Organizational and Operational Management of Tesco

This article discusses the organizational and operational management practices of Tesco, including Total Quality Management, principles, implementation, impact, and use of technology. It also covers supporting functions such as operational planning and finance.

Operations and
Service Management

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
Operational Management Practices.............................................................................................3
Total Quality Management of Tesco...........................................................................................4
Operational Management Principles of Tesco............................................................................4
Implementation of total quality management.............................................................................5
Impact of total quality management on organisation..................................................................6
Use of technology in operational management...........................................................................8
Supporting Function....................................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
The practices or methods performed with in the business organisation to gain top most
level of efficiency and effectiveness with in the business organisations are termed as
Organisational Management. It helps in converting man power efforts and raw materials into
products and services in order to gain maximum amount to profit and also helps in achieving the
organisational goals (Adivar and et. al., 2019). In context to TESCO, it's a Public Limited
Company listed on London Stock Exchange and was founded in 1919 by Jack Cohen. Its
headquarter is in Hertfordshire, England, UK, having 367,321 employees globally. They are
mainly dealing in retail category consumer products, from food to fashion and are specialised in
Retail, Fashion, E-commerce and banking industry (Ali, Hilman and Gorondutse, 2020). This
file includes the organisational management of the company, practices of organisational
management and Total Quality Management operational management practice that the company
follows. Principles of the company, how the Total Quality Management is implemented with the
company and analysis of the company after its implementation, technological benefits which the
company is enjoying and lastly what are the supporting functions which are helping the company
in achieving its goals.
MAIN BODY
Operational Management Practices
Operation management practices of any organisation refers to concerned with designing,
evaluating and redesigning the operations of the businesses in order to maintain the proper flow
of production of goods and services. It involved the responsibility of identifying that business
operational management practices are effectively working or not in terms of meeting customer
requirements. It also defines that managing the practice involved that is used convert inputs as
materials, labour and energy into outputs such as goods or services. There are various operational
management practices that helps operational managers to increase profitability, to increase
productivity, to reduce unnecessary expenses and to decrease waste of the organisation. It
includes stock control management, deliver & supply chain management, information
management, total quality management and purchasing & ordering policies etc. (Chen, Yang and
Luo, 2021). TESCO is using Total Quality Management as operational management practices to
increase the productivity of the company. TESCO is delivering its products or services on right

time to their customer and maintaining the overall system of operational management with the
help of total quality management.
Total Quality Management of Tesco
Total quality management refers to providing excellence in all parameters of business in
order to prevent errors and to create the optimal products or services to meet up with customer
requirements and their satisfaction. Total quality management is also used in service industry.
This approach offers for long term success through customer satisfaction (Holweg and et. al.,
2018). In the total quality management, all members of company involved in improving
processes, products or services and environment in which they work.
Operational Management Principles of Tesco
The guidelines or rules that the company follows while performing the operational
management practices are as follows -
 Reality – The first principle of operational management states that the organisation
should not be depended only on the tools and techniques because these are not sufficient
to measure the problem and identifying its solutions, different varieties of techniques
should be adopted in order to gain more efficiency. As, the company is able to acquire the
large customer base across the world, every country have their different rules and
regulations and company is skilled enough to understand the demand and culture of each
and every nation across the world (Huang, Lee and Chen, 2019).
 Change – Its the might be not so easy to adapt the changes quickly, but mostly changes
brings something good in the output. By analysing the things which are affecting the
performance of the company its better to make necessary changes on it. By reviewing the
marketing mix Tesco recognised that, the prices of new product line of new farm brand
products, are 15% more expensive then the competitors products. So, they reduced the
price and this results in rapid increase in the demand of farm – style products of the
company, this shows how beneficial adoption in changes are at early stage.
 Skilled human assets – The employees are always considered as the asset of the
company, as they are they are one who are the main participant for making an
organisation successful. As, they are serving their efforts towards the organisations, its
the obligation of organisation to take care of the needs and requirement of the employees.
The company has around 367,321 employees across the world and the company is

delivering full online, offline as well as practical training and reviewing them, by giving
expertise feedbacks this is how the company is making their employees effective and
efficient which helps the organisations in achieving the organisational goals, apart from
this proper facilities are also provided by the company to its employees.
 Fundamentals – As per the efficiency rule given by Pareto states that the success of the
organisation depends on the 80/20 rule, which means by our maintaining the current
performance of the business 80% of the success can be achieved and rest 20% can only
be achieved by applying new, unique and innovative techniques and manufacturing
products within the organisation. With this the company is skilled in being innovative and
making the products as the customers demand their main goal is to satisfy the needs of
the customers, adding unique and innovative features in the products and to increase the
market capitalization, growth and profit of the organisation. Rapid change in the
customer's tastes and preferences and shifting their attitude towards organic products, the
company manage to capture its customer base by producing their products as per
customer demand (Jin and Shin, 2020). Also, due to busy schedule customers prefer to
buy products in bulk, so to protect perishable food items the company has started
working on non-food model.
 Accountability – In each and every organisation a defined structure is follow that who
will report whom. Apart from this a manager or superior is accountable for monitoring all
the activities of the employees and in case the employee is unable to achieve his given set
of target then, the manager will guide him and provide the required directions and also
the manager will be accountable for efforts made by the employees. As the company is
working globally so for the smooth functioning of the organisation they follows
hierarchical organisational structure, under which roles, authorities, powers,
responsibilities were divided into various parts and each group has one manager who is
accountable for all the activities performed by the employees, but they use four layers of
management inside the outlets for this expects says that, it can create bureaucracy which
will create conflicts among the managers.
Implementation of total quality management
Total quality management technique can be implemented with the help of following as:

 Clarify vision and mission: It is indeed that employees needs to know the organisation
objectives and strategies. TESCO provides a clear vision and mission to its people that
where the company is headed and what are the things to achieve. It helps in decision
making process.
 Upgrading equipment: In this section it refers to the equipment of company that are
involved in manufacturing of products, supply chain management, quality management
etc. can be upgraded to latest technology. TESCO monitors its existing equipment that
are working perfectly or not, any fault detected can be resolved quickly in order to
maintain the quality of the product (Moura, 2021). It is helpful to increase the
productivity and to reduce the efforts by introducing the latest technology in the
manufacturing unit.
 Analysing critical success factors: It is one of the important part of total quality
management which help the company to meet with its objectives. It includes financial
performance, market share, customer satisfaction, product quality and process
improvement etc. Analysing these critical factor influence the success of the business.
 Identifying customer groups: It includes employees, customers, suppliers and vendors
are the part of customer group. They are somewhere involved in product development
process as per the customer requirements. Total quality management can be effective to
identifying such key customer groups and managing them to create the products or
services according to the customer satisfaction. This also includes surveying of each
customer group which is helpful for the organisation to know more about the insights of
the company.
 Technology advancement: Implementing latest technology in total quality management
refers to how the company can deliver its products or services to their customer in less
period of time with the help of technology. With the help of this the company can ensure
its product's quality before dispatching it to the customer. A website is also developed
where customer can easily access company's products or services, and can order from
there only.
Impact of total quality management on organisation
The role of total quality management is essential in every organisation. It is impacting
the organisation positively. It helps the company in order to maximise its productivity,

profitability and efficiency. Total quality management helps the company to achieve several
operational management gains such as high working efficiency, supply chain reliable and
effective customer service. It also helps organisation in following ways as mentioned below:
 Maintaining quality of products or services: Adopting proper way of quality
management ensures the quality of the products or services offered by company are
meeting the customer requirements. In Tesco, total quality management evaluates the
reliability of every products or services before delivering. Quality of product reflects in
brand image which is helpful to attract more customers towards the offering. It is directly
impact on the profitability of the organisation.
 Maximising productivity: Operation management in total quality management gives
space for higher productivity. It ensures that all the resources in the organisation are
utilising properly during the process of manufacturing the products. Hence, effective
operation management in total quality management creates positive impact on the
productivity of the Tesco.
 Customer satisfaction: There is only one way to make sure that the customers are
satisfied with the products or services is delivering quality products to them. Total quality
management also includes handling the customer query and complaint regarding products
or services in effective way and provide them solution in specified time. It is a great way
to satisfy customer.
 Low cost of operations: When a organisation maximises the productivity it is directly
related to the pricing of goods. Higher the productivity impact on lower the price of
products (OPERATIVĂ and et. al.). Similarly, when the cost of product is reduced it
leads to increased the sell of the product. Hence it increases the revenue and profitability
of the company. Total quality management positively impact the Tesco in this scenario. It
creates more customer towards the products due to the low pricing. Therefore, it helps the
company to increase market share as well.
 Competitive advantage: Effective total quality management provides competitive
advantage over the competitor in the market. It is due to high productivity, low pricing
and customer satisfaction helps to become a market leader which leads higher returns to
the company.

Use of technology in operational management
In the current pace, the technology can be considered as the most valuable asset for any
organisation after the human assets. The use of technology is at peak and adopting it will
improve the quality of output which one is producing. It will also helpful in reducing the overall
cost of the organisation and will make the process of delivery and functioning of the organisation
smooth and effective. Technology also helps in increasing productivity and bringing down the
complex procedures into the simple understandable format. As the rapid change in the
technology the company should be updates and advance, so with the help of technology
producing designed and customized products is very convenient. The organisation which makes
delay in adopting the technology will definitely will results in loosing its customers. With this
measuring the performance of the organisation and employees are also equally important in order
to achieve the defined goals (Yan, Cui and Huang, 2021). So, different varieties of performance
measuring tools are also available which make this work easy. Some of them are Enterprises
Resource Planning software, it is a tool used by the companies to measure and identify the risk
involved in the business. Key performance indicator software which is used to check the
performance of the employees and business are on track or not. When the organizations wants to
make the customers to be shifted toward the loyal and profit making customers, uses Customer
Relationship Management software. All these tools makes the performance of the work more
effective and efficient and also this reduces the chances of errors. Technology helps in reducing
the human efforts which benefited in achieving the economies of scale by reducing the cost of
producing per unit of output. By adopting the technology Tesco had achieved its certain
objectives like the company had opened its frictionless sales outlet, this was only be possible
whit the help of technology using computer vision technology. The automatic payment system
was also being established by the company in their stores. Also by performing certain sets of
experiment the company managed to influence 43% of their shoppers to do online shopping, and
getting their products home delivered. As per their recent announcement they are planning to
pair-up with Amazon-Go for cashier less billing, this will help customers to preclude from long
queues.
Supporting Function
Some of the supporting functions which in making the organisation successful are as
follows -

 Operational Planning – The most crucial step before starting any work is making plan.
The planning should be done in such a way that its covers all the important small as well
as long term activities which will be useful in achieving the organisational goal.
 Finance – The main and most important objective of each and every business
organisation is to make profit so proper allocation of finance in order to maintain our
budget is very crucial and challenging task (Yan, Cui and Huang, 2021). So, to meet with
the organisational goal proper allocation of funds is very important.
 Product design – The team which design products for the company identifies the need of
the customers, monitors the trend of the market and then with combining both these
things brings output the final product.
 Strategy - It is a action plan or method created by the organisation to accomplish
competitive advantage, profit and growth in the market. The effective and efficient
market strategy will discover more new opportunities available in the macro
environment. A sound strategy is one that helps the organisation in achieving it short as
well as long term goals.
CONCLUSION
From the above research it can be concluded that the operational management plays an
important role in ensuring the proper management of the business and to gain the top level
efficiency in work. With this the there are many practices which the operational management
have, out of which Total quality management is the one which the companies follows. Moreover,
the principles of operational management helps in defining the path and rules and regulation one
organisation must follow in order to perform its functions smoothly. The implementation of total
quality management help in attracting the customers and lower the cost of per unit of output
which will help in achieving the scale of economies. Then the use of technology helps in
performing the work more effectively and efficiently. Lastly, we can see some of the supporting
functions with helps in achieving the operational management practices and making the
organisation successful.

REFERENCES
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orientation and total quality management on performance: Evidence from Saudi
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