Strategic Management and Tesco's Case

This assignment examines Tesco's strategic management practices through the lens of two key analytical frameworks: the Ansoff Matrix and Value Chain Analysis. Students are tasked with evaluating Tesco's current market position, identifying growth strategies, and analyzing the company's core activities and their contribution to overall value creation. The analysis should consider Tesco's strengths, weaknesses, opportunities, and threats (SWOT) in the context of its competitive landscape.

INDIVIDUAL WRITTEN REPORT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Organisation profile ...................................................................................................................3
Strategic theory...........................................................................................................................3
Critical analysis...........................................................................................................................4
CONCLUSION................................................................................................................................9

Illustration Index
Illustration 1: Value chain analysis..................................................................................................7
Illustration 2: Anshoff matrix..........................................................................................................9

INTRODUCTION
Strategic models are used to develop effective business strategies for managing
organisation. They help the corporation to achieve goals and objectives of corporation in the
specific industry (Condorelli and Galeotti, 2015).The present report describes about strategic
theories to take effective decisions for the organization. In addition to this, it emphasizes on
critical evaluation of strategic models for the corporation.
MAIN BODY
Organisation profile
TESCO is a retail organization which provides optimistic products and services to its
consumers in United Kingdom. Corporation was founded in 1919 and its head quarter is situated
in Welwyn garden city. Organization has spread its operations in 12 countries like Europe,
America as well as Asia etc. In addition to this, corporation has many businesses such as
retailing of books, electronics, furniture, clothing, toys, petrol and software, financial services,
telecoms as well as internet services (About us. 2016). TESCO is a leading organisation which
has largest consumer stack as comparison to other competitors like ASDA and Mark and
Spencer. Management of organisation has 50000 employees to handle its retail operations in the
world.
Organisation also uses effective promotional strategies like social media, television, radio
as well as newspapers to promote its new and existing products in various areas. Along with this,
management of TESCO provide effective discount strategies like card membership, seasonal
discounts as well as coupons to the consumers. Further, organisation also conducts many types of
charity function, donation camp as well as corporate social responsibility activities for welfare of
people (About us. 2016). Brand value and image of TESCO organisation is better as compare to
other rivals in the retail industry of United Kingdom.
Strategic theory
For developing strategic business strategies, management of corporation can consider
value chain analysis as well as Ansoff matrix. These approaches can help the organization to
develop and achieve its marketing objectives in the market. With help of value chain analysis,
organization can provide effective value to its consumers (Dutta and Jackson, 2013). This
process can aid corporation to increase frequency of customers which can provide effective help
to earn effective profit in the market. In addition to this, Anshoff matrix is a strategic planning

tool which gives better guidance to management of organization to increase their growth in retail
sector. Further, it can help the firm to achieve its goals and objectives by using effective
strategies.
Critical analysis
According to Powers and Hahn (2015), value chain analysis is adopted to give effective
value to customers instead of their money. This process plays important role for TESCO to
develop effective consumer’s strategies in the market. It helps the corporation to increase
numbers of customers by providing effective facilities to them (Powers and Hahn, 2015). On the
other side, Anshoff matrix is a strategic frame work which helps the management of TESCO like
managers and employees to design suitable market strategies as per market situation for better
future growth in the retail sector (Gonzalez-Loureiro, Dabic and Kiessling, 2015).
As per Simister, (2010), value chain can also be very flexible strategy tool which can
play important role for TESCO to develop effective strategies by improving its internal activities
(Simister, 2010). According to Vo and Li (2012), value chain analysis can be adopted by the
company to gain competitive advantages as compared with its competitors. In addition to this, it
can provide effective opportunities for the management of organization to earn better profit as
well as revenues in the market (Vo and Li, 2012).
Similarly Selten (2013), Value chain analysis can play important role for management of
corporation to identify its strength and weakness. So it can help the company to improve its
efficiency and performance in the retail sector (Selten, 2013). Moreover, According to Heidari,
and et.al., (2014), value chain can assist TESCO to improve its operational strategies like
purchasing, marketing sales and inbound logistics in an appropriate manner. In addition to this, it
can help the corporation to reduce its issues as compared to previous years. Value chain analysis
can also aids the organization to reduce its cost of internal activities by optimizing them in a
better way (Heidari, and et.al., 2014).
According to Simister (2010), it can help the company to understand the organisational
complexities which are related with consumer’s commitments because it emphasize on
delivering effective customer values in the market. It can help the TESCO to increase frequency
of consumers in an appropriate manner. Further, it can help the management of organisation to
increase its income in the market (Simister, 2010). However, it is typical process to for TESCO
and only experts can understand this process. Further, value chain analysis is also time

consuming process for the organization which requires lot of efforts to achieve its information
(Bajari and et.al., 2012).
On the other side, benefits of Anshoff matrix can help also the corporation to manage its
operations. According to Munro (2014), it can play important role for management to analyse the
expected risk which can help to develop effective market strategies as per condition. It can assist
the corporation to reduce level of future threat in the market (Munro, 2014). As per Raza and
et.al., (2014), Anshoff matrix can help the enterprise to identify possible strategies for growth. It
can help the firm to reduce its complexities to develop effective plans by determining all aspects
of the market (Raza and et.al., 2014). According to Culpan (2014), Ansoff matrix can help the
TESCO to analyse level of rivalry in the retail industry. In addition to this, it can aid the
organisation to set its pricing as well as promotional strategies which can support to increase its
sales in the market (Culpan, 2014).
Similarly, Demil and et.al., (2015), Ansoff matrix can guide management of corporation
to fix its objectives which contribute effectively in achieving its goals. Further, it can provide
huge reliability to TESCO for managing its business activities (Demil and et.al., 2015). As per
ill, Jones and Schilling (2014), it can aid the organisation to attract its stakeholders by revealing
its marketing and competitive strategies which can help to increase numbers of consumers.
Further, investors of organisation can provide effective monetary funds for its further expansion
in the market (Hill, Jones and Schilling, 2014).
Moreover, Ansoff matrix can assists the management of TESCO for assessing
alternatives by analysing its advantages and disadvantages of them. According to Munro (2014),
it can support the firm to analyse present risk in the market. Further, it can guide the TESCO to
avoid threat by using appropriate strategies (Munro, 2014). However, it creates complexities for
enterprise to develop market development and diversification strategies due to rapid dynamic
changes in the market. In addition to this, Ansoff matrix is not able to perform accurate
prediction which creates complexities for management of TESCO to make effective strategic
decisions (Martínez-Costa and et.al., 2012).

(Source: Gary,Wood and Pillinger, 2012)
As per the Gary,Wood and Pillinger (2012), Value chain analysis of organisation is
divided in primary activities as well as supporting activities. Primary activities contain process of
TESCO like inbound logistics, operations, outbound logistics, marketing and sales and service.
Along with this, supporting activities of firm consists many procedures like procurement, Human
resource management, technological development as well as infrastructure (Gary,Wood and
Pillinger, 2012). According to Ghertman, Obadia and Arregle (2013), Ansoff matrix is
categorised in market and product development, market penetration as well as diversification
(Ghertman, Obadia and Arregle, 2013).
Ghosh, Meijering and Verbrugge (2014), TESCO can use primary activities to improve
its various operations at the workplace. In this inbound logistics, organisation can emphasize on
receiving, distributing and storing raw material of TESCO (Ghosh, Meijering and Verbrugge,
2014). Further, in the operation process, corporation can transform its raw material into finished
products to sell the consumers which can help to provide better value to them in the market
(Flamholtz and Randle, 2012).
As per Baden-Fuller and Haefliger (2013), Primary activities of values chain analysis
concentrate on outbound logistics and marketing sales of TESCO. In the outbound statistics,
finished materials are transferred at warehouse as well as store of organisation to sell customers
in the market. This process can help corporation to manage logistics operations in an appropriate
manner. Value chain analysis can help the TESCO to communicate its present sales in front of
Illustration 1: Value chain analysis

consumers in the market. So it can support management of enterprise to manage effective
relationship with consumers (Baden-Fuller and Haefliger, 2013). Similarly, According to
Condorelli and Galeotti (2015), organisation can provide additional services to service users
which can assist to maintain value for them. This process can aid TESCO to develop effective
consumer’s strategies in an appropriate manner (Condorelli and Galeotti, 2015).
In addition to this, corporation can improve its supporting activities like procurement, HR
management, technological development and infrastructure. These processes can support
TESCO to increase its productivity at the work place (Dutt and Jackson, 2013). According to
Powers and Hahn (2015), for improving purchasing process, organisation can also negotiate with
vendors for price negotiation. This also helps the firm to decrease its expenditure on procurement
activities. Along with this, value chain analysis can assist the corporation to hire as well as
motivate staff members by providing effective salaries and rewards. Further, it can help the
organization to increase its efficiency at the work place (Powers and Hahn, 2015). As per
(Gonzalez-Loureiro, Dabic, and Kiessling (2015), it can support the TESCO to use effective
technological tools like CRM (Consumer relationship management) as well as ERP (Enterprises
resource planning) to manage its information which can aid to manage its operations in a better
way. This process can help the organisation to take organisational decisions very fast as
compared with past years (Gonzalez-Loureiro, Dabic, and Kiessling, 2015).

(Source:Vo and Li, 2012)
On the other side, Anshoff matrix can be beneficial for TESCO to develop better
strategies in the market (Vo and Li 2012). As per Selten (2013), organisation can use market
penetration strategies to increase its market share as compare to its competitors. In addition to
this, it can contribute effective role for the firm to increase its profit from consumers. It can help
TESCO to use effective promotional strategies for enhancing awareness in customers about retail
products (Selten, 2013).
According to Heidari and et.al., (2014), organisation can use market development
strategies for its further expansion. In this process, TESCO can launch its existing products into
new market which can aid to enhance its sales in the market. This method can help the company
to enhance its image as well as brand value in front of consumers in retail sector (Heidari and
et.al., 2014). As per Bajari and et.al., (2012), management of corporation can use product
development strategies to launch its new products in the present market. This method can
support the TESCO to increase frequency of consumers. It can help the organisation to increase
its revenue by increasing its sales of new products (Bajari and et.al., 2012).
Illustration 2: Anshoff matrix

Raza and et.al., (2014), corporation can utilize diversification strategies to launch new
products and services into new market. This approach can help the TESCO to increase its market
share across various countries in the world. In addition to this, it can assist the organisation to
expand its operations beyond the country (Raza and et.al., 2014). On the contrary note it is a very
risky process for organisation due to typical rules and regulation of different countries.
Furthermore, it also creates complexities for TESCO due to inappropriate knowledge of
international market (Culpan, 2014).
CONCLUSION
From the report, it is found that strategic theories help the organisation to develop its
effective business strategies in the market. Further, value chain analysis helps the management of
TESCO to offer effective value for the consumers. In addition to this, it can be concluded that
market development of strategies of Ansoff matrix aid the organisation to increase its growth in
various markets.

REFERENCES
Books and Journals
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Dutta, B. and Jackson, M.O., 2013. Networks and groups: Models of strategic formation.
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Online
About us. 2016. [Online]. Available Through:<http://www.tescoplc.com/index.asp?pageid=6>.
[Accessed on 2nd April 2016].
Munro, K., 2014. Advantages and disadvantages of Anshoff matrix. [Online]. Available
Through:<https://getrevising.co.uk/grids/ansoffs_matrix>.[Accessed on 2nd March 2016].
Simister, P., 2010. Advantages of value chain analysis. [Online]. Available
Through:<http://www.differentiateyourbusiness.co.uk/the-advantages-disadvantages-of-
value-chain-analysis>. [Accessed on 2nd March 2016].