Understanding Business Organisation

This report discusses the organisational structure of Premier Inn, which is a hierarchical structure. It also includes a business environment analysis of Premier Inn using PESTLE and SWOT analysis. The report concludes that business organisation is an entity formed with an intention to carrying out commercial activates in order to generate profits or to serve community.

Understanding
Buisness Organisation

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK ..............................................................................................................................................3
Organisational Structure of Premier Inn.....................................................................................3
Business Environment analysis of Premier Inn..........................................................................5
CONCLUSION ...............................................................................................................................7
REFERNCES:..................................................................................................................................9
Books and Journals:....................................................................................................................9

INTRODUCTION
The term business organisation refers how organisations are formed and structured and
how it will be helpful to meet their targets and objectives. Generally, businesses are structured
with a prior purpose to achieve profit objectives or to improve society. An organizational
structure of the business defines how specific activities are designed to achieve goals. It includes
roles, rules, policies and responsibilities (Plewnia and Guenther, 2021). It also determines how
message can be conveyed between different levels of the organisation. The following report is
based on the case study of Premier Inn which is a British multinational hotel brand situated in
Dunstable, UK. In 1987, the company was founded by Whitbread as Travel Inn, then founder
took over Premier Lodge in 2004 and merged it with Travel Inn to form the existing business
named as “Premier Travel Inn”. Lately, it was shortened to “Premier Inn”. It is a leading hotel
brand in UK which has over 72k rooms and 800 hotels. It has allocated their hotel in varieties of
locations such as UK, Republic of Ireland, Germany, UAE, Jersey (Kerdpitak, 2018). The report
includes the organisation structure of Premier Inn and how it benefits and drawbacks the brand.
It is also discussed with environmental analysis tool i.e. pestle and swot.
TASK
Organisational Structure of Premier Inn.
The organisational structure refers the method through work flow within the company. It
allows teams to work together within their specialized skills to manage activities. In context of
Premier Inn, the structure must be based on the corporate design and has to suitable to the plans
and organisational strategy. In context of Premier Inn, they use tall or hierarchical structure
within their company.
Hierarchical Structure of organization: It is also known as tall structure which is in a pyramid
shape. This structure has been commonly used by most of the companies in which chain of
command goes from high authority i.e. manager or CEO to lower authorities i.e. entry level or
low level employees, where each employee has a leader or manager to supervise. The lower level
employees are responsible to answer the first managerial position (Herzenberg, Alic and Wial,
2018). Each manager or supervisor appointed to the position is accountable to the senior level of
managers above them. Employees in this structure are well supervised and trained as the
supervisors are in charge to lead small number of followers. It becomes easy for them to

facilitate with right supervision individually (Halmaghi, 2018). Although, the employees face a
pretty hard time in this structure due to rigid rules and regulations which must be followed by
them in a strict manner. Also, information communicates in this structure is very complex in
nature. As the structure contains several layers, a fine line is exist in the structure. But the
decision making is not fast due to the requirement of approval by top authorities.
In Premier Inn's context, there are various pros and cons which are discussed below:
Pros:
 It is helpful in defining the authorities, duties and responsibilities.
 It directs employees, shows a clear direction where chances for promotion can be
increased.
 It delivers every employee a strength (Tian and Et.al., 2018).
 There is healthy relationship between employers and employees.
 The top level authorities gets more time to make decisions.
 Mutual trust established between top authorities and lower authorities.
Cons:
 It can demotivate the lower level employees feel they have inferiority or less ownership.
 It can slow down creativity and innovation due to boosted bureaucracy.
 Managers are dominating.
 The decision-making is time consuming.
 It lacks freedom of employees due to the strictness by the supervisor.

Business Environment analysis of Premier Inn.
There are various internal and external factors that influences business and its operations
directly or indirectly. Most of these factors can be controlled or not by business organisations. In
context of Premier Inn, internal factors includes vision, mission, objectives, human resources,
corporate culture and many more (Ibarra, Ganzarain and Igartua, 2018). While external
environment is consist with micro and macro environment factors. Micro environment includes
customers, media, competitors, whereas macro environment includes political, economic and so
on.
SWOT Analysis-
Strengths Weaknesses Opportunities Threats
As the Premier Inn
established a great
image over the past
years, it was voted as
“Best UK economy
hotel brand”. After
completion of lock
down period, when the
situation is back to
normal and hotels
were reopen, the brand
welcoming their guests
with new norms and
restrictions. They
provide their guests
with CleanProtect
hygiene measures, also
they have modified
their check in time so
that they can avail
enough time to clean
Due to government
measures and
restrictions in hotel,
the brand has slumped
to a loss of £725m in
the first half of its
financial year. Also,
got warning that due to
regional lock-downs
their bookings goes
slow. Most of the
travellers stayed away
especially in London
which severally affects
it business sales
(Barnes, 2019).
Premier Inn can
explore new markets as
it worth to efforts. It
can also flexible their
booking systems so
that customers could
booked their rooms
and also pay online
which is helpful to
avoid physical contact.
It can also attract new
customer by showing
that they keep update
themselves with
government introduced
measures and policies.
Lock-down caused
huge losses to most of
the businesses in the
past years. The
respected brand
affected as well, so
similar situations in
the future may turn
out to be super
thought-provoking
(Wu and Et.al., 2021).

the room for other
guests.
PESTLE Analysis-
Political factors: Positive collaboration of hotel industry with the government brought
hospitality to the industry in UK. The aims of government increases the opportunities to tourism
in the nation which impact the hospitality sectors in an positive way. It creates highest revenues
and contribute in the GDP of the country. But it is also identified that VAT is increased 2.5%
since 2011 which deliver a negative impact to the Premier Inn.
Economic factors: It has been researched that financial crises of 2008 dropped country
into recession, resulting in wide scale issues for the organisations. Nevertheless, the economic
disaster delivered some benefits to the Premier Inn. Budget friendly brands are viewed as inferior
goods but in times of recession, it provides as demand for the service in the Premier Inn could
rise or it can be said that it was less impacted than luxury hotels.
Social factors: As the respective brand relies on the tourism, seasonal holidays such as
bank holidays, Easter or Christmas which the company aims due to travellers are more likely to
visit and spend in this days or vice versa during off seasons.
Technological factors: The use of technologies such as internet browsing, computers or
use of mobile applications has been increasing day by day. It benefits the Premier Inn by
improving its visibility and ease of use. The increase in social media marketing, advertisements
has led to more cost effective ways of aiming broad range of audience (du Gay and Et.al., 2019).
With the help of social media marketing, it is possible to target people from different locations.
But on the other side, use of existing communication technologies declines the demand for travel
which severely impacts the potential customer base.
Legal factors: A change in the legislations caused a rise in the minimum wage by 12p.
Also, the brand has liable to follow health and safety measures associated with covid-19.
Environment factors: Global climate change has a vital impact on the Premier Inn. It is
found that in 2014, it is declared as the wettest month which caused flooding, most of the
transport services were discontinued, particularly the railways (Knoke, 2018). This affected
negatively the brand. Many franchises had sold out due to the uncontrollable situations and
Premier Inn started focusing on the cities like London. With the cancellations of flights and

closing of rail networks, the brand has lost many people who stop overnight at service stations or
travel by car.
CONCLUSION
It has been concluded from the discussed report is that business organisation is an entity
formed with an intention to carrying out commercial activates in order to generate profits or to
serve community. When business is properly organized, it allows the employees with freedom to
make decisions which are helpful to build their career. The business has different organisational
structures such as hierarchical, flat, matrix and many more, in which hierarchical has been
discussed in which chain of command flows from top authority to low authority. The business
environment is also influenced by internal and external factors which affects business activities.
SWOT analysis helps business to identify strengths and weaknesses which avoid opportunities
and brings threats to the company. Pestle analysis helps to identify the six factors of macro
environment such as political, economic, social, technological, legal and environment.

REFERNCES:
Books and Journals:
Barnes, R. C., 2019. Organization Design for Small Business: A Discovery of Business
Fundamentals for Executing A Purposeful Path to Profitability. Benedictine University.
du Gay, P. and Et.al., 2019. Character and organization. Journal of Cultural Economy, 12(1),
pp.36-53.
Halmaghi, E. E., 2018. From the traditional organization to the learning organization. Journal of
Defense Resources Management (JoDRM), 9(1), pp.98-103.
Herzenberg, S. A., Alic, J. A. and Wial, H., 2018. New rules for a new economy. Cornell
University Press.
Ibarra, D., Ganzarain, J. and Igartua, J. I., 2018. Business model innovation through Industry
4.0: A review. Procedia Manufacturing, 22, pp.4-10.
Kerdpitak, C., 2018. Key successes strategy of organization efficiency in frozen sea food
business for exporting. International Journal of Business Tourism and Applied
Sciences, 6(1), pp.16-20.
Knoke, D., 2018. Changing organizations: Business networks in the new political economy.
Routledge.
Plewnia, F. and Guenther, E., 2021. The transition value of business models for a sustainable
energy system: the case of virtual peer-to-peer energy communities. Organization &
Environment, 34(3), pp.479-503.
Tian, M. and Et.al., 2018. How does culture influence innovation? A systematic literature
review. Management Decision.
Wu, J. and Et.al., 2021. How business model designs influence firm growth in a transforming
economy: A configurational perspective. Management and Organization Review, 17(2),
pp.226-253.