Strategic Management of Tesco - Assignment

Added on - 21 Jul 2020

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Strategic Management
Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................11. A) Business level as well as corporate level strategy.............................................................11 B.) Environmental analysis......................................................................................................31 C.) Resources and competent analysis.....................................................................................42. Developing strategy plan based on above analysis................................................................53. Evaluating the place of strategic control through the development of strategyimplementation plan....................................................................................................................6CONCLUSION................................................................................................................................8REFERENCES................................................................................................................................9
INTRODUCTIONStrategic management is a process that include management of companies resources inorder to accomplish desired objectives. It involves various activities such as establishing short aswell as long term goals, identifying the competitive environment, conducting internal as well asexternal analysis, determining and reviewing strategies. The strategic management intends toidentify the way business entity achieve competitive environment, exploring as well as capturingopportunities, formulating strategy in order to minimise threat. It also assists organisation ineffective utilisation in resources.Understanding the concept of strategic management is important as it helps manger indesigning or formulating suitable strategy in order to deal with risk and other business problems.The report has focus on conducting strategic analysis of Tesco Information and data thatsupport manager in effective decision making. The main problem that has effected the Tescobrand image is its poor quality of products and services. It will also include various other tool formeasuring the impact of various environmental forces on business operation.TASK 11. A) Business level as well as corporate level strategyBusiness level strategy intends to emphasize on enterprise core competencies that can beused by firm for meeting customer expectation. As this activity will support business entity inincreasing its profitability. Business level strategy is defined as detail tactics that is planned toprovide value to consumers and this will also allow business entity to achieve competitiveadvantage by making proper utilisation of competitive advantage. It is more concerned withposition of organisation in market (Leitner, Meissner and Martyna-David,2015.)Corporate level are associated with strategic decisions that is taken by manger and havegreat impact or influence on entire business. Human resource management, Mergers, acquisition,financial performance all are elements of corporate level strategy.As due to various controversies related to quality of products and services have greateffect on companies' growth. Tesco has adopted new strategies in order to foster its growthprocess.The various plans about various operational activities that has ben planned by companyare :Expansion of offshore services.1
Adoption of effective as well as advanced technology for manufacturing goods and services.Development of innovative products as well as modification in features of existing goods.Adoption of rental; business in order to market conditions and incorporation of additional pipehandling item into international platform.This corporate level; strategies has drive Tesco towards achievement of their goals aswell as objectives.Porters Five forces modelThreat of New entrant:The retail industry in UK is highly dominated by few competitors. Themajor competitors in Retail industry in UK are Tesco, Asda, Safe way and sainsbury's that holdsmaximum market share. There is less risk of entry of new firm as there are mainly two reason i.e.Retail industry is a very big and require huge investment of capital. The organisation that aredealing in retail industry has to bear burden of fixed cost and required to maintain highlydeveloped supply chain. Advance technologies and strong stock controlled system that has beenadopted by existing companies has great effect on the entry of new competitors.Bargaining power of Suppliers-The bargaining power of suppliers is comparatively low. Assuppliers in retail industry is totally dependent on Big companies like Tesco to deliver theirproducts as well as services to end consumers. Tesco has able to maintain good relationship withits suppliers and able to get supply of goods at reasonable price. It has provided organisation anopportunity to increase its profit margins.The case of Tesco that has been analysed from the report of (Mc Cabe, a retail pricingexpert states) that Tesco treats its suppliers very badly and its suppliers has threat of losingcontract with such a big organisation. Enterprise has signed agreement for supplier codepractices that has been given by Department of trade and industries in order to solve the variousproblems that has been faced by supplier. It has been presented by the authority that have controlover industrial activities that Tesco is not complying with the agreement. Tesco have high threatof being de-listed by supermarket (Kernbach, Eppler and Bresciani, 2015)Bargaining power of Customers-The significant reason behind firm profitability is Club cardthat is introduced by organisation and other reason is its consumer maintenance strategy. Tescohas high potential to meet its customer expectation and need. As firm has focus on conductingvarious activities such as store promotions, customizing services that has helped business entityto provide goods at reasonable price to its customer. The consumer has low bargaining power.2
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