Contemporary Issues on Business Management: Impact of Covid19 on TESCO

This report analyses the impact of contemporary issue of Covid19 on TESCO in terms of business management and leadership. It also evaluates the impact of Covid19 on organisations and the approaches taken by organisations on stakeholders’ views.

Contemporary Issues
on Business
Management

Table of Contents
INTRODUCTION...............................................................................................................................3
TASK....................................................................................................................................................3
Analysis of contemporary issue of Covid19 in the field of business, management and leadership....3
Impact of covid19 on leadership.................................................................................................4
Impact of covid19 on Management............................................................................................5
Evaluation of the impact of contemporary issues on organisations....................................................6
Impact of contemporary issue of Covid19 on TESCO..............................................................6
Impact of the approaches taken by organisations on stakeholders’ views..........................................8
Approaches taken by TESCO and their impact on its stakeholders’ views............................8
REFERENCES..................................................................................................................................11

INTRODUCTION
Contemporary issues refer to the problems or opportunities that are pertinent to
today’s life and politics. These issues exist in the field of business, management and
leadership as well. The present day contemporary issues of business include economic effects
of commodity/stock markets, growth and decline of economies, etc. (Westman, Moores &
Burch, S. L. (2021)). Management of company also faces contemporary issues like company
culture, regulation and compliance etc. Leadership contemporary issues include the
compliance with artificial intelligence by the leaders, rate of change etc. These business fields
have their respective contemporary issues in present world but the common contemporary
issues that all fields are facing today include Covid19 issue, Motivation issues and Change
management issues. They need to eliminate their impact in the organisation so as to increase
its productivity (Hassan (2021)). This report is based on contemporary issue of Covid19
faced by a retail company i.e. TESCO on its management and leadership. It is a UK based
multinational public limited company in retail industry headquartered in England, UK and
dealing in the products like grocery, clothing home and food products. The report will
analyse the contemporary issues in business, management and leadership with their impact on
organisations. It will also discuss the impact of approaches taken by organisations on
stakeholders’ views.
TASK
Analysis of contemporary issue of Covid19 in the field of business, management and
leadership
Contemporary issue of Covid19 is a major issue that is being faced by today’s
business organisations. This pandemic has spread worldwide and has impacted every industry
in terms of employment, business operations, profitability etc. and has left a big impact on the
economy of every nation as a result of which Global GDP has also been impacted in a major
way. Covid19 is posing various financial as well as operational challenges to the business
organisation in terms of human resources, customers and suppliers. As with the coming of
pandemic, the businesses had to comply with the restrictions of government in the premises
such as social distancing norms due to which many operations of business like production,
material management, supply chain management, marketing management have been
impacted. Also, the UK government had imposed lockdown due to which the human resource
management of big as well as small organisations got impacted in a major way as the

employees were made to work from home that led to many hurdles and disruptions in their
work. Due to lockdown, many organisations have shut down their business due to low
business operations and operational as well as financial losses (Joshi & Gupta (2021)).
In retail industry also, the impact of Covid19 can be seen in a great manner as it led
to closing of the stores of retail business worldwide due to which many employees have lost
their jobs that led to increase in unemployment rate as a result of which economy of UK has
seen a great impact. Although there is reduction in offline sales because of covid19, but the
online businesses and sales is now being improved a people are preferring to purchase the
products online so as to avoid the fear of covid19. So, the retail business that have strong
online presence and effective digital channels to serve their customers in an online mode are
able to face this major issue of covid19 but those businesses that are new or are not having
strong online presence and have low and recognition have been impacted by covid19 in a
great manner and are still making efforts to increase their sales through offline selling. But
still, the cases of covid19 are being observed in UK as well as other parts of the world and
government restrictions have also not been removed yet. So, covid19 has posed many
challenges to businesses in terms of operations and employment as well.
Impact of covid19 on leadership
Covid19 pandemic is posing an enormous challenge for the leaders worldwide. The
uncertainty factor of this issue is making the leadership challenge more and more complex. It
is the great principle in relation to leadership that the great leaders prioritise human resources
over their businesses. The effective and prudent leaders stay committed to the principles of
empathy and well-being of employees in the organisation. Covid19 has changed the
perspective of leaders in terms of employment of human resources to avoid heath related
issues. The pandemic has changed people’s attitudes for institutions in general and for
employers in particular (Burgos & Ivanov (2021)). So, the leaders are required to respond by
reframing their approach towards human resources to put emphasis on individual as a whole.
Covid19 has shifted the values of individuals as well as organisations. Covid19 has reshaped
the relationship of individuals with the institutions including government, healthcare and
employers.
For example, due to covid19 impact, many leaders have adopted transformational
leadership style so as to ensure high degree of coordination, communication and cooperation
in the organisation to achieve compliance with the imposed restrictions due to covid19 while
ensuring effective productivity in business. By following transformational leadership in the

organisation, leaders can bring necessary changes in the organisation according to the
covid19 norms to ensure safety of workers and developing positive organisational culture. In
context with covid19, the healthcare and human welfare must be included in economic and
social objectives (Saide & Sheng (2021)). Apart from adopting the effective leadership style
to deal with the issue of covid19, the leaders also have to consider the impact of interventions
and responses of government agents, civil servants and local administration, the impact of
external environment on which the leader have no control, so adopting a leadership style
would also not be effective enough to deal with the challenge of covid19. The leaders of
many big organisations have changed their leadership approach towards management of
human resources so as to provide them with positive and healthy working environment and
ensure the safety of their employment.
Impact of covid19 on Management
Due to covid19, the management of organisations has also been impacted in a major
way. The global impact of covid19 has put an unprecedented pressure on the business
organisations. The challenges imposed by covid19 make the management organisations to
compromise an organisation’s legal, financial and reputational standing. It is required to
concentrate on real time engagement. The management of organisations across the world
have faced major challenges during the second and third quarters of 2020. There are various
issues of covid19 faced by the management team. Some of those issues include Funding
issues. Due to covid19, funding and liquidity both were impacted in the stock market that
also impacted the performance of the organisation that had invested in those markets
(Kulshreshtha & Sharma (2021)). When they were in dire need of money in the covid19
pandemic, they were also unable to take the financial help from the stock market as stock
market condition was also very tight due to funding and liquidity. As Tesco and Sainsbury,
both are the retail sector business and deal in other business divisions as well, so they also
faced the major financial issues during the covid19 pandemic for arranging funds for material
management and marketing management of different business funds (McGaughey & et. al.,
(2021)).
Management had to face the supply chain management issue also in the organisations.
Due to the restrictions of government on movement of people and social distancing norms,
organisations were not able to maintain physical contact with the suppliers due to which they
had to face delays in receiving materials as well. Government had also imposed restrictions
on the movement of certain goods to avoid physical touch so as to ensure avoidance of

covid19 spread (Hauer (2022)). Businesses had to invest on the purchase of sanitizers and
other essentials for products so as to ensure safety of products as well human resources. Due
to the government restrictions, Businesses had to face disrupted supply chain management.
Marketing management of the organisation also got disrupted in a major way as the
businesses were not able to organise the marketing campaigns during the period of covid19.
The functions of management have got impacted by covid19. For example, planning,
organising, staffing, directing as well as controlling have been impacted by the covid19 issue.
Evaluation of the impact of contemporary issues on organisations
The retail industry is one of the mostly impacted industry by the issue of covid19. In
UK, the retail businesses had to face their major impact on the business operations. The
changes in the external environment that surround the retail industry have major influence on
the company’s operations (Lavoie‐Tremblay & et. al., (2022)). The big UK companies in
retail sector like Tesco had faced the issues of Covid19 in terms of leadership as well as
management due to which its functions of management were also got impacted. The impact
of contemporary issue of covid19 has been discussed below in context with TESCO in terms
of their leadership and management in the organisation.
Impact of contemporary issue of Covid19 on TESCO
TESCO also had to face the impact of Covid19 on operational and financial
management. The pressure of covid19 was observed across all the teams of TESCO i.e.
marketing team, human resource team, finance team etc. Its finance team had played a crucial
role in responding to covid19 crisis working with the team to facilitate the implementation of
great operational changes. TESCO has responded to Covid19 in terms of drafting thousands
of new workers in the company, increasing its online delivery capacity and making prompt
payments to its suppliers. The profits of TESCO fell down by almost 890 million pounds
because of covid-related costs and this costs also include the requirement to recruit the
personnel so as to cover for the workers that were impacted by the virus (UK supermarket
giant Tesco sees profit dented by Covid related costs, 2022). As reported by Tesco, it has
hired about 50000 temporary employees during the covid19 pandemic, and from among
them, almost 20000 employees have been recruited in the company on permanent basis.
Apart from the above negative impacts of covid19 on TESCO’s performance, it has
also been observed that its sales has seen a positive impact in the year 2020 as compared to
the year 2019. Its online sales increased as people stayed at home that increased the demand

of food and grocery to be purchased online (Tesco: Coronavirus (COVID-19) Company
impact, 2022).
The 2020 sales of the company observed a positive impact due to covid19 with the
increase in demand of its food and grocery worldwide as the consumers wanted to purchase
the essential products online while staying at home and as a result, the online sales of
company saw an increase of 9.2% (COVID-19 Impact on Tesco, 2022). The company has
started delivering online shopping using plastic bags as it will reduce the time required to
deliver the order and thus the company is contributing to the reduction in the risk of infection.
To respond effectively to the pandemic, the company, as part of its crises management, has
mobilised its logistic network in UK and has increased the number of delivery slots that it
offers.
The impact was that the company was able to win its customers as compared to its
competitors and its profits also took a large hit after the company had incurred extra costs of
£892 million. This cost included hiring of more staff for providing online deliveries and to
cover those staff members as well who were on work from home due to avoiding the covid19
or when they were isolated according to the government norms so as to avoid the covid
infections. The impact was that in all, the company had to employ almost 50000 more
workers during the pandemic from among which, 20000 had joined the company ion a
permanent basis (Tesco profits fall as Covid costs offset sales surge, 2022). In context with
Covid19, the chief executive of TESCO, Ken Murphy has reported that the company has
strengthened its brand and increased customer satisfaction during the pandemic as a result of
which the company is able to improve its value perception. To respond to the pandemic in
terms of increased sales, the company has doubled the size of its online business and by its
Clubcard, it is developing a digital customer platform for future crises management. And, for
dealing with the increase demand of customers, the company has opened a new Robot-
powered fulfilment centre in its West Bromwich Superstore during the year in which
pandemic was growing rapidly.
The company has reported that the pandemic has changed its customer behaviour in
major way. And as per the company’s updates from May 2022, as a result of Covid19, the
company is selling the Everything genetic Covid19 Antigen rapid test kits in some of its
stores. The kits are approved from the UK government and the UK health Agency
Regulations 2021. By, this the company is supporting its localities and communities to

respond to the covid19 by taking precautionary measures. The company is providing the slots
to the customers of Scotland, Wales, Northern Ireland etc. according to the directions
provided by the government. The company is providing its slots services to those customers
also who are self-isolating. During the pandemic, the company has made partnership with
Cancer research UK, British Heart Foundation and Diabetes UK for protecting the health
concerns of its employees as well as customers (Tesco COVID-19 updates from 20/05/22,
2022).
In context with management, the leaders in TESCO have changed their leadership
approach i.e. they have adopted the transformational leadership styles as part of their change
management. They are striving to ensure safety of their employees as well as customers and
trying to instil the required skills such as decisiveness i.e. the ability to take clear-cut and
timely decisions with appropriate and required information. Such as the CEO of company had
took the decision of enhancing its digital infrastructure in view of the covid19 pandemic . The
skills like flexibility and adaptability have also worked in managing the crises. As effective
leaders are able to effectively adapt with the circumstances and respond to them in effective
way, the leaders like Alan Stewart have adopted flexibility to meet with the uncertainties of
Covid19 and comply the rules and policies of government associated with the prevention of
pandemic. The main focus of its CEO i.e. Ken Murphy has been on its employees safety as he
considered to be the main assets of the company that are very crucial; in contributing to the
company’s stability in such a major pandemic.
Due to the employment of more employees, its management and organisational
structure have also observed a slight shift in the company’s structure. Organisational culture
of the company have also been made very strong as part of its change management. So,
TESCO had bring number of changes in its leadership, organisational culture as well as
structure and in the leadership styles so as to deal with the crises successfully. And it has
been successful in dealing with the crises by its strong online presence and major contribution
for its employees in dealing with the pandemic. The supermarket retailer has modified its
business model so as to address the Covid19 issue (Adapting to COVID-19: the Tesco story,
2022).
Impact of the approaches taken by organisations on stakeholders’ views
Approaches taken by TESCO and their impact on its stakeholders’ views
To avoid the covid19 issues and to deal effectively with its impact, TESCO has
started delivering online shopping using plastic bags that is facilitating the company in

shortening the time needed for delivering an order and this is helping the company in
eliminating the risk of infection. The company has seen an increase in the online sales due to
pandemic that has increased its sale of groceries. The approaches and their impact on
stakeholders’ views of TESCO is discussed hereunder –
 Customers – The customers of the company have positive views regarding its
approaches to deal with covid19 as the company has extended its shopping items for
NHS workers and continued to hold its priority hours for elder and vulnerable
customers. The company created easy access to the essential products for its
customers by providing wide limit of 3 items per customer on every product line. It
had also increased the number of home delivery and click and collect slots availability
as a result of which its customers developed positive views regarding company due to
easy access to more slots. Its main approach towards the customers was to increase
customers satisfaction and improving value proposition by having robust customer
analytics and insight capability (How analytics helped Tesco improve its customer
satisfaction amid Covid: An Economic Times Coverage , 2022). The company has
emerged as a strong and trusted brand both financially and operationally. In the crises,
it redefined its strategy and began working with the third-party organisations for
providing them with supplementary data for understanding customer behaviour and
market needs in a better way. This had developed a brand loyalty in the customers of
company and developed a loyal customer base globally.
 Colleagues and Employees – During Covid19, TESCO had invested a huge
expenditure on the safety and protection of its staff i.e. employees as well as
colleagues due to which the employees and colleagues developed positive attitudes
towards the work and contributed more to the organisational goals even during the
pandemic. TESCO is also supporting its elderly and vulnerable colleagues and
employees with full pay on their self-isolation that has left a positive impact on the
employees regarding the company. It has seen a massive benefit in recruiting 35000
new colleagues from its careers website due to its support to the existing employees.
By making partnership with Heath charity partners like British Heart foundation,
cancer Research UK and Diabetes UK, the company aims to assist its colleagues live
healthier lives and reduce the risk of health challenges. For its women staff, it is
working with The eve Appeal to make the resources and materials available to
develop the understanding and awareness about women’s wealth. All these efforts of

the company towards its employees and colleagues are facilitating the company to
achieve major contribution from the employees in its growth by developing a positive
and healthy organisational culture.
 Communities – During the pandemic, TESCO has donated about 25 million meals
from its stores and distribution centres to the local communities. It has donated almost
£70 million as charity with its charity partnerships, and community grants. It is still
delivering food every month through its community Food Connection scheme and
distribution centres (Our latest response to COVID-19: 31 March, 2022).
 Government – TESCO complied with the government guidelines on ensuring welfare
of employees that wanted the company to not cut the pay of elderly and vulnerable
employees on their self-isolation according to government norms and TESCO did the
same by providing its isolated employees with full pay. This has developed the trust
of government for the company and ensured that the company will be getting
community grants and other grants, relaxations, etc. in tax from the government.
TESCO had complied with the rules of UK government and both the companies
followed the government announcement of making wearing of masks mandatory in
the stores. TESCO had contributed more and more efforts to encourage wearing of
masks for the shoppers of England and gained governmental support in the foreign
trade relations due to this support.
 Shareholders –The Company kept connected with the shareholders in the time of
pandemic by conducting EGM in virtual mode to share the company’s projects and
the measures to deal with covid19 pandemic due to which the shareholders of the
companies did not lose their interest in the company and developed a sense of trust in
the companies. By its strong online presence and increase in the online sales, the
company is able to maintain sufficient profits from the operations and is able to
satisfy the shareholders as well.
 Suppliers – As TESCO maintains long-term partnerships with suppliers, it has been
able to work with its suppliers effectively during the pandemic time. The supplier
base of company in UK consist of nearly 3000 suppliers that were also impacted by
the outbreak. It supported its small suppliers by having their invoices paid
immediately instead of the usual 14 days. The company remained in contact with its
suppliers, farmers and growers to help them in meeting up with these challenges that
provided suppliers reliance on the company due to which they are still delivering
effective service to the company (Supporting our suppliers during Covid-19, 2022).

The company has made investment in almost 200 delivery vans, in adding 2500
drivers and 5000 stock pickers for increasing its supply (Analysing the impact of
Covid-19 on Tesco’s share price, 2022).
CONCLUSION
From the above discussion, it can be concluded that the contemporary business issues
like Covid19, motivation, change management and other issue of management, leadership
and businesses have impacted the business organisations, particularly in the retail industry in
major way. It has been analysed from the above report that the contemporary issues like
covid19 demand changes in the leadership and management and organisational culture as
well as structure of the company so as to ensure effective crises management. Covid19 has
immensely affected the financial as well as operational performance of many retail
businesses, but the companies with strong digital infrastructure like TESCO have been able to
cope with the pandemic in an effective manner. As per the report, Covid19 has been emerged
as a major challenge in today’s business era, the effects of which are still being faced by the
business organisations. The retail businesses like TESCO have been able to deal effectively
with covid19 despite major impact on their sales and profitability but with the effective use of
their online business, they were able to increase their online sales. It can be analysed from the
above report that the companies must be able to deal effectively with the contemporary issues
by developing effective approach so as to impact their stakeholders in a positive manner as it
has been seen in case of TESCO.

REFERENCES
Books and journals
Adapting to COVID-19: the Tesco story, 2022 [online] available through
<https://www.icaew.com/insights/interviews-and-profiles/2020/july-2020/adapting-
to-covid19-the-tesco-story >
Analysing the impact of Covid-19 on Tesco’s share price, 2022 [online] available through
<https://www.ig.com/uk/investments/news/share-dealing/2020/04/07/analysing-the-
impact-of-covid-19-on-tescos-share-price >
Burgos, D., & Ivanov, D. (2021). Food retail supply chain resilience and the COVID-19
pandemic: A digital twin-based impact analysis and improvement directions.
Transportation Research Part E: Logistics and Transportation Review, 152, 102412.
Changes to shopping online
COVID-19 Impact on Tesco, 2022 [online] available through
<https://www.globaldata.com/store/report/coronavirus-covid-19-company-impact-
tesco/ >
Hassan, I. (2021). Challenges of Islamic Education in the Era of Globalization: A Proposed
Holistic Solution. International Journal of Academic Research in Progressive
Education and Development.
Hauer, J. U. (2022). Virtual Human Services Delivery: Lessons for Equity, Leadership, and
the Future. In Multidisciplinary Approach to Diversity and Inclusion in the COVID-
19-Era Workplace (pp. 247-261). IGI Global.
How analytics helped Tesco improve its customer satisfaction amid Covid: An Economic
Times Coverage , 2022 [online] available through
<https://www.tescobengaluru.com/news/how-analytics-helped-tesco-improve-its-
customer-satisfaction-amid-covid-an-economic-times-coverage/ >
Joshi, V. A., & Gupta, I. (2021). Assessing the impact of the Covid-19 pandemic on
hospitality and tourism education in India and preparing for the new normal.
Worldwide Hospitality and Tourism Themes.
Kulshreshtha, K., & Sharma, G. (2021). Understanding e-leadership: Please mind the gap.
Technological Forecasting and Social Change, 168, 120750.
Lavoie‐Tremblay & et. al., (2022). Influence of caring for COVID‐19 patients on nurse's
turnover, work satisfaction and quality of care. Journal of nursing management,
30(1), 33-43.
McGaughey, F., & et. al., (2021). ‘This can’t be the new norm’: academics’ perspectives on
the COVID-19 crisis for the Australian university sector. Higher Education Research
& Development, 1-16.
Our latest response to COVID-19: 31 March, 2022 [online] available through
<https://www.tescoplc.com/news/2020/our-latest-response-to-covid-19-a-message-to-
customers-from-dave-lewis-tesco-ceo/ >

Saide, S., & Sheng, M. L. (2021). Knowledge exploration–exploitation and information
technology: crisis management of teaching–learning scenario in the COVID-19
outbreak. Technology Analysis & Strategic Management, 33(8), 927-942.
Supporting our suppliers during Covid-19, 2022 [online] available through
<https://www.tescoplc.com/blog/supporting-our-suppliers-during-covid-19/ >
Tesco COVID-19 updates from 20/05/22, 2022 [online] available through
<https://www.tesco.com/help/covid-19/ >
Tesco profits fall as Covid costs offset sales surge, 2022 [online] available through
<https://www.theguardian.com/business/2021/apr/14/tesco-profits-fall-as-covid-costs-
offset-sales-surge >
Tesco: Coronavirus (COVID-19) Company impact, 2022 [online] available through
<https://www.researchandmarkets.com/reports/5094159/tesco-coronavirus-covid-19-
company-impact >
UK supermarket giant Tesco sees profit dented by Covid related costs, 2022 [online]
available through <https://www.business-standard.com/article/international/uk-
supermarket-giant-tesco-sees-profit-dented-by-covid-related-costs-
121041400640_1.html >
Westman, L., Moores, E., & Burch, S. L. (2021). Bridging the governance divide: The role of
SMEs in urban sustainability interventions. Cities, 108, 102944.