Developing Strategic Management and Leadership Skills for Tesco

This report analyses the organizational direction of Tesco and recommends an effective leadership style for the firm. It includes a plan for the development of leadership skills for the organization, with a focus on transformational leadership. The report also discusses the importance of people management, team working, and performance achievement in the retail industry, and how these aspects can be supported by a suitable leadership strategy.

S 18011063 Developing Strategic Management and Leadership Skills Semester1 MBA B1 | Zikura International college 1

Table of Contents
INTRODUCTION.........................................................................................................................................3
A) ANALYSE THE ORGANIZATIONAL DIRECTIONS.........................................................................................3
B) THE MOST APPROPRIATE AND EFFECTIVE STYLE(S) OF LEADERSHIP FOR THE ORGANIZATION.......................5
C) PLAN FOR THE DEVELOPMENT OF LEADERSHIP SKILLS FOR THE ORGANIZATION..........................................7
DETERMINATION OF SUITABLE LEADERSHIP STYLE OF THE FIRM...................................................................8
IDENTIFICATION OF PRESENT AND FUTURE LEADERS OF THE FIRM................................................................8
IDENTIFICATION OF LEADERSHIP GAPS......................................................................................................8
DEVELOPMENT OF SUCCESSION PLANNING FOR IMPORTANT ROLES..............................................................9
DEVELOPMENT OF GOALS REGARDING CAREER PLANNING FOR FUTURE LEADERS............................................9
IDENTIFICATION OF ROADMAP OF SKILLS FOR LEADERS...............................................................................9
PROGRAMS FOR RETAINING PRESENT AND POTENTIAL LEADERS...................................................................9
CONCLUSION......................................................................................................................................11
REFERENCES.......................................................................................................................................12
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INTRODUCTION
Organizations always have specific leanings down its business path for reaching to
its set purpose. In business parlance, these leanings are governed by firms’ mission and
business objectives. Particularly, it can be said that direction is a business journey that
includes determination of the business destination. Hence, the organizational direction is
required to stay within the business scope and the mission. The direction of business becomes
more oriented in tune with business objectives when the leadership of business entities is
effective. Thus, some leadership qualities are essential. In this report, the case study of Tesco
is selected for analysing the organizational direction and in the course of the report, an
effective leadership style has been recommended for the firm.
A) ANALYSE THE ORGANIZATIONAL DIRECTIONS
Tesco was formed by Jack Cohen in the year 1919 at the east end of London. Ever
since, the firm has emerged as one of the leading retail firms in the world. The core trade
function of the business is in retailing in the UK. The brand has expanded its operations in
countries like the Czech Republic, Malaysia, India, China, Poland, and Hungary. Tesco
believes in constantly working on its international brand and this is supported by its
operational expansion. Tesco has a highly focused business goal, setting its sight on long-
term success in competition (Nooteboom & Termeer, 2013). Customers are the most vital
stakeholders of the firm and their satisfaction is always instrumental in carrying business
performance in a consistently better manner.
The vision and the mission of the business are static and are looking for adapting to
a business environment which is always subject to change. The firm’s business view is
inspirational and is supported by the vision and mission, which are although pinned on
similar purposes but are archetypal in their own proposition. The vision of the business is ‘to
be a highly valued business by serving customers, communities, employees, and the
shareholders.’The mission of the firm is‘ making what matters better, being
together.’(Murawski & Dieker, 2013).
The strategic planning of Tesco has its own process that holds the direction of
business in a bid to stay in a competitive position in the retail sector in the UK. Tesco keeps
its direction aligned with the consistent search for business excellence by providing
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maximum satisfaction to the people the firm works with. Customers, employees, community
members, and the environment are most important and a constant effort of keeping them
satisfied comprises the business direction. The firm feels that the business functionalities are
the basis of better performance and this could be ensured by adhering to the vision and the
mission propelled by a strategic direction.
A discussion regarding some moves undertaken by Tesco will render this report
more analytical in terms of understanding the business direction and nature along with the
scope of business. Tesco’s thought for customers, employees and communities mirror in its
business philosophy that in turn influences the direction of business to remain within the
framework of the business objectives. The firm defines its philosophy as ‘Every Little Helps’
for customers so that they get seamless shopping experiences. It holds a better commitment to
customers and the community by ensuring environmental sustainability. Day (2013), stated
that commitment to customers and the community becomes more defined when the
environment is taken care of. This opinion has symmetrical justification for Tesco since the
firm opened its supermarket known as a zero carbon retail chain in Ramsey of
Cambridgeshire and was conferred green retailer in annual grocer gold award held in 2012.
Tesco has slipped from its numerousUNO position in the retail sector in the UK, but still has
a dominating position in support of its consistent growth in mission with the help of the core
business of retail (Day, GU& Sammons, 2016). In this regard, multichannel customer service
by the firm focused on ‘Click and collect service’.
Tesco’s strategic direction leads the business towards growth based on the
foundations of innovation and customers’ satisfaction. Tesco formulated department based
strategies to interrelate every strategic move with core business values. While the direction of
the firm is aligned with a search for continuous excellence in the retail sector in the UK, the
performance of employees is never undervalued and key performance indicators help the firm
to ensure better evaluation of performance. Scholars like Breevaart, Bakker, Demerouti &
Derks (2016), always stressed on motivating the boosting factors rather than limiting the
focus on employees in the performance segment. This is somewhat opposed by Shapira-
Lishchinsky & Levy-Gazenfrantz, (2015), as it was suggested that employees are made to be
aware of the kind of business and firm they are associated with and this causes motivation
from within, leading them to offer better performance and this follows better evaluation to
enable the firm to judge the employee satisfaction level. Community focused business of
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Tesco affirms a better direction which justifies the firm’s corporate social responsibility
moves known as ‘Tesco in Society’.
The firm’s direction falls in some focal parts strengthened by some core purposes
like the achievement of a continual growth in the UK retail market, to remain as a most
valued brand, to be an excellent international retailer, and team development to fulfil a
commitment to community and customers (Singh, Kumar & Puri, 2017). Tesco is criticised
for its failure in China market and the reason for this is the overconfident view of expansion
tactics leading to an overreach coupled with a low business performance both in Japan and
China. It started facing questions from investors regarding the know-how about its business
and business direction. It is stated by Goetsch, & Davis, (2014), that strategic efficiency and
farsightedness are different, but helpful to each other, however, the latter does not necessarily
develop efficiency in strategy arrangement. The business direction of Tesco has suffered
some hiccups which do underrate the balance between the firm’s direction and its nature
along with the scope of business supported by its vision and the mission.
B) THE MOST APPROPRIATE AND EFFECTIVE STYLE(S) OF LEADERSHIP FOR THE
ORGANIZATION
Successful implementation of the strategy and a better turnaround of business are
reliant on capable management, however, that too has a dependence on the aspect of better
leadership. The retail sector is full of competition and an effective transformation of business
leading towards goal achievement is dependent on the capacity of the management to
champion new styles of leadership within business organizations. Supermarket businesses of
the retail segment are competitive and the risk of dropping market shares is always high. An
organization like Tesco in consideration is always in need of thinking and implementing a
new style of leadership with a focus on its business objectives and its current position in the
market (Markopoulos & Vanharanta, 2014). The business of retail from the firm’s
perspective includes activities which always demand coordinated and collaborated efforts
among all staffs under the supervision of management. A better leadership does the effective
task of people management and purpose achieved without compromising the motivation level
among the people.
Tesco although is poised for continual growth in the competitive sector with a
capacity of adapting to changing business environment, the need for better leadership style is
almost imperative in the face of rising volatility and competition in the retail sector. Since the
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firm is exposed to risks like incremental product prices, competition in the market, the
excessive scrutinization of quality aspects, ever-changing external business environments, it
needs to have business agility consistently with the support of a firm leadership strategy
(Menaker, 2013). By practicing transformational leadership in the firm, the business could
think of risk minimization by following the set strategies of the leadership style. Engaging of
employees and their collaborative working relationships get developed by transformational
leadership. The retail industry incorporates a change which is in terms of industry regulation,
buyers’ perception about service and products, quality and service benchmarks, performance
expectations and accomplishments, which incidentally is in relevance to Tesco’s leadership
style requirement. Business is always dependent on the performance backed by managing the
people as well as a set vision and mission. Thus, the firm is always on the lookout for abilities
among its leaders to initiate and accomplish change management in the sector. In addition to
this development of vision and motivation of its people, the firm is always in consideration
for ensuring success in the sector. Therefore, senior people of the firm must have the skill of
motivating the workforce by instilling a vision of business into their performance, by
encouraging them to deliver performances with a focus on better working relationships
among them (Vizzuso, 2015).
Overall, peoplemanagement, whether done individually or by the team is a suitable
quality aspect of leadership required for the firm. These all match with transformational
leadership in which leaders are always expected to deliver a performance before a team of
people and also set an example of integrity and fairness to them. Better interpersonal
relationships among leaders and employees help in the task of leading them towards
accepting changes motivated by the common goal of their organization. Tesco relentlessly
pursues the course of strategic orientation, balanced by business direction to achieve its
business vision of fulfilling commitments by helping customers, society, employees, and the
environment. Therefore, leaders are always in need of setting expectations before its
stakeholders so that these could be fulfilled by their cooperation and consistent level of
loyalty.
Tesco needs to remember that leaders need to focus on the human side of the
practice of leadership as excessive task orientation is not better for the firm and its workforce
to deliver the desired level of performance. But at the same time, excessive leniency can
expose the management to criticisms. In such a situation the aspect of leadership alone can
balance between people management and task accomplished without any negative effect on
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employees’ satisfaction (Barney, 2014). Here is the maximum importance of transformational
leadership by which leaders could set goals, practice skills of mentoring, understanding the
problems of employees before assigning them tasks to deliver. Most effectively,
transformational leadership helps to transform the organizational vision and effort of people’s
contribution and motivation into the accomplishment of the mission. Development of trusts
becomes easy among people and a situation like the practice of change and decision making
become relatively easy. People tend to accept decisions so long as the faith prevails that the
leadership in the firm is not detrimental to their interest. The business process and operation
of Tesco are expected to become more dynamic, with an adaptability to change and getting
accustomed to business risks while the leadership of the firm helps the business performance
soar new heights (Asif & Palus, 2013).
Successful business venture in retail segments in China and Japan will no more seem
implausible by the firm and teams’ motivation could support quality and operational
benchmark achievement. Business is always uncertain with no predefined set of norms of
performance and this necessitates change. Since transformational leadership speaks of better
management of people and their motivation, success does not seem far, even in a competitive
sector like the retail industry in the UK.
Retail market’s dynamic aspects like fluctuation in demands among customers and
innovation led products modification for development, keep people engaged in creative
thoughts and team working. The need of appropriate leadership is immense. People
management, team working and performance achievement on consistent basis are the most
crucial aspects related to Tesco if its business and business orientation are concerned. In this
respect, transformational leadership is expected to produce much better results like
productivity among workers and more task achievement capacity by leaders through team
working. Leaders are to focus on some aspects like better coordination with team members,
developing mentoring skills among them alongwith exchange of ideas to generate better
motivation among employees. These are related qualities needed for task achievement and
fulfilment of their leadership roles in the firm. Moreover based on the transformational
leadership employee enagement and coordinated performance can be ensured by the firm
(Barney, 2014). Retail industry always thrives on team work and better leadership for
supporting organizational goal to achieve best performance in industry. This cannot be
possible without a proper and suitable leadership strategy. From the case study based on
Tesco, transformational leadership styles is more suitable and appropriate.
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C) PLAN FOR THE DEVELOPMENT OF LEADERSHIP SKILLS FOR THE ORGANIZATION
An effective plan for leadership development in Tesco starts with the understanding
of the company strategy and identification of a suitable leadership style for the company.
Leadership development for Tesco needs to commensurate with the strategies, vision, and the
mission of the business. Following are the important phases of the leadership development
meant for Tesco:
REVIEW AND UNDERSTAND LEADERSHIP STYLES ADOPTED AND ORGANISATIONAL
DIRECTION
This stage begins with certain acitivities based on leadership evaluation and its justification
followed by understanding the direction of business in retail sector. Firstly leadership
requirement and its style are to be evaluated in the organizational context (Santamaría &
Santamaría, 2013). This only becomes possible if knowledge on the leadership approach in
the firm is clear for management. This is in relation to understand the fruitfulness of
leadership adopted in the firm in accordance with organizational direction in the industry.
This is most vital stage in the leadership development plan and without this, next stages
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cannot be properly performed. The basic elements in this stage are evaluation of leadership,
knowledge development about leadership approaches and understanding the organizational
direction.
IDENTIFICATION OF PRESENT AND FUTURE LEADERS OF THE FIRM
In this stage, it is important to identify a leadership programme so that an expected
level of leadership competencies and skills for the benefits of the firm can be understood.
Internally leaders need to be recognized so that the employee feels appreciated and valued.
Moreover, those who are under observation by the management must display the expected
level of skills and talents. Apart from this, the performance criteria and its evaluation are to
be fed into a performance management process of the firm (Ladegaard et al, 2014).
IDENTIFICATION OF LEADERSHIP GAPS
This is an important evaluation with regard to the presentation of the skills of the
current batch of leaders and the eagerness of the firm to get an important job done by them.
Some important elements in the evaluation process revolve around the know-how of the
requirements of the present and the future leadership. The requirement of future leadership
needs to be compared with the present leadership. Leaders who are seemingly interested to
leave the firm need to be retained through the process of mutual understanding followed by
succession planning. The gap in leadership skills needs to be identified for measuring the
time required for fulfilling the gap (Santamaría & Santamaría, 2013).
DETERMINATION OF SUITABLE LEADERSHIP STYLE OF THE FIRM
At the very beginning, the firm needs to have the know-how of the adequacy or
suitability of a particular leadership style as there is no specific leadership approach that
relates to situations within the workplaces. With such a tight course, the firm needs to analyse
the organizational work, the degree of complexity of business and the leaders’ qualifications
in the identification and the formulation of a leadership style at the initial stage. Attention to
the requirement of group decision making does the helpful task. Accordingly, working
policies and culture of the firms are worth discussing among senior members of the
management of the firm (Scarborough, 2016).
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PROGRAMS FOR RETAINING PRESENT AND POTENTIAL LEADERS
A focus and effort of keeping talented leaders associated with the firm are highly
important. In this attempt of retaining the most talented leaders in the firm, Tesco’s planning
of retention of leaders is of great importance. They need to be motivated by the firm on the
basis of giving recognition to their talents and performance (Mitchell, 2013).
From the aforesaid discussion regarding leadership development plan, it can be
understood that Tesco on the basis of the planning can find its most talented and suitable
leaders according to the organization’s working culture and business objectives. Needless to
say, it is important to retain leaders in the organization as their business detachment can
prove expensive for the firm since they deliver optimal performance for the firm in retail
markets (Aarons, Ehrhart, Farahnak&Sklar, 2014).
DEVELOPMENT OF GOALS REGARDING CAREER PLANNING FOR FUTURE LEADERS
Tesco in course of leadership development must focus on career development
planning for each individual to ensure that they remain motivated. If the firm does not
provide them with the opportunity of career development then possibly they are most
unlikely to stay in the firm in the long run. After the career development planning is
structured, employees get equal opportunities for showcasing their talents and it becomes
easy for the firm to identify performers and potential leaders amongst them (Furtner,
Baldegger&Rauthmann, 2013).
EVALUATE AND IDENTIFY SKILLS OF LEADERS AND POTENTIAL LEADERS
In this stage leadership qualities are recognized and efficiency of leadership skill can
be understood. This requires better evaluation of present leadership skills from present
manpower. If adequate leadership is found then same can be developed more or else focus
needs to be on development of leadership. This practice works better and gap between
leadership skills become understandable and future requirement of leadership can be known.
IDENTIFICATION OF ROADMAP OF SKILLS FOR LEADERS
If potential leaders are recognized by Tesco then it becomes important to develop a
roadmap of skill for them. This needs the support of suitable training or learning process
initiated by the management. The learning may be less formal, traditional or non- traditional
in nature.
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DEVELOPMENT OF SUCCESSION PLANNING FOR IMPORTANT ROLES
Tesco’s eagerness regarding leadership development gets on the track at this stage as
the firm needs to work upon its strategy of delegating the responsibility and important roles
to the next suitable leader in the firm. This planning is most important so that when a veteran
leader quits then immediately the task is taken over by another talented and skilled leader
identified by the firm (Bro et al, 2014).
CONCLUSION
Leadership strategies if suitable and effective can accrue the biggest benefits to an
organization like Tesco. The firm has consideration for customers, the environment,
Community, and employees. Transformational leadership is of importance to the firm. In this
report, a leadership development plan has been discussed. This report has highlighted
organizational direction that relates to Tesco as a case study. The organization is one of the
leading retail firms in UK with its vision to be highly valued business by serving customers.
Customers’ satisfaction is the core part of business and the strategic orientation of the
business is to remain competitive in retail business sector in UK. Performance orientation and
people management are important for the firm and need of suitable leadership style can
provide the firm with required support.Transformational leadership style is more effective for
Tesco (Baldegger&Rauthmann, 2013).
This reports also has discussed a leadership development plan that includes some
stages like review of leadership styles, identification of leadership in present and future,
identification of leadership gaps, identification of better styles of leadership, development of
planning to retain leaders, development of goals for carrer planning for leaders, identification
and skill measurement of potential and present leaders of the firm, identification of road
maps, succession planning for leadership and important roles. This report concludes that style
like transformational leadership is more appropriate based on strategy and direction of retail
business of Tesco. People management, their motivation and task achievement are important
for the firm which needs better leadership. Transformational leadership fits better into this
requirement for the firm Tesco (Baldegger&Rauthmann, 2013).
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