Sainsbury's Business Environment: Innovation and Technology

This essay discusses the innovation and technology used by Sainsbury's, a UK-based supermarket chain. It also covers the company's corporate social responsibility and principles of corporate governance.

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Business environment
Essay
4/26/2018
Student Name

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Executive Summary
The reports highlight the facts related to the company Sainsbury. The company performance
is depends on its new offerings, technology, innovation and discounts offered in the market.
Sainsbury makes it possible by having a separate research department in the company to
analyse the demand of the people and according to that produce the goods in least cost. The
sales and profits of the company are increased and the related figures are also given the
report. Sainsbury Company is doing the work while following the ethics, principles, rules
and regulations. These principles include the corporate governance and social responsibilities.
The pyramid is there in the report to discuss about the CSR followed by the company and
principles to know the corporate governance deeply.

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Table of Contents
Introduction................................................................................................................................3
Part A.........................................................................................................................................3
Innovation...............................................................................................................................4
Technological change.............................................................................................................6
Part B..........................................................................................................................................8
Corporate Social Responsibility.............................................................................................8
Archie Carroll’s CSR model..................................................................................................9
Corporate governance...........................................................................................................11
Responsibilities of the board of directors to the stakeholders..............................................11
Principles of corporate governance......................................................................................11
Conclusion................................................................................................................................13
References................................................................................................................................14

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Introduction
The report discusses about the different technology and innovation used by the Sainsbury
company. Report highlights the facts that how improvement in technology leads to economic
growth in the country. The innovation in the company will increase the country chances to
grow more. The company policies are also discussed in the report. The company is following
which ethics and policies, corporate governance in the organisation to have sustainability in
its business. The report talks about the principles of corporate governance and social
responsibility fulfilled by the Sainsbury. The company is making the profits while keeping in
mind the welfare of the society and fulfilling the responsibilities towards the society also.
Part A
The company chosen is the Sainsbury, which was established in the year 1869. Sainsbury is
the second largest retailer in supermarkets chain. The company is covering 16.9% of the
market. Sainsbury is also available online for everything. The online market of Sainsbury
offers everything from groceries and clothing to home wares, electrical and many more.
Sainsbury also offers a great range of financial services to the customers. Sainsbury’s bank,
Argos and home retail bank are the subsidiaries of the Sainsbury Company. The company is
working with the concept that “live well for less”. Sainsbury has many big competitors in the
market which include Tesco and Asda. Sainsbury is divided into three divisions: Sainsbury
Supermarkets Ltd (including Convenience shops), Sainsbury Bank and Sainsbury Agros.
Sainsbury working on the concept of “Save more and less wastage of resources”. The
company is trying to reduce the wastage of food in the country of U.K. Managing waste in
the country like the UK is quite a cumbersome job. The main difficulty faced by the farmers
in the UK is to mitigate the risk. Sainsbury Agro is working in this concept to reduce the

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wastage and utilise the resources to the most. Sainsbury comes on the market and takes the
stand of a farmer and covert the Agri-tech to Agri-food technology strategy (GOV. UK,
2015). Sainsbury research and innovate new ways to produce the goods at low priced while
having high quality in the product. A company runs a campaign of the buy better product at
less cost as compared to others. Under this campaign, they included that there will be a
supply of healthy goods, more technical assistance, more productive animals and more
efficient purchasing of inputs
Innovation
Innovation can be defined as the new idea, device or method to do a particular task.
Innovation is required in every business so that business can survive in the market for long
period of time. Innovation is the need of every business nowadays. Business can run
effectively when they are giving extra new add on feature to the customer that business can’t
able to provide. There can be two types of innovation in the market. Firstly, innovation can
be a new product, service or technology introduced in the market. Another can be the novelty
degree that is whether the innovation done is new to the market, new to the firm, new to the
industry or it is new to the world. Innovation is done for the betterment of the business and its
regulation. With use of innovation, work can be done easily in the organisation (Domun,
Hadavinia, Zhang, Sainsbury, Liaghat and Vahid, 2015).
Innovation in business is done by the research and department in many ways. Information
technology and changing business needs and requirement process are the reason to identify
the new innovations in the business. Sainsbury has done many innovations in the
supermarket's sector. Sainsbury offers a variety of products and services to the customer at
large. The emerging theme of the company is to invest in the research and development
collabouration between industries, businesses and research institutions across all sectors to
create new possibilities and make innovation easier (Drucker, 2014). The company has

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introduced the Agri tech strategy in the partnership with the government. Sainsbury has done
the partnership with the government to share a long term strategy which will benefit the
country, farmers and company too. It will be good source for a company to earn profits as
well as do the welfare in the society.
The company has introduced the concept of The Catapult programme. The Catapult centers
are a network of world-leading centers designed to change the UK’s capability for innovation
in specific areas. These centers are helping to drive the future economic growth of the
country. A catapult center provides the technical assistance, equipment, and other resources
to take the innovative ideas from concept to reality (Catapult, 2018). Using Catapult by
Sainsbury, it reduces the risk of innovation; accelerate the pace of business development.
There will be sustainability in the jobs and their growth (Carroll and Buchholtz, 2014).
Sainsbury is using the latest technology in its operations like industrial robots for attending
the customers, artificial intelligence and machine learning. Use of these technologies in the
industry makes the work easy and fast for the company. But attention to these technologies
should be given time to time as it has a direct impact on the employment and public policy.
Using these technologies by Sainsbury makes the work faster, easier and there will be less
use of workers in the company. The cost incurred by the company will be less when the
company is using the technological up gradation in working. The falling price of robots
makes them cost-effective to take into the operations of the business. The recent trends
towards an increase in the automation will impact the increased economic growth (Galindo
and Méndez, 2014).
Technological change
Technology encompasses a huge body of knowledge and tools. It will make the work of the
organization easy and leads to the optimum utilization of economic resources. The goods and

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services produced with new technology are leads to economic growth and development in the
country. As more production will be done in the country which will increase the economic
progress of the country. Using technology in operations reduces the time off as well as the
cost of the company. As time is money, so by using the technology both will be saved in the
economy and can be further use in other good production (McDaniel, 2014).
Sainsbury also used the new technology in its operation which is saving the time of
employees and they can contribute that time in some productive work. Technology using in
Sainsbury brings the specialization in its working. The company is able to expand its business
operation easily because of technology. This will increase the efficiency of the labour, labour
will produce more and ultimately the company and labour will earn more in the long term. In
the implementation of new technology incur a high cost as new equipment and machinery are
introduced in the business. Usage of technology in the operation of the company leads to the
achievement of economies in scale which further increase the sales of the company.
Examples
Sainsbury is using the JIT in its business. JIT is nothing but a strategy to reduce the operating
cost of storage in the day to day business. Just-in-time is basically a methodology aimed
primarily at reducing flow times within the production system as well as response times from
suppliers and to customers. It will reduce the cost for Sainsbury and maintain a good
relationship with the supplier. Another way from which goods can be ordered is app services.
There is an app name Sainsbury Groceries, from which goods can be ordered online.
Sainsbury is providing a range of more than 30000 products in the pocket of the customer. It
gives the convenience and ease to the customer for shopping. The company is providing the
products at very low cost as compared to another online store available. Not only that
sometimes companies are providing the free samples also to competitors to check the quality

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of the goods. The company is providing the new and trending products in online store also
(Google Play, 2018).
The company is also giving the delivery pass to the customer to save the money on delivery
of goods. If the delivery pass has been expired then the delivery expenses will be included in
that. Sainsbury is also giving the vouchers and other schemes to influence the more and more
customer. The payment can also be done online by the customer. Sainsbury Bank has selected
the FIS as retail banking technology partner in the business. It is giving a fully outsourced
real-time core banking solution. All the back office work, processing, and transition support
system are managed by the company itself. FIS is providing the cost-efficient ways to the
Sainsbury and financial service sto the next generation in the global market place. Using this
payment mode, Sainsbury is able to cover the large market share (Fis, 2018).
Sainsbury is using the social media technology also for promoting his brand in the market.
Other techniques for fast working in the business are used that include a barcode reader in the
working. Sainsbury is also using the radio frequency chips in its technology. Radio frequency
identification technology promises the company to have numerous benefits in the supply
chain. Benefits that Sainsbury enjoy from the RFID are an increase in the visibility, security,
and efficiency (Musson, 2014).
Particular
s (in $'s)
Years 2013 2014
201
5 2016 2017
Profit 602 716 600 471 377
(Sainsbury, 2018)

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Part B
Corporate Social Responsibility
Corporate Social Responsibility is the social responsibility which is developed by the
company itself while seeing the environment and society. In this responsibility, the company
does some welfare for the society as the company is using the society’s resources. CSR
activity is done in the business to bring quality to the management. The Sainsbury take all the
inside and outside factors into consideration so that it will bring about positive change in the
society. The company is doing these responsibilities done in the society to satisfy the
government and non-government organization (Carrero and Valor, 2012). CSR is also known
as corporate sustainability. The sustainability of the business comes when the company is
using the new technology and innovation in the business activities.
The importance of CSR is lies in all the business nowadays. Maintaining CSR activities are
equally important like profits for the business. As CSR programmes continue to evolve and
extend the reach of the business. It will help the business to survive more and handle the
dynamic environment and can get good financial results. Sainsbury adopted good CSR
strategy which helps its business to explore more and have good brand image in the eyes of
public. Sainsbury is following the CSR strategy from last many years because of this there
will be more dedicated employees, access to talent, less capital conflicts, and a better
goodwill (Bae and Kim, 2013).
Archie Carroll’s CSR model
CSR model is built on the foundation of profit and profit come first. The second thing the
model talks about is that the need for a business to follow all the rules and regulations of the
law. Before business meets its philanthropic options, company first able to meet its ethical
duties (Dodd, 2017). Carroll introduced the four parts in its model which are related to the

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economic, legal, ethical and philanthropic issues that society take into consideration while
evaluating an organization. These concepts are inter-related and interdependent each other.
(Source: Pinterest, 2018)
Economic Responsibilities
As a fundamental, society views business as an organization producing goods and services
for the satisfaction of consumer needs and desires. Businesses make profits by selling the
products and services to the consumer. Profits are necessary for both the investors and
owners of the business. In today’s dynamic environment of hyper competition economic
performance and sustainability have become the immediate topic for every company. Like
Sainsbury, all these issues are taken into consideration as it is the baseline requirement that
should be met in the competitive business world. This is only way from which Sainsbury can
survive in the market for long-term (Ellabban, Abu-Rub, and Blaabjerg, 2014).
Legal responsibility

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Legal Responsibility covers matters related to the following of rules and regulations in the
business. Sainsbury is completing its legal responsibility by providing the employment to the
people at large. Sainsbury has to comply with the rules and regulations formed by that
government in which the company is operating its business. Sainsbury is doing well for the
society and providing goods and services with least minimal requirements.
Ethical responsibilities
In addition to legal responsibilities, the company has to follow certain ethics in regulating its
business in the dynamic business environment. Sainsbury has to follow activities and norms
which are accordance with society and environment. Ethical responsibility is nothing but to
act business ethically and morally. With this responsibility, Sainsbury should go beyond the
narrow requirements of the law. The treatment given by the Sainsbury to its suppliers and
employees are good. They treat each and every individual equally. No partiality is adopted in
the organization (Financier, 2015).
Philanthropic Responsibility
This responsibility is to give back the society. This means that resources used by the
Company should be returned to the society. This responsibility found to be discretionary but
still important to follow by the Sainsbury. Sainsbury is doing this responsibility very well.
Sainsbury is using the sustainable ways to use the natural resources so that there will be less
wastage of resources. Donations and charity are done by the company. This responsibility is
focused on to be a good corporate citizen.
Corporate governance
Corporate governance is the process, mechanism from which the relation between the
corporations are directed and controlled. Corporate governance is followed in the company to

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maintain a healthy relationship between the shareholders, employees, suppliers, customers,
and investors. Corporate governance allows the company to maintain the framework of its
objectives and goals. Internal to external plans can be made using the governance in the
organization.
Sainsbury board is committed to the high standards of corporate governance. Corporate
governance emphasise the need well-balanced, effective boards, strong vision on risk
management and alignment of remuneration policies with interest of shareholders. Sainsbury
tries to maintain the good relationship with its stakeholders so that stability in the
organization can be made.
Responsibilities of the board of directors to the stakeholders
The board of Directors is responsible for the long-term success of the business. Business is
handled by the board. The stakeholder perspective is based on the corporate governance. The
board of director’s key purpose is to ensure that the company’s prosperity should be
maintained and collectively directed towards the company goals while meeting the interest of
stakeholders and shareholders. In addition to the business affairs, directors have to deal with
the challenges of corporate governance, corporate ethics and corporate social responsibility
(Harford, Mansi and Maxwell, 2012).
Principles of corporate governance
Fairness
Fairness refers to the equal treatment of all the individuals whether it is employee or
shareholder. All shareholders are given the equal rights and consideration for whatever
shareholdings they hold. The Sainsbury appears to be the fair in treating all the employees
and stakeholders. Treating equally to all in the business increases the chance of survival of
business in a dynamic environment.

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Accountability
Accountability can be defined as the responsibility and obligation performed by the board of
directors in the organization. Sainsbury’s Board of Director communicates to the company
shareholder and other stakeholders. There will be a balance, fair and understand the
assessment of how company is achieving its business purpose and goals. The board of
directors are responsible for maintaining the high risk management and internal system of
control in the organization (Grant Thronton, 2016).
Responsibility
It is the responsibility of the Board of Director of Sainsbury that all the workings are taken
care by them. The management businesses are also taken into consideration by them. They
are responsible to do the work in the interest of the company and its stakeholders.
Accountability goes hand in hand. If a company is giving the responsibility then equal
authority should also be given by the managers in Sainsbury.
Transparency
Transparency refers to the clear vision of the strategies, objectives, and activities which are
held in the company. There should be transparency in the books of accounts of the company.
All the profits and loss should be disclosed by the board to the shareholders. A principle of
good governance is that the shareholders are informed about all the future plans, risks
involved in its business (The Guardian, 2018).
Ethics
There should be followed of moral and values in all types of organization irrespective of its
size, nature of the business. Ethics is a branch of philosophy and is considered as a normative
science because it is considered as conduction of human norms. Sainsbury focuses on that all

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the employees and trustee of the company should have an ethical code of conduct in its
workings. Sainsbury works on the concept of not to cheat any customer and try to give the
maximum satisfaction to them.
Conclusion
From the above analysis, it can be concluded that the Sainsbury have competitive advantage
in the market. Its new and innovative technology has made its company products and features
unique. The company is offering new offers and discounts scheme to customer to influence
them and can grab the large market portion in the supermarket industry. The development
and growth of company leads to rise in the Gross Domestic product and per capita income of
the individuals. The company is doing various CSR activities to survive in the market and
have a competitive edge in the market. Follow of corporate governance is there buy the
business to satisfy the stakeholders of the company.

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References
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