Strategic Management: Tesco Analysis

BSc (Hons) Business Management Top up
Cohort 2
BMP6002
Strategic Management
Strategy Evaluation
2019/2020
Spring 2020/Semester 1
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Table of Contents
Introduction......................................................................................................................................3
A critical evaluation of the value of clear purpose, vision, mission and objectives in setting the
strategic direction of organizations using examples from selected organisation.............................3
Assess the competitive advantage of the selected company, using the VRIO framework..............3
Using PESTLE framework analysing the external environment of the selected business..............3
Application of the Porter’s Five Forces Model for the selected organisation.................................6
A review of the selected organization’s strategy.............................................................................7
Conclusion.......................................................................................................................................7
References........................................................................................................................................7

Introduction
Strategies refer to various policies and rules formulated by an organisation which helps
organisation in functioning smoothly (Zuo, Wang and Corder, 2019). There are a number of
tools and analysis developed which help businesses in formulation of their strategies. There are
different tools to analyse internal as well as external environment of a business. In the following
report strategical analysis of Tesco is done. It is British multinational which deals in retailing. It
is one of the biggest supermarket chains in United Kingdom. The following report consists of
study of purpose, vision, mission and objectives of Tesco closely. In order to analyse the internal
environment of company VRIO analysis is performed. PESTLE is performed to know about
external environment of company. Other than this it is important for companies to know about
the competitive standing in market. To understand this porter five force analysis have been
performed on Tesco. At the end of the report a review of strategy of Tesco is also performed.
A critical evaluation of the value of clear purpose, vision, mission and
objectives in setting the strategic direction of organizations using examples
from selected organisation
Purpose: The purpose of Tesco is to champion for their customers so that they can help them in
order to enjoy a better quality of life and also an easier way of living. It is seen that customer
need great products and great values Tesco tries to deliver them all of these requirements.
Vision: The vision of company is to become the most valued business through serving
customers, operating in communities, loyalty of their employees and colleagues and also that of
their shareholders. There can be five basic elements derived from vision of Tesco which are:
 Growth in business with a number of opportunities.
 Diversified and extended business around the world.
 Winning locally and applying skill globally
 Inspiring and earning trust of communities, people, and colleagues.
 Innovative, modern and full of ideas.
Mission: Mission of company is simply to make what matters. They are aiming at business
which can make strategies based on departments.
Values: There are a number of values followed by Tesco which include the following
 Do not try harder for the customers

 Everyone is treated how they should be treated
 The scale of company is used for good
 Company create new opportunities for a number of young people throughout the world
 They are trying to reduce their impact on environment
 They believe in supporting the local communities
Objective: Tesco majorly aims at providing electronics, groceries and clothing goods along with
a number of services online. They aim to develop the online shopping experience of customer so
that they can attract more and more customers.
Assess the competitive advantage of the selected company, using the VRIO
framework
VRIO analysis is an analytical tool which is used by business in order to evaluate all their
resources and their competitive advantage to the company. VRIO stands for value, imitability
organization. This helps an organization to compare their resources with their competitors. VRIO
Analysis for Tesco is below mentioned below:
Valuable- This includes in analysing weather following resource adds some value to the firm or
not. In this various resource are studied so that they can exploit opportunities or defend the
organization against any threat (Grissom and Bartanen, 2019). Positive market situation and
reputation of Tesco is valuable for company. It helps company in generating a positive image in
mind of customer. Leadership team of company is also valuable for company as effective leader
helps to run an efficient team. The brand awareness of company is also a valuable resource for
company along with this customer rate company very highly which is another valuable resource
for company that makes it better than their competitors.
Rareness- Rareness refers to a factor where following resources can be acquired by only few
companies. Valuable resources and their resources provide company with temporary competitive
advantage. All the resources of company including positive market reputation, leadership team
and leaders, awareness about brand, high customer rating are there for company and they help in
providing temporary competitive advantage to Tesco over its competitors.
Imitability- This includes all those resources which cannot be copied by competitors of Tesco.
The high customer rating and positive market reputation of Tesco is imitable. Any competitor of
company can easily copy this resource. On the other hand, leadership team and awareness about