with an increase in utilization of computers, internet browsing and online marketing, that
affect the company's sales in positive way. In addition to this, the rise of social media,
advertisement also helps to target large group of mass. In the same way, Premier Inn also uses
social media, Internet browsing and online marketing in order to attract wide range of customers.
Legal Factor: The sudden change in the legislation also led to increase in minimum
wage, therefore, it is quite essential for the firm to comply with all the legislation with regard to
Health and safety legislation and also offer some opportunities within employment as well
(Chang and et.al., 2019).
Environment Factor: sudden change in the climatic conditions also affect the business
such that in January 2014, due to heavy flooding, the transport services got disrupted and it
creates negative impact upon the business. On the other side, the firm has to follow sustainability
act so that it did not create negative impact upon environment.
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Porter five force model: The model helps to analyse the competitive advantages of the business
and also provides different solutions in order to overcome those threat.
Bargaining power of Suppliers (low): the power of suppliers are quite low such that
Premier Inn is only subjected to the power of labour, trained staff and personnel which has a
huge demand of them. The quoted hotel is not subjected to bargaining power of suppliers and
also has a low and indirect pressure upon their competitiveness. Therefore, it is quite essential
for the firm to maintain high cost advantages and provide innovative products as well.
Threat of substitute products (low):the hotel has low rate of substitute products such
that people are looking for cheap accommodation in hotels and as a result, there are many small
hotels who provide the facilities with low rates as compared to Premier Inn (Allen, Grolnick and
Córdova, 2019). In the case of accommodating large group of mass such as travelling group and
business traveller, quoted firm did not face any threat of substitute products.
Threat of new entrants (low): Premier Inn faces low threat of new entrant because it
require high cost of investment and it is generally needs high knowledge to stay in the
competition. Therefore, It has been analysed that new entrant have to be conscious about a target
market and quality service such that when the hotel run on product differentiation, the entrant
also have to invest in some innovation of the services. This all requires high amount of
investment and due to not having high customer base, Premier Inn did not faces any threat of
new entrant.
Rivalry among existing firms (high): There is a high competition which premier Inn
also faces because of cost of products differentiation and the switching cost are also low. Further
the business growth also required greater than the rate at which business is growing. It is also
analysed that if the firm have high rates of their products, cutting down the prices of the products
except at the weekends and holidays and as a result, the competition also becomes bad.
Therefore, it is also analysed that in hospitality industry also faces high competition (Nasrin,
Sarker and Huda, 2019).
Bargaining power of Buyers (high): The company has strong customer base because of
the good variety of products and services at reasonable rates. Further, at the company uses
effective marketing strategy that helps to attract wide range of customers and it also uses
discount pricing strategy that also draw attention of many customers towards it. That is why it
has been analysed that the company also target business traveller which are concerned with
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differentiation and it becomes significant for the company to sustain its brand image at market by
fulfilling the demand of their customers.
SWOT Analysis: It is the strategic management tool that helps to determine the micro factors
that affect the internal environment of the company. This includes strength, weaknesses,
opportunities and threats, which are as mention below:
Strength: Premier Inn is considered one of the largest UK hotel brand such that it has
around 700 hotels at different country. The firm also have highly advertised chain of hotels such
that it offer different deals and offers to their customers at the time of online booking. The
company also recognized with several awards for being one of the finest hotel chain in Britain.
The hotel is well-known for its best services and discount strategy that helps to attract wide range
of customers.
Weaknesses: The company did not have a global presence such that it is not elaborated
as an international hotel chains. Further, due to intense competition for the brand, which means
that it has a small margin (Corsi, Cohen and Lockshin, 2016). The firm also have the big issue of
5
Illustration 2: SWOT Analysis
(Source: SWOT Analysis, 2018)

hygiene because in 2018, the new is came out that housekeeping staff is hired by Premier Inn are
uses the same guest towel to clean the entire bathroom. Thus, it is also considered as a weakness
Opportunities: The company has strong advertisement which means that the company
can also invest In digital marketing that helps to draw attention of wide range of customers. As
the products and services offered by Premier Inn are of good quality which creates an
opportunity to build a brand image value through better customer experience. Even the company
also innovate new products and services to their customers which also provide an opportunity to
Premier Inn so that it will help to establish its unit in different country.
Threats: the company also faces high competition with its rivals such that Marriott
because people generally prefer brand hotels because of safety purpose. Further, the firm also
faces threat in regard to high risk of legal actions against Premier Inn (Ammendolia and et.al.,
2016). In addition to this, the firm sale also decline in tourism due to disaster and terror
activities. This affect the brand reputation of the firm in negative way.
1.3 Determining the potential improvement of a business firm
In order to determine the improvement growth option for a business, Premier Inn uses
Ansoff Growth vector Matrix. It is the strategic management tool that helps top management of
the company in order to devise strategies for the company's future growth. The tool describes
four strategies which are mention below:
Market Penetration: It is one of the most common strategy that is used by the large
firms in order to sell the existing products in the markets. Therefore, this strategy is mainly used
in order to increase the market share and company also seeks increases sales with regard to an
existing products in present market. It can be established by decreasing the price and increasing
the promotion and distribution support (Boedker and et.al., 2017). If Premier Inn uses this market
option then it will help to improve the financial business and sustain its brand image at different
countries as well.
Product Development: This strategy will help to establish new market such that a
company tries to offer new products and services by targeting its existing market in order to
achieve growth. And it also involves extending the products range which is available for the
market. Such that it can be achieved by investing in research and development of additional
products and provide new and innovative products to their customers tat also helps to remain
competitive. This is suitable for Premier Inn only when it may require the development of new
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skills and this requires the business to develop the modified products. Therefore, it also helps a
business to sustain its brand image by offering new products in existing market only.
Market Development:This is the strategy which is used by the firm when the company
wants to offer the existing product into new market. This strategy is only applicable when the
business export the products in new country with new packaging style. So that it will help to
sustain the brand image at international level. It has been analysed that market development
strategy is quite risky strategy as compared to market penetration because of the targeting of new
market (Chang and et.al., 2016). But If Premier Inn is also used this strategy then it will be more
helpful for the firm to increase its market share and even the firm also have a weakness of not
dealing at international level. Therefore, it will be better for the firm to use this growth strategy
in order to sustain the brand image at new country.
Diversification: It is the strategy that is not used by the company because it is considered
one of the most riskiest strategy among all. In diversification, the firm tries to introduce new
products in totally new market. Apart from this, it as been analysed that the company this
requires lots of investment and expenses, that is why it is beneficial for those firm who has
strong financial performance. In the context of Premier Inn, the firm did not uses this strategy
because it did not offer any new products to their customers of new market. That is why it is not
suitable for the quoted firm.
Among all, Premier Inn uses Product development under Ansoff growth vector matrix
because it helps to increase the market share of the business. In this case, the company introduce
new products and also modified its existing products into the market in order to expand the
market share. This strategy is suitable because the firm has good customer base and knows that a
market for its existing product which has reached saturation (Garbacz and et.al., 2018). Premier
Inn also has good investment in research and development of its additional products and that is
why it is most suitable for the firm to introduce new bar and soaps for its new target customers.
So that, it will help to increase its market share.
LO 2
2.1 Reviewing the effectiveness of a business
Business effectiveness is refers to the different aspect of a business and it is the quality of
results which are derived from task that completed by both employees and managers of a
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company. Further, to creates effectiveness in the workplace, it is quite essential for the firm's
employees and managers that needs to deliver the consistent results. Therefore, there are
different areas which shows the business effectiveness, these are as mention below:
Products/ services: The Premier Inn offered different products and service such as super
comfortable double size bed, TV, en-suite bathroom, restaurant facilities, desk area, iron, hair-
drier, Wi-Fi services, air conditioning rooms, free cot hire etc. This products are high in quality
and it also provides 24 hour service to their customers and also has a no- smoking policy in its
entire premises.
Marketing: Premier Inn also uses all the marketing tools, because it is the only way that
helps to attract wide range of customers towards it. Apart from this, the quoted firm uses modern
marketing tools such as social media, e- brochures, online marketing because in this modern
world, everyone become digitalized and that is why it Is essential for the firm to use all the tools
that helps to make the brand image at international level (Sullivan and Rosenberg, 2019).
Recently, the firm also uses online booking with different discount offers that helps to convince
people to stay in Premier Inn.
Sales and Finance: the company has strong financial performance such that it helps to
invest in its working place. In order to analyse the working performance of the company, the
quoted firm also uses different key performance measurement such as benchmarking, Balance
Scorecard and different financial governance tools that helps to keep determine the firm existing
working performance (Goto and et.al., 2019). Apart from this, it is also realized that to increase
the sales of the company, managers of the firm uses effective methods in order to increase sales.
Staffing: It is the process of hiring, aligning and sighted the employees in a firm, and in
the context of Premier Inn, it uses effective recruitment and selection methods that helps to
attract wide range of customers such that it uses online recruitment methods, provide effective
training sessions to their customer, induction to their new employees in order to make them
comfortable in the working place. In this way it manages the entire staff, so that it will help to
run the business in effective way.
Business Image: the quoted firm has brand image because of the high quality of products
offering and effective use of advance techniques into its working place. Such that the firm
provides digitalized key to their customers that helps them to open and lock the room through
mobile application. Apart from this, the company also has good production and operational
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department that always makes it brand image in market and by introducing innovative products
to their customers will also help to sustain its brand image in market.
Record keeping: It is clear and accurate records that supports clinical decision making.
The firm also has its separate accounts department that separates its all financial services and
now Premier Inn also uses electronic record keeping system in which all the entries and data are
feed in computer so that it saves time for calculation and also saves extra expenses for the
business (Chang and et.al., 2019). Therefore, the review shows that the Premier Inn also has its
effective business and that s why the firm is able to sustain the brand image at international
market.
2.2 Developing a plan that helps to improve the business by justifying the value.
Business Planning –
It refers to the process of developing the objectives, forecasting the actions and strategies
of the firm that will support the survival of the business (Grant, 2017).
Executive Summary -
Business Plan refers to the plan that provides the future directions for planning regarding
the future of the company. It also describes the methods for achieving the goals of the firm. The
business plan of Premier Inn will explain the vision, mission, objectives of the company as well
as it will also describe STP, actions, monitoring and controlling the performance of the firm.
Company Vision -
The vision statement of Premier Inn is to become a unique organization in Hospitality
Industry by offering a better experience to the customers.
Company Mission-
The mission statement of Premier Inn is to become a preferred destination by offering
personalized hospitality services to the targeted segment of the customers.
Business Objectives –
There are various objectives of Premier Inn that it will accomplish in different time
periods. These are as follows -
 To increase the sales of the company by 10% till 2021 through effective marketing of
goods and services. To reduce the cost of production and distribution by 15% within next 6 months
(Ballantyne, I. and Povah, 2017).
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STP –
It is a framework that consists of 3 steps that is segmentation, targeting and positioning
etc. It helps the firm to integrate the market with the ways that company will adapt to compete
with competitors. STP of Premier Inn is as follows -
Segmentation –
It refers to segmenting the overall market into various segments on the basis of various
factors. The Marketing Manager of Premier Inn will segment the market on the basis of
demographic factors of the population such as income, age etc. and on the basis of
psychographic variables such as lifestyle etc. It will also segment the market on the basis of
geographic variables like at national, international level etc.
Targeting -
After segmenting the whole market, next step is to target a specific segment for offering
the products or services of the organization. Premier Inn will target particular segment of the
buyers of demographic factors. For Example – The company will develop products and services
for middle age and high class group customers.
Positioning -
Final step in the process of STP is to develop positioning strategy of the organization. It
refers to the strategy of positioning the brand image of the company and its products or services
in the minds of buyers. Premier Inn will develop marketing campaigns, advertisement on T.V.,
The hotel will use the strategy of low pricing for offering high quality products and services
(Zepeda, 2019).
Tactics –
It refers to the actions an organization takes for implementing various strategies related
with marketing, production, sales of the firm. Premier Inn will adopt different tactics to
accomplish strategic objectives of the organization. These are as follows-
 Premier Inn will invest funds for developing marketing campaigns, providing
advertisement for Television for creating awareness regarding the products and facilities
that Hotel is offering for targeted segment of customers.
 To improve the productivity of staff that are working in different departments, the
management of the Hotel will arrange training sessions for front desk departments, food
and beverage department etc.
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 To improve the Financial Management System of the Hotel, it will implement Tracking
Model for monitoring various operations of the company such as production, sales etc.
Budget -
Budget of the firm outlines the goals of the firm such as operational and financial etc. It
will support Premier Hotel in apportioning the resources of the firm, to evaluate the performance
etc. Budget of the Hotel is as follows -
Expenses Amount (£)
Stock 900
Plant and Machinery 1000
Wages and Salary 300
Marketing Expense(Marketing campaigns etc.) 600
Miscellaneous expenses (Ex. Service Charges) 200
Total Amount 3000
Monitoring and Controlling -
It refers to the process of tracking and controlling the performance of the business through
application of different methods and techniques. Premier Inn will adopt technique of standard
costing for controlling the cost of operations by comparing the actual performance with standard
performance. It will also implement tools such as Operating System etc. for evaluating and
controlling the performance of the Hotel ((Inch, 2018)).
LO 3
3.1 Evaluating the current skills of management and staff.
Management-
It is a process of effective administration of the company whether it is profit making, no-
profit organization of a government body etc. Management of Premier Inn should possess
required skills for performing various functions of the company (Chambers, I. and Humble,
2017).
Staff-
It refers to the people that are responsible for performing various tasks in an organization.
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Employees of Premier In should have necessary skills for performing different job roles in the
firm. Staff of the Hotel are working at different job positions in different departments such as
Front Desk Office, staff working in Housekeeping department etc (McKenzie, 2015).
Technical Skills-
Technical skills are required to perform technical nature tasks in the organization for the
success of the firm. Management and Staff of Premier Inn should have technical skills for
performing practical tasks of the organization.
Current skills of Management of the Hotel-
Currently, the Management of Premier Inn are having skills of working with Information
Technology. Example – Creating the material for providing training staffing etc (Singh, A.K. and
Vinodh, 2017).
Current skills of Staff of the Hotel-
Presently, the employees that are working in the Hotel are having technical skills such as
Information Security, etc.
Operational Skills- Operational skills are required for effective management of operations of the
company.
Present skills of Management of the Hotel-
At present, the people that are responsible for effective management in Premier Inn are
having Operational skills such as Negotiating with customer etc.
Present skills of the staff-
Currently, the staff of the Hotel are having Operational skills such as execution skills etc.
Managerial Skills-
Managerial skills refers to the skills that are required for effective management of various
operations of the business. Management of Premier Inn should possess these skills for managing
the Human Resource of the firm. Staff should also have managerial skills that will help to
achieve the objectives of the Hotel.
Current skills of Management of the Hotel-
Presently, the Management of Premier Inn is having various Managerial skills like
Problem Solving, Leadership skills etc.
Present skills of staff of the Hotel-
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Currently, the employees that are working in the Hotel are having strong Decision-
making skills that helps the company to achieve its business objectives (Inch, 2018).
3.2 Developing a plan for development of a skill for management and staff.
Skill Development Plan-
It helps an organization to develop the plan to achieve the long term goals of the
company. Premier Inn will develop skill development plan for development of technical,
managerial and operational skills of the staff and Management of the Hotel (Argenti, 2018).
Technical Skills-
Current and future skills required for Human Resource Manager and Front Desk Manager
in Premier Inn are as follows-
Front Desk Manager-
Current skills in Front Desk Manager are Information Security Skills etc. In future
Manager should develop Customer Representation Skills.
Human Resource Manager-
Presently, the Human Resource Manager of the Hotel is having skill of working with
Information Technology like HR Software. In the future, they should develop skill of Project
Management.
Operational Skills-
Present and Future skills that are required in Human Resource Manager and Manager of
Front Desk Manager in Premier Inn are as follows-
Front Desk Manager-
At present, the Manager is having skills of execution and in the future, they should
improve the skill of effective communication with the clients of the Hotel.
Human Resource Manager-
Currently, the HR Manager of the Hotel is having negotiation skills and in the future they
should develop Motivation skills for motivating the staff of the Hotel (Berbegal-Mirabent, Gil-
Doménech, D. and Alegre, 2016).
Managerial Skills-
Current abilities and skills that are required in Human Resource Manager and Front Desk
Manager of Premier Inn are as follows-
Front Desk Manager-
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At present, the Manager is having strong decision-making skills, and they should develop Time
Management skills.
Human Resource Manager-
HR Manager of Premier Inn is currently having strong Leadership skills, and they should
make efforts for developing interpersonal skills.
Skills Gap Analysis -
It is a tool that helps the firm to determine the requirement of providing training to the staff and
management of the organization. Premier Inn will use skill gap analysis to determine the gap
between the present skills and skills that are required in staff and management in the future (Bell,
2018).
Skills/Abilities Missing Requires
Improvement
Competent
Customer
Representation skill
Operating Software
skill
Communication skill
Time-management
Skill
Skill Development Plan-
Skill development Plan of Premier Inn will help to develop and improve technical, managerial
and operational skills of Front Desk Manager and Human Resource Manager of the organization.
Plan will help to achieve the objective of Hotel that is increase in sales by 10% till 2021.
Skills Actions Resources Time Period
Required
Communication skill Have to join English-
speaking Course in a
good institute.
Have to read English
Newspapers like
Business Standard etc.
2-3 months
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IT skill Have to attain classes
for practical learning
regarding how to
operate IT system such
as HR Software etc.
Have to read Books on
IT such as Tourism
Information
Technology etc.
1-2 months
Time-management
skill
Have to attain classes
for learning various
approaches of
managing the time
effectively.
Have to read different
types of Books such as
Getting Things Done
etc.
1 month
Customer
Representation skill
Have to discuss with
the supervisors to gain
knowledge regarding
how to represent the
customers.
Have to read
magazines and English
newspaper to acquire
Customer
Representation skill.
2-3 months
CONCLUSION
The above Report has described that companies should monitor their abilities. It has also
explained the Health Check of the business with the help of internal and external environment
analysis and analysis of effectiveness of competition in the market with the help of different
models such as SWOT, PESTLE analysis etc. Further, the Report has also outlined different
alternatives for market development through Ansoff Growth Matrix. Moreover, the Report has
also explained various skills, skill development plan and skill gap analysis of staff and
management of the Hotel.
RECOMMENDATIONS
 Top level Management of Premier Inn should develop strategy for providing training and
development opportunities to the employees and management of the Hotel. So that, it will
help to improve the present skills and acquiring new skills that are required in the future
for achieving the objectives of the organization.
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 Management of the Hotel also develop Reward System for providing incentives to the
staff. So that, productivity of employees will improve.
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