Strategic Management: TESCO Case Study

Question for
Strategic Management

Table of Contents
INTRODUCTION...........................................................................................................................1
Task 1...............................................................................................................................................1
PESTLE model.......................................................................................................................1
Porter Five Forces...................................................................................................................3
Task 2...............................................................................................................................................5
Alignment of Mission and vision with market demands........................................................5
Value Chain Analysis.............................................................................................................6
Task 3...............................................................................................................................................8
Strategic Directions available to a company..........................................................................8
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
Strategic management can be comprehensibly said to be the set of decisions taken up by a
company with an aim of achieving a top position in market place. These decisions lead to the
stipulation of effective strategies through which the entity can gain an upper hand over the rival
firms operating within the confines of same corporate sector. Strategic management can thus be
seen as the pathway to development of strategies and tactics by which the overall working and
financial performance of company can be enhanced in the long run (Pham, Darabi and Wilmot,
2020). The present project is based upon TESCO. This is a globally renowned retail corporation
functioning within many parts of the globe and serving the customers with general merchandise,
footwear, accessories, home ware items, kitchen goods, food products, home decor and
furnishing items. This entity is headquartered within United Kingdom and enjoys market
leadership in the region owing to its excellent quality products and unmatchable services.
The below mentioned project is primarily categorized into 3 tasks. The first task consists
of review of external environment together with the industrial analysis. The second section
explores the alignment of mission and vision statements of organisation with demand in market.
Further, it talks about company strategic competencies and capabilities along with the manner in
which organisation develops, provides and captures value in retail market. The last task deals
with effective strategies through which the entity may be able to defend its core operations.
Task 1
PESTLE model
In the current era of mass competition it is necessary for every business to work in most
effective manner that is preferable by the market. The intent behind doing so can be to sustain in
respective corporate sector for a relatively longer time period. Every business strives to work in a
manner that is better than its rivals so that customers prefer to stay connected with the branded
for long run. Thus to analyze the need and demand of the market it is essential for a large retail
store chain like TESCO plc to undertake all the important factors of macro external factors of
environment. The study of these factors gives a 360 degree view of all the externals forces of the
business that determines its success or failure by affecting either directly or indirectly on to its
operations and procedures. The thorough study of these factors is important in order to ascertain
the opportunities and threats linked with them. This provides company with the chance to
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leverage the opportunity so as to inflate its existent positioning within the confines of market
place. Further, it also provides the company with the scope to deal with the threats identified in
macro factors to ensure least harm being caused to the business operations from the external
factors of business environment within which it operates.
Thus the analysis of PESTEL is the most effusive tool that can evaluate the facts and figures of
external market, this analysis certainly cover the major elements of political, economic, social,
technological, environmental and legal. These factors are elaborated in regards to TESCO as
follows:-
Political factors - The political factors comprise of the certain rules, policies that are
formed by and out of the political powers within a nation. As the TESCO PLC has a major
working area in United Kingdom the political factors within the country are quite helpful for the
effective growth of the business (Kanakaratne, Bray and Robson, 2020). Due to the long term
stability of a single political power, the enterprises like TESCO there get an opportunity to save a
lot of time in the planning of upcoming actions. This implies that they are able to run smoothly
within the confines of UK by exercising knowledge of the political rules and regulations.
Economic factors – These factors are based on the characteristics of financial and
monetary elements within the nation. The GDP, growth rate, per capita income, economy rate are
some of the economical elements that are evaluated by the management of TESCO plc. These
factors impact on the various decision of the business such as determination of price of a product
or the price of purchase of any raw material is generally based on the economical factors.
Therefore the economic factors in UK help the business to add on the sufficient margin in their
products.
Social factors - The social factors are those elements which affect the business on the base of
change in market trends, social behaviours, culture, beliefs, customer lifestyles etc. Being a
developed nation United Kingdom facilitates its citizens with flourished and growing lifestyles.
This keeps the business at a high competition in the market. The continuous changes of the social
factor in the market companies like TESCO get the opportunity to evolve its functioning with the
changing course of trends and times. By this it will get an effective market capturing as well as
better mouth publicity (Jones and Comfort, 2020). This will also instil a sense of trust and loyalty
within the customers towards the offerings of TESCO, thereby enhancing the loyal customers for
the retail corporation.
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