Analyzing the Influence of Environment on TESCO PLC

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1 Analyse the influence of environment on chosen company..............................................1
PESTLE Analysis...................................................................................................................2
Stakeholder Analysis..............................................................................................................4
TASK 2 Critically evaluate the internal environment and capabilities...........................................5
Resource Based View.............................................................................................................5
VRIO Analysis.......................................................................................................................6
TASK 3 Evaluate and apply the outcomes of Porter’s Five Forces model.....................................7
Porter Five Force Model.........................................................................................................7
Ansoff Matrix.........................................................................................................................9
TASK 4 Interpret strategic direction..............................................................................................10
Porter Generic Strategies......................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business strategy is looked upon as the integration of competitive moves which are aimed at
attainment of a competitive advantage in market place (Bell, Bryman and Harley, 2018). Each
and every organisation develops its own unique strategy in accordance with the screening of its
internal as well as external environment. With the help of a strong business strategy, an entity is
able to create its unique brand image and value within the global market place. This helps the
organisation in developing a large base of loyal customers and retaining them for a long period
of time in future context. The present project is carried out to gain strategic analysis of TESCO
PLC, the leading retail corporation functioning within the boundaries of United Kingdom.
TASK 1 Analyse the influence of environment on chosen company.
TESCO PLC is acknowledged to be a multinational corporation which has its headquarters
situated within the confines of England, United Kingdom. This company leads to grocery retail
market functioning within the territorial boundaries of UK. This entity is engaged in the
provision of a wide array of items like general use, kitchen ware, home ware, grocery, clothes,
toys, gadgets etc. Apart from this, the company also tends to offer telecom, financial and internet
facilities to clientele base across the world (Tench and Topić, 2017).
Mission: “To be the word of mouth for customers across the world”.
Vision: “To appear as the most valued retailer to community, customer base and other
stakeholder groups”.
Objectives: The objectives laid down by the respective market leading retailer for
ensuring continued existence within the confines of market place are given as follows:-
 To gain the leading position within the global retail sector.
 To diversify the offerings of company in order to ensure facilitation of growth and
development of business operations of the entity.
 To lay down and be a part of several social initiatives so as to build its effective image in
the eyes of customers and society.
Macro Environmental Analysis
It is important for each and every organisation to take into account the macro environment and
its set of external factors in order to identify the opportunities and/or threats linked to it. Further,
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it becomes important for an entity to carry out macro environmental analysis so as to determine
the influence placed by the external forces of business environment upon the business operations
and functioning (Engert and Baumgartner, 2016). TESCO is leading the UK retail market at
present by holding the highest market share in the confines of its domestic territory. Thus, it is
crucial for this firm to undergo screening of its macro environment so as to sustain its top
positioning in the domestic market. In this relation, it can be said that PESTLE analysis and
Stakeholder analysis are two of the business management models or frameworks which are put to
use by the companies across the globe for gaining knowledge of the different facets of its
external environment. Thus, these 2 models are discussed in the light of TESCO as follows:-
PESTLE Analysis
This is a widely applied tool of strategic management which provide assistance to
companies in analysing the forces of external environment that affect the working as well as
strategy of the organisations. The top management of TESCO has decided to apply this model so
that they can gain knowledge of such impact and thereby craft strategies for the entity in
accordance with the opportunities and threats.
PESTLE of TESCO
The macro environmental factors in the business environment hold high level of impact on the
overall operational functions in the business and its activities. Thus it becomes essential to
evaluate the external environmental factors that are present in the surroundings of any business
and that are incontrollable in nature (Brewster, 2017). Thus in regards to TESCO PLC, the use of
PESTLE model will be done in order to analyze the political, economic, social, technological,
legal and environmental factors of the business that impact either directly or indirectly on the
business and operations of TESCO PLC.
Political
The political environment comprises of all the major policies and beliefs on the ruling party
within a country. The political background in United Kingdom has higher stability as compared
to any other developed nation. Thus for the growing business like TESCO it creates an ease to
formulate its strategies and planning for the long period of time. With the unchanged political
powers within the country, the need for a political affair expertise in the organizational planning
tends to get decreased to a large extent (Newton, 2018). This largely helps in saving the cost,
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