E-business strategy - Tesco Assignment

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A migration plan to develop e-business capability from scratch for Tesco organization
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Research question
Over some time now e-business strategy has now become a conclusive element to a successful
operation within a business (Bandara & Pathiratne, 2017). When it comes to the market place
any organization despite of the field in which it function has emphasized on the use of the e-
business strategy in order to gain a competitive edge (Chao, 2018). To the retail sector they have
being taken into the consideration in regards to this context, since they had found it an effective
way to which they could improve on the productivity level with the use of this strategy (Bandara
& Pathiratne, 2017). Nonetheless, there do exist little evidence which has shown any positive
effect between the effectiveness of the business strategy and the performance of the organization
(Chao, 2018). Thus, in this research study it aims to execute a study in regards to the retail
organization which is TESCO. The research question which would be used in this study is
highlight as below.
 Do the e-business strategy innovate the service operations of this organization to increase
in profit level?
In this research question has been designed in the manner in order to measure the effectiveness
of the e-business strategies which are adopted by Tesco and its effect to the organizational profit.
E-business strategies usually comprise of technologies which are complex as well as tools. In
this analysis and the illustration to this question would assist and ensure that the customers’ e-
commerce strategy is economical to the business (Chen, Pan and Ouyang, 2014). There is aspect in
relation to security when it comes to the e-business strategy which offers reliable and secure
services to the client (Chen, Pan and Ouyang, 2014). In this organization it should offer a user
friendly website to the clients, and they need to have advanced security programs to ensure all

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the customer data are secure. They could attain this through use of encrypted methods, and use of
the firewall applications. There is importance to protect personal and confidential data of the
clients to ensure that the reputation of the organization has been maintenance since any
compromise to the client data could put the organization to a lot of trouble (Vanderveld, Pandey,
Han and Parekh, 2016). This research would assist to identify of any loopholes within the
organization in order to improve on the areas which are identified. The high client satisfaction
would assist in maximizing on the annual profit of this business since this is crucial to the growth
of the organization.
Research method
The research method in this research would assist in solving the above mentioned research
question through an evaluation analysis (Chao, 2018). This research has employed inductive
method that would be followed which comprises of the collection of the secondary data as well
as quantitative analysis of the data techniques. The use of the inductive method is crucial since it
assist in selecting an effective research tools as well as method which are useful in the collection
of the data which are from the sources which are reliable. Moreover, the use of this research
technique assists in the analysis of the data with the use of effective data analysis and this is
quantitative techniques (Vanderveld, Pandey, Han and Parekh, 2016). The use of the
quantitative approaches helps in the recording of the data from the large percentage of the
participants in order to add better description in relation to this topic which has been selected for
this research. Additionally, the use of this approach utilizes the statistical aspects as well as
numerical data in order to extract data that is crucial from the analysis of the e-commerce
strategies which are utilized in the retail applications of the business (Vanderveld, Pandey, Han
and Parekh, 2016). This study has been done on the Tesco organization. There were 5

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employees and forty eight clients who were selected as the sample size. There were structured
questionnaires which were distributed to these participants. The response in this research has
been measured through use of the Likert scale analysis. This analysis usually measures on the
response by providing a rank to them from one being strongly agree to 5 being strongly disagree.
This method helps to validate on the content and check on the facts which are provided on this
research. the analysis of the data would be provided in the various sections within this research
which would assists in drawing accurate summary of the work at the end of this report.
Report
Introduction
The organization which runs on the e-commerce platform has been the key elements to change
on the economy of that business through enhancement of the positive growth rate (Chiejina and
Olamide, 2014). E- Business has greatly evolved in the manner to which the organizations are
thinking and this has provided new opportunities which have helped enhanced competitive
rivalry. In this report, it would discuss about one of the major leading retailer organizations in the
world which is Tesco. The research would analyse on the effect of the e-commerce strategies on
the performance of the business (Chiejina and Olamide, 2014). The usage of the e-business
strategies within this business would assist them to improve in productivity and at the same time
enhance on the customer satisfaction. This analysis in regards to the e-business to this
organization is carried out to measure on whether the integration to the e-strategies to this
business is an effective measure or not.
Background information of TESCO organization

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Tesco is the general merchandise as well as grocery retailer organization whose headquarters are
situated in England, UK (Fernie and Sparks, 2014). It has been 3 world largest organizations in the
world in this sector in terms of the profits and the 2 largest in terms of the annual revenues.
The vision of the organization is offering the best and quality products at prices that are
reasonable to their clients (Eaton, 2013). In the UK the organization has numerous stores and their
major goal to each is ensuring that the customer experience the best services every time they visit
the organization (Eaton, 2013). Based on the survey carried out, Tesco has earned more than one
hundred million dollars through their operation in more than six thousand stores in their more
than thirteen countries globally (Galliers and Leidner, 2014). Nonetheless, competitors such as
Asda they have an annual sales which has been 8 times that of Tesco (Chiejina and Olamide, 2014).
Other competitor such as Sainsbury holds the 2nd positions in the market share. Tesco has
approximately twenty seven percent in terms of the market share and they have been able to
dominate both in the online and the offline in the grocery market. Nevertheless, the presences of
the other giant grocery organization have forced them to expand to the new and unique
opportunities which might have arisen (Chiejina and Olamide, 2014). Therefore tesco.com they
were able to launch on their first e-commerce site which is Tesco Direct (Galliers and Leidner,
2014). There have been more than eight thousand products which have been made available in
this platform and promoted such as fashionable clothes, electronic as well as sofas to name a
few.
Impacts on the organisation and changes to infrastructure

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To analyse on the effects of the organization changes within this organization it is crucial to
highlight the conceptual framework which has been implemented on the use of this strategy to
the business (Fang, Qureshi, Sun, H., McCole, Ramsey and Lim, 2014).
Figure 1: The diagram shows the conceptual framework adopted by Tesco in E-business strategy
(Tesco.com, 2018).
All the data which has been related to the products, its features prices as well as discount made
can be transmitted via the EDI system that has merits to the organization such as faster
transmission of the data which is highly accurate (Carrillo, Vakharia and Wang, 2014). Another
benefit is that there is complete information in regards to each transaction and a better flow of
the communication within the organization (Chiejina and Olamide, 2014). As the data would be
transmitted within the organization through the electronic system, it would be much easier in the

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ordering of the products as well as the services when there have been changes in the
infrastructure within the organization (Galliers and Leidner, 2014).
The major advantage for the organization in the adopting on the e-business strategy is assisting
them in streamlining on the process of the procurement as well as standardizing on the trading
procedures via advanced computerization (Galliers and Leidner, 2014). There would be reduction
in the errors and the delay which were there when the customers were making the purchases
(Bandara & Pathiratne, 2017). Additionally, it would be possible for those who are purchasing
the products to compare on the prices, information about the products to the other organization
when using the e-commerce platform (Colla and Lapoule, 2012). This becomes an effective way in
regards to the distribution so as to match on the requirements of the clients. There would be also
improvement of the decision making process through adopting the e-business since there is
enhancement to the capabilities of the web.
Analysis of the e-business to the Tesco organization
With the adopting of the e-business approach Tesco organization will use it to handle on their
business operations on the networked digital programs (Colla and Lapoule, 2012). The authorities
in the Tesco business would use it to document and do codification activities in the digital
platform. The electronic network would assist them to manage on the flow of the data in order to
provide unique services to the business (Turban, Outland, King, Lee, Liang and Turban, 2018).
The new e-business strategy would help the organization to change on the way they handle
services and it would help reduce on both the transactional and operational costs (Colla and
Lapoule, 2012). Other benefits are associated on improving on the visibility, enhancing customer
services as well as increase in the market share through expansion (Lin, 2014). According to Lin

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(2014) becoming world leading retailer business it is achieved through the integration of the e-
commerce strategies within the applications of the business.
Figure 2: The diagram shows the components of e-commerce on changes of infrastructure
(Tesco.com, 2018)
This e-commerce platform would have impacts to the organizational infrastructure in the sense
that it would establish a direct link with the clients through offering them new kind of the online
services as well as offer new services (Galliers and Leidner, 2014). Such kind of the strong
relationship which would be established with the clients would help lower on the operational
costs, develop on the loyalty as well as offers valuable and authentic data in regards to the
products given to the clients (Rutherford et. al 2016). The emergence of the computer which
includes the implementation of the data management system to the e-business strategies helps to
locate the resources well and locate on the products as well as the services which could match on
the customized requirements of the clients within a given price (Galliers and Leidner, 2014). The

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operational conduct which would be done by the e-business strategy when implemented would
be on the following process;
Customer-focused process: The new strategy would change on the way marketing and
promotional activities of the products over internet (Hannak, Soeller, Lazer, Mislove and Wilson,
2014). The organization has also promoted on their brand through the social media platform such
as the Twitter and the Facebook and this has helped draw more clients to the organization
(Ghezzi, Mangiaracina and Perego, 2012).
Production process: This includes the procurement and the logistic operations. It also entails the
replenishment as well as the ordering of the products, processing of all the transactions as well as
the control of the production (Ghezzi, Mangiaracina and Perego, 2012). The organization used the
desktop publishing web software which enables them to develop content which ensures that there
is flow of the product from the system (Ghezzi, Mangiaracina and Perego, 2012). The organization
warehouse system usually comprises of the database program which has the capability to gather
on the customer data and this ensures the products that are shipped are on time.
In their infrastructure the organization has also been able to integrate one of the best functional
strategies in their e-commerce which is club card to the potential clients (Chen, Pan and Ouyang,
2014). The use of such assists in tracking the data of the clients from the personal details to the
buying patterns (Vanderveld, Pandey, Han and Parekh, 2016). To ensure they did meet on the
needs of the organization they were able to formulate a predictive model to which they used in
their warehouse technology as well as the logistic system (Chen, Pan and Ouyang, 2014). This kind
of the model ensures that the stock controller gains access to the sales uplift forecast. The

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customers who use this card any time they make a purchase they gain one point which is
equivalent to each dollar that is spend on a particular product (Tuflija and Janzen, 2017).
Major benefits, with suggestions for how to measure them
The suppliers would help to meet on the needs of the organization and requirements will be
provided through real time data in regards to the information which relates to the services and the
products (Eaton, 2013). This would help the organization to enhance the process of making the
decision (Vanderveld, Pandey, Han and Parekh, 2016). Economic interactive findings enable the
searching to the other products that are similar in the other organization to ensure that the
bargaining power is much easier.
This e-commerce strategy has enabled the buyers they view the numerous ranges of the products,
in terms of their features in comparison to the other organization and be able to examine on the
prices request to modify when they make their orders (Hübner, Kuhn and Wollenburg, 2016). The
e-business platform for the Tesco organization offers products data via the buyer guides which is
an effective way to market their products to the customers worldwide.
Through the use of this strategy the organization would be able to create products based on the
needs of the clients as well as their requirements (Hannak, Soeller, Lazer, Mislove and Wilson,
2014). This e-commerce approach would help create a direct links between the suppliers and the
clients and this would enable gathering of the data between them, in terms of their needs,
patterns of the buying and other relevant data.
This e-commerce platform will ensure there are a 24 hours operations and support services
available so that the needs of the customers are met through addressing on the queries which they
raise (Hannak, Soeller, Lazer, Mislove and Wilson, 2014). It also helps the customers since there are

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numerous options which are available thus they are able to compare the best prices at a cost that
is reasonable (Hannak, Soeller, Lazer, Mislove and Wilson, 2014). All these changes in the
infrastructure aim to maintain the loyalty of the clients and at the same time attract others
towards the business. On this benefit it would be measured through the customer feedback the
organization get and the changes in the sales (Vanderveld, Pandey, Han and Parekh, 2016). If it
increases this means the platform is doing well for the business and if there are decrease there is
issue somewhere which needs immediate correction.
Major risks, with strategies to avoid or minimize them
Risk encountered by the business
The major risks which are encountered by the organization are as follows;
Technical issues: one of the risks is in relation to the security on the e-commerce platform
(Lapoule and Colla, 2016). Absence of an effective security measures in place in terms of the
application such as the use of the firewalls, encryption approaches and intrusion detection system
would enable unauthorized individuals to hack and have access to the confidential data of the
clients (Eaton, 2013). In most cases this data is stored on the databases along with the significant
data of the organization. There are numerous types of attacks which could be subjected to this
system such as the DDoS, SQL injection attacks which could block on all the channels of the
distribution when the hackers insert malicious virus to the system (Liu, 2015).
The hackers are also able to steal confidential data of the customers such as their credit card
information which they use to make purchases in other online platforms using this data (Fung
and Hood, Gula Consulting LLC, 2017). This is a great risk to the organization since their
reputation would be destroyed when such issues arises.

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Societal risks: The cost which is associated to the e-commerce implementation is huge. The
organization would need to acquire technologies which are advanced which ensure there is
smooth running of the business without necessary increasing on the cost of operation as well as
other business cost (Fung and Hood, Gula Consulting LLC, 2017). The challenge comes in when
the organization does not have skilled personnel to handle this new system, the system might be
destroyed when not handled well and this increases the organizational overhead costs (Hirt and
Willmott, 2014). This sometime could result to overlooking at the customers issues and they are
not handled appropriately.
Strategies to address the risks
These are the strategies which the organization could implement to address on these risks;
Enhancement of the security: Tesco organization need to implement an advanced security
programs for instance the firewalls, encryption techniques as well as intrusion detection system
which would ensure that both organizational and the clients data has been protected from the
individuals who do not have access to the system (Tuflija and Janzen, 2017). The security tools
described should be placed between the server and the internet since this platform is internet-
based to ensure that any data packet that are incoming or going out of the system network could
be monitored before they could enter to the main e-commerce platform system (Tuflija and
Janzen, 2017). Tesco should also utilize the digital signature approach to protect the system from
any malicious attacks such as the viruses, or the Trojans.
Training and education: To address on the risk of the system being damaged by unskilled
personnel within the organization, the business need to introduce inductive training session to the
workers within the organization to ensure that they can understand on the operation of the new

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system so that they could use it effectively to attract more client to the business and enhance on
the customer satisfaction (Lodha, 2017). This aspect would ensure that the workers do optimize
on the issues the customer raises and provide effective and prompt solutions.
Implementing a central technology system: Tesco organization needs to have a central system in
place rather than using various systems to each technology they have implemented (Vanderveld,
Pandey, Han and Parekh, 2016). They need to integrate all the technology to a single central
system for easy management (Huang and Benyoucef, 2013). The systems that need to be integrated
together are on the management system, dispatch system, the tracking system- for the orders
placed along with the clients’ support system (Omondi and Mbugua, 2017). Integrating them
together will ensure that the data has been synchronized to a person point about the products,
services and the clients within the company.
Conclusion
Through the analysis of the e-business strategy which has been adopted by Tesco organization,
the report can conclude that migrating to this system would helps the organization in their
operation and this would enhance on their growth. Having a reliable and also user friendly site to
the customers would enhance on the logistic and the procurement procedures within the business
ensure that the organization offers the best and high quality services to the clients globally.
Through the implementation of the client centric techniques such as the launch of the Clubcard
would help the organization to maintain the loyalties of the clients and at the same time draw
new customers to the business which helps them increase on their market share in terms of
customer base and profits. Nonetheless, as much there are benefits in the implementation of the
e-business strategy for this organization there are numerous risks which they would likely

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encounter. The risks which have been addressed in the report are the security vulnerabilities and
poor understanding of the workers to the new system which leads to damages on it. It is crucial
that the organization could re-shape their current e-commerce model and migrate to the proposed
model which ensures they enjoy a lot of benefits associated to it and grasps on the opportunities
which comes with it. This will also be crucial since the other giant retail organizations are
implementing on the same and each organization is competing to offer the best services to the
clients.

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