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Strategic Management : Tesco

   

Added on  2021-02-18

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Strategic Management

Table of ContentsINTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................1Strategic analysis of Tesco.....................................................................................................1Internal analysis of Tesco.......................................................................................................2SWOT Analysis............................................................................................................2McKinsey 7S strategy analysis.....................................................................................3External Analysis of Tesco.....................................................................................................6PESTLE model.............................................................................................................6Competitive analysis..............................................................................................................9Porter Five Force Model...............................................................................................9Strategic Marketing Analysis...............................................................................................10BCG Growth Share Matrix.........................................................................................10Bowman Strategic Clock............................................................................................12SUMMARISING FINDINGS.......................................................................................................13RECOMMENDATION.................................................................................................................14CONCLUSION..............................................................................................................................15REFERENCES..............................................................................................................................16APPENDIX 1.................................................................................................................................18

INTRODUCTIONStrategies refers to the plan of action which are designed to accomplish a long term andoverall aim. In order to sustain in the competitive environment, it is essential and important forthe management of business organisations to devise specific and precise strategies that assists inenhancing performance and growth of the company (Úbeda, Alsua and Carrasco, 2015). In thiscontext, the following report will helps in providing detail understanding of strategic decisionmaking and development of business principles that reflects on strategic management of Tesco.It is one of the leading supermarket and retail organisation incorporating in United Kingdom.The report will demonstrate and evaluate the strategy and process undertaken to implement,manage and understand its impact on the organisation. In this report, with the help of precisestrategic models and applications, the internal, external and competitive position of Tesco will bedescribed. In this way, the review of emerging markets and influence of market development,marketing and relative dominance on the performance of organisation will be assessed. MAIN BODYStrategic analysis of TescoTo gain the internal, external and competitive position of the organisation, strategicmanagers conducts strategic analysis of the organisation frequently. This helps them to ascertainabout the aggregate position of the organisation which helps them in sustaining in thecompetitive environment (Leung and et.al., 2018). To attain desirable organisational goals andobjectives, it is essential for the strategic managers and decision makers to devise specificstrategic plans so that organisation can gain competitive advantages. In order to establishstrategic plans, managers first need to conduct strategic analysis of the organisation. For thisnumerous strategic tools and applications have been developed by researchers and strategicexperts which could help the management of business company to formulate precise and robuststrategic plan. In United Kingdom, there is stiff competition in retail sector. With largesupermarket companies like Aldi, Asda, Morrisons, etc. management of Tesco required to updatetheir strategic plans so that their dominance in the market remain stable (Goetsch and Davis,2014). In this context, the strategic analysis of the Tesco is described below:1

Internal analysis of TescoSWOT AnalysisIt is one of the most essential part to identify strength and weakness to improve internal workingenvironment. Tesco also render the installation of online marketplace. They are publicity theirbusiness concern with the assistance of television and other wholesale based education centre.With the help of Swot analyse to be find out the internal capability of organisation and increaseoverall market share. Swot analyse are as follows : Strength : Tesco is an almighty retail brand worldwide, in the top 100 of the planetarymost quantitative brands, slightly at a lower place Ikea and well above eBay (Hill, 2014). It isbest-known as a establishment that offers value for medium of exchange, comfort, a wide scopeof merchandise, and local area administration (Barney, 2017). Global, Tesco has 8,785 retailstore, an indefinite quantity of 600 stores since 2017, despite the disposal of their US venture,Fresh & Easy. Tesco has utilized forward-looking business know-how in its rise, exclude thecreative activity of shop like Tesco Metro and Tesco Explicit, which are little mercantileestablishment in local locality to make buying more handy for the custom-made. On the otherhand, online shopping is one of the most important part and help to increase the customerstrength or weakness. There are some changes is made for long time period as well as futuredevelopment. This license the establishment to lower monetary value to support cost attractiveand be competitor with UK wholesale such as Asda or Sainsbury's. In addition, by creatingtrueness packages such as the Club-card, they hold bespoke, creating long-term humanrelationship. Weakness : In this context, to be focus on financial sector of internal department. Inaddition, credit facility is provided for customer is give negative impact of organisation (Ginter,2018). This worthy has its weaknesses. Tesco net income has been wedged by bad indebtednessfrom credit card game and high levels of family insurance claims Some other issue is Tesco lackof education in some marketplace that it be given to enter, such as its aim brand smartphones andpad In conclusion, Tesco necessarily to invest a lot of payment in new web profession and IT, aswell as store renovation, amusing Cash from price reducing plan of action. Opportunity ; In this context, to be focus on some opportunities for increase marketsshare in different market. There are some changes is made form long employment work or2

increase current market share (Wheelen, 2017). The resoluteness by Tesco to contribution own-brand pad and smartphones can athletics with this investment funds, peculiarly in overseaactivity such as Malaysia, South Korea, Thailand, and China Online buying can message greaterinflexibility to custom-made who are prime occupied house lives or have prime issues; Tesco isdifficult to proper the inevitably of the custom-made by spread out transaction in this two-dimensional figure. The ongoing effects of the financial condition, where household andidiosyncratic may be struggling commercial enterprise, or too reserved impermanent to cook. Threats : The organisation is improved many threats in market and threats give negativeimpact on customer (Slack, 2015). One danger that Tesco continues to defy is the putsch ofAsda by Wal-Mart. Branding of mercantile establishment as Asda Wal-Mart has beenaccelerative in the UK, show a weakening in the user scorn for Wal-Mart. The ninth most-valuedtrade name in the planetary, Wal-Mart is Tesco the largest planetary challenger and hence has theessential skills, informant, happening and pecuniary resource to cause Tesco difficulty. McKinsey 7S strategy analysisThe model was developed in 1980 by McKinsey consultants Tom Peters , RobertWaterman and Julien Philips with assistance provided by Richard Pascale and Anthony G.Athos. It is considered as one of the most effective and efficient tool which helps in analysingfirms' internal design by looking at 7 key elements which are strategy, structure, systems, sharedvalues, styles, staff and skills (Volk and et.al., 2017). This is done in order to determine thealignment of these elements. If the 7 internal elements of the organisation are aligned effectively,then organisation have robust internal structure and vice versa. In this context, the 7S strategyanalysis of Tesco is described below:3

Hard Ss'Strategy: Strategy refers to the plans which are formulated by the managers andmanagement of Tesco which helps them in providing competitive advantages. A soundstrategy must be formulated accordingly which aligned with all other elements and isreinforced by robust vision, mission and values (Cameron and Green, 2015). Afteranalysing the strategies devised by Tesco, it was identified that management implementstrategies which are appropriately aligned with other internal elements. Thus, it helps inproviding them competitive advantages. Structure: It depicts the flow of information within business departments, units andbusiness divisions of the organisation. In order to have strong internal design,management must have organised and efficient organisational structure. In other words,organisational structures is the chart of the firm which describe the responsibility andaccountability of officials of the organisation (Kurucz and et.al., 2017). From the analysisof organisational structure of Tesco, it was identified that the departments are segregatedon the basis of specific tasks and work. The information flows in organised and in formalmanner which helps in eliminating confusions and misrepresentations issues. 4Illustration 1: McKinsey 7s Model (Source: Jurevicius, 2013)

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