Business Strategy Solution Tesco: Assignment
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Added on 2021-02-21
Business Strategy Solution Tesco: Assignment
Added on 2021-02-21
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Business Strategy
Table of ContentsINTRODUCTION...........................................................................................................................3TASK 1............................................................................................................................................3P1 Macro environmental impact............................................................................................3TASK 2............................................................................................................................................5P2 Analyse the internal environment and capabilities of a given organisation using appropriateframeworks.............................................................................................................................5TASK 3............................................................................................................................................8P3 Applying Porter’s Five Forces model evaluate the competitive forces of a given marketsector for an organisation.......................................................................................................8TASK 4............................................................................................................................................9P4 Strategic Planning for TESCO..........................................................................................9CONCLUSION .............................................................................................................................14REFRENCES.................................................................................................................................15
INTRODUCTIONBusiness strategies is course of action and set of decision that help an entrepreneur inaccomplishing specific goals and objectives. Moreover, business strategy is the master placewhich use by management for getting competitive position within market area (Hatherly, 2016).This assignment is based on TESCO plc. which is retail sector organisation founded in 1919 andits founder is Jack Cohen. It is offering products in several places such as United Kingdom,Ireland, India, Malaysia, Thailand, Poland and so on. This report will going to conduct PESTELanalysis for identifying impact of external factor on company. Along with this, SWOT and VRIOanalysis will be conducted for identifying internal factors as well as capabilities of organisation.In addition to this, Porter Five Force analysis will be carried for identifying competitiveenvironment of retail sector and its impact on working of TESCO plc. Further, Ansoff matrix hasbeen utilised for analysing the availability of strategic option and devise a strategic managementplan.TASK 1P1 Macro environmental impactIt is essential for each and every organisation to carry out a constant analysis of businessoperations as well as its external environment so as to ensure the negative aspects do not causeharm to functioning of business. This helps them to identify the opportunities that pay wave forentity as well as threats that pose risk for the sustainability of company (Jocovic and et. al.,2014). In this regard, PESTLE analysis has been conducted by TESCO Ltd to gain knowledge ofthe impact of macro environment upon the activities and processes:PESTEL AnalysisThis is a strategic framework that is used by organisations to gain comprehensiveunderstanding of the macro environmental factors that have a significant influence upon theworking of corporate enterprise. With the help of this analysis, a company can easily design,develop and formulate strategies that can sufficiently cater to the needs and requirements ofentity and assists it in gaining a competitive advantage over rival firms present in market place.This helps in effectively executing the operations of organisation in the desirable manner.PESTEL analysis applied to TESCO Ltd is as follows:3
Political:This consists of factors associated with government and political system of anation. In this regard, TESCO is operating its operations primarily within United Kingdomwhere the company takes advantage of political stability. This creates opportunities for therespected company to effective conduct its operations in a desirable manner. Further, thegovernment of the major revenue generating country for TESCO (UK) has decided fordecrement in corporation taxes leading to the current rate being around 28%. This helps businessto utilise the saved fund in betterment of its offerings so that customers can be satisfied and theirloyalty can be inflated (Davies, 2016). The management of TESCO is required to devisestrategies that are aligned with the policies enforced by government.Economical:United Kingdom is an economically strong country. Its strong economytends to create opportunities for companies operating within its geographical confines such asTESCO. However, owing to BREXIT, the corporations operating within this nation arenegatively getting affected by it. The value of pound has also fallen due to this phenomenonwhich tends to create risks for the enterprise (Chang, 2016). To tackle the inflation causedbecause of this economical adversity, TESCO is required to introduce new products within themarket place at lower prices so that the lowered purchasing power of buyers due to BREXITdoes not impact upon the sales of organisation. TESCO is required to develop a strategy stressingupon making products by making use of value addition and low cost pricing to gain the attentionof customers.Social: The trends and lifestyles of population keeps on changing at a rapid basis. In thisregard, an entity should constantly undertake measures to address such changes and devisestrategies in accordance with them. By conducting research upon the latest trends andphenomena prevailing in market, TESCO gains advantage as it develops products as per theneeds and preferences of people. This helps the entity to build a loyal customer base, thereby,enhancing the sales and profitability of entity in market (Cavusgil and et. al., 2014). However,there are a large number of substitute brands present in market which deals in same product line,thus the probability of anticipation or ascertainment of a trend by the rival firms before TESCOcan act as a threat for enterprise. To deal with this, the respected organisation should adopt astrategy where the entity constantly carries out research on market and analyse the customerpreferences and trends.4
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