Premier Inn Hotel Chain: Organisational Structure and Business Environment Analysis

This report discusses the organisational structure of Premier Inn Hotel Chain and analyses its business environment using SWOT and PESTLE analysis. It also includes the impact of Covid-19 on the hotel. Subject, course code, and college/university not mentioned.

Level 0 Guide – Case Study
2021/2022.
Understanding Business
Organisation
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Table of Contents
1 Introduction ............................................................................................................................3
2 Organisational Structure of Premier Inn Hotel ......................................................................3
3 Business Environment Analysis of Premier Inn Hotel.............................................................4
3.1 SWOT Analysis .................................................................................................................5
3.1.1 Strength.....................................................................................................................5
3.1.2 Weaknesses...............................................................................................................5
3.1.3 Opportunities............................................................................................................5
3.1.4 Threats.......................................................................................................................6
3.2 PESTLE Analysis................................................................................................................6
3.2.1 Political Factors.........................................................................................................6
3.2.2 Economical Factors....................................................................................................6
3.2.3 Social Factors.............................................................................................................6
3.2.4 Technological Factors................................................................................................7
3.2.5 Legal Factors..............................................................................................................7
3.2.6 Environmental Factors..............................................................................................7
4 Conclusion...............................................................................................................................7
5 References ..............................................................................................................................9
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1 Introduction
The business organisation defines how the business organisation are structured and
helps to meets the objectives. The business is designed to generate the profit or for the society
improvement. In the business development, business organisation has important role which
consists of the skilful activities of the businessman that helps in promoting the trade of
commerce and industry (Abednego, A. and Syah, T.Y.R., 2019). In the field of the hospitality
sector the customer is always focused which provides various services of foods and
beverages, entertainment etc. Different types of business come under the law how it is
operated and delivers flexibility to management. The report has been discussed of the Premier
Inn Hotel which is a British hotel chain and UK's largest brand having more than 72000
rooms and 800 hotels. In the variety of locations the hotel is operated involving city centres,
suburbs, and airports providing supreme level of services. The hotel was introduced in the
1987 by Whitbread as Travel Inn to compete with Travelodge. The headquarter is situated in
Dunstable, England, UK (Premier Inn, 2021). In the report the organisation structure of
Premier Inn has been discussed and business environment involving the SWOT and PESTEL
analysis of Premier Inn which has been affected due to Covid-19.
2 Organisational Structure of Premier Inn Hotel
The organisation structure defines the delegation of the duties and how information is
passed to the members of the organisation. The roles, responsibilities and rules for the
employees are decided on the designing of the organisation structure. The Premier Inn
follows hierarchical structure which is shaped in form of pyramid. In such structure the chain
of command is followed from top to bottom. In various levels the whole organisation is
divided defining the roles and responsibilities. It has many level which is controlled by one
person. In the hotel the executive level comprises of owner and general manager where the
standards and policies of the hotel is set by the owner and for implementation it is delegated
to the manager (Babu, M.V.M.S., 2020). The general manager is responsible for managing
the day-to-day activities and to oversee the functions of various departments of food and
beverages, housekeeping and laundry. The assistant manager provides the support to the
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general manger for the number of daily tasks. In such hotel, several assistant managers are
assigned to oversee a specific department in the hotel. The mid-level managers involve the
position of front desk, food and beverage, sales and housekeeping manager. It also involves
marketing, finance, and human resource manager which also has different functioning to
perform. In the hierarchical structure it has long path way of communication which is moved
in chain of command. It has narrow spam of control with less number of subordinates
(Garriga Ferrer, M., 2020). The Premier Inn is benefited with this structure as the manger has
tight control on employees. It helps in creating a sense of spirit and loyalty between the team
members of the department to attain the organisation goals. The better level of authority and
responsibility is defined in the structure. The drawback to the structure is the innovation and
necessary changes to make are slowdown with the increase in bureaucracy. The power and
authority is centralized at the high level.
3 Business Environment Analysis of Premier Inn Hotel
The business environment refers to the aggregate of all the internal and external
factors like employees, supply& demand, suppliers, technology and government etc. which
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affects the functioning of the company directly or indirectly. The activities and quality of
decision of firm and competitor is influenced with the external changes (Holt, M., 2018).
3.1 SWOT Analysis
It refers to the framework which evaluates the business internal environment and
benefit the organisation in getting the best advantage by developing the strategic planning. It
assesses the internal and external factors with the current and future potential (mba SKOOL,
2011-2021).
3.1.1 Strength
The Premier Inn offers various amenities and facilities to attract the customers such as
WI-FI connection, room service, parking area etc. It has a high brand recall with having
strong presence. Due to the pandemic, the hotel was able to get the customers back by
providing various deals and offers for the online booking, online check in-check out facilities
to the customer which is a safety measure taken by the hotel and also a strength (Mayer, C.H.
and Boness, C.M., 2020).
3.1.2 Weaknesses
The Premier Inn is operated in number of countries which has a weakness of limited
global presence (mba SKOOL, 2011-2021). The declining in the growth of the hotel is also
an weakness faced by the hotel as sometimes the guests are not satisfied with environment,
facilities. Due to Covid-19 the customers can face the issue of hotel hygiene as hotel staff
may not sanitising the room properly. The hotel can have low sales and growth due to less
visit of customers (World Health Organisation, 2021) .
3.1.3 Opportunities
The Premier Inn hotel has the opportunity of attracting more customers by providing
various deals and offers such as on room prices during the vacations. The new market can be
explored after successful entry in Germany (Howandwhat, 2021). It has opportunity of get
surprising the guests with new décor. The Premier Inn has the opportunity of attracting large
customers by providing the facility of online payment due to pandemic. To make the
customers safe and others it takes in account proper safety measures of sanitisation and teams
are managed in such way to make the work complete safely (Rajamanthri, S., 2021).
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3.1.4 Threats
The threat faced by the Premier Inn is of competition from various competitors such
as Travelodge Hotels, Scandic Hotels as other hotels are also taking the safety measures to
have the attraction of large customers. In food preparation if the proper safety is not taken it
can affect the brand reputation due to the emerging pandemic. The change in customer
attitude and preference in the selection of hotel is also an threat for Premier Inn hotel
(Howandwhat, 2021).
3.2 PESTLE Analysis
It describes to the framework of macro-environmental factors which is used for
environment scanning (Marketing Audit, 2020). To get an overview of different external
factors a market research is conducted. The understanding of market growth is also provided
by the PESTEL analysis.
3.2.1 Political Factors
In the economy the factors are related to government intervenes which includes the
factor of trade restrictions, tax policy, political, political stability and tariffs. The Premier Inn
has unfavourable impact of decreased corporation tax with the influence of government. The
positive collaboration with UK government affect the hotel favourably with the objective of
increasing tourism opportunity (Swapna, B., 2018).
3.2.2 Economic Factors
The company profitability and performance is impacted which includes the factors of
employment, interest rates, foreign exchange rates, inflation rates. The change in economic
cycle affects the hotel (PESTLE Analysis, 2021). In the hotel sometimes guests pay extra for
the services they demand which leads to the growth of the hotel. The foreign travellers are
also attracted which puts an favourable impact on hotel. The rise in the inflation leads to low
purchasing power of the customers which can affect the hotel growth unfavourably.
3.2.3 Social Factors
The emerging trend is identified by the market to understand the needs and wants of
customers and also focus on social environment. The factors include are demographics,
cultural trends, change in lifestyles etc. The change in cultural trend and customer preference
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affects the hotel unfavourably. The demand for the services increases on the seasonal
holidays such as Easter, and Christmas as people spend money on this periods which puts
favourable impact on the business (Thamaraiselvan, N and et.al., 2018).
3.2.4 Technological Factors
The technological innovation and rate of development is considered which involves
the factor of research and development, automation, new methods of distribution (PESTLE
Analysis, 2021). The hotel is affected favourably with development of technology as various
online services can be provided such as check-in & check-out, online booking which also
makes the customers safe in the emerging pandemic. The growth of the hotel can be impacted
favourably and unfavourably as customers can shop prices on travel sites and reviews can be
read as well.
3.2.5 Legal Factors
The company operations and product demand is affected with the legal laws and
legislation such as constitutional protection, regional and local legislation. The factors of
consumer law, discrimination law, health and safety law is included in the legal factor. The
Premier Inn is required to comply with the laws and offer equal opportunities within
employment (Marketing Audit, 2020). It is required to follow all the rules regarding the food
& beverages to create the value in product.
3.2.6 Environmental Factors
The ecological aspect and environment surrounding is impacted with this factors
which involves the climate, recycling procedures, sustainability. There is an unfavourable
impact on Premier Inn, due to change in global climate due to disruption in transport
especially rail network as a result of flood. The cancellation of the flights, close of rail
network also leads to loss of customers to the hotel. The sales and growth is increased which
impacts the Premier Inn favourably as owners makes the understanding of seasonal
differences and pricing of room is adjusted for the guests in accordance to seasonal for more
customers attraction and maintains a safe environment (Marketing Audit, 2020).
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4 Conclusion
It can be concluded from the above report that organisation structure impacts the hotel
by using hierarchical structure which makes the working efficiently and powers are
centralised. The sales of the hotel is increased with the help of organisation structure and
various safety measures are taken to have the opportunity of attracting more customers. In the
UK segment the Premier Inn will remain the leader from the SWOT analysis. It has the high
brand image and too faces the competition. The PESTEL analysis shows that Premier Inn is
affected with several factors which affects the functioning and operations of hotel. The
impact on the market and consumer demand can be understand with help of external factors.
In the pandemic situation, the hotel suffered lot having the low growth due to less visit of
customers. The hotel took several safety measures and provided online facility such as online
payment, chicken-checkout etc. to regain the growth back and large customer base.
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5 References
Books and journals
Abednego, A. and Syah, T.Y.R., 2019. Implementation of SWOT analysis in hospital
management using the JKN-KIS service concept. Russian Journal of Agricultural
and Socio-Economic Sciences, 2(86), pp.171-176.
Babu, M.V.M.S., 2020. Assessment of Development Opportunities for a Water Purification
Start-up in India.
Garriga Ferrer, M., 2020. Business plan of Nanotarg: a technological platform aiming to treat
pancreatic cancer.
Holt, M., 2018. The Common curriculum: its structure and style in the comprehensive school.
Routledge.
Mayer, C.H. and Boness, C.M., 2020. Experiences of Chinese and Tanzanian cooperation in a
Chinese organisation in Tanzania. In Chinese Organizations in Sub-Saharan
Africa (pp. 204-233). Routledge.
Rajamanthri, S., 2021. Current trends of HRM towards effectiveness of the
organisation. Archives of Business Research, 9(5).
Swapna, B., 2018. Cultivation and Marketing of Tuberose (Lily) Flowers by the Rural Poor:
An Approach of Swot Analysis. International Journal of Agriculture, Environment
and Biotechnology, 11(1), pp.137-140.
Thamaraiselvan, N and et.al., 2018. Evaluation of employee brand using typological analysis
in Indian airline organisation. International Journal of Business Excellence, 16(4),
pp.478-496.
Online:
Premier Inn, 2021 [Online] Available Through
<https://www.premierinn.com/gb/en/home.html>
mba SKOOL, 2011-2021 [Online] Available Through
<https://www.mbaskool.com/brandguide/tourism-and-hospitality/14052-premier-
inn.html>
Howandwhat, 2021 [online] Available Through <https://howandwhat.net/swot-analysis-
premier-inn-premier-inn-swot-analysis/>
Marketing Audit, 2020 [online] Available Through
<https://premierinnmarketing.wordpress.com/2014/02/06/pestel-analysis/>
PESTLE Analysis, 2021 [online] Available Through< https://pestleanalysis.com/pestle-
analysis-for-hotel-industry/>
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World Health Organisation, 2021 [online] Available Through<https://www.who.int/news-
room/q-a-detail/coronavirus-disease-covid-19-staying-at-hotels-and-
accommodation-establishments>
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