Business and Management in Context: Premier Inn Hotel Analysis

This report analyzes Premier Inn Hotel using Pestle analysis, Porter's five forces, opportunities and threats, resources, value chain frameworks, and VRIO analysis. It also discusses the importance of effective business management and planning for the success of an organization.

Business and
Management in
Context

Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Pestle analysis..............................................................................................................................1
Porter's five forces.......................................................................................................................2
Opportunities and Threats of the organisation.............................................................................4
Resources of the company...........................................................................................................4
Value chain frameworks..............................................................................................................5
VRIO............................................................................................................................................6
Valuable ......................................................................................................................................6
Strengths and Weaknesses of the organisation............................................................................7
SAFe analysis...............................................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business management can be defined as the co-ordination of all the activities in the
workplace that are carried out in order to accomplish the goal of the business (Corallo, Lazoi and
Lezzi, 2020). It is very important for the managers of the organisation’s to make effective plans
so that leaders can implement in a systematic manner. For this report, Premier inn hotel has been
undertaken into the account. Premier inn is a British hospitality chain that is serving hospitality
services into the boundary of the UK. It is one of the well established hotel chain. Along with the
hospitality services they also offers bar and restaurant services to the customers in the market of
the UK. In this report, there will be the discussion on the Pestle and SWOT analysis that helps to
understands the internal as well external factors of the business. Along with that Porter's five
forces model will also be analysed in this report. There will be the evaluation of the resources of
the chosen organisation. VRIO model and value chain analysis will be undertaken into the
account. At the end of the report, various suggestions will be given to the chosen organisation.
One of the main competitors of the organisation is the Hilton hotel, London that majorly affect
the revenues of the Premier inn.
TASK 1
Pestle analysis
It is an effective analysis that is used by the organisation in order to analyse the level of
competition in the market. These forces facilitates the managers of the organisation to make
effective corporate strategies through which they can give tough competition in the market.
Porter's five forces model is mentioned below in relation to the Premier inn:
 Competition in the industry: It is the first part of the model that means the total number
of competitors present in the market. These organisation directly affects the level of
profitability of each other in the market. In relation to the hospitality services in the
boundary of the UK, there are lots of hotels are present that are offering hospitality
services to the customers in the market (Oldman and Tomkins, 2018). There are huge
competition in the market of the UK in relation to the hospitality services. In relation to
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the Premier inn hotel they have strongly established in the market of the UK, so for them
there is a low degree of risk in relation to the competition in the industry.
 Threat of new entrants: It is the second part of the model that means the power of the
new companies coming into the specific market. In relation to the hospitality industry of
the UK, companies can come easily but it needs lots of investment in order to provide
effectively services to the customers in the market. There is a moderate degree of risk for
the Premier inn in relation to the new entrants coming into the market.
 Threat of substitutes: It is the third part of the model that means that organisation focus
on to provide same products and services in the market in order to attract customers
towards them (Whitelock, 2019). In relation to the hospitality industry in the UK, new
organisation regular came and brings down the image of the company which also affects
the profitability of the Premier inn. It comes out as a threat for the organisation.
 Power of suppliers: It can be defined as the power of the suppliers that means to which
extent they can influence the price of the raw material. In relation to the hospitality
industry in the UK, there are few sellers present in the market which directly increases
the power of the suppliers. On the other hand management department of the Premier inn
ensures that they maintain good relation with the suppliers so that they will not charge
extra prices in exchange of the raw material.
 Power of customers: It can be defined as the power of the customers in order to drive
the price in relation to the particular products and the services. In relation to the
hospitality services of the UK, customers have various options through which they can
chose that hospitality organisation which will give them more satisfaction. It comes out to
be the threat of shifting of the customers of the Premier inn to the other organisation.
There is a high degree of risk in relation to the power of customers.
Porter's five forces
Pestle analysis is a framework that is used by the organisations in order to evaluate the
external factors of the business (Zhou, Fang and Grover, 2022). These factors generally affects
the operational activities at the workplace. Various factors that affects the activities of the
Premier inn can be find out with the help of this analysis. This analysis is mentioned below in
relation to the Premier inn:
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 Political factors: These factors includes various components such as taxation, trade
policies, government rules etc. It can be defined as the interference of the government of
the particular country in relation to the working of the organisation. It becomes easy for
the management department of the Premier as they can effectively carry out the
hospitality services. It also gives them the opportunities to expand their services in the
national boundaries.
 Economic factors: These types of factors are generally expressed in the monetary terms.
It includes interest rates, employment rates, inflation etc. In relation to the Premier inn
hotel they focus on to increase the employment in the market (Gerke, Woratschek and
Dickson, 2020). It overall make the conditions of the country much better and people in
the economy become able to maintain the standard of living. Through this Premier inn
become able to create valuable image in the market.
 Social factors: These factors mainly includes needs and wants of the customers. In
relation to the Premier inn hotels they sometimes fails to effectively adopt new ways of
offering the hospitality services into the market. It is very important for the organisation
to effectively analyses needs and wants of the consumers in the market. It creates
challenges for the organisation as this shifts the customers of the Premier inn to the other
hospitality organisation.
 Technological factors: These factors are related to the techniques of production which
includes automation, R&D, technology infrastructure etc (Leminen and et.al., 2020). In
relation to the Premier inn hotels, technical department of the company is not so attentive
in order to use the updated techniques of production through which they can provide
effective hospitality services to the customers in the market. It can become as a threat for
them because other hospitality companies attracts their customers by providing them
effective services by the use of updated technologies.
 Environmental factors: These factors includes the impacts on the environment that is
caused by the operational activities of the organisation. In relation to the Premier inn they
use solar panels in order to use electricity at the workplace. Through this they become
able to save the environment from getting polluted by the carbon emissions. They have
also banned the use of the plastics in the hotel premises which creates an valuable image
in the eyes of the customers.
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 Legal factors: These factors includes all the laws and legislations of the organisation has
been made by the government in order to regulate the activities of the business. In
relation to the Premier inn hotel they always follow all the laws that has been made in
regards to the hospitality industry in the UK (Brunk, 2020). This helps them to effectively
carries out the operations in a systematic manner.
Opportunities and Threats of the organisation
Opportunities
 There are various opportunities present for the Premier inn hotel as they can there is very
less political interference and they can expand the hospitality services in the local market.
 Another main opportunities that the company has is they carry out the operational
activities in regards to the protection of the environment. This can provide them the
opportunity to attract large number of customers towards them.
 They have maintained good relation with the suppliers so they have the ability to provide
hospitality services to the customers throughout the year.
Threats
 One of the main threat that can be seen from the above analysis is of analysing the needs
of the customers in the marketplace (Breivold and Rizvanovic, 2018). It comes out to be
the biggest threat for the Premier inn as this cause shifting of the customers.
 Another main threat is of the implementation of the updated technology at the workplace.
Through this they do not become able to provide effective hospitality services to the
customers.
Resources of the company
Premier inn have various resources with them which helps them to provide effective
hospitality services to the customers in the market. Some of the resources that the company have
are mentioned below:
 They have skilled employees at the workplace who helps them to provide hospitality
services to the customers. They always believe the satisfaction of the customers.
 Another main resources that the Premier inn has is that they are offering staying service
from approximately 800 hotels across the UK. It is one of the main tangible resources of
the organisation that facilitates them to generate much revenues in the marketplace.
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 Another main resources that the company has is the goodwill and the reputation they
have build and maintain the boundary of the UK. They have set up a valuable brand
image in the eyes of the customers (Trufanov, 2021). It is one of the main tangible
resources of the company that helps them so stay in the competition.
Value chain frameworks
It is an effective frameworks that is used by the organisation which consists of all the
activities that is needed to produce products or the services in the marketplace. It includes
various components with it. Value chain is mentioned below in relation to the Premier inn:
Primary activities
 Inbound logistics: In relation to the Premier inn, inventory department of the
organisation effectively manages all the raw material in their hired warehouses. They
effectively perform this functions and they make sure that they should use the material
before getting stale.
 Operations: it includes the conversion of raw material into the finished products. In
relation to the Premier inn hotel they effectively provide hospitality services to their
customers in the marketplace.
 Outbound logistics: In relation to the Premier inn, they provide restaurant as well as bar
services to the customers in their premises (Souto and Rodriguez-Lopez, 2021). They
also focus on to provide various membership cards to their customers.
 Marketing and sales: This part of the framework means various promotional tools are
used by the organisation in order to promote the goods and services in the market.
Marketing department of the Premier inn mainly focus on to use social media platforms
in order to promote the hospitality services in the marketplace.
 Service: Premier inn hotels is one of the well established hospitality chain in the UK.
They always give priority to their customers and for that they believe in the customer
satisfaction. Sometimes new staff fails to provide effective services to the customers.
Support Activities
These are the activities that are undertaken in order to make the activities of the primary segment
more effective and efficient.
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 Procurement: Premier inn have maintained good relationship with the suppliers from
where they but raw material (Hassel and Cedergren, 2019). They have established contact
with the several sellers so that they should not have to suffer from the shortage of raw
material.
 Technological development: Premier inn organisation hire professional people at the
premises who can carry out the research and development in relation to the updated
techniques of production. They always focus on to use updated machinery in order to
provide hospitality services to the customers in the market.
 Human Resource Management: HR department of the Premier inn hotel hire efficient
employees at the workplace who hire potential staff. It facilitates them to hire and retain
the skilled staff who can increases the customer satisfaction with the hospitality services
of the Premier inn.
 Infrastructure: This is the last part of the model which consists of planning, accounting,
finance and quality department. In relation to the Premier inn, they have separate
department for each activities (Dörndorfer, Hopfensperger and Seel, 2019). This helps
them to effectively establish co-ordination between each and every department.
VRIO
This analysis is undertaken by the organisation in order to find out the resources of the
company through which they can give tough competition in the market. VRIO analysis is
mentioned below in relation to the Premier inn:
Resources Value Rare Imitability Organized
Services Yes - - -
Supply chain
network
Yes Yes - -
Effective
manpower
Yes Yes Yes -
Finance
resources
Yes Yes Yes Yes
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Valuable
It is the first part of the model that considers the values in the products and the services.
In relation to the Premier inn organisation they focus on to provide valuable services to their
customers. They also ensures that they hire efficient staff at the workplace so that they can
increase the customer satisfaction with their hospitality services.
Rare
These can be defined as the rare resources that can be implemented by some of the
companies. In relation to the Premier inn they mainly use of the financial resources in order to
provide services to the company (Jackson, 2018). They are established company and have
enough resources to meet the demands of the customer.
Imitability
These are the resources that can be copied from the other organisation. In relation to the
Premier inn, they have these resources but they do not consider this as imitable. As they have
effective employees at the workplace but this resources can also be hired by some other company
at the marketplace.
Organised
This means that the organisation should effectively organise their resources at the
workplace. Premier inn management department use their resources when there is a need of it.
Strengths and Weaknesses of the organisation
From the above analysis and models various strengths and weaknesses of the company
can be evaluated. These are mentioned below:
Strengths
 One of the main strengths of the company is that they effectively use the social media
platforms in order to attract customers towards their hospitality services. They are well
established in the market of the UK and have build effective brand image.
 Another is that they provide valuable services to the customers in the market (Marino,
Resciniti and D’Arco, 2020). This helps them to stand out from the competition.
Weaknesses
 One of the main weaknesses of the Premier inn is that they sometimes fails to provide
effectively hospitality services to the customers. As they regularly hire new employees at
the workplace which creates challenges for them to analyse needs of the customers.
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 Another weaknesses that can be stated is that they do not expand the hospitality services
in the international market. This comes out as the weakness of the Premier inn as their
competitors are taking over the global market.
SAFe analysis
SFA matrix Global Expansion Innovation
Suitability It can be referred to as one of
the crucial part of the model.
This facilitates the
organisation whether the
particular strategy is suitable
or not suitable for them. In
relation to the Premier inn, this
strategy can prove to be so
beneficial for them. It will help
in generating more revenues in
the market.
Innovation can also prove to
be suitable techniques in order
to expand the activities of the
Premier inn. This will help
them to provide innovative
services to the customers in the
market. It will also facilitates
them to attract more customers
towards them.
Feasibility It will be feasible for the
Premier inn as they want to
increase their brand values and
it will helps them to establish
themselves on the global level.
It will ultimately increase the
profitability of the
organisation.
Innovation will be very
feasible for the Premier inn as
they want to attract more
customers (Dörndorfer and
Seel, 2020). Innovation in the
services will helps them to
increase the number of
customers towards their
hospitality services.
Acceptability It can easily be accepted by the
company as this expansion
decision has to be taken by the
management department.
Innovation can be accepted by
the company but on the other
hand it can be difficult for the
employees as they have to get
training. So it can be adopted
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in order to attract new
customers in the marketplace.
CONCLUSION
From the above report it has been analysed that business needs co-ordination in
performing various activities at the workplace. In the above report, Pestle and Porter's five forces
model has been analysed. Along with that resources of the company has also been evaluated.
After that values chain frameworks and VRIO analyses has been undertaken into the account.
These analysis helps in finding out the strengths and weakness of the company. At the end of the
report, SAFe analysis has been analysed.
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