Understanding the Business Environment (Distinction Criteria)

This report analyzes Tesco's business environment, including its market structure, stakeholders, PESTLE analysis, Porter's Five Forces Model, and key performance indicators. The report aims to provide a better understanding of the factors that affect the company's performance and how it can achieve sustainable growth in the market.

The business
environment

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
TASK 1 ...........................................................................................................................................3
Overview of the organisation ................................................................................................3
Market structure of Tesco.......................................................................................................4
TASK 2 ...........................................................................................................................................4
Stakeholders...........................................................................................................................4
Shareholders...........................................................................................................................5
Stakeholders Analysis............................................................................................................5
Conducting Stakeholders analysis in relevance to Tesco.......................................................5
TASK 3............................................................................................................................................6
Pestle Analysis........................................................................................................................6
Porter Five Forces Model.......................................................................................................7
TASK 4 ...........................................................................................................................................9
Key Performance Indicator.....................................................................................................9
Measuring Tesco performance with Blanche Scorecard........................................................9
Recommendations for improving the services.....................................................................10
CONCLUSION .............................................................................................................................11
REFERENCES:.............................................................................................................................12
Books and Journals...............................................................................................................12

INTRODUCTION
There are various internal and external factors which can affect the business. The
organisation needs to evaluate it significantly to generate more revenues in the market. It
includes new marketing conditions, suppliers, consumer buying patterns etc. Tesco is a British
multinational corporation which provides the essential goods and services to the customers. It is
the third largest chain the company has managed to acquire a huge share in the market by
offering quality products (Zhu and Liu, 2021). The reports aims to analyse about understanding
the role of various factors in business structure which is affected by various factors. This
particular project will analyse the market structure of the business. In other words, there is
evaluation about role of shareholders in the company and how they can affect the business. For
further instance, the major focus of this report is about various various advancements and
strategic tools through which the company can achieve sustainable performance in the market.
MAIN BODY
TASK 1
Overview of the organisation
Tesco is a retail supermarket which has various stores all across UK. The organisation
has gain a competitive advantage due to their ethical practices. They are offering quality
products to the consumers (Antonescu, 2018). It was founded in 1919 by jack Cohen. They had
globally expanded their business by indulging in various joint ventures. With the changing
market trends they had diversified their business operations in an effective manner. Tesco is a
public company in order to gain more capital there are various shareholders and stakeholder
which had invested in the company. The main vision of the organisation is tp offer equality
products to the consumers and achieve and significant growth in market.
There are different types of companies which is discussed below:
 Public Company – They can offer shares to the general public when they wish to
generate more capital for the company.
 Private Company – It is a firm which is held by the private owners. They do not issue
the shares to the general public during the time of allotting the shares.

 Voluntary – Three are various organisation which works to provide various employment
opportunities to the public. They are basically representatives and their way of doing the
operations is to benefit the company.
 Charity – There are various organisation in which various peoples donate amounts to for
social causes (Le, Ling, and Yau, 2018). For example, UNICEF is a charitable
organisation which works for the betterment of the society.
 Public sector – In this sector there is buying and selling of various goods and products in
the market.
Market structure of Tesco
Tesco is retail supermarket store which provide various goods to the consumers. Due to
the rules and regulations the organisation has managed to achieve a sustainable performance in
the industry. In this new changing marketing conditions the organisation is using multiple
technological tools to achieve great results in the upcoming future. The market structure in which
the organisation comes is oligopoly (Fadaki, Rahman and Chan, 2020). They had dominated with
the industry by attracting new audience in the market. In oligopoly market there are fewer firms
because of the competition. Tesco is using a competitive pricing strategy in order to achieve the
goals and objectives in the market. In the past recent years the organisation is indulged in various
ethical practices which is beneficial for them. There are various other competitors like
sainsburry's, Morrisons etc. They had build a positive image in the desired industry. With the
changing dynamics the digital infrastructure is implemented in tesco it helps the employees to
maximize the overall productivity of the workplace. There are very few competitors due to the
immense competition present in this market structure.
TASK 2
Stakeholders
There are various individuals which has a significant interest on the growing business. In
order maximize the operations the company needs capital the stakeholders provides the
additional capital to improvise the business operations in the workplace (Wong, Sinnandavar and
Soh, 2021).

Shareholders
The organisation can allot their shares to various individuals in the market in order to
generate more capital. Shareholders plays the most vital role role for the company. When the
company generate adequate profits the shareholders also get minimum amount for the profits.
Minority shareholders are not involved in the decision making (Nisula and Pekkola, 2018). On
the other hand, there are various rights of the shareholders which is described below:
 The shareholders check the account books whenever they see the company is not
performing well in the market.
 They had the power to give various suggestions to the employees when the productivity
is less in the workplace.
 They get the equal amount when the organisation generate profits in the market.
Stakeholders Analysis
This is one of the most crucial tool which help the individual to analyse new factors
which could affect the performance in the organisation. They will achieve the targets effectively
in the market. With the changing market trends there are new policies which could be made to
provide benefits to the relevant parties.
Conducting Stakeholders analysis in relevance to Tesco
The steps is this framework are as follows: It helps the firm to understand various
requirements and make an systematic plan.
Determining the stakeholders – In this stage the organisation can make list of the
stakeholders. Tesco follow systematic process in the workplace. There are various stakeholders
of the company which includes the employees, owners etc. Most of the shareholders are general
public and co-owners. In order to achieve an economic growth the company has indulged in
various joint ventures. It helps the company to diversify their operations in various other regions.
Grouping and Prioritizing the shareholders – This stage suggests that the organisation
can understand the needs of the shareholders effectively (Klimuk and Lazdins, 2019). They had a
signifiant influence on the workplace. The organisation needs to formulate all the strategies and
make and effective plan to achieve great results. Most of the girds in this process are as follows:
 High power high interest – The firm needs to create a positive impact on the
stakeholders. The employees needs improve their productivity in order to achieve the

goals and objectives effectively. In relation to tesco they are following a structure in
which the employees with the rules and regulations abide by the management.
 High power Low Interest – In this stage the stakeholders asses the situation properly
they can pass various suggestions to make the organisation more profitable in the market.
Tesco objective is to attract new customers by providing quality products to individuals
(Kasemsap, 2018). Through this, they will dominate the market and achieve great results
in future.
 Low power high interest – The main duty of leaders is to measure the performance of
the employees and improvise the overall productivity of the workplace. Tesco provides
the right training and development to the employees to make them more productive.
 Low Power low Interest – In this stage with the new technological factors the
organisation creates new innovative ideas to achieve greater results in the market.
Establishing effective communication with the stakeholders – There are various
innovations which the management can implement in order to achieve the goals and objectives in
the market. Tesco employees works in a systematic manner in order to make the management
achieve more targets in the market. The management is understanding the new market conditions
and managing their way of carrying out operations in a systematic manner. The main vision of
the company is to offer the excellent products to consumers and attain maximum customer
satisfaction.
TASK 3
Pestle Analysis
Pestle analysis is an important tool to analyse dynamic market situation effectively. This
could impact the organisation overall performance for a longer period of time. The company can
improve the overall performance in the market (Purwanto, 2020). Multiple factors in this tool is
mentioned below:
 Political – These factor can influence the performance of the firm. It includes various
trade tariffs, conflicts etc. Tesco is fulfilling all the legal laws and regulations to become
more stable in the market. They are offering quality products to the consumers and
attaining maximum customer satisfaction. In UK after the implementation of the Brexit

rules the company is working to comply all the new rules and regulations which is abide
by the government.
 Economic – With the changing market conditions there are various economic factors
which could influence the company's operations. It includes disposable income, inflation
etc. Tesco is implementing new ideas to counter all these factors. Through this they are
optimising the utilisation of resources in an significant manner.
 Social – This is one of the most crucial component in this framework. It includes
consumer preferences, brand image etc( He and Ortiz 2021). Tesco comply with all the
rules and regulations and they are offering the quality products to the consumers in order
to incur more revenues in market. Different promotion techniques which the company is
using in order to attract new potential customers.
 Technological – Technological advancements can help the firm to improve their
performance in the workplace. It includes factors like research and development, artificial
intelligence etc. Tesco has implemented digital infrastructure in the workplace to improve
the overall performance in the market. They are capitalising on every new opportunities.
For example, they are using artificial intelligence to manage the line of operations in an
effective manner. There are various continuous improvements which the company is
doing.
 Legal – Multiple internal and external factors can effect the overall performance of the
business. It incudes various rules and regulations like employment laws, consumer
protection etc. Tesco is working according to the rules and regulations and provide
quality products to the consumers to enhance the sales.
 Environmental – The organisations needs to wok for the benefit of the environment.
They need to achieve great results in upcoming future market. It includes factors like
location, weather etc. Tesco manages to achieve sustainable performance in the market.
They had reduced the use of plastic while delivering the essentail good and services in
the market.
Porter Five Forces Model
This tool will help the organisation to evaluate various new factors which can impact
their firm performance (Cravo and Piza, 2019). They can achieve the overall objectives and goals
by evaluating various factors. It has multiple factors which is described below:

 Threats of New Entrants – The firm needs to improve their products and services in
order to attract new customers in the market. Tesco is implementing new new ideas to
gain a competitive advantage in the industry. The main aims of company is to enhance
the living standards of the consumers.
 Bargaining Power of Suppliers – The organisation needs to buy the raw materials from
various manufacturers. Tesco has established an helathy relationship with most of the
manufactures. They ensures that they are providing the quality products to the consumers
in the market. With the changing technology the management uses the artificial
intelligence technology to manage the logistics supply chain management system.
 Bargaining Power of Buyers – With the changing market conditions there are various
new demands of the customers which are emerging. The organisation needs to provide
the quality products to the consumers to generate more profits in the market. Tesco has
managed to build a positive brand integrity in the market by providing the essential
products and services. They are rapidly improving their operations in order to gain a
competitive advantage among various other brands.
 Threats of substitute products and services – Most of the organisation which are
present in the market is receiving threats to get substituted. The retail industry is become
more competitive with the changing dynamics. Tesco use their digital infrastructure to
make the services and products more valuable for the customers. On the other hand the
company use the feedback system in order to improve their overall services and achieve
an effective growth in the market.
 Rivalry among the existing customers – The market structure in which the organisation
works also affect their business operations. Tesco woks in a oligopoly structure in which
there are fewer competitors (Rocha, Narcizo and Gianotti, 2022). The company has
managed to give a tough competition to various brands in the market. They are improving
the quality of their products and services to achieve more profitability and maintain a
positive brand integrity in the industry. By using various strategies and approaches the
company has manage to dominate the market with the new changing conditions.

TASK 4
Key Performance Indicator
It is a strategic framework which measure the performance of company. Most of
essential key indicators is described below:
 Revenue Growth – This is one of the most crucial factor to measure the performance.
The company can generate profits and losses in the financial year through which they can
measure the profitability and growth. Tesco use the tool to measure the overall
performance of the company in the market.
 Customer Satisfaction – The company can measure the performance on the basis of
customer satisfaction. The products needs to be of good quality to attain the maximum
customer satisfaction. Tesco provides the high quality products and services in the
market. This helps them to measure the overall performance. On the other hand they are
maintaining a positive image in the industry. There are implementation which they can
indulge to maximize the sales and enhance the customers satisfaction. On the other hand,
they can improve the services in an effective manner.
 Profit Margin – The company could increase the profit margin on their products and
services by evaluating the critical components. Tesco supplies the raw materials from
various manufacturers this helps the company to increase their profit margin. The
company measure their performance with this key indicator. They had managed to
achieve a significant growth over a period of time.
Measuring Tesco performance with Blanche Scorecard
Balance Scorecard
This is a tool which help[ firm to identify the critical factors and they can target the nice
markets which is untapped. This framework is essential for the organisation to achieve positive
results in the market (Kir and Erdogan, 2021). There are various perspectives which are
mentioned below:
 Learning and Growth – The organisation can understand the new market condition sin
order to improve the overall services. They van achieve the goals and objectives
systematically. Tesco provides the essential products and services to the customers, due
to the ethical practices they had managed to achieve a sustainable performance in the

market. With the new marketing trends they had establish digital infrastructure in the
workplace. With this new era most of the companies are innovating new ideas to achieve
greater results in the market.
 Business Process – This stage suggest that the organisation needs to offer great quality
products to the consumers. In relation to Tesco the company has maintained a positive
brand integrity in the market. With the use of appropriate strategies they are achieving
greater results in the retail industry.
 Customer Perspective – The organisation needs to offer improvised goods and services
which attains high quality. The company needs to become more customers oriented in
this new era (Ilin, Levina, Lepekhin and Kalyazina, 2018). Tesco provide the quality
products and services to the customers to attain maximum customer satisfaction. By
fulfilling the rules and regulations they are improving the standards of their services.
 Financial data – Multiple new components which could be included in this tool. The
sales of the company, Budget, expenditure etc. Tesco use various strategies tools to
manage the financial data in an effective manner. This helps them to gain a stable
position in the market.
Recommendations for improving the services
 Tesco needs to enhance their operations pace with the help of technological aspects of the
business. This will help the organisation to provide the products to consumer at a rapid
pace. They are significantly improving the infrastructure to gain more stability in the
market.
 The organisation is using the competitive pricing strategies to attract new customers in
the market. The management is also maximizing the productivity of the workplace with
right approaches and strategies. The management need to enhance their vision with new
practical ideas in order to dominate the new marketing conditions.
 With the changing market scenario tesco is delivering the products and services with the
help of websites (Gao and Li, 2020). They are using social media platforms to promote
the new products and services. This will help them to incur more profits and and offer
better products to consumers. The company could transform in a new way and provide
quality standards to the products to individuals.

CONCLUSION
It has been evaluated from the report organisation needs to understand the market
structure various factors in the business environment to achieve more profitability. The main
evaluation of this project is about various tools and frameworks which helps the organisation to
carry out the operations smoothly in the workplace. Along with that, there is asignificant
influence of stakeholders. the stakeholders analysis which helps the company to significantly
understand their influence on the workplace. For further instance, there are implementation of
new methods about the key performance indicators which helps the company to improve their
overall performance in the market. With the new ideas and strategies the brand can dominate the
market and could achieve sustainable performance in the upcoming future. The brand needs to
provide the quality products to attract new potential customers in the market.

REFERENCES:
Books and Journals
Antonescu, M., 2018. Are business leaders prepared to handle the upcoming revolution in
business artificial intelligence?. Quality-access to Success, 19.
Cravo, T.A. and Piza, C., 2019. The impact of business-support services on firm performance: a
meta-analysis. Small Business Economics, 53(3), pp.753-770.
Fadaki, M., Rahman, S. and Chan, C., 2020. Leagile supply chain: design drivers and business
performance implications. International Journal of Production Research, 58(18),
pp.5601-5623.
Gao, P. and Li, J., 2020. Understanding sustainable business model: A framework and a case
study of the bike-sharing industry. Journal of cleaner production, 267, p.122229.
He, J. and Ortiz, J., 2021. Sustainable business modeling: The need for innovative design
thinking. Journal of Cleaner Production, 298, p.126751.
Ilin, I., Levina, A., Lepekhin, A. and Kalyazina, S., 2018, December. Business requirements to
the IT architecture: a case of a healthcare organization. In Energy Management of
Municipal Transportation Facilities and Transport (pp. 287-294). Springer, Cham.
Kasemsap, K., 2018. Mastering business process management and business intelligence in global
business. In Global Business Expansion: Concepts, Methodologies, Tools, and
Applications (pp. 76-96). IGI Global.
Kir, H. and Erdogan, N., 2021. A knowledge-intensive adaptive business process management
framework. Information Systems, 95, p.101639.Cherunilam,
Klimuk, V.V. and Lazdins, A., 2019, September. INTERACTION OF EDUCATION, SCIENCE
AND BUSINESS IN TERMS OF DIGITAL ECONOMY DEVELOPMENT.
In Economic Science for Rural Development Conference Proceedings (No. 52).
Le, Q., Ling, T. and Yau, J., 2018. Do international cocurricular activities have an impact on
cultivating a global mindset in business school students?. Journal of Teaching in
International Business, 29(1), pp.62-75.
Nisula, K. and Pekkola, S., 2018. How to move away from the silos of business management
education?. Journal of Education for Business, 93(3), pp.97-111.
Purwanto, A., 2020. Does Quality, Safety, Environment and Food Safety Management
SystemInfluence Business Performance? Answersfrom Indonesian Packaging
Industries. International Journal of Control and Automation, 13(1), pp.22-35.
Rocha, C., Narcizo, C.F. and Gianotti, E., 2022. Internet of management artifacts: Internet of
Things architecture for business model renewal. In Emerging Issues And Trends In
Innovation And Technology Management (pp. 297-316).
Wong, W.P., Sinnandavar, C.M. and Soh, K.L., 2021. The relationship between supply
environment, supply chain integration and operational performance: The role of
business process in curbing opportunistic behaviour. International Journal of Production
Economics, 232, p.107966.
Zhu, X. and Liu, K., 2021. A systematic review and future directions of the sharing economy:
business models, operational insights and environment-based utilities. Journal of
Cleaner Production, 290, p.125209.