MGBBT0UBN Case Study: Analysing Premier Inn's Business Organisation

This case study provides an in-depth analysis of Premier Inn's business organisation, focusing on its hierarchical structure and the internal and external factors that influence its operations. The report examines the benefits and drawbacks of the chosen organisational structure, highlighting its impact on communication and departmental dynamics. Furthermore, it employs SWOT and PESTLE analyses to evaluate the strengths, weaknesses, opportunities, and threats faced by Premier Inn, particularly in the context of the COVID-19 pandemic. The analysis covers political, economic, social, technological, legal, and environmental factors, offering a comprehensive understanding of the challenges and opportunities within the hospitality industry. The study concludes that a well-defined organisational structure is crucial for achieving business goals and maintaining a competitive edge, while also emphasizing the importance of adapting to both internal and external environmental changes.

Understanding
Business Organisation

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Organisational structure of Premier Inn Hotel............................................................................3
Internal and External factors which impact on Premier Inn.......................................................4
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Business organisation helps in identifying structure of companies which they implement
to achieve certain targets and goals. Organising business properly assist in managing different
departments within organisation effectively and employees productivity could also be improved
(Perreira, Berta and Herbert, 2018). This report mainly focuses on the organisational structure
executed by Premier Inn Hotel to achieve its desired aims. It explains why the implemented
organisational structure is beneficial for hotel and its drawbacks are also mentioned.
Furthermore, the internal and external factors impacting the working of organisation during
COVID-19 are defined by using SWOT and PESTLE analysis. In this report the focus is paid on
understanding organisational structure of Premier inn Hotel which is UK's largest hotel brand
and was established in 1987 by Whitbread. The hotel has more than 72,000 rooms and 800
hotels. The headquarter is in Dunstable, UK and operated in various other counties also.
MAIN BODY
Organisational structure of Premier Inn Hotel
Organisational structure is a method that defines the flow of information between
different departments within an organisation. It also explains how certain activities are occurring
in a company to achieve its target or goals. These activities include responsibilities and roles of
employees within an organisation. In case of Premier Inn Hotel, it follows hierarchical
organisational structure which is a chain of command from superior management and
administrator to general workers. Senior management departments overlooks the employees
beneath them and takes all important decision which are then circulated through subordinate
level of management (Bang, Miles and Gordon, 2019).
The upper management of hotel consist of owners and executive managers who
implements certain policies as well as direct general manager to manage everyday activities. The
general manager also overlooks functions of different department such as laundry, housekeeping,
food and beverages. Housekeeping department, front desk officer, food and beverages
department comes under mid-level departments whose responsibilities are to attend guest as well
as provide them best facilities.
Benefits of hierarchical organisational structure

 Develop Defined Structure: It creates a clear defined system for communication within
employees who receive their daily tasks from supervising manager. The supervising
officers get their orders from their superior authorities. This process of information
circulation makes it easy for hotel to implement their business strategies effectively. Establish a clear authority system: Under this structure all the roles and responsibilities
of employees and managers are clear which makes it easier to operate business. As all
duties of every person working for hotel is well defined hence, this creates no confusion
between them and proves to be beneficial in the times of crisis (Camargo-Borges, C. and
et. al., 2019).
Drawbacks of hierarchical organisational structure
 Lack of connections: Various department perform their duty in their own division which
isolate them from other sections of hotel and decrease interdepartmental communication.
This further creates miscommunication and employees finds it difficult to connect with
workers from other departments.
 Department competition: Division of employees in particular departments would
sometimes leads to rivalry between them in order to achieve targets that could benefit
their section only. This would harm the company as people might develop hate for each
other in order to become more powerful than another which could reduce their
productivity and efficiency.
Internal and External factors which impact on Premier Inn
SWOT analysis of Premier Inn
SWOT analysis helps in determining the Strength, Weaknesses, Opportunities and threats
companies could face in market while operating business. Through SWOT analysis a company
could evaluate the advantages it could have and might decrease chances of failure. SWOT
analysis of Premier Inn is as follows:
Strengths Weaknesses
 In UK it is one of the most profitable
hotel chain. In 2017, the profit rose by
7.4% to around £468 million. It has
residency rate of almost 80% (SWOT
 The hotel has a very limited
international presence and operates in
few countries which is its major
weakness.

analysis of Premier Inn, 2018.).
 It has created a strong brand image in
UK which provides friendly
environment to its customers. It has
also been voted as 'Best UK economy
hotel brand' in 2017 at British Travel
Awards.
 It has a limited market share or small
margins as there is an intense
competition in the market such as
Holiday inn, Easyhotel and many more.
Opportunities Threats
 Many businesses are shifting towards
digital marketing it is an opportunity
for Premier Inn to invest in this to
enhance its growth and also to attract
more customers.
 Mostly travellers across the globe look
for new destinations to explore which
creates an opportunity for hotel to
open its branches in other countries
and expand its business to new market
(Evans, 2019).
 Due to COVID-19 there is a decline in
number of tourists which has
decreased the profitability of hotel.
Because of this pandemic restrictions
against the travelling and hospitality
sector, the hotel has been majorly
impacted by it.
 There are number of competitors in
the hospitality sector such as Ibis,
Radison and many more which
increases competition in market.
Pestle analysis of Premier Inn
Pestle analysis is the strong tool to analyse the external environment of the hospitality
industry in which big organisations like Premier Inn operates their business. After the impact of
Covid-19 it is very necessary for the organisations like Premier Inn to consistently analyse their
external environment to exploit market opportunities and to mitigate the threats.
Political factors:
Premier Inn is UK based hotel chain and government of UK has strong hold on the
hospitality industry and their organisations. The UK government has established a new “Eat out
to help out” scheme for the hotels and other hospitality industry to earn revenue after the
reopening from Covid-19 restrictions (ARAPIK, U.H.B and et. al., 2020). This has positive

impact on the hotels of whitebread's like Premier Inn and also the hotel has ensured all the
necessary measures for the safety of guest.
Economic factors:
The economic condition has been highly impacted after the Covid-19 as there is great
decline in the GDP of the UK. The downfall of the disposable income of people reduced the
sales and revenue of the hotel. The economic factor has the negative impact over the business of
Premier Inn as the company is facing major loss due to unnecessary expenses and higher
maintenance cost of the hotel. As after the Covid-19 economic recession it is difficult for people
to spend on hospitality industry which has directly impacted the sales of the Premier Inn
(Nguyen and Van, 2020).
Social factors:
The premier Inn is the part of Whitebread plc and is highly concerned and persistent on
the customer's satisfaction. The customers have changing trends they prefer additional facilities
when visiting a hotel apart from stay such as Spa, pool, gym etc. this change is effectively meet
by the Premier Inn hotel chain and also helped in creating moire customer satisfaction and
increasing brand recognition. The customers of hotel industry prefer quality of food and service
this demand as the social factor is effectively meet by the Premier Inn as they provide the
customer with best service.
Technological factors:
The technology is growing rapidly and especially in hospitality industry the big hotels
like Premier are using latest technology to enhance their kitchen operations. Premier has very
positive impact of technology as the company drive digital supply chain, payment transactions,
robotics room service and many other technology oriented features to enhance their customer
service and brand image (Barros, Galego and Pires-Cabral, 2018).
Legal factors:
In the hospitality industry of UK the legal laws and regulatory plays a very crucial role.
The hotel industry has to effectively comply with the food safety laws, data security and privacy
laws etc. Premier Inn is the leading hotel chain of UK and is highly technologically advanced
therefore comply with GDPR law. The hotel also maintain the hygiene and food safety in the
kitchen to comply with food safety act.
Environmental factors:

The environment is the leading external factor for the hospitality industry of UK. The
hotels are asked to reduce the impact of their operations on the nature by the UK government and
also customers are highly concerned for environment and more prefer the hotels with organic and
greenery look. The Premier has exclusive greenery and sustainability in the activities and also
taken an initiative to reduce carbon footprint.
CONCLUSION
From the above report, it could be concluded that for running an organisation efficiently
it must implement an effective organisational structure to accomplish its set targets or goals.
Organising roles and responsibilities of every individual within a company helps in enhancing
their growth and also improves their skills in the field of interest. The selected hotel enforced
hierarchical organisational structure which assist it in defining clear objectives. This structure
comes with certain advantages and disadvantages which could benefit or harm hotel. It has also
been observed in this report that, there are various extrinsic and intrinsic environmental factors
that could impact the strategies of hotel. In the end, it could be said that for a healthy work
environment every business must implement suitable organisational structure in order to run
company expeditiously.

REFERENCES
Books and Journals
ARAPIK, U. H. B. and et. al., 2020. FACTORS THAT INFLUENCE THE HOTEL
SUSTAINABILITY DURING PANDEMIC OF COVID-19.
Bang, H., Miles, L. and Gordon, R., 2019. Evaluating local vulnerability and organisational
resilience to frequent flooding in Africa: the case of Northern Cameroon. Foresight.
Barros, T., Galego, L. and Pires-Cabral, P., 2018. Monstera deliciosa fruit: physicochemical
characterization and potential for distillate production. Journal of Food Measurement and
Characterization, 12(4), pp.2874-2882.
Camargo-Borges, C. and et. al., 2019. Organisational ethics. In Ethical dilemmas in the creative,
cultural and service industries (pp. 122-148). Routledge.
Evans, N., 2019. Strategic management for tourism, hospitality and events. Routledge.
Nguyen, T. A. and Van, T. T., 2020. Marketing Strategy.
Perreira, T. A., Berta, W. and Herbert, M., 2018. The employee retention triad in health care:
Exploring relationships amongst organisational justice, affective commitment and
turnover intention. Journal of clinical nursing, 27(7-8), pp.e1451-e1461.
Online
SWOT analysis of Premier Inn. 2018. [Online] Available through:
<https://howandwhat.net/swot-analysis-premier-inn-premier-inn-swot-analysis/>./