In July last year, Whitbread finalised the £505m acquisition of no-frills hotel group Premier Lodge, with the intention of merging the company with its own budget chain Travel Inn.
So began the complicated process of integrating the two businesses and their IT systems to create Premier Travel Inn.
The new organisation worked with Whitbread to establish a six-month programme to rebrand all 457 hotels in the combined 28,000-room estate, and merge Premier Lodge staff into the company.
New computer systems were installed in the Premier Lodge hotels, and thousands of transferring staff were retrained on how to use them.
The company has recently completed the integration of the 141 Premier Lodge hotels and says it has already increased hotel occupancy rates, improved efficiency, and lowered IT costs.
Susan Thomas, IT director at Premier Travel Inn, says the most significant factor contributing to the success of the merger was the IT department being involved from the outset.
‘From the very early days IT was seen to be a critical part of the acquisition team,’ Thomas told Computing.
That meant Thomas was well-placed to advise the board and plan the migration around her team’s existing workload.
‘Significant planning before the deal was finalised enabled us to move quickly once we had the go-ahead,’ she said.
‘The initial plans were so detailed we had a date for each hotel conversion, a risk assessment on all assumptions and contingency plans developed.’
This level of detail in the planning process allowed the company to be ‘ruthless in supplier selection’, according to Thomas, approaching prospective vendors well in advance of completing the acquisition to gauge levels of responsiveness and resources.
Some incumbent suppliers lost their existing contracts as a result.
‘If a supplier was unable to meet the demands of the project, they were replaced immediately.
This enabled the integration team to be in place the day after the deal was completed,’ said Thomas.
Premier Lodge had been running ageing IT systems and it was decided a complete refresh was necessary.
‘We had to replace all of Premier Lodge’s technology,’ said Thomas. ‘Prioritisation of activity was therefore very important. At board level, we decided what was critical for us, what ongoing projects we had to complete and what else could we stop, identifying what were the key business activities.’
Whitbread uses Oracle enterprise resource planning software to run its group-wide human resource (HR), payroll, finance and purchasing systems, which had to be installed in the new hotels.
Other projects, such as the implementation of a speech recognition platform to automate the telephone reservation booking system, were put on a slow burner.
‘We have the speech recognition project in pilot and we’ve redesigned our web site with the new Premier Travel Inn brand,’ said Thomas.
‘But there were business activities we had to postpone as they would have had a technical impact, such as investing in revenue management software to improve our occupancy rates.’
Her team’s main task was to separate the back-of-house and reservation systems of Premier Lodge from those of its parent company, The Spirit Group.
This took three months and involved implementation of a separate wide area network to allow back-office system connectivity with Whitbread’s central IT infrastructure.
The team also had to ally new supply chain and procurement processes with accounting and administration systems for the former Premier Lodge hotels.
And some 3,500 Premier Lodge staff were transferred to the corporate HR systems of Whitbread.
‘To minimise disruption, we made the decision to deploy Oracle for the Premier Lodge sites, but not to ask the units to enter the data. Central administration teams receive paper timesheets, which they enter onto the system,’ said Thomas.
New electronic till equipment and systems also had to be installed in any former Premier Lodge sites with a restaurant.
Rebranding of all customer communications, including internal and external signage and the company’s web site and directories, meant that the transfer of all front-of-house systems, including reservations, had to be complete by the end of Premier Travel Inn’s financial year at the beginning of March.
At its peak, the project was converting 50 hotels a week to the new brand, as well as integrating the IT systems.
Despite such an ambitious and disruptive transformation programme, Thomas says reservations made through the combined company’s newly-branded web site were up ‘significantly’ within a few days of transferring the reservations systems to Premier Travel Inn.
And Whitbread’s most recent trading update last month revealed Premier Travel Inn’s like-for-like sales increased by 6.7 per cent, excluding the Premier Lodge acquisition. ‘We fundamentally believe our systems drive great competitive advantage,’ said Thomas.
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