Contemporary Issues In Multinational Org. | Tesco

Running head: CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
Name of the Student
Name of the University
Author Note

1CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
Executive Summary
The report is based on the study of contemporary issues that are related to the field of
management, business and leadership in the organizations. The organization that has been taken
into consideration for analysis is Tesco that is a large retail firm in the United Kingdom. The
critical evaluation is also based on the impact that these issues have on the operations and
profitability levels that are gained by Tesco in the competitive retail market. The impact on
internal and external stakeholders on Tesco has been discussed in the report in detail with the
help of stakeholder matrix implementation.

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Table of Contents
Introduction......................................................................................................................................3
Contemporary issues in the field of management, business and leadership....................................3
Identification and critical evaluation of the impact on contemporary issues on organizations.......7
Critical analysis of the impact stakeholder views have on the approaches of the organizations. .10
Conclusion.....................................................................................................................................14
References......................................................................................................................................15

3CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
Introduction
Tesco is a international general merchandise and grocery based retail organization that
has its headquarters in Welwyn Garden City, Hertfordshire, England United Kingdom. Tesco has
gained the position of third biggest retailer in the world with respect to the gross revenues. The
organization operates its shops in around seven countries in Europe and Asia. Tesco is also
considered to be the market leader based on groceries that are offered to the customers in
different parts of the world that include countries like Hungary, Thailand and Ireland. Tesco was
established in the year 1919 by Jack Cohen as a group of the market stalls and named of the
organization had also appeared in the year 1924 (Tescoplc.com 2020).
The report will be based on the analysis of different contemporary issues that are faced
by the organizations in field of business, management and leadership as well. The proper
identification and analysis of the impact that contemporary issues have on Tesco will also be
discussed in detail along with the impact of stakeholders on the firm. The influence of
stakeholders on the approaches and strategies implemented by Tesco will also be discussed in the
report in detail.
Contemporary issues in the field of management, business and leadership
The modern business environment in which different organizations are currently
operating can face many different issues that can have an influence on the processes. The various
contemporary issues can have advantages or disadvantages as well. The influence of these issues
can be both positive and negative on the modern organizations. The organizations thereby need
to implement different changes in the operations with respect to the impact that the issues are
having on the external environment (Aguinis, Edwards and Bradley 2017). The business

4CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
organizations have the responsibility to develop the policies in such a manner so that changes in
the external environment can be implemented effectively. The stakeholders of the organization
and the management will be able to play a key part in appropriate achievement of the objectives
and goals (Barros, Hernangómez and Martin-Cruz 2016). The major trends that have an impact
on the business environment are as follows,
Cybercrimes – The advancements of technologies has been a major aspect that has
influenced the operations of modern organizations. However, the disadvantages of advanced
technologies also have a negative impact on different organizations. Hacking is a key issue that
is being faced by the organizations currently and has proved to be a threat to the privacy of
customers as well (Cantwell 2017). The data of a certain can be acquired by its competitor and
can be used against the organization itself. Data theft can cause major difficulties for the long
term operations of the organizations and can also reduce the levels of trust of customers. The
weaknesses of a particular organization can also be exposed by the theft of data. The competitors
are able to gain a better place in the market with the theft of data of a certain organization
(Bogers et al. 2019).
Human resources and technologies – The development of human resources has an
impact on the services that are offered by the modern organizations to its consumers. The trends
and developments are able to influence the growth of organizations and contribution that is
provided by the employees as well. The HR professionals and managers are also influenced in
huge way by the variations in technology implementation that have taken place in the human
resource departments of the organizations. The implementation of modern technologies in the
HR department is mainly based on the effectiveness of human resources of the organizations.

5CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
The personnel or employees have to be well-equipped with computer knowledge in order to
ensure success of the implementation of technologies (Berkowitz and Dumez 2016).
The employees will also need to adapt themselves to the variations that take place in the
external environment in order to face the increasing competition. The recruitment and training
processes of the organizations have also been affected in a huge way due to the influence of
modern technologies. The flexibility of talent in the organizations is able to play a key part in
ensuring that the changes can be easily faced and competition can also be mitigated.
Performance management based activities that are performed in the firms are also influenced by
the use of technologies (Daspit et al. 2017). The organizations are thereby providing huge levels
of importance to the training that are being gained by the employees in different areas. The
training that is provided to the employees is considered to be a key aspect that has an influence
on the competition levels in retail market. Technology is mainly used by the organizations for the
purpose of remaining relevant in their respective industries (Demir, Wennberg and McKelvie
2017).
However, the ineffective implementation of technologies can also have a adverse
influence on processes of different organizations. Different factors that are related to the
implementation of modern technologies mainly include robots, machines and different tools of
working as well. Employees also have to be provided with training related to the proper usage of
the technologies and machines that are being used by the firms. Robots have been able to play a
key part in influencing different actions of the organizations. The management of different
business operations are also influenced positively with the help of robots (Durand, Grant and
Madsen 2017). The crucial tasks are performed in a more economic manner and the operations
can also be highly cost effective. The organizations can increase the number of tasks that are

6CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
performed by different departments with the help of robots in comparison to the employees.
However, robots can have a negative impact on the jobs of employees in different departments
that are a part of various organizations (Dyer et al. 2015).
Globalization – Globalization is considered to be a key aspect that has an influence on
the organizations in different countries. The modern organizations are not a part of certain
regions as they are able to maintain their processes in various countries. Organizations have also
been able to gain effective levels of knowledge related to the business environment that is
formed in the various countries. Different media are used by the people or employees to
communicate and to perform the business operations as well. Various channels implemented by
the international organizations include social media, mainstream media and publication media as
well (Engert, Rauter and Baumgartner 2016). Increase in sales volumes and enhancement of
profits are influenced by the increase in globalization within the business environment.
Globalization has been able to increase the sales based ground of the companies and this has an
impact on the size of customer base as well. The organizations aim at increasing their presence in
various countries by starting the operations in different countries (Ethiraj, Gambardella and
Helfat 2018). The companies can also aim at reducing the production costs by expanding their
operations in the developing economies. Innovation is also a major aspect that has led to the
expansion of organizational operations in various countries. The results that are being received
by the organizations in different countries are helpful in deciding whether they wish to continue
the operations. The failure expansion of the firms can also have a huge negative impact on the
revenues that are gained in various industries (Dyer et al. 2015).
Workplace diversity – The organizations in different industries can comprise of
employees belonging to different cultural backgrounds, nationalities and religions. Social

7CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
grounds are considered to be an important aspect that can have an impact on the behavior of
employees. The beliefs and perceptions of the employees are able to influence the decision
making method of the organizations. However, the expertise of employees can are considered to
be highly important by the firms in order to face the challenges that are a part of the business
environment (Frynas and Mellahi 2015).
Innovation in the organizations is increased with the help of various ideas and opinions
that are provided by employees belonging to different cultural backgrounds. However, the
challenges that are faced by the organizations based on diversity are also quite huge. The
organizations need to enhance the training that is offered to the employees in order to enhance
the cultural intelligence levels. The levels of cultural intelligence of employees will have an
impact on the collaboration that is formed and the ideas that are provided as well. Diversity can
thereby be considered as a positive and negative aspect that is related to the processes of
different organizations in the industry (Hill, Jones and Schilling 2014).
Identification and critical evaluation of the impact on contemporary issues on
organizations
The impact of globalization on the operations of Tesco can be analyzed in order to
understand the operations of contemporary organizations in the modern business environment.
Impact of globalization on Tesco – Tesco has gained the place of number one food
retailer in the United Kingdom and has low opportunities related to organic growth. This has led
to the aggressive growth strategies that have been implemented by the organization in order to
enter different countries. Tesco has expanded its processes in different countries that include the
United States, Eastern Europe, various Southeast Asian countries. Innovation has been able to

8CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
play a key part in enhancing the organic growth within the food retail based industry of the
United Kingdom (Michael, Storey and Thomas 2017). Tesco acquired different small retail
supermarkets within the last few years and this strategy has however lost its impact in various
parts of the country. Tesco can thereby aim at organic expansion of its operations with the help
of online growth. The organization has started opening its operations in the new markets that are
a part of Asia and Central Europe. The international operations of Tesco has contributed around
25% to total revenues that have been gained by the organization (Newburry, Deephouse and
Gardberg 2019).
The outside operations of Tesco in the countries like Poland, Hungary, Slovakia, Czech
Republic, Taiwan and Thailand have provided 30% of total revenues that have been gained by
the firm in the industry. Tesco is planning to enter the countries like Japan and Malaysia in order
to further enhance its presence in the retail market. Tesco has also improve the back end based
operations along with proper improvement of the international sourcing of the raw materials or
products. The process of international sourcing of Tesco has been currently concentrated in the
countries like India, Bangladesh, Thailand and China (Phillips and Moutinho 2018).
Tesco is following the internationalization strategies that have been applied by Walmart
in order to improve the overseas operations. Globalization has thereby been able to influence the
operations and approaches that are applied by Tesco. Globalization of the retail industry is
considered to be a key driving force for an organization like Tesco to enhance the sourcing
opportunities. Tesco has gained profitability in the retail industry and the growth of the
organization is continuing with the help of markets in Eastern Europe and Central Europe as
well. Innovative strategies have been applied by Tesco in order to improve the food retailing
based operations in various countries (Meyer, Neck and Meeks 2017).

9CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
Tesco is a major international retail firm that operates in many different countries along
with the United Kingdom. Tesco Bank had to face a huge fine of 16.4 Million Euros in the year
2016 by City Watchdog based on a cyber-attack that was able to influence more than thousand
customers. The attack had been able to influence the online transactions of the customers for
around 48 hours. The bank was forced to pay a 2.5 Million Euros in order to cover the losses
after the cash had been removed from various accounts due to the fraud. Financial Conduct
Authority or FCA had also stated that the bank had not been able to exercise the due skills,
diligence and care that is required for the purpose of protecting the account holders
(Independent.co.uk 2020). The deficiencies that were a part of the banking design of Tesco had
been exploited by the hackers in a huge manner. The scammers were able to remove huge
amounts of cash from the account holders of Tesco Bank with the help of only 34 transactions.
The attack was able to prove that although Tesco had started the development of online
transactions in the operations, the system was not effective for managing the customers
(Independent.co.uk 2020).
Human resource management or performance management is considered to be an
important aspect related to the methods by which the firm is able to manage the work process of
employees. Tesco has implemented performance management approaches in order to enhance
the work-life balance levels of the employees. Human resource management of the company has
also divided the jobs that have to be performed by different individuals that include recruitment,
skill development, work force management, performance appraisal, monitoring and training
(Lasserre 2017). The brand value of Tesco is influenced in a huge manner by the discrimination
in recruitment process. Tesco has implemented different approaches in order to diversity and
equal opportunity within the organization that include new strategies of human resource

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management after considering survey based answers, providing equal opportunities in same
grade staffs, enhance diversity within the workforce, implementing the technology monitoring
based system. Tesco has also implemented many changes in the line of the strategic purposes of
the organization (López‐Duarte, Vidal‐Suárez and González‐Díaz 2016).
Tesco has its processes in different countries including the United Kingdom and the
employees in the company belong to various cultural backgrounds or locations. Employee
integration is considered to be quite common for the working environment of an organization
like Tesco. Knowledge levels of organization are also increased with the help of opinions and
ideas that are offered by the employees. Tesco has developed different management practices
that have been helpful for the company to maintain the levels of diversity (Lasserre 2017). The
legal policies that have been implemented by Tesco are also helpful in enhancing the diversity
levels within the organization. The management of Tesco has implemented different approaches
in order to reduce the levels of discrimination within the firm. Tesco has also been able to
encourage the diversity in its employee base in order to maintain the knowledge levels in an
effective way (Meyer, Neck and Meeks 2017).
Critical analysis of the impact stakeholder views have on the approaches of
the organizations
The internal and external stakeholders of Tesco have an influence on the approaches and
strategies that are implemented by the company. The major internal stakeholders of Tesco
include the employees, shareholders, executive committee and board and the managers.
Employees are considered to be the most vital resource of Tesco and currently the organization
employs 450,000 people in various parts of the world. The board of Tesco mainly includes

11CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
chairman, chief financial officer, chief executive and the non-executive directors. The internal
stakeholders are considered to be highly powerful and important for the strategies that are
implemented by Tesco as well (Hill, Jones and Schilling 2014).
External stakeholders of Tesco mainly include suppliers, customers, competitors, local
communities, creditors and government. The customers are able to influence the product
portfolio and services that are provided to the consumers. The competition that is faced by Tesco
in retail industry from the organizations like Walmart, ASDA, Sainsbury’s and Amazon is faced
by Tesco with support that is provided by the customers. Pressure groups on the other hand are
able to provide major levels of pressure based on different aspects of the organizational
operations that include suppliers pay, employees pay. Local communities are influenced by the
production processes and manufacturing activities of Tesco in different countries (Ethiraj,
Gambardella and Helfat 2018).
Stakeholder Interests Influence
Managers
Hifgh
High Medium

12CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
Employees
Investors
Board of Directors
Customers
High High
High Medium
High Medium
Medium High

13CONTEMPORARY ISSUES IN MULTINATIONAL ORGANIZATIONS
Suppliers
Shareholders
Regulators
Figure 1 – Stakeholder matrix of Tesco
Source – Created by author
The stakeholders of Tesco are considered to be highly vital and powerful for the
company. Some of the stakeholders can be considered as more powerful in comparison to the
others who are a part of the organization. The competitors have huge influence on the profit
margins that are gained by Tesco in the retail industry. The suppliers of Tesco on the other hand
can affect the prices of various products and the service levels as well. Various stakeholders of
Medium Medium
Medium Medium
High High

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the organization have different expectations and this can also cause major levels of conflict
within the operations (Demir, Wennberg and McKelvie 2017). The small organizations or
competitors are affected by the operations of Tesco in different countries. The local communities
on the other hand may not be comfortable in purchasing the products from the large
organizations like Tesco. Shareholders of Tesco expect higher returns for the investments that
are made by them. The stakeholder matrix will be able to depict the ways by which the internal
and external stakeholders can influence the approaches and strategies that are implemented by
Tesco (Aguinis, Edwards and Bradley 2017).
Conclusion
The report can be settled by asserting that the contemporary issues that are a part of the
modern business environment can have a major influence on the operations of a major retail
organization like Tesco. The major issues that have been taken into consideration including
workforce diversity, globalization, human resource technologies and cybercrimes have a major
impact on the strategies that are implemented by Tesco. The internal and external stakeholders of
Tesco on the other hand are also able to influence the organizational operations and strategies
that are implemented by the organization.

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