Innovation and Technologies in Tesco: A Strategic Analysis

Innovation and technologies
1

Contents
INTRODUCTION...........................................................................................................................3
TASKS.............................................................................................................................................3
CONCLUSION..............................................................................................................................11
2

INTRODUCTION
Technological innovation is a process whereas organization embarks in the journey and
consider the importance of technology as a source of innovation. It is based on the extended
concept of innovation which providing the opportunities for organization who will struggle to
survive in marketplace. In another way, it also provides chance of existing enterprise that is
being beaten by other challenger in business market. The report will describe the current
condition of enterprise by using strategic analysis frameworks such as porter’s five forces, value
chain, SWOT analysis, innovation model, Mckinsey 7-s Model. These framework will explain
the current situation or condition of organization.
TASKS
Company overview
TESCO is a British Multinational groceries and general merchandise retailer. It is the
largest retailer in global world that would be measured by its gross revenue. The organization
was founded in 1919 by Jack Cohen as a group of market stalls. In various countries, Tesco has
already opened their physical stores such as Asia, Europe. According to report, it has found that
Tesco struggling supermarket into Britain since mid-2000s (Ichino, 2020). In 2007, Tesco
opened their first store in Los Angeles. Afterwards, physical stores were rolled out across
California. It provides better quality of product and service but they have faced problem and
struggle due to customer satisfactory. In this way, organization was forced to expand business
within unsatisfactory retail side. Furthermore, it also declaring US market entry strategy but it
completely failure in Britain marketplace.
Porter’s Five forces Model
It is based on the strategic management tool to analyse the organization and understand
the various levels of profitability. Tesco can use Porter’s Five force to understand that how
competitive force influence growth and development. Furthermore, it is developing an effective
strategy to enhance the Tesco competitive advantage in long term growth.
Threat of new Entrant
In Tesco, New entrants which will bring innovation, new way to doing things in US
supermarket but the pressure and strategy fails (Popp, 2019). Tesco consider low pricing
strategy, reducing cost and providing new value proposition to the consumers. Tesco has to
3

manage the challenges and build an effective barriers in competitive edge. Threat of new entrant
is high.
Bargaining Power of Supplier
Tesco buy their raw materials from various suppliers. These suppliers in dominant
position that will reduce margin in Britain markets. The most powerful suppliers in consumer
sector use their own negotiating power to extract high price from US marketplace. In this way,
bargaining power of supplier is low.
Bargaining Power of buyer
In US supermarket, buyers are demanding a lot. They want to buy available offers that
available in minimum price. In this way, it put more pressure on Tesco profitability in long term
running enterprise in Britain markets. The bargaining power of buyer is higher.
Threat of Substitute
When new product and service meet the similar consumer expectation in different
manner. In this way, Tesco has suffered within Britain marketplace. The threat of substitute
provide and service is high.
Stakeholder analysis
A stakeholder analysis is based on the process of identifying people before starting
project. It is consider as group of people to their level of participation, interest and influence in
the Tesco (Paiola and Gebauer, 2020). In order to determine that how involve and communicate
with each other. In Tesco, it can identify both internal as well as external stakeholders. In order
to explore their influence on the organization in US super markets.
External stakeholder
 Managers, committee, employees and executives
Internal stakeholders
 Supplier, creditors, competitors, customers, government, creditors and local governments.
These are considerations of various stakeholder that perform significant task within organization.
The primary aim to explore their business project while implementing new innovative in
business processes.
Strategic stakeholder analysis
In Tesco, Strategic stakeholder analysis the process of meeting particular expectation and
objective of stakeholder of Tesco. In accordance with internal and external environment of retail
4