Understanding Business Organisation

This report discusses about the organizational structure and the advantages and disadvantages of using it in the company. Further the report includes the internal and external environment analysis of Travelodge. For analysing the factors the SWOT and PESTLE have been discussed in this report.

Understanding
Business
Organizational

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Organisational structure...................................................................................................................3
Advantages..................................................................................................................................4
Disadvantages.............................................................................................................................4
Business environment analysis........................................................................................................4
SWOT Analysis..........................................................................................................................5
PESTEL Analysis .......................................................................................................................6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Businesses are said to be engaged in the activities involving products and the services.
These products and services are fulfilling the needs and wants of the businesses. There are four
types of business organizations such as sole proprietorship, partnership, limited liability and
corporation. The organizational structure chosen by the company should be according to the size
and the funds available with the business. It is seen that the hospitality industry is growing
rapidly with the time. It is important for the marketers to evaluate the tastes and preferences of
the customers before providing any new service them (Alagaraja, and Herd, 2022). Analysing
the preferences will help the business to make changes accordingly and will help in attracting
broader customer base. This report is about the Travelodge, which is a private limited company
involved in hospitality customer. The company is founded in 1973 and is having headquarters in
England and is also operating in United Kingdom and Spain. This report discusses about the
organizational structure and the advantages and disadvantages of using it in the company.
Further the report includes the internal and external environment analysis of Travelodge. For
analysing the factors the SWOT and PESTLE have been discussed in this report.
MAIN BODY
Organisational structure
Organizational structure is defined as the activities which are taking place in the
organization. The structure helps in achieving the defined goals and objectives which are useful
for the organization. Different types of business organizations are following different
organizational structure according to their culture and business activities performed. Travelodge
is following Hierarchical organizational structure, because the company is operating at large
scale and has employed a large number of employees. In this type of structure the information
flows from top to bottom and the employees cannot directly pursue their superiors. The
information flows from every level and the top level managers have to connect to the managers
and then the managers will transmit the information to the employees. In this structure the roles
and responsibilities delegated to the employees are clearly defined to them and they are required

to perform them with full efficiency. The advantages and disadvantages of the hierarchical
structure in context with the Travelodge are described below-
Advantages
 Clear path – Organizational structure helps in defining the roles and responsibilities to
every employee in a clear and effective manner. The employees have clear understanding
of their goals and objectives (Di Vaio, and, et. al., 2021). Thus they can perform the
tasks with better productivity and in one direction. Clear and defined goals helps the
employees to get motivated to perform their work efficiently.
Department loyalty – The department is loyal and the management is involved in dividing the
tasks or the activities according to the skills and the abilities of the employees. All the
employees are tend to work in a team and have build trust over each other.
Disadvantages
 Costly – There are several departments in the Travelodge company, thus the company
have to appoint large number of employees which will increase the overall cost which has
to be beard by the customers at the end.
 Poor communication – The hierarchical structure followed by the Travelodge is lacking
in communication. As the top level managers cannot connect with the lower level
employees directly, thus it takes a lot of time to communicate the information. The lower
level employees cannot directly share their thoughts and ideas to the top managers, thus it
is difficult to manage the business operations.
Business environment analysis
The business environment is the analyses of the internal as well as the external forces which are
driving the business activities. These factors have to be identified by every business as they have
both the positive and negative effect on the business. There are certain challenges which have to
be overcome so it is important to analyse both the external and internal factors of the Travelodge.

SWOT Analysis
SWOT analysis is the analysis of the internal factors which are affecting the business operations
of the Travelodge. SWOT analysis of Travelodge is stated below-
Strength Weaknesses
Knowledgeable staff - The staff hired is
skilled and are trained well by the managers.
The staff knows to deal with every type of
customers effectively and also have
influencing skills (Hunt, Sarkar, and
Warhurst, 2022). The staff is friendly and
helps in satisfying the customers with their
problems.
Good connections – The Travelodge is having
good relations with the influencer present over
social media. They help them in promoting its
products & services, also they influence its
followers to visit the place.
Competitors – The hotel industry is having a
lot of competition among them, as there are
various renowned brands available in the
market. The hotels are fighting for the same
customer base thus it is important to make
effective marketing strategies to influence
customers.
High infrastructure cost – The Travelodge
has spend a huge amount of money within the
business to give a new look to it's
infrastructure, which had resulted in increasing
unnecessary cost.
Opportunity Threat
More social media presence – The millennial
generation is now dependent on the digital
technology and are using various social media
sites. So the marketers can focus on advertising
their brand with the help of social influencers.
Expansion – Travelodge is having the
opportunity to expand in the developing
countries as the business is operating in limited
locations. Through expansion the business can
attract new customers.
Change in consumer consumption pattern –
It is seen that the customers tastes and
preferences are changing a lot so the marketers
at Travelodge have to analyse the changing
preferences of the customers.
Economic crises – Due to the COVID- 19
pandemic, people are not allowed to move out
thus the Travelodge hotel has to remain close
in the mean time.

PESTEL Analysis
PESTEL analysis is the framework used by organisation to identify external factors that
influence organisation at Macro level. These are as follows-
 Political Factor – Such factors involves legislations or economic policies like taxation,
trade policies and Tariffs etc. imposed by Government.
1. Positive- Due to stable government in UK. Travelodge don't have to bear with rapid
changes in economic policies leading it in creation of long term efficient rules and
policies within the organisation.
2. Negative - High taxation rate in UK causes Travelodge to charge high prices for their
services leading in weak customer retention rate.
 Economical Factor – Such factors have direct impact on organisational performance as
they include factors like Inflation rate, employment rate, interest rate that influences
operations of organisation.
1. Positive- Holiday seasons creates huge demand for accommodating places in UK.
Travelodge earn good business and raises its charges in order to maximize its revenue.
2. Negative – Demand for travel decreases during recession period ultimately creating
lower or no demands for Hotels (Laskar, and Singh, 2022). Travelodge too is not spared
with such diverse effect.
 Social Factor – Organisations should consider the country's demographic that can impact
business operations. Consumer's tastes and preferences, attitudes and opinions, culture
and beliefs must be taken into consideration while commencing business.
1. Positive – Considering customers preferences during holidays and vacations and
introducing packages accordingly boosts Travelodge business.
2. Negative – Not paying much attention to middle class society impacts Travelodge
business. As a reason of that customer base of Travelodge is smaller as it only considers
elite class society.

 Technological Factor – Continuous development and evolution of technical tools and
products influence industry in either ways. Adoption of technologically advanced tools
brings productivity and efficiency at work. Companies must evolve their operations as
per the advancement in technology.
1. Positive – Implementation of online digital tools have boosted the business and
efficiency of Travelodge operations resulting in generating higher revenue and eventually
profits.
2. Negative – It becomes expensive for Travelodge to implement latest technological tools
resulting in increment of overall cost for the company.
 Environmental Factor – Due to vast degradation of ecosystems, various countries have
imposed environment friendly laws to protect the ecosystem. To commence business
operations companies must adhere to such laws and adopt environment friendly
approaches for their business activities.
1. Positive – Using environment friendly products at its hotels make Travelodge a company
inclined towards improvement of environmental conditions making it environment
friendly organisation.
2. Negative – Some products used by Travelodge contains non biodegradable substances
causing environmental pollution.
 Legal Factor – Every country have different laws and regulation needs to be followed by
organisations. Companies should frame their policies according to the respective laws
and legislation of the respective country. These includes- Employment laws, industry
regulations, consumer protection laws etc.
1. Positive – Travelodge conducts its internal and external operations as per the framed
policies and laws or legislation by the government of UK.
2. Negative – During expansion of business activities across boarders or hiring international
talents creates hindrance for Travelodge legal policies are quite rigid when it comes to
UK's government.

CONCLUSION
From the above report it is concluded that the businesses are engaged in providing goods and
services to the customers in exchange of money. For businesses it is important to have a
effective organizational structure according to their type and size of the organization. Effective
organizational structure helps the managers to clearly define the goals and objectives. It also
helps in defining the roles and responsibilities to the assigned persons individually. For a
business it is important to analyse their business environment so that the marketers can make
effective strategies according to them. For analysing the business environment the businesses can
use SWOT and PESTLE which will analyse the positive and negative effects of the factors.

REFERENCES
Books and Journals
Alagaraja, M. and Herd, A.M., 2022. Understanding Multi‐level Learning in Organizations: A
Comparison of Lean and the Learning Organization. Performance Improvement
Quarterly, 34(4), pp.521-546.
Di Vaio, A., and, et. al., 2021. Understanding knowledge hiding in business organizations: a
bibliometric analysis of research trends, 1988–2020. Journal of Business Research, 134,
pp.560-573.
Hunt, W., Sarkar, S. and Warhurst, C., 2022. Measuring the impact of AI on jobs at the
organization level: Lessons from a survey of UK business leaders. Research
Policy, 51(2), p.104425.
Laskar, N. and Singh, D., 2022. Intelligence: Business A Value-Increasing Strategy for the
Organization. Business Intelligence and Human Resource Management: Concept,
Cases, and Practical Applications, p.31.