Premier Inn: Analysis of Business Strategies and IT Deployment

This report provides a comprehensive analysis of Premier Inn, a leading UK-based hospitality brand. It begins with an introduction to the company, its business strategies, and its products and services, including an overview of its expansion and competitive positioning within the global market. The report then applies Porter's Five Forces model to assess the competitive environment, identifying key threats and opportunities. Furthermore, it utilizes Porter's value chain to analyze Premier Inn's primary and support activities, highlighting its strengths and weaknesses. The core of the report focuses on how Premier Inn can leverage information technology and innovative ideas to enhance its business processes and improve its competitive standing. The report also includes SWOT analysis, PEST analysis, and considers factors such as political, economical, social, and technological influences on the business strategies of Premier Inn.

Managing Information and
Technology

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................3
1. Introduction, business strategy and products and services of organizations......................3
2. Analysis of the competitive environment of Premier Inn with the help of Porter's five forces
model......................................................................................................................................6
3. Analysis of the primary activities and support activities using Porter's value chain and the
strength and weakness of Premier Inn....................................................................................8
4. Summarization and reflection on how the business could deploy IT and use innovative
ideas to improve its business processes and to enhance its competitive positioning...........10
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Information technology is study of systems which is used for storing, retrieving,
processing the data is known as Information Technology. Due to the advancement in technology
use of IT has increased in almost every organization. This report is based on the hospitality
sector industry hotel Premier Inn. This is the largest brand of hotel chain in UK. This hotel group
also works in foreign countries. In this report, introduction current business strategies, and the
products and services of chosen organization is discussed. To find the competitive environment
of company Porter's five forces model is also used. Primary and support activities of porter's
value chain and its strength and weakness is also discussed. Apart from that, deployment of IT
and use of innovative ideas to enhance the competitive positioning of company is also discussed.
TASK
1. Introduction, business strategy and products and services of organizations
Premier Inn is a British multinational hospitality industry which has it headquarter in
Dunstable, UK. This industry only serves in UK but also in many countries like, UAE, Ireland,
India and Germany. It is the largest brand of UK in hotel industry with almost 72000 rooms and
785 hotels. This company not only operates its business in urban areas but also includes, airports,
suburban, etc. Therefore, it has a great competition among its rivals such as Travelodge etc. As
per the history of this industry, it was established by Whitbread in 1987 as Travel Inn. The main
motive of the company was to compete with Travelodge (Anderson and et. al., 2015). In 2004,
company opened premier Lodge and merged it with Travel Inn. Finally, the name originated as
Premier Inn. This hospitality industry not only provide accommodation to the customers but also,
they serve food. Their food quality is awesome such that most of the hotel order them to serve
for their guests.
Business Strategy of Hotel Premier Inn is to put the customer at the heart of everything
the company do (Business strategies. 2019). They want to sustain their customers by providing
exceptional facilities to them. They also provide a quality food to their customers with the help
of their restaurants. The company wants to grow itself in their premier market of UK by
innovating different ideas. Apart from that, to grow internationally they have to focus on their
strengths. In order to evaluate the business strategies of Premier Inn, PEST analysis is done.

Political Factor: The political factor within the company impacts a lot on the business strategies
of a company. In case of Premier Inn, the government of UK in 2010, implemented some
strategies to boost the tourism industry across UK. With the help of which company feels free to
formulate its strategies accordingly. The operating strategy of premier Inn is aggressive which
meets the political situation. Th firm is focused on managing carbon foot print by focusing CO2
reduction.
Economical Factor: In 2009, a series of sporting events has held in London, UK such as Ashes
and ICC world T20 (Bobak and et. al., 2014). This allows the tourism industry to grow with its
potential. The strategy matriculation of Premier Inn has started at that time and thus it has
outperformed its rivals in October 2009.
Social Factor: Living condition, lifestyle and income distribution has played a lot of effect on
the business strategies of Premier Inn. The working culture of UK wants to invest their savings
in touring outside the UK or abroad. This boost the tourism industry a lot and thus the strategy of
company formulated. The marketing strategy of company focuses on creating awareness
regarding services and helps in managing change sin series according dynamic hospitality trends.
This creates brand image of company among the customers.
Technological Factor: Technology plays an important role in the development of an
organisation. In case of Premier Inn, the company changes the blue print of their website and
thus attracted over 3 million of customers to visit them (Han and et. al., 2014). Thus, the
formulation of strategy helps the company in gaining competitive advantage.
SWOT analysis is another business strategical model which help the company in finding
the strength, weakness, opportunities and threats.

Figure 1: SWOT analysis
(Source: Malerba and et.al., 2015)
Strength: Premier Inn has many of its
strengths such as profitability, Brand Image
and strong presence in UK.
Weakness: The weakness of Premier Inn is big
issue with hygiene and limited global presence.
Opportunity: The company can have many
opportunities such as decorating the average
rooms and entering into new market.
Threat: The threat a company can face are
competitors and legal threats.
Hotel Premier Inn not only provide accommodation services to its clients but also serves
food with its restaurant chain. The quality of food is awesome therefore different hotel sectors
also deal with Premier Inn to serve their restaurant's food. The size of hotel varies from location
they are serving. Some hotels of Premier Inn are serving in suburban areas and some are serving
in urban areas. This suggests that the hotel has a very big chain across the UK. This hotel serves
different offerings such as free Wi-Fi, food and drink and also spacious bedroom. These facilities
are enough to attract a customer then the management aim at customizing room accommodation
according to expectations of guest.

2. Analysis of the competitive environment of Premier Inn with the help of Porter's five forces
model.
A business can gain competitive advantage with the help of Information technology. IT
not only provides different technological advancement but also attract a number of customers to
their premise (Khanam, Siddiqui and Talib, 2016). In case of Premier Inn, the looking of website
has attracted a number of customers. This is known as the technological up-gradation. With the
help of changing views of website, a lot of customers has attracted to the premise of Premier Inn.
Thus, IT can help a company to gain competitive advantage. To analyse the competitive
environment of Premier Inn, Porter's five forces model is used which is stated as below:
Porter's five forces model mainly deals with external factors that influence the nature of
completion and internal factors how firms compete effectively to be more profitable. This model
not only help the company to formulate the strategy before its rivals but also advice in detecting
a number of threats in future. These threats can harm the succession of company in future,
therefore different threats related to Premier Inn are stated as follows:
Figure 2: Porter's five forces model
(Source: McGrath, 2013)
Threat of new entrants:

The government of UK is mainly focusing on to providing opportunities in hotel and
tourism sector. Therefore, the chances of competition for Premier Inn in future increases. Threat
of new entrant is higher because lack of governmental restrictions for hospitality industry.
Therefore, hotel should keep some different strategies so as to compete with them. To start a
budget hotel chain across a specific geographic area a lot of capital is required. Apart from that,
Premier Inn also find it difficult to adjust the demands and needs of customers in future. Since
the demands of customers are very frequent in nature therefore this hotel finds it to be very
difficult to compete with the same business profilers.
Threat of substitute:
This is the threat in which same profiler comes into existence. In case of Premier Inn, a
number of competitors are there which can replace the substitute of it (Kubasakova, Kampf and
Stopka, 2014). The rivals could be Travelodge, Hilton Hotel, Holiday Inn etc. These rivals can
address the same profile which is used by Premier Inn. They can copy the strategy of this hotel to
find the competitive advantage. Since, premier Inn also deals in restaurants therefore the strategy
of Rivals could be to open such food court as well. This will not only increase competition
among the companies but also distribute the revenue of customers. To overcome this situation,
Premier Inn is focusing on adopting the recent trends and technology so that it will always be
ahead of its competitors. When thereat of new entrant is higher, it is quite usual to see the threat
of substitute. This threat comes with the new business of same profession. Therefore, Premier
Inn should keep in mind different strategies for its rivals.
Bargaining power of customers:
This is another threat to Premier Inn. In this threat, if the bargaining power of customers
increases hotel have to sell its services with the cheaper prices. This will not only decrease the
revenue of it but also the flow of business interrupted. This threat can come into existence when
the number of competitors will increase in the same field (Laudon, 2016). Similarly, if the rivals
of Premier Inn increases, the customer have more better options to go anywhere. This will give
them the power of bargaining with the company. To overcome this threat company has to
provide exceptions of facility to its customers so that they will be eager to comes into the
premise of Premier Inn. If number of threat increases and the chances of entering the rivals is
higher than the bargaining power of customers also increases. Therefore, the rate of this power is
higher due to the entry of new rivals.

Bargaining power of suppliers:
This is also one of the new threats to the hotel Premier Inn. In this threat, the bargaining
power of suppliers increases which increases the cost of raw materials, etc. This increase the
expenses of hotel and thus the revenue decreases. The bargaining power of suppliers increase
when the number of distributors increase. It can sell its raw material to any of the distributor with
its own choice. Thus, the bargaining power of suppliers increases. Promoting different rivals of
hotel industry can leads to increase in competition thus the bargaining power of suppliers can
also increase as they have number of customers.
Intensity of competitive rivalry:
This is known as the number of rivals across a particular industry. In case of Premier Inn,
the intensity of rivalry across the hospitality industry is high. There are a number of rivals of
Premier Inn in the same sector such as Travelodge, Holiday Inn, Hilton Hotel, Hotel Russell etc.
All these hotels are pursuing their business in the same profession. That is why the competition
among Premier Inn and its rivals increase and the threat is high (Love and et. al., 2014). This
results in the decreasing in revenue.
3. Analysis of the primary activities and support activities using Porter's value chain and the
strength and weakness of Premier Inn.
The model of Michael Porter is very helpful for today's companies because it helps in
differentiate the product by analysing the group of events which occur within company. As the
name suggests that every company has a particular chain from the procurement of raw, material
to the production of final goods. To add further value to the final product a process can be
changed at any time. There are two elements in a company to compare such as primary and
secondary. The primary elements are implemented with the help of secondary elements. In case
of Premier Inn, the company has following two primary activities and two support activities.
Primary activities
These are the activities which are implemented to make the final product and services
within a company (Marchewka, 2014). In case of Premier Inn, the company can use this activity
to provide quality services to the customers. The primary activities are stated as follows:
Marketing and Sales:
These are the factor through which any company can advertise its products and services
so that the customers will buy from them besides their rivals. Marketing help the company to

count the benefits of product and services of company. The customer gets aware about the
products and services of company and thus selling increases. In case of Premier Inn, the
company can advertise the exceptional faculties provided by them to customers. If these facilities
are advertised, it will attract the customers. Thus, the revenue increases. To support this activity,
human resource management is the supportive activities used in this value chain.
Service:
These are the activities which are implemented after the purchasing of products and
services. In case of Premiere Inn, the hotel should take valuable feedback from its customers.
This will not only allow them to fulfil the desires of customers but also increases faith among
them (Or and Tao, 2014). Hotel provides different types of services such as food and drink, Wi-
Fi and other spacious rooms which are enough to attract the customers. The quality of service
provided by hotel is enormous. To support this activity, technology development is helpful in
hotel.
Figure 3: Porter's value chain
(Source: Razak and Vattikoti, 2018)
Support activities
These are the activities which are helpful in performing the primary activities smoothly.
Human Resource Management:

human resource management is one of the most important asst of any organization. In
case of Premier Inn, this assist marketing and sales department to increase the sale of
organization. The HR are used to advertised the products and services of company.
Technological development:
This is also one of the important assets of company. In today's business environment
companies have to be updated technologically so that they can get competitive advantage. In
case of Premier Inn, technology can help the customers in giving their valuable feedback and
managing relationship with customers via CRM software. They also use website or the platform
of company to give their reviews.
Strength of Premier Inn
Profitability: The profitability of company is good in UK as it is the largest of hotel chain. This
is giving it a huge revenue and thus profitability increases (Oztaysi, B., 2014).
Brand Image: With the help of profitability, the company's brand image is also higher which
help them in strengthening their market among its rivals.
Weakness of Premier Inn
Limited Global Presence with regard to rivals: Although, premier Inn is running in foreign
countries also. In spite of that company has low presence in foreign countries. They have to
increase their business to convert this weakness into strength.
4. Summarization and reflection on how the business could deploy IT and use innovative ideas to
improve its business processes and to enhance its competitive positioning.
According to the above activities it can be summarized that Premier Inn is one of the
leading hotels chains in UK. This provides only the accommodation services but also the food
facility. The quality of food is good is the premise of Premier Inn, therefore a number of
different hotels orders food from its restaurants. This hotel is operating in UK and also in foreign
countries such as Germany, India, Ireland, etc. Apart from that it has 72000 rooms and 785
hotels across the globe. The company was started in 1987 with the name of Travel Inn and in
2004 the company merged with new entrance of it in hotel industry known as Premier Inn. The
company is serving with the business strategy of providing the best services so as to assure 100%
affordable rooms. Apart from that, different internal and external factors allow them to formulate
their strategies accordingly (Peltier, 2016). In External factors company can formulate its
strategies on the basis of political, economic, social and technological factors. These factors

allow the manager of Premier Inn to make decision effectively. In case of Internal factors
company, strength, weakness, opportunity and threat to the company identified. With the help of
which they have to modify their strategic formulation. The company is providing its services of
accommodation and food. They are also dealing in the restaurant factors.
Figure 4: Technology in hospitality firm
(Source: Marchewka, 2014)
Information Technology will provide a company to adopt the technology so as to gain the
competitive advantage. With the help of IT Premier Inn can make its website attractive so that a
number of customers increases. In October 2009, the website of company hit with 3 million
views. This data provides the evidence that how the company can increase competitive
advantage among its rivals (Schwalbe, 2015). Porter's five forces model is also there through
which a company can identify the threats and also counter them. The threat to Premier Inn can be
threat of new entrant, threat of substitute, bargaining power of customer and suppliers and
intensity of rivalry.
After that, the use of value chain analysis is done to evaluate the overall margin and
increase the efficiency and productivity of Premier Inn. There are two types of elements in
Porter's value chain analysis such as Primary and secondary. Primary elements are directly linked
to the physical creation, sale, maintenance and support of a product or service. While secondary

functions are used to support the primary functions so that they can be implemented effectively
within an organization.
In case of premier Inn, the company can deploy Information Technology to their premise.
There are a lot of areas where the use of IT has deployed in hospitality industry. The areas are
explained below:
Internet and marketing
Due to increase of internet in almost all over the world, the use of different technology
has also increased. In today's modern technological era, companies are moving towards online
marketing. This type of marketing sometimes called as digital marketing (Sellers and et. al.,
2014). This type of marketing helps the companies in increasing their rating across internet.
Increased rating helps the company in gaining more business and thus competitive advantage can
be gained. In case of Premier Inn, it can also allow internet and marketing with latest technology
to gain advantage which help in targeting large customer base. For example, the firm will focus
on incorporating social media marketing for goal marketing and promoting interest of wide range
of travellers.
Computer systems
The use of computer systems also increases with the use of it in almost every industry.
The hospitality industry is also not left behind with its affect. Customer uses computer systems
from visiting the website to payment. Levelling up the use of software in hospitality industry is
another successful implication of IT as it will helps the business in managing systematic record
of data base. Thus, a competitive advantage is assisting with the use of IT (Wagner, Vollmar and
Wagner, 2014).
Mobile Communication
The advancement in technology has replaced a number of large size devices to smaller
one by making them virtually extinct. The customer can take a huge benefit to it because each
and every customer has its own mobile phone. The customer can call to the staff, allow to give
valuable feedback. Thus, the company can gain a competitive advantage among its rivals.
Innovative Idea
The company can use different innovative ideas through which it can gain competitive
advantage. They can prepare a system through which the operation of different equipment’s in
hotel room can be controlled with the help of mobile. They have to download the application of