Importance of Business Information System for Tesco PLC

BUSINESS INFORMATION
SYSTEM
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TABLE OF CONTENTS
BUSINESS INFORMATION SYSTEM .............................................................................................1
INTRODUCTION ...............................................................................................................................3
1.......................................................................................................................................................3
2.......................................................................................................................................................4
3.......................................................................................................................................................5
4.......................................................................................................................................................6
CONCLUSION ...................................................................................................................................8
REFERENCES.....................................................................................................................................9
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INTRODUCTION
Business information system is defined as a grouping of information technology, people and
resources of a corporation in a systematic mode. It contributes in improving the productivity and
efficiency of business by establishing effective communication channels. Present report is based on
Tesco PLC which is a leading retail chain of UK and provides general merchandising and grocery
items to its consumers. The report describes about importance of business information system for
the cited firm for achieving competitive advantage and growth in market. In addition to this, 6C
framework analysis is going to be studied for identifying the advantages of new information system.
1.
Competitive strategies were given by Porter that assist a corporation for achieving the
competitive advantage in a productive manner (Ibrahim, 2015). These strategies include cost
leadership, innovation and product differentiation strategy. Tesco's business information system aid
in achieving these competitive strategies in the following ways-
Cost leadership strategy: - This technique has assisted Tesco to enhance its capabilities for
achieving economies of scale. In this method, large volume of goods is produced that is sold at
relatively lower cost to the consumers. Company uses ICT in an innovative way that aids in
operational and strategic control by single and double loop feedback channel. Navigation system
has been implanted in supply chain and logistic activity of corporation. It helps the enterprise for
achieving superior profit by selling goods at a low price. Automation in stores and manufacturing
plant has rendered an efficient method for reducing operational cost and due to this, per unit cost of
the product is also reduced (Moon and et.al., 2014). Tesco has implanted barcode scanners and
automated self-service checkouts that helped in reducing the requirement of personnel and
operational cost of the firm. Overall investment expenditure has been reduced and the enterprise
became capable for providing superior quality goods to consumers at lower price as compared to its
competitors. Tesco has captured large market share in retail industry by charging lower price for its
various products.
Product differentiation strategy: - Use of ICT in corporation has helped in achieving new
and innovative methods for manufacturing goods. Company has diversified in the areas of
consumer electronics and financial services. It also provides internet, telecom services and budget
software and all this became possible due to advanced technology adopted by the enterprise (Imrie
and Dolton, 2014). ICT has assisted Tesco in developing products in an attractive and innovative
way by improving features, durability and functionality of goods produced by the same. E-selling
option of enterprise has rendered a productive medium for marketing and selling commodities in a
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unique and effective manner. Product development team of firm works continuously for enhancing
quality of manufactured items and for inventing new products.
Innovation strategy: - Tesco has been able to move ahead with its competitors by the use of
ICT in its business. It has innovated new products at a fast speed as compared to its competitors.
Quality of products is continuously improved by research and development department of
corporation and thus, new range of products in merchandising and food category has been made
possible by the corporation (Cushman and Burke, 2014). Business operations of Tesco are
supported by wireless devices, self-checkout devices, bar code scanners and electronic self-
labelling. These techniques provide an effective methodology to find out innovative techniques for
manufacturing a product. Company uses thermal imaging technology for predicting and inspecting
customer’s arrival at checkouts in its retail stores. Separate voice and data networks of organization
has been combined into a single communication network that helped in saving investment cost of
operations (Weske, 2012). Apart from that, ICT system helped in improving the overall functional
and distribution system in organization.
2.
Information system is a useful tool that assists Tesco in processing the data of its inputs to
generate meaningful information that is required in executing company’s operations. An
information system is described as a software that renders a functional method for organizing and
analysing data of any firm (Rainer and et.al., 2013). Use of information system aids in developing
an effective communication channel in organization by providing new and advanced techniques.
Overall operations of enterprise including manufacturing, distribution and value chain management
are performed in a better way by adoption of innovative technologies. Necessary information
required by company's management for decision making process is delivered by the business
information system. Tesco can acquire software for a new business information system by using
following methods-
Purchasing the software: - Tesco can buy the software from a commercial vendor to
develop an efficient business information system in the firm. For installing software in organization,
a storage network and web application programme will be required and IT department should be
directed for making necessary arrangement for the same (Österle, 2013). The required program can
be purchased from an IT specialist corporation or from online and hardware suppliers. Before
taking purchasing decision, a proper and detailed analysis is required and IT department can support
the management for taking final decision. Company should investigate with trader about the details
of services that a software can provide. Data backup, total cost, tech support and services provided
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