A Report on the Changing Nature of Business and Tesco's Response

Desklib provides past papers and solved assignments. This report analyzes the business context, focusing on Tesco's strategies.

CONTEXT OF BUSINESS

TABLE OF CONTENTS
Introduction......................................................................................................................................1
Assignment 1...................................................................................................................................2
Identify and discuss macro and micro environmental factors that in your view changed nature
of modern business in global environment..................................................................................2
Discuss the reasons why you think it important that individuals and organisations to manage
responsibly, sustainably and behave ethically in relation to social, cultural, environmental and
economic issues...........................................................................................................................3
Assignment 2...................................................................................................................................5
1. A brief history and summary of business you have selected and rationale for your choice....5
2. According to your research, discuss their vision, leadership style and management practises
and various strategies making use of various theories you have studied as evidence.................7
3. Analyze how the above have been achieved or implemented by your selected company with
specific examples.........................................................................................................................9
4. What could be your recommendations as an improvement (the proposed leadership styles,
management practises and various strategies that can be undertaken by this firm based on
research done) to your company................................................................................................11
Conclusion.....................................................................................................................................13
References......................................................................................................................................14

Introduction
Context of business refers to analysing environment and culture in which organisation operates
by scanning micro and macro environment factors that is identified by knowing business context.
The report will describe first assignment as essay that will discuss and identify factors related to
micro and macro business that has changed picture of modern working conditions within global
environment. Further, different reasons will be discussed that aids in managing organisation and
individual in responsible, behavioural and sustainable manner by linking from issues related to
social, environmental, cultural and economic factors. The second assignment will study summary
and history of retail organisation of UK with its rationale in reference to Tesco. Moreover, it will
discuss leadership style, management practises and vision that are initiated with strategies. It will
further aim to describe stakeholder interest by focusing on necessary recommendations that are
required develop and design business organisation.
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Assignment 1
Identify and discuss macro and micro environmental factors that in your view changed nature of
modern business in global environment
Business is term refers to organised enterprise efforts for supplying goods and services to attain
profits and revenues by customers. The businesses present worldwide are varies in size that is
analyzed by sales volume or employee numbers that has common purpose of earning profits. It is
further determined as important society institution, supplies goods and products, aims to create
job opportunities, dispenses quality life, and contributes to country economic growth. Therefore,
business role is determined as crucial as society and business both requires each other.
The modern business is determined as dynamic that is occurred from change in today’s business
(Lancaster and Massingham, 2017). The change and improvement in policies and strategies aids
organisations for boosting capacity of spending substantially on departments of research and
development for market survival. The important norms that are practised by organisations
include mass marketing and production. Till 1970, three businesses only were identified by
having 100 million as annual turnover. Now, with rapid speed of increasing people’s living
standards the businesses have regularly grown to give quality products and services. The
business in current time are indulged in providing diversified services by adopting methods such
as concentric, conglomerate and horizontal diversification. It has further aimed for going
international which is determined as modern business trend. Based on current situation, a wide
exposure has been given by businesses for competing at global level for satisfying consumers.
The businesses in 21st century has adopted technical methods from that it has become knowledge
based firms, that eliminates more time on paper shuffling and file pushing by managers. Use of
information technology has helped businesses for adopting flat structure. It has created methods
that provide remuneration and wages according to employee desire by analysing the contribution
ratio towards organisational success. The current business goals are growth, profit, service to the
society, power, employee satisfaction, market leadership, challenges, quality products etc.
A business environment is determined as reasons that either brings success or failure to business.
It depicts external forces that affects business functioning at domestic and global level (Wirtz
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and Daiser, 2017). These are not under the control of individuals, management and industrial
enterprises. The environment of business brings threats as well as dispenses opportunities for
exploiting potential market. It has various factors that are discussed below:
Technological Factor – It refers systematic application developed for organised and scientific
knowledge that requires for task completion using practical manner. The change in technology is
fast and constant that requires business person to be active for adopting technological changes.
Economic Factor – The business has close relationship with its economic environments that aids
in availing business inputs that dispenses units as an output by producing products.
Political Factor – The business is highly affected by institutions such as judiciary, legislature
and executive that shapes, develop, control and direct activities and operations of business. The
growth of business becomes indispensable from political and stable environment.
Cultural and Social Factor – It identifies attitude of people towards wealth and work, marriage,
family role, education, social responsiveness, religion, ethical issues that are essential for firm’s
operations (Mose, 2016).
Discuss the reasons why you think it important that individuals and organisations to manage
responsibly, sustainably and behave ethically in relation to social, cultural, environmental and
economic issues
The business needs becoming highly social responsible that is important for organizations to gain
success. It can be enhanced by empowering women, aiming to reduce poverty and environments
help. There are several organisations either big or small is incorporating social responsibilities by
including in business operations and strategies. The social issues might consist of national, local
and global but firm that is considered about wellness and health of other people without focusing
on high sales which is commendable. Being socially responsible helps to improve brand name of
business, engaging consumers in goods and services provided by business, gives opportunity to
present offering at international level and able to retain highly competent and skilled employee.
Thus, issues in social business can be managed by becoming socially responsible entity to attain
long term success (Davis, et.al, 2015).
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The business sustainability is affected from cultural factors that might bring issues in gaining
issues and profits. The cultural differences in business include expectation of personal space, low
and high business context, relationship importance and establishing cultural understanding. It can
be handled by promoting communication, valuing time, focusing on culture used by client, target
to appreciate cultural changes, becoming innovative and creative. The interaction within workers
and management will develop best relations in which business results can be boosted by giving
chance to discuss that will eliminate the doubt faced in production process. Further time value
and management must be guided to employees so that they can manage task effectively without
delaying and crossing deadlines given by clients.
The responsible business needs handling economic issues for achieving the ethical and sustained
business growth. The economical factors regularly challenges firm for adopting new methods for
meeting consumer requirements by focusing on factors related to inflation, deflation, recessions,
and unemployment (Mežinska, et.al, 2015). The growth of income inequality is reason that list
individual on list of poor and rich that affects spending capacities. In such situation, business
needs to select skilled staff by focusing on adopting technological change in working methods by
providing training sessions that will save employees from becoming unemployed due to low
knowledge of new technology. The economic situations can managed by guiding crowd not to
follow economic data provided on social media as it shows fake statistics that is relied by 38% of
population in UK.
Further, risk from environments is another problem that might faced by businesses. The top issue
consist of climate change that is uncertain and might affects supply and demand from market and
customers. Moreover, fluctuations in climate bring low demand that also increases material cost
that become barrier for producing products as firm faces huge setbacks in profits results. It can
be managed by stocking materials and products so that crisis can be managed in professional
manner without affecting consumer demands. The businesses require becoming more responsible
towards environments by producing healthy and natural products that will not harm consumers.
Thus, the issues related to social, economical, cultural and environmental is necessary to resolve
for making business responsible, ethical and sustainable at national and global level (Charter,
2017).
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Assignment 2
1. A brief history and summary of business you have selected and rationale for your choice
Businesses in UK have captured huge market in country from operations and activities according
to industry type. The most successful industries include retail sector that is highly competitive
due to several rival and business competitors. The UK is gaining economic stability and growth
from such firms that include Tesco as largest retail industry. Tesco Plc is determined as British
multinational retailer carries general merchandise and groceries by holding its headquarters in
England UK. Calculated by its gross revenues it is determined as 3rd largest retailer and based on
revenues it is 9th largest retailer across world. It has outlets within seven countries by holding
28.4% as market share in UK (Ramanathan, et.al 2017). It was founded by Jack Cohen in year
1919 as market stalls group incorporated from tea shipment and till 1939 it has set up 100 outlets
of Tesco within country.
The brand was displayed in 1924 by using supplier name label as TES and CO from surname of
Jack Cohen that made Tesco. After opening first stall in indoor market he launched first shop in
1931 that was listed on London Stock Exchange. The first shop of self service and supermarket
started in 1956 that made world record in 1961 of largest shop situated in Europe in Guinness
Record Book. In year 1950 & 1960 it developed organically from 800 shops. It purchased 70
shops of Williamson, 200 outlets of Harrow Stores, 212 shops of Irwin, 97 shops of Charles
Phillips and value chain of Victor. The motive was to pile on high for selling cheap by further
developing motive to motivate sales team using “YCDBSOYA” approach. In year 1994, it took
over 57 shops of Sainsbury. It further launched loyalty card known as branded ‘Clubcard’ in year
1995 and at last service of internet shopping.
In year 1997 it announced retail arm purchase of Associated British Foods that boosted business
of £640 million approved by European Commission (Filimonau and Gherbin, 2017). It used
strategies of diversified services in 1960 including clothing and household goods and in 1974
developed first petrol pumping station. It has further faced criticism for breaching planning laws.
Rationale – The strong and large retail brand by involving operations related to centralized
buying, supply chain management and logistics. It has grown effectively by technical excellence
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by initiating change in retail supply chain. The aim is to examine retailer role as channel captain.
It has also launched service of home delivery related to groceries started in England and Whales.
The effective business model started taking orders from telephone, fax and internet out of which
internet was determined as best model. The website tesco.com was prepared in year 2000 for
Tesco home shopping and direct operation to sell products of electrical, clothing, home ware,
CD, gifts and books including Tesco personal finance. Hence, organisation gives merchandise
product range to customers without developing physical stores that requires expensive funds for
business. It has leveraged franchise to its existing customers for becoming largest online world
grocer for attaining profitability and expertise growth in business operations (Monios, 2015).
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2. According to your research, discuss their vision, leadership style and management practises
and various strategies making use of various theories you have studied as evidence
The growth and strategic decisions of business is dependent on leadership and management style.
It is essential to determine Tesco vision and objectives that defines working criteria and steps to
accomplish targets. The management needs to have strategic decisions to grab and accomplish
opportunities for fulfilling objectives for gaining future sustained growth. The strategies will aid
in managing organisational activities to gain competitiveness with business culture. On contrary,
leadership method brings group together through prior guidance and direction for completing
specific goals. The most popular theory of leadership consist of transformational that provides
idea of passion and vision from leader’s personality (Holten, et.al, 2018).
Vision and Mission
The CEO of Tesco Terry Leah is known as visionary leader that aimed to change organisational
structure. The organisation has target to dispense quality and affordable services and products to
consumers by providing training and development sessions to employees of firm by calculating
performances. The vision play crucial role as it aims for leading market within world by taking
strategic decisions to acquire profits from assistance of effective leaders. It aims on doing small
things by dispensing services to external as well as internal consumers. Thus, it is manager duty
for motivating and leading employees for delivering customer promise by Tesco. The thinking of
manager watches leader’s success that mainly depends on guiding workforce effectively, giving
interesting task, determining performances and motivational acts. The well-developed growth
strategies have provided opportunities to become competitive by being profitable and productive.
Leadership Style in Managing Tesco
The Tesco’s management is practising democratic leadership style also determined as participant
leadership in which employee ideas and demands are listened while taking important decisions
of business (Obholzer and Miller, 2018). The leaders focus on encouraging employees that helps
in dispensing the consumer goods with quality. The organisational process in business is handled
by appointing best leaders allotted to every department for functional working. The manager in
Tesco assigns and delegates the task to employees that prepares them to become their own leader
by taking responsibility of completing task by conducting interaction levels properly and
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effectively. For instance, the stores of Tesco appoint various individual that manages regular
activities using validated, participative and trained approach. Audits are conducted by managers
on weekly and daily basis that helps in resolving organisational issues by preparing standard for
store delivery, customer services and better availabilities.
The democratic management style in Tesco provides opportunity to operate in decentralized way
under which higher level of management passes information to lower level of employees that are
allowed to discuss growth ideas with management. The flat structure initiated in Tesco has given
opportunity to employees for involving in decisions by providing suggestion to accomplish goals
of business. The style used for leadership and management gave effective support for constant
growth. In Tesco, staffs are guided with best job offers, supports disability and illness. The high
performance aims customer to complete task that has helped in becoming more competitive and
able to handle economic recessions. Tesco can further use autocratic style for assuring task are
completed be team in given timeframe (Amran, et.al, 2016).
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3. Analyze how the above have been achieved or implemented by your selected company with
specific examples
There are various strategies and plans that are initiated in Tesco for achieving competitiveness
and profits. The styles of leadership as well as management adopted in organisation are to attain
growth. The current leadership and management styles used in business are highly effective and
proved successful but it cannot be repeated for gaining further growth. Due to different value and
cultures of different countries it becomes least possible to initiate similar practises and styles. In
reference to Tesco following leadership and management practises can be initiated for attaining
consumer and stakeholder satisfaction which are discussed below:
Management Grid of Blake and Mouton’s
It determines management behaviours according to employee oriented and task oriented styles
that interact with one another (Bolden, 2016). The managers in Tesco must aim to practising
authoritarian way that only targets efficiency and production by concentrating on low numbers of
employees. The task approach is initiated for completing task by employee rather than focusing
on subordinate’s requirements. It becomes helpful for organisation as firm has low competent
and skilled staffs.
Herzberg Two Factor Theory
It was discovered for identifying satisfaction needs that take place at workplace by affecting the
motivational attitudes and behaviours. It has two major factors such as motivators and hygienic
factors. The factors related to hygiene include salary, work environment, colleague relationship,
supervision and firm’s policies. In case factors get absent that job is determined as dissatisfied by
employees that impacts positive working attitude. The motivators are promotion, responsibility,
recognition and achievement. The employees of shop floor are least interested in achieving the
motivators that brings de motivation in jobs. It will impact Tesco in negative manner by affecting
productive results. Hence, it is essential for management for handling motivational reasons from
which employee might boost interest towards its work without impacting firm’s operations
(Alshmemri, et.l, 2017).
Action Cantered Leadership
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This theory targets three areas in organisation that comprises achieving task, developing person
and maintaining or building team. It carries core strength that includes timeless, not depend on
situation or culture and identifying dimensions that requires improvement. The theory is highly
applicable in organisations that follow authoritative working culture by practising hierarchical
structure in organisation. It might not benefit Tesco in achieving goals due to flat structure but it
can prepares and pressurize employees in positive way to achieve given tasks or roles. Thus, it
might be practised in organisation for gaining better sustained growth by satisfying consumers.
Trait Theory of Leadership
According to this theory it is essential for organisational leaders to exhibit important qualities,
attributes and characteristics for effectively practising functions of leadership. The factors that
are essential for handling team and employees consist of group influence, coolness, command,
application, judgement and responsibility (Meuser, et.al, 2016). The theory is very simple to be
adopted by used by organisations for gaining effective results in terms of profits and growth.
This phenomenon is focused on methods used by skilled leaders that are copied and followed by
team mates to grab success and growth by guiding employees for attaining specific goals
developed to complete.
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