Operations Management at Tesco: Challenges, Approaches and Recommendations

This report discusses the challenges faced by Tesco in operation management, inter-relationship between operations, core and support function of Tesco, input-transformation-output process review and critique, roles and importance of the operations management in Tesco, and recommendations of new and emerging technologies that can use to effectively manage overall operational activities in TESCO.

Operations
Management

Table of Contents
INTRODUCTION...........................................................................................................................1
PART A...........................................................................................................................................1
Introduction of Tesco.............................................................................................................1
Inter-relationship between operations, core and support function of Tesco..........................2
Input-transformation-output process review and critique......................................................2
Roles and importance of the operations management in Tesco.............................................3
Explanation of various challenges faced by TESCO in operation management....................3
Comparison between TESCO and Sainsbury's of how they measure their operation
performance and evaluate the effectiveness of each measure................................................4
Recommendations of new and emerging technologies that can use to effectively manage
overall operational activities in TESCO.................................................................................5
Part 2................................................................................................................................................5
Critically evaluate different approaches of quality management used by The TESCO.........5
Approaches of quality management and continuous improvement for providing better
customer satisfaction..............................................................................................................6
Role and scope of supply chain management in supporting different organisations.............7
Assess the organisation’s supply chain performance objectives, and their use of lean vs agile
supply networks......................................................................................................................8
Evaluate effective supply chain management options and recommendations for improvement
................................................................................................................................................9
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Operation management refers to process of business in which increase the efficiency
level of the organisation as it mai9nly focus on converting the labour and material into product
and service. The operational management maximize the organisation's profit as it balance the
cost and increase the sales of the company. It involves organising, planning and implementation
as these factors help to achieve the organisation's goal as it mainly focus on reduce the cost and
increase the profit of the organisation (Barnes, 2018). For the present report, Tesco is taken into
consideration. It is a famous grocery company which was founded by Jack Cohen in1919 and its
headquarter in London, England. The TESCO has been dealing its business in approx. 14
countries of Europe and Asia and It has approx. 7000 retail outlets. The respective company
dealing in wide range of products such as internet service, telecoms , financial service, software,
petrol, toys, furniture, electronic, clothing and books etc. The report will cover the concept and
theories of operation management along with the challenges associated with it. IN addition to
this, various quality management approaches will be elaborated that will help an organisation to
improve its quality.
PART A
Introduction of Tesco
Tesco is a multinational organisation which deals in general merchandise headquartered
in England. The company was founded by Jack Cohen in 1919 which is now third largest
retailers in the world and ninth largest in terms of revenue. In UK the company owns around
28.4% market share and also Tesco have shops in five countries in whole UK. The company
serves in UK, Ireland, Hungary, Slovakia and Czech Republic. Tesco carries out his business
through online and offline medium and also serve a wide variety of food and non-food items,
including fresh food, drinks, health and beauty products, consumer electronics and many more.
The company also provide consultancy, banking retail and insurance services through Tesco
Bank in UK.
Tesco is a unique brand which produces its grocery products by itself in Tesco Factory,
do not buy anything from outside world because of this reason the dairy and meat products of
Tesco is very cheap. Due to Tesco Factory the profit margins of the company is very high and it
helped a lot in the expansion of the company. Tesco was the first commercial store chain that
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released club board system for its employees which means the consumers of the store will get
some points on their every purchase.
Inter-relationship between operations, core and support function of Tesco.
Tesco has an efficient operation functions as Tesco always keep on changing its
marketing mix that brings it a competitive advantage. The company is operating at many
locations also Tesco mainly focuses on rebranding its existing products to improve the sales
(Bessant and Jia, 2018 ).
The core and basic function of Tesco is to serve its customers, society and planet a little
better every day. The company keeps on researching all the time to keep a pace with the ever
changing demands of its customers.
Tesco provides very efficient support function like the company provides 24*7 hrs
service that means a consumer can buy and avail after sale services at any time also the staff of
Tesco always wear uniform which is easy for the consumers to understand where to go.
All the operation. Core and support function of organisation is inter-related to each other
as all the functions work in a process. These functions play a major role in earning competitive
advantage over its competitor. All these functions are consumer centric which automatically
enhance the consumer satisfaction (Lee, 2018). The competitors of Tesco are Sainsbury's,
ASDA, Morrison's and Waitrose who are the well-established and well-known brands of UK but
only because of strong functions the Tesco rules 28.4% of market share all alone.
Input-transformation-output process review and critique
Input-transformation-output process is a continuous process which starts from
organisational inputs which are staff and other facilities which helps in operation function for
example computers and billing machines. Whereas, the transformation process includes selling
of goods, advising customers, working according to the company capacity and taking proper
inventory measures. The output of all the inputs and transformation provided are consumer
satisfaction, goods sold by the company and the total amount of profit earned.
The input output process of Tesco is totally consumer centric, the consumers behaviour is
quite dynamic and ever changing with the changing time so Tesco always need to spend time for
keeping pace which is time consuming and money charging at the same time as well. The
company decides it internal and external working through the behaviour of its customers so it
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become a big problem which can effect the sales of Tesco or the organisation need to employ on
more department in for the management of the company.
The disadvantage of the company is that either the workers of the company have to keep
an eye on the current market trends of the organisation which can reduce the work of the
employees but this will cost heavy on profit.
Roles and importance of the operations management in Tesco
Role and Importance:
The role of operation management is:-
 Quality Assurance- The factor of production where the operation management
professional works is maintaining or improving the quality of the products and services
offered by the company to its customers as any change in the quality of product or service
will directly effect it sales. The Flow Of Work Process: The Operations Management helps to maintain the proper
flow of activities within the organisation that leads to higher leve of productivity and
smoot functioning of business operations.
Challenges
 Cost-based competition: The completion in the market is intensifying rapidly (Xu, Peng and
Prybutok, 2019). There are many retail organisations like Tesco that gives cost based
completion for their products that serves similar purposes.
 New technologies: The constant upgradation of technologies is anothe5r reason for
intensifying completion in the retail market. The era of digitalisation is among the biggest
challenges and it is also an opportunity for the organisation if it can leverage the
technologies for its benefits.
Explanation of various challenges faced by TESCO in operation management
There are various challenges faced by operation management in TESCO such as,
Globalization with increase in globalization the government and environmental activities
planned initiation for controlling it and forcing law against the current situation which led to then
effect on the operation of company, in response to this situation many companies are following
more biodegradable products in there production and operation , in context to TESCO they are
putting initiation on making biodegradable packaging and producing more of organic products
and offers to customers and taking necessary action against the globalization to protect it.
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Consumer Satisfaction is another challenge for the operation manager as there are various
similar products available in market as TESCO are providing so, the company had to increase
their product quality and provide products according to requirements of the customers. As the
consumer satisfaction is a big concern for firm, operation manager had to take it into account and
process accordingly to the situation (Choi,Wallace and Wang, 2018). There are many challenges
come in-front of the operation manger in work-life such as need to improve product quality,
sustainability and many more, which the organisation to take in consideration and do action
against it.
Comparison between TESCO and Sainsbury's of how they measure their operation performance
and evaluate the effectiveness of each measure
TESCO
Corporate steering wheel- This tool consider as
powerful factors, which the company has
managed to perform well. With the help of tool
the firm delivered corporate strategy and
improved the organisation by developing
strategic performance management. Corporate
steering wheel allowing TESCO to kept the
mission in form of living document, as it is a
powerful tool that align the firm's vision of
each member into single corporate vision and
allow to monitor missions and change
accordingly. In original tool used by TESCO
consist of four perspective that includes
operations, customers, finance and people but
due to impact of climatic changes firm added
fifth perspective to tool for strategic goal that
is community perspective.
SAINSBURY'S
Performance management framework- This
tool help Sainsbury's to increase their quality
of services. As it clarifies the strategies and
communicate business priorities and
objectives, monitoring progress, priorities and
objectives by measuring to an extent being
delivered and manage and define initiatives to
deliver the company's priorities and strategic
objectives to ensure action plans are in place
(Netessine, 2021).
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Recommendations of new and emerging technologies that can use to effectively manage overall
operational activities in TESCO
TESCO should open frictionless store in worldwide using technology from trigo that is a
computer vision technology supplied by Israeli artificial intelligence start-up which will help
company to evaluate and help in increasing the growth of organisation. It involves no cashier and
hassle free shopping for customers as there are sensors on shelf and customers can pick items
from ,which the sensors will provide the amount of product to the person cart from which the
customers can directly pay from there phone through internet (Albergaria and Jabbour, 2020)..
Due to pandemic with this technology there will be no waiting in long line for checkout, as
people can checkout from there online carts and pick items physically from stores. This new
technology can help TESCO in there operational activities as there will be increase in sales,
heavy operation of hiring new employees for store with no issue of getting in contact of people
and it ensure to attract more customer to go and buy more products more the stores. In last this
technology will effect in positive way for managing overall operation of the company.
Part 2
Critically evaluate different approaches of quality management used by The TESCO
It is stated that there are various quality management approaches that is given below in
context to Tesco:
Low cost: The TESCO acquire the raw material in high volume and they produce the
product in volume as it has help in reducing the cost and increase the profitability (Manika and
et. al., 2020).. This strategy is an important tool that helps to increase the supply of product in
globally.
Speed and time: The TESCO has advanced technology and updated machine that help in
serve the good and service instantly. The TESCO provide numerous numbers of goods and
service through online and offline and wide numbers of consumers list as it can be done with
help of latest technology.
Quality control: The growth of company is directly depending on consumer's
satisfaction like good quality, brand image and consumer's taste. The TESCO provide best
quality of products in multiple countries as it help in increasing the sales.
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Planning: The organisation's success depend on good planning as top level of manager
of TESCO always forecast the future threat and opportunity that help in making operational more
flexible.
Customer Focus The TESCO provide the good and service according to the consumer's
taste as it always focusing on changes in consumer's preference. The respective company has
good understanding of consumer's behaviour for buying the product.
Benchmarking: Benchmarking is used for evaluate the performance and quality of the
TESCO as it increase the performance of the business . Benchmarking are divided into two parts
such as internal benchmarking and competitive benchmarking. The internal benchmarking is
used for measuring the internal process and competitive benchmarking is used for analysing the
competitor such as quality of product and service.
Balance scorecard: The TESCO has been focusing on internal performance, growth and
learning as it monitor strategic goal's progress (Agostino and et. al., 2020 ). The balance
scorecard helps in aligning the different operational activity as well as reduces the cost and
increase the profitability.
Approaches of quality management and continuous improvement for providing better customer
satisfaction
There are many approaches to supply chain management such as total quality management,
Best practices, six sigma, etc. (Karia and et. al., 2021). The use of best practices of operations
management and quality control helps Tesco to improve its operational activities by lowering
down the wastage, optimising the use of resources and completion of work on time. The
company uses various approaches a quality management and continuous improvement with the
help of following methods:
 Standards and systems for Quality management: It is true that tests utilize basic
standards, guidelines, specifications, regulations, norms, requirements and criteria for
their products and services that must be fulfilled before they are placed in the market. The
quality management standards and systems that are used by the organisations are formed
to fulfil the needs of customers by providing them high quality products or services. The
basic standards for quality products are important for identifying the best processes for
production, management, sales and distribution, etc.
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 Supply chain management: Managing the supply chain of the organisation helps to
acquire higher quality products or raw materials that are required for the production
process. With the higher grade of raw materials better products and services can be
developed that possess high quality and standard. The supply chain management activity
helps Tesco to improve the overall quality of products and services produced and sold by
the organisation. Supply chain management activities also help to maintain proper flow of
inventory, raw materials, in process products, delivery and sales etc. With supply chain
management the chances for continuous improvement increases because it helps to
minimise cost by lowering down the wastage and optimising the profits.
 Purchasing and ordering: Within a business the purchasing and ordering activities are
among the most crucial aspects for developing high quality products and improving the
chances for continuous development. In order to improve the quality of products and
services on a continuous basis it is important that an organisation should purchase and
order high quality durable materials. This could help to improve better relationships with
the customers by providing high quality products as well as the relation with the suppliers
also increases.
 Information management: Managing information is very important because it helps the
organisation to create better chances for growth by maintaining and recording its data and
comparing with the other organisations and previous performance. In order to grow
continuously the organisation needs to manage their information wisely in such a manner
that it provides competitive advantage as well as create the pathways for the organisation
to improve its performance on a continuous basis.
Role and scope of supply chain management in supporting different organisations
The specific roles of supply chain management within an organisation were never defined but
some of the scoops and rolls that were identified for the purpose of supply chain management
within an organisation to meet customer needs include:
 Better quality products provided if the operations management activities are effective
because the business processes are optimised (Pettit, Croxton and Fiksel, 2019).
 Continuous improvement is facilitated by supply chain management because of smooth
flow of business activities and increasing growth.
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 Protect delivery of products and services into the market, as supply chain management
is designed to optimise the supply of goods and services into the market.
 Fulfil customer demand: Supply chain management helps to fulfil the demand of
customers by identifying their requirements and supplying products needed by them.
Difference between supply chains and supply networks
Supply chain and supply networks are entirely different (Cuevas-Vargas and et. al., 2020).
The supply network is a broader term that comprises many interlinked supply chains. Supply
networks combine many supply chains that help to cover a broader area in the market and
improves the ability of the organisation to reach maximum customers. On the other hand supply
chain only connects the activities of business with the market and market with the business.
Assess the organisation’s supply chain performance objectives, and their use of lean vs agile
supply networks
Supplier and demand are no longer the only driving forces within a market because the
consumer Trends and behaviours along with the changing environment conditions in the market
are affecting the activities of organisations like Tesco. Supply chain management of Tesco has
provided greater opportunities for its continuous improvements. Tesco uses lean as well as agile
supply chain for its products that is explained below:
 Lean supply chain is a traditional form of supply chain that emphasizes the production of
high quantity at lower prices. It also focuses on predictability and reliability rather than
flexibility and adaptability but it is only good for products that have low market variability
like food and toiletries.
 Agile supply chain mainly concentrates on receptiveness and flexibility due to the changing
demand of customers. Agility supply chain is used by Tesco for improving its supply chain
as per the demands of the customers and forecasted projections of the market change.
Evaluate effective supply chain management options and recommendations for improvement
 Effective supply chain can be demonstrated as a supply chain that is capable of fulfilling and
exceeding the actual demands into the market which includes its customers, suppliers,
vendors and other stakeholders.
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 Supply chain management is considered efficient when it provides optimum results and high
quality products and services that meet the requirements of customers adequately.
 The effective supply chain also makes a business more sustainable and improves the overall
matrix that can help the organisation to optimise its processes (Upadhyay, 2020)(Brinch,
2018).
It can be recommended that an organisation can use multi production line optimisation for
improving and aligning the supply chain activities within an organisation. Moreover, the use of
technology augmentation and machine learning can help to improve the planning activities of the
supply chain so that better predictions can be made. Along with this, it can be recommended that
an organisation can improve its sales and operations department to connect and link to the sales
operations and supply chain activities. Furthermore, it can be recommended that standardisation
of supply chain by eliminating supply chain bottlenecks can help the organisation to improve its
profitability and productivity. Finally, it is recommended that an organisation can source
resources from dependable suppliers that helps to acquire the products easily and reduces the
chances of failure in the supply chain.
CONCLUSION
From the above discussion, it has been concluded that operation management is
significant for an organisation in order to improve the performance and productivity in an
effective manner. In addition to this, it is determined that there are many challenges faced by
company while executing business operations that is high cots, ineffective technology and so on.
Moreover, it is analysed that there are various quality management approaches used by a
company with the objective to improve quality and performance and these are balance scorecard,
benchmarking and so on. All this help an organisation to ensure execution of activities in an
effective manner and also help in attainment of objectives within stipulated time period.
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REFERENCES
Books and Journals
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understanding the challenges of service information and operations management in the
sharing economy: Evidence of peer effects in libraries. International Journal of
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Barnes, D., 2018. Operations Management. Macmillan International Higher Education.
Brinch, M., 2018. Understanding the value of big data in supply chain management and its
business processes: Towards a conceptual framework. International Journal of Operations
& Production Management.
Brown, S., Bessant, J. and Jia, F., 2018. Strategic operations management. Routledge.
Choi, T.M., Wallace, S.W. and Wang, Y., 2018. Big data analytics in operations
management. Production and Operations Management, 27(10), pp.1868-1883.
Cuevas-Vargas, H. and et. al., 2020. Information and Communication Technologies to achieve
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In Handbook of Research on Industrial Applications for Improved Supply Chain
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Kagan, E., Leider, S. and Sahin, O., 2021. Dynamic Decision-making in Operations
Management. Available at SSRN 3937554.
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Accounting and Business Research.
Lee, C.K.H., 2018. A review of applications of genetic algorithms in operations
management. Engineering Applications of Artificial Intelligence, 76, pp.1-12.
Manika and et. al., 2020. A review of operations management literature: a data-driven
approach. International Journal of Production Research, 58(5), pp.1442-1461.
Netessine, S., 2021. A vision of responsible research in operations management. Manufacturing
& Service Operations Management.
Pettit, T. J., Croxton, K. L. and Fiksel, J., 2019. The evolution of resilience in supply chain
management: a retrospective on ensuring supply chain resilience. Journal of Business
Logistics, 40(1). pp.56-65.
Upadhyay, A., 2020. Antecedents of green supply chain practices in developing
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Xu, L., Peng, X. and Prybutok, V., 2019. Formative measurements in operations management
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