MGBBT0UBN - Premier Inn Case Study: Business & Environment Analysis

This case study delves into Premier Inn's business operations, exploring its organizational structure, which employs a vertically integrated model to streamline operations and maintain competitive advantage. It examines the internal environment through a SWOT analysis, highlighting strengths such as diversified services and weaknesses like imbalanced market coverage. The external environment is assessed using a PESTLE framework, considering political, economic, social, technological, environmental, and legal factors influencing the hotel industry. The study also addresses the significant impact of the COVID-19 pandemic on the hospitality sector, leading to decreased bookings and altered business dynamics. Ultimately, the report emphasizes the importance of a robust business structure for revenue growth, employee engagement, and brand identity, while also recommending strategies for Premier Inn to adapt to market challenges and maintain a competitive edge.

UNDERSTANDING OF THE
BUSINESS
ORGANISATIONS AND IT IS
ENVIRONMENT

TABLE OF CONTENT
INTRODUCTION...........................................................................................................................4
MAIN BODY..................................................................................................................................4
Organisational structure of Premiere Inn hotel............................................................................4
Internal analysis of business........................................................................................................5
External analysis..........................................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Business refers as the organisations who are engaged in the commercial and other
professional activities. Business organisation can be understood as entity which is develop for
carrying out the commercial enterprise, such firms are predicted on the system which involves
the governing contracts and other rights (Gorzelany and et.al 2021). It is profit or non profit
entities for the firm, productivity of the organisational business depends upon their functionality
it ensures the success. Operational business environment, in which the firms interacts with their
stakeholder to smoothly run their business, or to know their external direct impact over the
business. Premier inn hotel chain, consider as the largest hotel brand in UK with efficient
services, it is developed by the Whitbread. This report covers how covid-19 hits hard the hotel
industry it completely changes business dynamics. It lays out the organisational structure of the
hotel and also will discuss the internal and external factor impact over the business with the help
of SWOT and PESTLE framework.
MAIN BODY
Organisational structure of Premiere Inn hotel
Structure define as system in which all things are arranged in systematic order, it entails
how such activities and process of the organisation being carried out. Organisational structure
also, promotes the information and knowledge flow between the different levels of company. For
the premiere Inn hotel they usually follow the vertically integrated structure. This structure
allows them to streamline their operational task by acquiring direct ownership at different stage
of development process (Fenn and Bullock, 2021). It allows them to provide strong competitive
advantage and to deliver the winning consumer proposition to their customer. Vertical structural
organisations have the strong or tight span over their operation which leads them to increase the

operating efficiency. Usually it is seen that in such firms there is a small departments so it allows
the managers to carefully monitor all the processes. Thus Premiere inn hotel implements this
structure to enhance their productivity or to acquire maximum market share in their sector. Firm
also have the inclusive environment in which every employee from cross culture valued and also
allow them to share their views and opinion over the firm’s decision making process.
Vertically integrated structure enable the premiere inn to strongly control over their supply
chain management, which allow them to offer less price over their services while enhancing the
market control. Other benefits of this structure as it offer the firm to maximise their sales and
productivity by providing better and affordable services to the customer. Due to the outbreak of
corona virus company has lost almost its maximum revenues, bookings of the customer has been
decreased at huge level due to the lockdown. But their work place structure allows them to
reconstruct their business strategy for attracting the customer in the market. Also they uses the
value pricing strategy for improving the customer experience.
Internal analysis of business
SWOT framework is used for determining the internal environment of the organisation; it
gives the complete information regarding business. It helps to build things in which the firm is
good, to minimise the certain risk or to accounts the things in which they are lacking. Factors
that guide the firm to analyse their internal aspect are as follows:
Strength: It describe in what area does the organisation is able to maximise their profit. Premiere
inn hotel is one of the leading hotel chain of UK, they offers the highly diversified services to
their customers (Kokt and Makumbe, 2020). Firm follow their strategies very well, for example
they offer the discounts and different deal to the customer in their online booking. All things
were going in good direction, but after the entry of corona virus it adversely impacts the hotel
business.
Weakness: Frailty restricts the fir to perform at their optimum level; it is the areas which
company need to improve for maintaining their market position. Imbalanced market coverage is
the weakness for premiere inn, also they are facing problem in managing their firm’s
international operation. Marketing is another problem, also customers are not satisfied with their
services, It results in poor brand image of their firm. It is required for them to streamline their
services for remaining strong in the market.

Opportunity: It refers as the avenues which offer the chance to the organisation to maximise
their profit or to increase their annual revenues. Hotel industry is highly anticipating sector, thus
premiere inn also have the option to invest in digital marketing, and it will help them to improve
their customer experience within their services (Serpa, Ferreira and Sá, 2020). Digital tool help
to connect with good range of audiences, through which firm will be able to maximise their
booking. But covid has stops all the tourism activity which ultimately impacts the hospitality
business, in such premier inn can proceed to go with live performance or streaming platforms. It
will help them to develop the online community for their business, to collaborate with the
popular influenced so that customer will show interest in their services.
Threat: Hotel industry is the highly competitive industry, every day new business enters the
market sector, and it is the big treat for the Premier inn. Private room offered by their rivalries or
backpackers hostel increasing the competition in the market. Firm need to review or modify their
strategies for better result, as to offer the WIFI services room, digital keys and services will help
them to develop the competitive edge to their business.
External analysis
PESTEL analysis is the strategical tool that determines the macro environment which
impacts the business. It involves the factors which are as follows:
Political: It gives the analysis as at what extent does the government policies and regulation
affect the economy. This factor directly impact the hospitality industry, whether there is
changing in government bodies or terrorism, stability in this factor always plays a good role for
the hotel organisation (Lestari and Yunita, 2020). Therefore for the premiere inn hotel it is
important for them to pay their taxes, tariffs at given time or to follow all the government
policies in order to prevent from vulnerable situation.
Economical: Changes drives in interest or inflation rate strongly affects the business, as hotel
sector consider as the massive investment region. It means that fluctuation in economy affects
the productivity of the hotel business. Therefore hotel premiere inn also needs to consider this
factor while investing in the market so that it will not impact their financial resources.
Social: Cultural aspect, demographic trends, profession has the major impact over the
organisational business. For the successful business it is important to have strong relationship
with community so it helps the firms to drive revenues. For the premiere inn their rivalry Airbnb

offers the customised services at affordable rate (Samusenko, Plaskova and Prodanova, 2020). It
is threat for their business, therefore it is stated that premiere inn also working with the
community to provide employment opportunities to youth, they are also organising event for
charity to help the community, it is the great move, also advantageous for the firm to provide
resources to the community during pandemic time.
Technological: Rise of new technologies is offering various opportunity to business, customer in
the market always looking for the items which are tech savvy. Therefore this factor cause great
impact over the premiere inn, it is necessary for them to use the internet technologies, or to target
their customer through social media for their easy going of business.
Environmental: Climate change has the major impact over the premiere inn’s business, it is
important for every business to go green to meet the sustainability; otherwise it will cause the
threat for future generation. This factor will cause the business productivity as to increase the
insurance cost and disrupts the supply chain. Therefore hotel premiere inn need to ensure that
they are not using natural resources in excessive amount because it is the biggest reason for
causing the climate change.
Legal: It involves the legal implications which impacts the employment, import export, quotas
etc, it has the major impact over the hotel industry business. As adjustment in the legal system
impacts the premiere inn because it can affect their firm’s management, therefore if the hotel is
close in a crime rated area then crime will reduce their revenues. So it is important for them to
follow all the rules to protect from any malicious or crime activity (Ulubeyli and et.al 2019).
CONCLUSION
From the above report it is concluded that business structure plays an important role for
growing the revenues. As it enables the firm to increase their employee engagement, and it
develops the strong brand identity of the organisation in the market. Report illustrated the
structure of the firm, which describes the vertical integrated structure, it also describes how
covid-19 impact the hotel industry, it drives many changes as it completely decrease the
productivity of business, also due to this some businesses leads to shut down their doors forever.
Also hospitality industry faces the problem because of no tourism activity during the pandemic.
It further lays out the internal and external analysis of the organisation which involves the swot

and pestle framework. Swot describes the strength and weakens area of the organisation, and
Pestle describes the impacts of its factors over the business.
REFERENCES
Books and journals
Fenn, L. and Bullock, K., 2021. How the interplay between organisational ‘culture’and
‘climate’shapes police officers’ perceptions of community policing. International Journal
of Police Science & Management, p.14613557211064056.
Gorzelany, J. and et.al 2021. Finding links between organisation’s culture and innovation. The
impact of organisational culture on university innovativeness. Plos one. 16(10).
p.e0257962.
Kokt, D. and Makumbe, W., 2020. Towards the innovative university: What is the role of
organisational culture and knowledge sharing?. SA Journal of Human Resource
Management. 18. p.11.
Lestari, T.I. and Yunita, L., 2020. The application of SWOT analysis as a basis for determining
marketing strategies. Enrichment: Journal of Management. 10(2, May). pp.25-29.
Samusenko, A.S., Plaskova, N.S. and Prodanova, N.A., 2020. The Analysis of the External
Environment to Determine the Practical Focus of Applied Research. Complex Systems:
Innovation and Sustainability in the Digital Age: Volume 1. 282. p.245.
Serpa, S., Ferreira, C.M. and Sá, M.J., 2020. The Potential of Organisations’ SWOT Diagnostic
Assessment. Academic Journal of Interdisciplinary Studies. 9(4). pp.93-93.
Ulubeyli, S. and et.al 2019. Strategic Factors Affecting Green Building Industry: A Macro-
Environmental Analysis Using PESTEL Framework. Sakarya Üniversitesi Fen Bilimleri
Enstitüsü Dergisi. 23(6). pp.1042-1055.