Comprehensive Strategic Management Report on Tesco's Business Model

This report provides a comprehensive analysis of Tesco's strategic management, covering aspects such as the company's mission, vision, business strategy, and business model. It identifies Tesco's main competitors like Sainsbury's, ALDI, and Asda, and conducts an industry analysis using Porter's Five Forces, evaluating the threats of new entry and substitutes, buyer and supplier power, and industry rivalry. The report also includes a strategic factors analysis summary, an implementation of the TOWS matrix, and an evaluation of alternative strategies for Tesco, focusing on the potential benefits of a broad differentiation strategy. Furthermore, it analyzes the effect of the chosen strategy on stakeholders, particularly customers, and concludes that effective strategy implementation is crucial for maintaining a competitive position in the UK retail industry. Desklib provides access to this and other solved assignments.

STRATEGIC MANAGEMENT OF
TESCO

ABOUT THE COMPANY
• Global grocery retailer.
• Headquartered in Cheshunt, UK
• Founded in the year 1919 by Jack
Cohen
• Present in 15 nations
• The first own brand of Tesco was Tea
which were bought from T.E
Stockwell
• In 1968, it was claimed as the
“superstore” (Tesco.com, 2018).

MISSION, VISION AND
STRATEGY OF TESCO
• Mission statement- Together Making what
matters better.
• Vision- To become the most valued
business in the world by the customers
that they serve as well as the communities
in which they operate.
• Business Strategy- It has four point
strategy-
• Tesco UK core business
• Tesco International
• Retailing services
• Non food (Clothing's) (Tesco.com, 2018)

BUSINESS MODEL OF TESCO

STRATEGIC GROUP OF TESCO
• Main competitors-
• Sainsbury
• ALDI
• Asda
• Lidl

INDUSTRY ANALYSIS OF
TESCO
• Threats of New Entry
• Low
• Captured by the industry giants like Asda, Morrison and Sainsburry
• Threats of Substitutes
• High
• The principle retailers are Asda, Morrison and Sainsbury
• Buyer Power
• High
• Cost of switching is low
• Availability of online retailers
• Supplier Power
• Low
• Suppliers are moved towards the main food and grocery retailers
• Industry Rivalry
• High
• Slow market growth
• Threatened leadership position

STRATEGIC FACTORS
ANALYSIS SUMMARY OF
TESCO
Five major aspects of the business
operations are considered in the
strategic factor analysis summary.
The five aspects of the business in
this case are, the products or the
services, the levels of competition in
the industry, difficulty or ease of
entry in the market, profit potential
and growth and overall environment
of the business (Barros,
Hernangómez & Martin-Cruz, 2016).

IMPLEMENTATION OF TOWS
MATRIX
Generic strategies are considered to
be an important part of the operations
of the retailers. A large scale retailer
like Tesco needs to implement the
generic strategies in order to operate
profitably and maintain a sustainable
advantage. The proper
implementation of generic strategies
is considered to be important for the
operations of Tesco (Demir, Wennberg
& McKelvie, 2017).

ALTERNATIVE STRATEGY FOR
TESCO
Tesco has been operating in the retail
industry with the help of cost
leadership strategy. The organization
can however implement some
alternative methods in order to
increase the revenue levels in an
effective manner. The broad
differentiation based strategy will be
the most effective in order to increase
the profitability levels of Tesco
(Durand, Grant & Madsen, 2017).

ANALYSIS OF THE EFFECT OF
STRATEGY ON STAKEHOLDERS
The customers can be considered to
be the most important stakeholders
of the organization and they are able
to affect the operations and
profitability of Tesco in a huge
manner. The organization needs to
implement the generic strategy in
such a manner which will play a key
role in the proper management of
the stakeholders (Engert, Rauter &
Baumgartner, 2016).

CONCLUSION
The analysis can be concluded by stating that the
implementation of an effective strategy is able to provide an
organization with a different position in the retail industry.
The retail industry of UK is affected by the huge number of
organizations which operate. Tesco can maintain its position
in the industry with the help of proper implementation of
strategies and the ways by which it is able to respond to the
needs of stakeholders.

REFERENCES
•
• Barros, I., Hernangómez, J. & Martin-Cruz, N. (2016). A theoretical model of strategic management of family firms. A dynamic capabilities approach. Journal of
Family Business Strategy, 7(3), pp.149-159.
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future directions. Journal of Managerial Issues, 29(1), p.6.
• Demir, R., Wennberg, K. & McKelvie, A. (2017). The strategic management of high-growth firms: a review and theoretical conceptualization. Long Range
Planning, 50(4), pp.431-456.
• Dobbs, ME 2014, 'Guidelines for applying Porter's five forces framework: a set of industry analysis templates', Competitiveness Review, vol. 24, no. 1, pp. 32–45.
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• Tesco.com (2018). Tesco :: Online Groceries, Banking & Mobile Phones. [online] Tesco.com. Available at: https://www.tesco.com/ [Accessed 20 Dec. 2018].