Strategic Management and Entrepreneurship Interface

This assignment requires an in-depth analysis of the strategic management and entrepreneurship interface. It involves exploring the relationships between entrepreneurship, strategic management, and innovation, as well as examining various research studies and papers on these topics. The assignment also includes a discussion of practical experiences from the automotive industry and a consideration of intellectual capital maturity models to improve strategic management in European universities.

STRATEGIC MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Strategic direction followed by Tesco and ways of developing it........................................1
TASK 2............................................................................................................................................3
2.1 Detailed analysis of Tesco in which they are operating........................................................3
TASK 3............................................................................................................................................5
3.1 Analysis of Tesco facing strategic drift................................................................................5
TASK 4............................................................................................................................................8
4.1 Strategies that Tesco could follow to defend its core business.............................................8
TASK 5..........................................................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12
Books and journals.........................................................................................................................12

INTRODUCTION
Strategic management can be explained as implementation and formulation of major
objectives and targets taken by company’s senior administration on behalf of owners, based on
resources available and critical analysis of internal or external environment. It provides overall
direction to Tesco and helps them in achieving predetermined goals and objectives. Tesco is a
multinational grocery store headquartered in England, United Kingdom.
Apart from grocery store, this company has been involved in various other businesses
like books, clothing, electronics, petrol, toys, software, financial services, telecoms and internet
service(Hitt and Duane Ireland, 2017.). Report will include strategic direction that has been
followed by Tesco and model that reviews external environment. Further, it will also include an
extent to which company is facing strategic drift and enterprise strategic capabilities. In addition,
it includes strategies that organisation could follow to defend its core business.
TASK 1
1.1 Strategic direction followed by Tesco and ways of developing it
Tesco has been termed as the biggest super market of United Kingdom and for achieving
success, they have followed some strategic direction which may include:
Vision Statement: Company has developed a vision for them, which provides clear
picture of its future. It defines fundamental objectives and goals which Tesco needs to achieve
and also provide framework for decision-making. Vision has been set up by company to achieve
long-term goals. It has helped them in achieving success and increases its market share.
Vision statement has served as foundation for broader plans evolved by Tesco. It has
helped them in motivating existing employees and retaining them. In addition, company has been
able to develop potential of employees by using vision statement. Tesco focuses on the efforts of
employees and alleviate the creation of core abilities by directing employees to focus on
strategic possibilities only that advance it’s vision(Meyer, Neck and Meeks, 2017. It has also
helped Tesco to differentiate its product from competitors and has helped them in achieving their
targets and objectives.
Tesco has a vision of increasing its employees in coming two years and renovation of
existing stores. These core values include making consumers feel wanted and respecting their
sentiments. Company has also been a creator of high value brand which involves providing
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consumers with quality products at competitive price. It has helped Tesco to become an
outstanding international retailer in stores and online.
Mission statement: Mission statement shows purpose and objectives of Tesco which
they want to achieve . It can be long as well as short term. Tesco has used it in serving
companies’ goal and agenda's. It has provided company to follow right path and helped them in
making better decisions which has been beneficial to them in achieving targets and objectives.
Mission statement also provided Tesco with clear purpose that has helped top management of
company in removing problems that has surrounded the existence of business.
Mission of company also worked as motivational tool for Tesco as it has allowed workers
to work towards accomplishment of prescribed goals or objectives(Bettis and et.al., 2014). It has
also helped organisation in increasing employee satisfaction and productivity that has resulted in
increased efficiency of company.
Setting goals: Goals have given Tesco a purpose and direction for achieving what they
want. Purpose is end towards where employees’ efforts are being directed and can often be
change on requirements or circumstances. Each goal is very important for Tesco, and they have
made their strategic plans on basis of objectives and targets that they want to achieve.
Setting objectives: These are short-term targets that have set up Tesco for achieving
their future goals. Objectives set up by organisation are SMART in nature, which means it is
specific, measurable, achievable, realistic and timely. These strategies have helped company in
creating value for consumers and providing them with unique a quality product(Michael, Storey,
D. and Thomas, 2017 ). It has also helped them in achieving organisational success and goals
that has been set up by them.
Ways of developing strategic thinking:
Strategic thinking has helped Tesco envisioning what might happen in forth coming time.
Company has followed some way in developing strategic thinking that includes: -
Observing employees: Tesco has been involved in assessing current company culture,
rules and regulations, product, technology and employees working with them. To develop
strategic thinking, they observe employees, their working pattern, feelings related to peers, work
that helps the top management of company in getting new ideas and strategies and also helps
them in developing strategic thinking.
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Creating thinking space: Tesco encourages senior management to set aside some alone
time and use this for research to increase efficiency of company(Bettis and et.al., 2016). It will
help employees in developing new and innovative ideas which can help company in increasing
their growth.
Value and reward strategic thinking: Tesco also provide rewards, praises for
employees who are engaged in strategic thinking and provides organisation with new and
innovative ideas. Rewards given by company can be monetary or non monetary, which may
include cash prize, appreciation in front of peers, incentive, fringe benefits, free holiday or dinner
with boss. It has also helped Tesco in achieving employees’ satisfaction and retaining skilful and
talented workers. These practices have also helped company in successful launching or
production of innovative and creative products and gaining customer’s loyalty.
TASK 2
2.1 Detailed analysis of Tesco in which they are operating
Model which review external environment of Tesco: Tesco uses PESTLE for understanding
growth of market, company position, employees potential and guidelines for operation.
Political factors: Tesco has been operating in 12 countries and has faced many political
factors which includes tax rate, current legislation, political instability, employment rate and
economic status of country where organisation has been operating. For eg import duty on
products can affect Tesco's growth because they are also indulged in importing goods from
different countries or continents. Tesco tax was also purposed by local government of UK which
has affected growth of Tesco negatively(Simon, Fischbach and Schoder, 2014)
Economic factors: Tesco has threat from economic factors arising in environment like
labour rate, inflation rate, foreign exchange rate, economic growth pattern etc. and many other
factors like cost, price and profit can also affect organisations growth. It should be involved in
focusing on increasing borrowing cost in UK which can increase cost and price and also can
decrease company's profit and can also affect brand image of and cost leadership strategy of
Tesco( What is PESTLE Analysis? A Tool for Business Analysis, 2017). These economic factors
also affect purchasing power of consumer and change demand supply models for that economy
in which company is running.
Social factors: Due to change various social changes trends shows that consumer in UK
has moved towards bulk shopping which has led Tesco to increase number of non food items
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which are being offered to sale. Customer demands goods and services based on their culture,
belief and sentiments and it can act as threat for company which may affect its growth.
Technological factors: It has brought new opportunities for Tesco to regain its consumer
as Tesco has been using new technology for consumer satisfaction. They have introduced RFID
technology to make in store experience better for consumer and also it has developed its own
mobile payment system(.Somsuk and Laosirihongthong, 2014). Non updating of Technology,
using old methods and research programs can become threat for company.
Legal factors: Changes in law and government policies and implications can affect
business performance of Tesco. Legal factors may include discrimination law, consumer law,
antitrust law, employment law, health and safety law which may affect company's cost and
demand of products. Tesco has been engaged in performing its operation according to food
retailing commission which has helped Tesco to grow and achieving success.
Environmental factors: These factors include ecological and environmental prospect
like weather, climate change or any other in change in surroundings which may affect growth of
Tesco. Company has been involved in growing awareness about change in of climatic condition
in countries and how it can affect their business growth. As it may happen due to heavy rainfall
or any other calamities stores have to be kept close which may affect sales of product of
organisation or due to any other terror activity Tesco can also face downfall. So company has
made various strategies to fight against these.
Tesco competitive advantage over competitors
Tesco competitive advantage over competitors
Brand marketing: Tesco that has been a strong brand with good and quality products is
engaged in providing better management of product life cycle and faster delivery of quality
goods(Engert, Rauter and Baumgartner, 2016). Its continuous innovation , better services,
efficient strategic operations has helped them to gain competitive advantages over competitors
and helped them in becoming the biggest retailer in country.
Price and promotion: Tesco has achieved competitive advantages over competitors by
providing quality products at low price and better customer services. Prices are set in such way
which can be afforded by consumers and various promotional tools like advertising, sales
promotion, public relations has been used by Tesco to gain competitive advantages over
competitors.
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Marketing and sales: Tesco has followed various marketing mix strategies like quality
promotion of products through advertising, communicating with consumers, providing discounts
which has helped Tesco in achieving competitive advantage over its competitors.
Scenarios faced by Tesco in existing market domain
Tesco has been faced by various scenarios which has affected growth and success of
organisation. Company has faced problems related to political environment like rules,
regulations and policies of government in different countries. For example Taxes on products for
importing and exporting them(Trigeorgis and Reuer, 2017). Also, organisation has faced
problems like change in trends, demand and preferences of people fr which company has been
engaged in understanding consumer by building relationship with them. Products developed by
competitors and threat of substitute can also hinder growth of organisation. To fight this
enterprise is engaged in creating new and innovative products.
TASK 3
3.1 Analysis of Tesco facing strategic drift
Strategic drift in company usually arises for many factors like organisation failing to
adopt changes, methods that work before are not useful in present, senior management do not
agree that there is a problem when actually mistake exist. Tesco has faced many strategic drifts
that may include incremental change which consists of slight change in environment.
Environmental factors like change in consumer taste, preferences, government rules and
regulations can affect business growth for fighting against this Tesco has developed various
strategies like keen research of consumer taste needs and wants, deep analysis of competitors
products etc.
Flux is also a type of strategic drift which has been faced by company. This phase has
been characterised by management in decision. This may also include huge gap between
companies production and consumer expectation. To face this type of challenges Tesco is
involved in understanding demands and needs of customers. They are engaged in building
relationship and creating trust with them(Peng, 2017). Also, they are engaged in providing
innovative products which can help them in increasing customer satisfaction.
Tesco has also faced drift in technology, at certain level it was very difficult for company
to fight against it but organisation has updated its technology like they have introduced online
payment method for purchase of any good, fast delivery of good using internet to sell
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commodity. Transformation changes can also affect company growth like death of any member
of organisation. For this Tesco trained employees with training methods like role play, coaching,
lectures etc. which has helped in organisational success.
Vision and Mission statement of Tesco
Vision Statement: Organisation has been engaged in developing a vision for them, which
provides clear picture of Tesco's future. Company vision has been long termed in nature and it
includes availability of manpower and resources to create value for its consumer. Enterprise
vision statement is aligned on demand of marketplace which includes pattern and lifestyle
followed by consumer and producing product according to that
Vision statement has been termed as foundation for wider plans evolved by Tesco. It has
helped company in motivating and boosting enthusiasm of workers towards target. Vision
statement has also helped company to increase potential of employees which has helped in
improving efficiency of workers(Barney, 2017.). Tesco vision statement has helped them in
achieving competitive advantage over their competitors as they are engaged in developing
product according to demand of market and by using updated technology, best promotional
methods which has helped company to grow.
Tesco has focused on appointing more employees and creating a better retail stores for
consumer for peaceful buying. They have been engaged in creating values for consumer and
respecting their beliefs and sentiments. Organisation has also been termed as a creator of high
value brand which involves providing consumers with quality products and better technology at
competitive price. It has helped Tesco to become a outstanding international retailer in stores and
online.
Mission statement: This statement basically consists of short term objectives of
company and reasons for existence of organisation . Mission can be long as well as short term.
Tesco has used mission statement in accomplishing goals and objectives. Using mission
statement Tesco has been able to follow right path and fulfilling demands of its market place.
This statement also provided Tesco with objectives they want to achieve and retaining existing
employees in company. Mission of company is to provide consumers with quality products at
low price according to their needs and demands.
Tesco has also been engaged in increasing efficiency of employees by providing them
rewards and praising them on achievement of goals. Rewards provided may be monetary or non
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monetary in nature(Bettis, and et.al.,2015). It has helped Tesco in increasing employee
motivation, satisfaction and productivity which has resulted in increased efficiency of company.
Strategic capabilities of company
For Tesco strategic capabilities mean power to successfully employ competitive ways
that allow organisation to survive and increase its value over period. It focuses on companies
assets, resources and market position projecting how efficiently it will be able to appoint
strategies in the future(What Is Strategic Capability, 2017.).
Organisations strategic capabilities also includes availability of adequate resources to
meet requirements of consumers and also to increase cost efficiency of products. Company is
also guarded by dynamic capabilities which means they have ability to change in accordance
with situation(Hladchenko, 2015. ). It may include system of producing new products or
methods on need of consumer or change in working pattern of organisation as per demand of
circumstances.
Talent management is also one of strategic capabilities of Tesco which includes training
and education of employees, flexible working of employees, retaining and managing talented
employees and involving workers in decision making has helped Tesco to expand its business
and increase its market share and success all over world.
Business canvas model:
This method has helped Tesco in creating, delivering and capturing values within market
to its consumers. It includes presentation of current or new business model which is generally
used by strategic managers of company. This model has categorised business in separate
segments which may include:
Customer segments- Tesco is involved in critically analysing strength, weakness of
consumer and needs demands of consumer(The Business Model Canvas, 2017). Various
customer segments may include mass market in which company is confident about its product
and they have ability to increase buyers potential which creates value for consumer about
commodity. Further, segments may include niche market, diversify market where products are
developed according to diverse needs of consumer(Secundo and et.al., 2015.).
Value propositions: This model is used by Tesco to create value for consumers. It can be
divided in two categories quantitative which includes creating value in terms of price and
qualitative which includes providing consumers with quality goods.
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Customer Relationship: Tesco is also involved in creating relationship with consumer
which they can be done through direct assessment in which company addresses to consumer
problem related with product directly or providing assistance through various online channels
which creates value in eyes of consumer.
Channels: Tesco has certain marketing channels like whole sellers, retailers and agents
who are involved in selling product in large geographical area and also help company in saving
their time and energy as consumers are asses by them directly. It has huge role in organisation
growth and success as retailers can get direct feedback from consumers which can help company
in creating goods which provides value to consumer.
TASK 4
4.1 Strategies that Tesco could follow to defend its core business
In order to achieve more success Tesco needs to follow some strategies which would help them
in defending its business(Kasemsap, 2014). It may include
Dynamic: Tesco should adopt the culture of being dynamic to achieve its goal and
targets. It includes adaption to changing environment easily which may include change in
consumer taste, preferences, demands or change in technology. It may also include threat of
entry of substitute product in market or competitors using new marketing or promotional
methods. Tesco should be involved analysing changes and clearly understanding and
implementing it.
Developing brand image strategy: Tesco will focus on use of brand image strategies
that included selling of goods by using their own name with better quality and low price. It
helped Tesco in creating awareness about their products to increase sell of goods and commodity
which would lead to increase in revenue of company. Company has also tried to focus on various
groups existing in environment like low and high income group, kids, young adults etc., which
has helped organisation in increasing their market share(Ruff, 2015 ). Tesco now deals in various
products like clothing, toys, financial services, internet, home appliances, food, beverage etc.
Company has also developed image of good brand for providing quality products to consumer.
Build a narrative: It includes sharing of views and opinions about goals and strategies
which company has led. If every employees in organisation share their feelings and views it
would help in developing peace among employees and would implement a friendly culture in
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organisation. This will help organisation in retaining employees and also help in increasing their
interest towards work.
Embrace constant learning: Tesco should use new methods and technology to perform
work which will help employees in learning new skills and methods. It will also help in
increasing their knowledge regarding products sold by company and consumers which are
involved in organisation(Bauer and Matzler, 2014.). Better understanding of consumer and goods
can help company in growth of business and also to expand its market share.
Involve advisors: Tesco should also include advisors like financial or any other which
would help them in making better decision and will also allow them in following right mark.
Better decision-making can help company in achieving targets and objectives and also lead them
to a path of success. They can also help them in knowing feelings and thoughts of consumers
related to products and will provide feedback related to goods(Cohen and Amorós, 2014). They
can act as support for guiding company in right direction and providing feedback on every
decision made by company.
Open discussion: Tesco should be involve in arranging open discussion about products,
ways of company, methods opted by employees, consumer behaviour which would help them in
understanding flaws of organisation and will also build positive relationship between them. It
will also allow new ideas ,methods and ways which can be adopted by company to have a
competitive advantage over competitors. Further it will also help in building relationship with
consumer, creating brand loyalty and enhancing trust among organisation. Open discussion will
result in positive changes in organisation environment and also it will help in building dynamic
nature of company(Popkova and et.al., 2015. ).
Free flow information: Tesco should be involved in providing relevant information
about company to all its employees for better working with them. Free flow of information
among workers will develop positive attitude towards organisation and will aslo develop a sense
of belongingness in them. Consumer also have right to know about data relating to product like
ingredients use in manufacturing of good, flavours added in it, whether it is of appropriate
quality or not. All this information should be known by customer which would help company in
building loyal consumers and will also help in expanding sell of its production
Team development: Tesco should be involve in building team for better and faster work.
Team work will also help company in bringing employees close to each other which would make
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organisation a better place to work. Also, by development of team targets and objectives can be
faster achieved by company. It will also help in retaining employees which would result in
growth of company(Dudin and Frolova, 2015 ). It will also increase happiness of workers which
would help in building motivation and develop self confidence and esteem among them. They
would be able to work more efficiently and also increase productivity of organisation.
Market Research: Market research should be done by Tesco related to consumer
demand, lifestyle, trends, likings and preferences which would help organisation in better
understanding of consumer and company would involve in developing goods according to their
needs. Also, research should be done on competitors' product, quality of goods, marketing
strategies, promotional schemes followed by them so that Tesco can set their strategies over
them and they can have a competitive advantage(Berry, 2014.). Research should also be done on
pricing scheme followed by competitors, so that organisation can set competitive prices and can
attract price sensitive consumer to buy their products.
TASK 5
This is to assess the resource implication of the above recommended approaches to
Tesco, in which, a strategic brand image will require them to adopt an integrative strategy of
branding. It will also reflect as a cohesive approach for promoting their brands. For this, they can
refer appointing BBH as its new advertising agency that will look upon its entire publicity
approach (). They will be responsible to look upon its overall marketing tactics that will be
applicable on both CRM and in- store promotion (Dudin and Frolova, 2015). It is basically to
make a closer interaction with that to its customers via both the measures of campaigning and
personally through emails and newsletters, etc. By which, they are expected to reach to a more
distinctive brand of their grocery products by together undertaking certain unique propositions
like an employee owned set up.
This is along with yet another concerning aspect of dealing with rapid number of changes
in the market. It is basically to meet out the changing needs and demand of the customers due to
their modifying or upgrading requirements and produce accordant products and services (). This
signifies the need of adopting several innovative measures to fulfil the above discoursed
requisition and for which, Tesco will hereby need to strengthen their Research and Development
(R&D) segment. It is also to beat the exaggerating competition in the retail sector of UK and
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survive easily by enhancing its brand value. This is also on referring to its degraded reputation
for some accounting related scandals and profit warnings.
Driving to digital medium of marketing is referred to be yet another significant agenda of Tesco
to improve its connectivity with enhanced level of interaction with its users. It is mainly to move
from its previously adopted approach that was very much reliant on television advertisements
with very less or no use of social media tools and techniques (Engert, Rauter and Baumgartner,
2016). This can be assured from its loyalty card schemes such as its club card program.
Likewise, they can refer to bring on such more offers by together considering to operate with that
to their digital team for marketing and hiring specialist agents in it. This will assist them to roll
out the services of mobile payments with some more easily accessible means for transacting
money. Basically, Tesco is suggested to work with a more client focussed approach and a target
of assisting them at every level. This will absolutely raise their brand identity to a great extent.
CONCLUSION
This is to summarise the current report which is based on the aspects of strategic
management. It has firstly assessed the strategic direction of TESCO that has been pursued by
them in the last few years. This has assisted in a clear recognition of their shift towards strategic
thinking. Another section of this report has carried out a thorough analysis of its industry with
suitable use of models to further discourse upon its contending benefits. A business canvas
model has together been used to determine possible strategies that can be followed by TESCO as
a way of defending its core business. This has produced some likely recommendations with a
final section that has scrutinized the resource implications of aforesaid suggestions.
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REFERENCES
Books and journals
Barney, J.B., 2017. Resources, capabilities, core competencies, invisible assets, and knowledge
assets: Label proliferation and theory development in the field of strategic
management. The SMS Blackwell handbook of organizational capabilities.pp.422-426.
Bauer, F. and Matzler, K., 2014. Antecedents of M&A success: The role of strategic
complementarity, cultural fit, and degree and speed of integration. Strategic
management journal. 35(2). pp.269-291.
Berry, H., 2014. Global integration and innovation: Multicountry knowledge generation within
MNC s. Strategic Management Journal.35(6). pp.869-890.
Bettis, R., Gambardella, A., Helfat, C. and Mitchell, W., 2014. Quantitative empirical analysis in
strategic management. Strategic Management Journa. 35(7).pp.949-953.
Bettis, R.A. and et.al.,2015. Qualitative empirical research in strategic management. Strategic
Management Journal.36(5). pp.637-639.
Bettis, R.A. and et.al.,2016. Creating repeatable cumulative knowledge in strategic management:
A call for a broad and deep conversation among authors, referees, and editors. Strategic
Management Journal.37(2).pp.257-261.
Cohen, B. and Amorós, J.E., 2014. Municipal demand-side policy tools and the strategic
management of technology life cycles. Technovation.34(12).pp.797-806.
Dudin, M. and Frolova, E., 2015. The balanced scorecard as a basis for strategic company
management in the context of the world economy transformation.
Engert, S., Rauter, R. and Baumgartner, R.J., 2016. Exploring the integration of corporate
sustainability into strategic management: a literature review. Journal of cleaner
production.112.pp.2833-2850.
Hitt, M. and Duane Ireland, R., 2017. The intersection of entrepreneurship and strategic
management research. The Blackwell handbook of entrepreneurship. pp.45-63.
Hladchenko, M., 2015. Balanced Scorecard–a strategic management system of the higher
education institution. International Journal of Educational Management.29(2). pp.167-
176.
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Kasemsap, K., 2014. Strategic innovation management: An integrative framework and causal
model of knowledge management, strategic orientation, organizational innovation, and
organizational performance. In Strategic approaches for human capital management
and development in a turbulent economy.(pp. 102-116). IGI Global.
Meyer, G.D., Neck, H.M. and Meeks, M.D., 2017. The entrepreneurship‐strategic management
interface. Strategic entrepreneurship: Creating a new mindset. pp.17-44.
Michael, S., Storey, D. and Thomas, H., 2017. Discovery and coordination in strategic
management and entrepreneurship. Strategic entrepreneurship: Creating a new
mindset.pp.45-65.
Peng, M.W., 2017. Cultures, institutions, and strategic choices: Toward an institutional
perspective on business strategy. The Blackwell handbook of cross‐cultural
management.pp.52-66.
Popkova, E.G. And et.al., 2015. Strategic effectiveness evaluation as integral part of the modern
enterprise management. Asian social science.11(20). p.16.
Ruff, F., 2015. The advanced role of corporate foresight in innovation and strategic management
—Reflections on practical experiences from the automotive industry. Technological
Forecasting and Social Change. 101. pp.37-48.
Secundo, G. and et.al., 2015. An intellectual capital maturity model (ICMM) to improve strategic
management in European universities: A dynamic approach. Journal of Intellectual
Capital.16(2). pp.419-442.
Simon, D., Fischbach, K. and Schoder, D., 2014. Enterprise architecture management and its role
in corporate strategic management. Information Systems and e-Business
Management. 12(1). pp.5-42.
Somsuk, N. and Laosirihongthong, T., 2014. A fuzzy AHP to prioritize enabling factors for
strategic management of university business incubators: Resource-based
view. Technological Forecasting and Social Change.85. pp.198-210.
Trigeorgis, L. and Reuer, J.J., 2017. Real options theory in strategic management. Strategic
Management Journal.38(1). pp.42-63.
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Online
What is PESTLE Analysis? A Tool for Business Analysis. 2017. [ONLINE] Available through:
<http://pestleanalysis.com/what-is-pestle-analysis/>
The Business Model Canvas. 2017. [ONLINE] Available through:
<https://strategyzer.com/canvas/business-model-canvas>
What Is Strategic Capability? 2017. [ONLINE] Available through:
<https://smallbusiness.chron.com/strategic-capability-15828.html>
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